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Quest Means Business
Trump Blasts Supreme Court, Vows More Tariffs; Trump: Will Implement Additional 10 Percent Global Tariff; U.K. Government Considering Removing Andrew From Line Of Succession; BHP CEO: There Is Been An Explosion Of Interest In Mining; Study: Artists See Decrease In Music Income In Streaming Era. Aired 4-5p ET
Aired February 20, 2026 - 16:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[16:00:17]
PAULA NEWTON, CNN INTERNATIONAL HOST: Yes, the market is up, but marginally so, given this day of tremendous news on tariffs, really the market is kind
of shrugging it all off. Those are the markets and these are the main events.
President Trump says the Supreme Court Justices who struck down his sweeping tariffs are fools and unveiled a global 10 percent tariff to take
their place.
The companies suing the Trump administration over its tariffs are celebrating today's ruling. We will speak with one of them, and the British
government now weighing whether to remove Andrew Mountbatten-Windsor from the Royal line of succession.
Live from New York. It is Friday, February 20th. I am Paula Newton. Richard Quest will be here in a moment, and this is QUEST MEANS BUSINESS.
Tonight, U.S. President Donald Trump says tariffs are here to stay after the Supreme Court struck down his favorite way to impose them. The court
ruled, six to three that Trump overstepped his authority by relying on the International Emergency Economic Powers Act., IEEPA to you and me.
Three conservative justices voted against the President Trump, called the ruling a "disgrace" and announced a 10 percent global tariff under a
different law. He also cited other laws to bring all the tariffs back. Listen.
(BEGIN VIDEO CLIP)
DONALD TRUMP (R), PRESIDENT OF THE UNITED STATES OF AMERICA: Numerous other federal statutes which are so true authorized the President to impose
tariffs and might justify most, if not all of the tariffs issued in this case, even more tariffs actually.
Those statutes include -- think of that -- those statutes include for example, the Trade Expansion Act of 1962 Section 232, all of these things I
know so well. The Trade Act of 1974 Sections 122, 201, 301 and the Tariff Act of 1930, Section 338, all clear, but it is a little bit longer
process.
(END VIDEO CLIP)
NEWTON: Now, the court's ruling applies mainly to what the Trump administration calls reciprocal tariffs. Those were announced with great
fanfare, you'll remember last April and impacted nearly every country in the world, including some uninhabited islands.
The President has used laws on national security to slap duties on goods like steel, aluminum, cars and kitchen cabinets. It is important to point
out here, those remain in effect, so do tariff countries like China that were investigated and found to engage in unfair trading practices.
Now, one glaring omission here in the Supreme Court's ruling was what to do about the revenue that was collected under the tariffs that are now struck
down. Now the Penn Wharton Budget Model says the Treasury could be on the hook for as much as $175 billion in refunds that leaves a lot of unanswered
questions like will the tariffs actually ever be refunded or repaid there? And where would that money come from?
The Trump administration has warned again and again that the process will be a mess.
(BEGIN VIDEO CLIP)
TRUMP: If that were ever reversed, it would be a disaster. Frankly, it would be a national security problem for our country, and nobody thinks it
is going to be reversed.
SCOTT BESSENT, U.S. TREASURY SECRETARY: We would have to give a refund on about half the tariffs, which would be terrible for the Treasury.
PETER NAVARRO, SENIOR COUNSEL FOR TRADE AND MANUFACTURING: If we lose the case, President Trump is right, it will be the end of the United States.
(END VIDEO CLIP)
NEWTON: Richard Quest joins us from now, Sydney, Australia.
Richard, you're on assignment there, but Australia, not inconsequential in terms of what happens with not just the tariffs but all of these trade
deals that all of these countries have been scrambling to negotiate, some of them already inked.
RICHARD QUEST, CNN INTERNATIONAL HOST, "QUEST MEANS BUSINESS": Yes. Good morning from Bondi Beach, where it is already Saturday morning. I am here
for "World of Wonder," but it is a good example, Paula of the issues, because Australia had one of the lowest tariff rates, 10 percent when it
was introduced, now that 10 percent will obviously go away. It has since been superseded by a variety of others, they will have to go away and
Australia will be left with the global 10 percent tariff for the United States.
No one here has any visibility on whether they are going to get any money back, because of course it is the U.S. importer that paid the tariff and if
they do get reimbursed and the Supreme Court was very vague on this, then how does the money go back up the chain?
[16:05:10]
The truth is, it doesn't matter which country you're talking about. The unholy mess that is and was and is the administration's trade policy now
has to be unraveled, like knitting and somehow put back into a feral sweater.
NEWTON: You don't describe an easy task there, Richard.
Listen, you have spent hours on this program and otherwise speaking to companies about these tariffs. I mean, do you follow me on my opinion? I
believe the uncertainty going forward will hurt many companies because what they wanted was certainty, even if that came with a tariff.
NEWTON: That is the number one issue. You can deal with the tariff once you know what it is, but if the tariff changes at the whim of the President
because he doesn't like what you've done on X, Y, or Z, that is your problem.
Now, if we look overall, 75 percent of global trade is still done on world trade terms -- freedom of trade. The U.S. trade deficit was one of the
worst on record in 2025. So whilst the President and the administration may claim that things are getting better, the level of confusion that they
created, Paula, they created it by changing the tariff rate almost on a daily basis. Now, they can't do that.
But the President has added more confusion, so if you're here in Australia and you're wondering about beef exports, you're wondering about metals or
minerals, you just don't know what the position is.
NEWTON: Yep. We are still in the dark. Richard, you are in Australia on assignment for the weekend. I guarantee you when you do return here, the
tariff issue will continue to be here right at this desk for you.
Grateful for you.
QUEST: Thank you. I will.
NEWTON: Thanks for taking the time.
Now, the Supreme Court seemed to warn President Trump that Emergency Declarations can't be used as some kind of a cheat code. Chief Justice John
Roberts wrote: "The President asserts the extraordinary power to unilaterally impose tariffs of unlimited scope, duration and amount. In
light of the breadth, history and constitutional context of that asserted authority, he must identify clear congressional authorization to exercise
it." I want to stress congressional.
Mark Wu is a Law Professor at Harvard University. He served as a senior advisor to the U.S. Trade Representative under President Biden.
Really grateful to have you here, and I do want to start with the basis of this ruling on legal grounds. What does the ruling say about how the
President can and can't use tariffs?
MARK WU, LAW PROFESSOR, HARVARD UNIVERSITY: The President argued that he was able to impose tariffs under the 1977 International Economic Emergency
Powers Act, or IEEPA and that contained the word that he was allowed to regulate importation, and so the Solicitor General argued that that
encompassed tariffs.
The Chief Justice's decision today makes clear that when there is a major question of this sort, what the Chief Justice refers to is a Major Question
Doctrine, there needs to be clear authorization, so that language regulate importation is not clear enough to encompass the scope of tariffs, and
therefore he can't use IEEPA as a statutory authority.
The dissent by Justice Kavanaugh highlights that there are a number of other steps the President could take, and clearly we are hearing from The
White House this afternoon that he is going to resort to one of those other authorities instead.
NEWTON: Yes, I am not sure why Justice Kavanaugh decided he had to outline this in his dissent, but I do want to get to that dissent because it is
interesting. He warned of chaos with a potential refund and I want to ask you about that as well.
But he also said that this could generate uncertainty regarding trade agreements already signed. I mean, I am no lawyer and certainly not a Chief
Justice, but I found this quite peculiar. What did you think of what the Justices put in that dissent?
WU: So I think it is important to go through a little bit of the background here. After the President announced the sweeping reciprocal tariffs on
Liberation Day, a number of countries sent their trade negotiators through to Washington over the last couple of months to negotiate agreements to
lower these rates.
And so the reference here is to those agreements. Now that the underlying authority for the IEEPA tariffs no longer stand in place, what about these
other agreements? Do these now enter into flux or not? And I think that's what this is referring to in that decision.
NEWTON: But should that matter on the basis of what was presented in front of the Supreme Court? I mean, I am trying to see this as this was executive
authority of which this Supreme Court has granted President Trump and other presidents to come much executive authority, and it is pulling it back, is
it not, and saying, no, you have to go to Congress for some of this.
[16:10:19]
WU: Yes, there is a number of different ways we can think about how we should interpret statutes like IEEPA. One of these is exactly as you
suggest, right? We look at it on the face of the text of the statute and we look at what was the original intent here, and on that ground, right, sort
of what is the pragmatic element of it would not matter.
There are others, however, who are much more sort of pragmatist and so, it really turns on the question of which way do you want to look at it?
But regardless of whether you think these real-life consequences matter or not, what we had today was a majority of six justices looking and finding a
rationale for why that language didn't give this type of authority. They didn't necessarily all agree on the rationale, but they all clearly came
down on the side that this language was not clear enough.
NEWTON: And then, there is the issue of the refunds. The court did not outline any kind of remedy here. What is your prediction about what will
happen now to billions that now have to be paid back? Does that all now have to be litigated in the lower courts?
WU: Exactly, so there have been a number of different cases already filed in the lower courts. Those have been pending because of this Supreme Court
decision. Now that the Supreme Court has ruled, right? All of those cases at the lower courts particularly the Court of International Trade, right,
those are going to be heard and it will be through the lower courts that will figure out is there a mechanism available, and if so does that
mechanism run through Customs or does it run through some other mechanism that the Treasury wishes to set up.
NEWTON: Yes, in a word, it sounds complicated. It is going to take a while, right?
WU: And there is a lot more to come. And, you know, if you're an importer today, you're not out of the woods yet.
NEWTON: Understood, Professor Mark Wu, thanks so much for clarifying. I appreciate it.
Now, U.S. industry groups applauded the Supreme Court ruling. The National Retail Federation said the decision provided much needed certainty for U.S.
businesses and manufacturers. The U.S. footwear industry said the decision provides relief at a time when cost pressures have been significant.
Now, it was a family toy business, though that led one of the lawsuits against The White House, Learning Resources, Inc. now has its name on one
of the most consequential Supreme Court decisions in recent memory.
Rick Woldenberg is the CEO of Learning Resources. You are the importer of record here that the Professor was just speaking about.
I mean look, Rick, David and Goliath doesn't begin to describe what you pulled off here. Large companies with so much firepower refuse to take on
the Trump administration. What is your reaction to this ruling and what effect do you think it will have on your business?
RICK WOLDENBERG, CEO, LEARNING RESOURCES, INC.: Well we are very excited and it vindicates what we've been trying to do. We've asserted for a long
time that this was an unlawful tax and the Supreme Court agreed with us and the Supreme Court also reinforced principles of rule of law which I think
we all depend on.
I think the impact of the case on our company will be to get us some money back, which we can use, and hopefully it will lead to a deceleration of
this asphyxiating tax. We have to pay the tax, we have no way to pay it except to pass it along.
Our tax rate on our company last year exceeded a hundred percent, so we can't handle it all ourselves. It is too much.
NEWTON: I do want to follow up on the refunds, but again, The White House had a comeback. President Trump followed this up with a 10 percent tariff.
Will this make any difference to your bottom line? Because he has really hit back in a broad way here.
WOLDENBERG: Well, it cuts the prevailing tax rate in half so certainly I will take that. That's helpful. The 1/22 tariffs last for five months and
so it is not permanent and it can't be extended, so I think it is leading towards relief. Obviously, a big tax like this will be an economic
depressant. It will force companies to decide to pass on those costs and this is all heading into the midterms.
The other thing to remember about these tariffs is they are regressive. And so they fall heaviest on the most vulnerable in our society. I don't think
that's right and I think that voters will be unhappy with this.
NEWTON: When we get to those refund checks, it is going to go to lower courts now, do you have any inkling about how much you might get back and
what the timeline might be?
[16:15:07]
WOLDENBERG: Well, no one knows the timeline. We spent a little over $10 million on IEEPA tariffs in 2025, and, I don't know, we spent some more
this year, but I don't know how much more and we expect that money returned to us in due course with interest.
I think that the hand-wringing and the fear mongering on how hard this will be to return the money is a bit of a head fake. The government sends out
millions of tax refunds every year with interest. No one opens those envelopes with a sense of marvel at how they are able to do that, and they
know exactly what they took from us when and why and how much and they can just reverse the gears and send it back to us.
It is our money. They took it unlawfully. They have to return it. And I am not crying for them that they find it inconvenient.
NEWTON: Rick, you seem anything but triumphant here. I want to ask you does that have something to do with how difficult it has been to run your
business in the last year? And also the fact that you didn't really get back up from the corporate titans until late in the game?
WOLDENBERG: The truth is we've never viewed our case as political, and so it is not mano y mano with Mr. Trump. We contested that the law was being
misapplied and so feeling vindicated, feeling that the court respected the way the law was written, is the victory and participating in this process
in a historic case is part of the victory.
I have declined to comment on choices other people made. You know, we made this choice for ourselves. We are a multigenerational family business. We
are in a mission driven business. We make educational products for schools and homes and we have hundreds of families who depend on our company for
their livelihood.
Our motivation was to protect those legacies and to protect those relationships. That's central to our values and so the decision for us was
easy.
NEWTON: In terms of what may not have been easy would have been things like legal fees and there are probably more to come. Bottom line, will this put
you further ahead for your business, for your profits, your margins?
WOLDENBERG: Well, I would like to say that when things were at their nadir, we were going to be spending many tens of millions of dollars a year for
the rest of time immemorial paying these unlawful taxes, so while I suppose it is painful to pay legal fees, I actually think our law firm is amazing
and we achieved something very worthwhile.
At the end of the day, the burden on our company will go down as a result of what we did, and so I think the money was well spent and as I said, the
lawyers did an amazing job.
NEWTON: It is a truly historic decision no matter what side of it you came down on. Rick Woldenberg, we will continue to check in with you. Thanks so
much. Really appreciate your time.
WOLDENBERG: Thank you.
NEWTON: Coming up, for us, British lawmakers are considering further action against Andrew Mountbatten-Windsor, including removing him from the Royal
line of succession a day after the former prince's arrest. We will have that when we come back.
(COMMERCIAL BREAK)
[16:21:00
NEWTON: British lawmakers are taking aim at Andrew Mountbatten-Windsor. They are considering introducing legislation that would remove him from the
line of Royal succession.
It comes after his arrest on Thursday. Andrew is eighth in line to the throne, 14 other countries which share the U.K. Monarch must also agree to
any changes in that line of succession.
Max Foster is in London.
I mean, we've already outlined a complication, Max, I have been interested to speak to you just to see your opinion.
I did notice in the British press that immediately this issue was brought up as if it would be a constitutional crisis. I mean what do you think?
Prime Minister Keir Starmer certainly outlined that this is a possibility, right?
MAX FOSTER, CNN ROYAL CORRESPONDENT: Well, it has been a debate ever since, you know, the titles were taken away. He would still have a place in the
line of succession. And its high, you know, less than ten, it is eight, quite a small chance of becoming King, but it is just the principle of many
M.P.s have an issue with that. You know, they don't want him going anywhere near the throne, particularly after this.
There are other M.P.s who feel that this is a complete waste of time, because the chance of him becoming King is slim, and it will take a huge
amount of Parliamentary time. So, a bill needs to be formed. It needs to go through all the different layers in Parliament, in the U.K. Parliament, and
then it doesn't -- you know, they can pass it, but it doesn't become law until they go through the process 14 more times in countries, including
your own, Paula Canada, but also Australia, everywhere from Jamaica to Tuvalu.
It is a huge amount of time to invest in something, but it just shows how you know, alienated everyone feels from him, how angry they feel about him
and how they just don't want him even having that tiny privilege that is left to him, but you know, the Prime Minister was always pushing back on
this.
And finally, a source telling us that he is now considering it because the government will introduce a legislation.
NEWTON: And now to what comes next in this case.
Andrew Mountbatten-Windsor has not been charged with anything yet. He certainly so far has denied all the charges. There is no timeline here, is
there, Max? I mean, we could be waiting a long time, or he may never be charged, right?
FOSTER: Yes, so they can re-arrest him. They are clearly going through -- it was interesting. They went through his house in Norfolk, which is his --
which is temporary accommodation before he gets his main house in Norfolk. And so a lot of his possessions remained at his previous house in Windsor
and there was a very quick search in Norfolk, and they spent a lot more time in Windsor, and they could be there until Monday, we are told by the
police.
So obviously, the first thing they are going to be looking for, according to all the police we've spoken to will be hard drives, e-mail, computer --
anything that they can find to file this trail, digital trail leading to Epstein.
But of course, what it does is it exposes all of his communications with all sorts of different people. So, speaking to Gloria Allred, who
represents many of the survivors here, and whilst he is not being investigated for sexual misconduct, this is a moment where some have been
forced to be accountable and open up about what they knew about Jeffrey Epstein and Epstein's world.
So many of the survivors are thrilled about this, even though it is not actually investigating sexual misconduct. Finally, someone is being held
accountable and they want, you know, their truth to be out. They want their stories to be the evidence to show that everything they've talked about to
be true.
NEWTON: Yes. Just an extraordinary scene there in the U.K. as this story continues.
Max, thanks so much for being with us. Really appreciate it.
Now coming up for us, President Trump says he is ashamed of some Supreme Court Justices after two of his appointees ruled against his tariffs.
(COMMERCIAL BREAK)
[16:27:57]
NEWTON: Hello, I'm Paula Newton, and there is more quest means business in a moment when we speak to Interscope Records co-founder Jimmy Iovine about
the rocky relationship between artists and streaming services and the CEO of Vue Cinemas will tell us what a potential acquisition of our parent
company, Warner Bros Discovery could mean for his industry.
Before that, though, the headlines this hour.
Donald Trump is reacting with anger to a bombshell ruling by the U.S. Supreme Court. The court struck down Trump's sweeping global tariffs today,
saying the President must get approval from Congress for them. Mr. Trump blasted the court, saying he is ashamed of the Justices who ruled against
him.
He also said he would implement a 10 percent global tariff under a different law.
British lawmakers are considering introducing legislation to remove Andrew Mountbatten-Windsor from the Royal line of succession. Andrew is currently
eighth in line to the throne. It comes after his arrest on Thursday on suspicion of misconduct in public office. He has not been charged and has
previously denied all wrongdoing.
Venezuelan lawmakers have passed an amnesty bill which could free hundreds of political prisoners. Acting President Delcy Rodrguez says the law opens
"an extraordinary door for Venezuela to reunite." However, critics say the bill doesn't go far enough to ensure activists and opposition members in
exile will also receive that amnesty.
And we do want to return to our top story. The U.S. Supreme Court decision striking down most of President Donald Trump's tariffs. Trump said he was
ashamed of certain justices after they posted their six to three decision. Two of his appointees, in fact, Amy Coney Barrett and Neil Gorsuch, voted
with the majority.
Gorsuch wrote that while it is tempting to bypass Congress, the deliberative nature of legislating is part of the constitution.
[16:30:03]
Joan Biskupic joins us now.
I mean Joan, look, you are completely steeped in this court. The President's characterization of the Justices, I am sure you couldn't have
predicted that one. You know, it was stunning, really the language that he used. This was deeply personal for the President, but I am wondering, what
can you tell us about how these Justices would have interpreted this, especially the Chief Justice?
JOAN BISKUPIC, CNN SENIOR SUPREME COURT ANALYST: You know, the chief justice is aware of the fact that in the US, there is really this narrative
that the court is always in lockstep with Donald Trump, and, you know, it wasn't here, and maybe Donald Trump just could not handle that.
He had been winning so much over the last couple of months. And, you know, he had won this major immunity ruling from the justices back in 2024, which
helped him toward his election.
And I think what really got him here is, you know, that they ruled against the signature initiative of his, even though he had been warned by people
in his own administration that there were better ways to do this. This violates -- this is just plain unlawful, the way he thread into Congress's
territory here.
But you know, he seemed to be particularly upset that two of his appointees, Neil Gorsuch and Amy Coney Barrett, were in the majority.
And Paula, when he made that remark about not just being of shame for them, but embarrassed for their families, that takes his criticism out of the
realm of, you know, the substantive nature of the decision, into, you know, security issues he has in the past. Unleashed his vitriol toward lower
court judges, who have been -- then, targeted in various ways by member of -- members of the public.
And to do this for the Supreme Court was, as you say, just so unprecedented and so unnecessary. You know, he has other ways to impose tariffs, and he
has other initiatives before the Supreme Court, many of which he will probably win. Just as he has won considerable latitude from the justices
since he first took office in January of 2025. So, it was -- it was an amazing response.
And one other thing I will mention, it stood in such contrast to the scene in the courtroom where I was today when John Roberts read excerpts of his
opinion in this kind of steady, measured way, trying to suggest, by the way, he was approaching it, that this is not some huge clash between the
judiciary and the executive branch that this is actually a very straightforward decision, and it was.
Precedent is on the side of the ruling here. Donald Trump exceeded his bounds of trying to go it -- go it alone on tariffs. He can -- he can
impose tariffs. It's just that he needs -- he needs the cooperation of Congress, and he needs to take certain steps that can be time consuming,
that he just did not want to do here.
NEWTON: Joan, grateful to you, and we preview the State of the Union next week.
BISKUPIC: Yes.
NEWTON: Where these justices will sit right in front of the president. You heard it here. This is must see T.V. and Joan will be at our side as this
happens.
Joan Biskupic for us. Thanks so much.
BISKUPIC: Thank you. Bye, bye.
NEWTON: Now, copper prices are up about two percent today. In fact, the commodity has seen a rally to record levels in the last year. That's amid
strong demand. Now, the metal is in everything, I remind you, from smartphones to E.V.s. And that's helped push the stock price of Australian
mining giant BHP. The company is a major producer of copper and other metals.
Richard Quest spoke to CEO Mike Henry in Sydney, and asked him, it's all a gold rush.
(BEGIN VIDEOTAPE)
MIKE HENRY, CHIEF EXECUTIVE OFFICER, BHP: Well, I think there is some aspects of that in the sense of everybody suddenly realizes the value in
mining. But I think it's actually much more profound than that. In that, there is been this awakening as to the criticality of metals and minerals
to the functioning of the everyday economy, to economic security. And so, all of a sudden, you've seen an explosion of interest in metals and mining
in the capitals around the world.
So, this isn't just a capital markets opportunity. You are seeing policymakers really focused on what needs to happen to shore up critical
mineral supply chains and to get more mining and processing up and running.
QUEST: And yet, look at that bridge over there. That was proof, back in a different century, of the importance of mining and of iron, ore, and --
(CROSSTALK)
HENRY: And there is BHP iron, ore, and steel in that bridge.
QUEST: Yes. I gave you that one. I gave you that one. The ability, though, to run a company like BHP in a highly controversial environment of politics
and geopolitics at the moment.
HENRY: Yes. So, it's -- look, it has made the world more difficult, more uncertain, but on balance, this focus and the support for metals and mining
is something that we haven't seen for decades. And so, I would take that any day of the week. It does make it important for people like myself to be
out there, educating and advocating for good policy that achieves the objectives of government, but in a way that ensures that we, you know, that
mining companies are able to mine as efficiently and as sustainably.
[16:35:09]
QUEST: But is it a race? In a sense, the United States seems to have determined that it is a race.
HENRY: So, there are some aspects of a race here, because for certain metals and minerals, we are seeing demand grow quite strongly.
Copper, for example. BHP is the world's largest copper producer. We are seeing 70 percent uplift in demand between now and 2050, and yet, these
mines are becoming harder to find, oftentimes deeper, lower grade, which means you need to mine more material to get the same amount of copper.
And if we don't get on top of policy and make the mining easier and more sustainable, we won't get that supply in a timely and cost-efficient
manner.
QUEST: That's the sustainability issue, in a sense, but it's -- when you are looking at, can you beat China? Can you beat X, Y, Z? Governments want
now to have sovereignty, and they want to be the leader.
HENRY: So, I think that governments want to ensure supply chain security, and there is a number of factors that can make that.
(CROSSTALK)
QUEST: So, let's say --
HENRY: There is the geopolitics, but there is also the economics of it, in that, irrespective of any geopolitical competition or tension. The reality
is, if demand is growing due to a myriad of factors, if you can't bring supply on because it's hard to get mines permitted, then, it really doesn't
matter who is ahead of the race or not.
You have to have policy globally that enables more minds to get up and running. Of course, do so in a sustainable fashion, and that's going to
benefit all parties.
(END VIDEOTAPE)
NEWTON: Now, streaming platforms are changing the playing field for musical artists. Up next, Beats co-founder, Jimmy Iovine will tell me why he
believes these services may become obsolete.
(COMMERCIAL BREAK)
NEWTON: Recording artists say they are making less money from their music since listeners turn to streaming services. Now, the Journal of Humanities,
Music and Dance conducted a survey in 2024. 68 percent of artists said the dominance of streaming has lowered their income.
It points to the disproportionate pay model of these services. Only the most streamed artists actually make any kind of substantial money.
My next guest says this relationship is one dimensional and may make streaming platforms obsolete. Jimmy Iovine was the co-founder of Interscope
Records, and he is also the co-founder and CEO of Beats Electronics and Beats Music, and I welcome you to the program.
[16:40:01]
I asked to have you on because I saw these comments, I really wanted to get to the bottom of it.
So, you call it a one-dimensional ATM, these streaming services. You put your money in, you say, and you get your music. But you are saying that,
look, artists are not about that. They are about engaging with their fans, communicating with their friends. So, tell me what this ecosystem would
look like, and do you think it will displace streaming services?
JIMMY IOVINE, CO-FOUNDER, BEATS ELECTRONICS: Well, thank you for the question. Right now, they are utilities. They are, you can't have a
cultural -- a true cultural economy on top of a utility. It just doesn't happen. It won't happen.
So, what Daniel, like did originally on Spotify, he did a brilliant thing in getting the labels together, and he went very simple. He said, let's --
you put money in and you get to hear whatever music you want at any time you want. Simple.
And what he did to wrestle those contracts, et cetera, from the record industry was miraculous, and he did an extraordinary job. But it needs to
grow now. It needs to evolve. And if they don't evolve, they will become obsolete. And A.I. is going to usher that in pretty quickly.
So, the streaming services have to move now, because right now, they do nothing for the artists. The artists want to interact with their fans. They
want to -- they want to communicate. They want the streaming. They want the service or platform to breathe in and out. And right now, they don't.
NEWTON: But, tell me what this would look like, because if just to play devil's advocate here, if I'm the consumer, and I am a consumer of a
streaming music platform, it has opened up a whole wide variety of music to me, and I enjoy the utility that I'm getting. So, you are the innovator
here. What is it going to look like?
HENRY: Well, if -- first off, it can -- it can -- let's take the streaming services as they exist right now. What would be wrong for a baby step of
having interaction? You can't interact the artist. You can't even say, communicate with the -- with the fans, with the artist -- the community,
the artist can't communicate with the audience at all.
So, what's the point? Artists want to promote themselves, a very simple thing, like a social element.
When Trent Reznor and I went over to Apple with our team, we wanted to have a social element to Apple Music. And, you know, in fairness, Apple doesn't
work in social and nor should they. You know, that -- that's their business, and they don't.
And Spotify chose not to. But that would have really helped and made it a lot simpler for artists to promote their music and find out what's really
going on, rather than having to go to TikTok and make a video that's clever enough or silly enough to get their song heard. I just -- it's absurd.
NEWTON: So, when you say they're obsolete, you are thinking that there will be new platforms that will mix this social element with the actual
streaming business. That it won't be just a straightforward utility anymore.
HENRY: And, you know, A.I. will usher that in. But remember, there is something about A.I. that gives the labels an opportunity now to recapture
the customer, which they refuse to do -- no, refuse is a rough word, haven't been able to do up until now.
There is a moment now, right now with these A.I. platforms that are coming up and ideas that are going to also have social are going to have streaming
attached to them. So -- but, here is where it gets tricky. Here is where the opportunity is.
The labels are going to go out now and they're going to license all these different streaming services. And they are going to create other third
parties like Spotify, et cetera. That's not good. The labels need to capture the audience and the customer.
So, when they are making all these licenses, they are just going to create another third party. And sooner or later, one of those third parties will
heat them.
NEWTON: What -- and you were talking about a lot of disruption there to come in the music industry.
Speaking of disruption, we had a really big tariff ruling today in terms of you and Beats and the kind of innovation that you are at the forefront of.
How much of adversity do you see that? This uncertainty in the economy in general, especially, when you are completing globally on so many levels,
whether it's the hardware on your ears or the software on your phone and your devices?
HENRY: Well, the good thing about being old is you've seen a lot of these things come and go. And some of the -- and some of the biggest economic
disasters, my music career soared. So, that's all I can point into.
So, as far as musicians are concerned, we need them. The world needs them, but they need a place to function properly.
[16:45:02]
And what I said about the record industry should be very careful licensing A.I. to all these different platforms.
(CROSSTALK)
NEWTON: Right.
HENRY: And I want to make that point.
(CROSSTALK)
NEWTON: And --
HENRY: They should take -- sorry?
NEWTON: Jimmy, you made that point clear. I just only have a few seconds left, and I do want to get to your education initiative. You are an
innovator in all things, especially, in education now.
Tell me -- we don't have a lot of time left, but tell me why you are so passionate about that.
HENRY: Well, because it's an interdisciplinary learning platform at USC, and we have high schools as well. And it's very simple. The problem that
I'm talking about in the music industry is what -- is what this school is about. It's learning and not being afraid of technology. Having creative
people understand technology. Having engineers understand the creative, be able to speak to them, understand the why of creative, on the wants and the
why of designers.
These people don't know, usually don't -- speak to each other. When I go into these corporations, they just can't -- and if they are going to go out
and buy all the entertainment companies, they should at least learn how to speak their language.
NEWTON: It's fascinating --
(CROSSTALK)
HENRY: And vice versa.
NEWTON: Yes, it is absolutely fascinating. Again, this is the intersection of the technology and the creative pieces, and you are putting it together,
at young ages right at high school.
Jimmy, we have to leave it there again, but we'll have you back and we'll see if your predictions come true. Appreciate it.
HENRY: Thank you. Thank you. Thank you.
NEWTON: Now, across Africa, financial access is quickly expanding as a rising number of adults sign up for banking accounts.
In Senegal, one mobile money provider is at the forefront of that shift, helping to drive financial inclusion right across the continent.
Eleni Giokos has more in our "CONNECTING AFRICA" report.
(BEGIN VIDEOTAPE)
ELENI GIOKOS, CNN ANCHOR (voice over): Along the coastal city of M'Bour, south of Dakar, hordes of fishermen are busy bringing their latest catch
ashore.
On the beach, they saw through their catch by species, size, and quality. It's a daily ritual, an activity that sparked an idea several years ago
that would go on to financially impact millions.
KARAMOKHO BADIANE, HEAD OF BUSINESS DEVELOPMENT, WAVE MOBILE MONEY (through translator): Wave started working with fishermen in 2018, because it was a
population that was excluded from the traditional financial system. But also excluded from mobile money.
GIOKOS (voice over): Until 2018, this was an informal economy. The fishermen were unbanked, and cash was king.
BADIANE: Two main problems came out. The first, was that these services were too difficult to use. It was just too complicated. The other problem
was the cost.
GIOKOS (voice over): Wave has been adopted by traders whose challenge wasn't earning money, but the cost of moving it.
SOULEYMAN N'DIAYE, FISH TRADER, SENEGAL (through translator): Wave really solved all our difficulties, because before, to send 1 million, you know,
here we deal with large amounts. So, to send 1 million, you had to pay 10,000, 20,000, or even 25,000 francs.
Then, Wave arrived. And to transfer 1 million, we only paid 5000 francs. It really made things easier for us.
GIOKOS (voice over): Today, Wave says it has onboarded 20 million customers across nine African countries.
BADIANE: Wave allows its users to receive, to send money, to buy mobile air time, to pay their bills, to receive international money transfers.
Now, we have started to introduce a bit more advanced services like virtual visa cards that are saving wallets. That allow them to save their money,
and also some services like the purchase of electronic tickets for mass transport.
GIOKOS (voice over): With its ambitions growing, what started with fishermen, Wave looks set to further unlock the benefits of financial
inclusion across the continent.
(END VIDEOTAPE)
NEWTON: Now, despite the Supreme Court's ruling, the threat of tariffs still hangs over the movie industry. It's just one factor weighing on
cinemas. We'll discuss everything weighing on them when we come back.
(COMMERCIAL BREAK)
[16:52:00]
NEWTON: Now, turning to our top story, now, the Supreme Court has struck down many of President Trump's tariffs. The decision only applies to duties
he imposed using emergency powers.
Sectors like the movie industry still remain vulnerable to targeted tariffs. Trump said last month that he still wants to put tariffs on films
made outside of the United States. Tim Richard is the CEO of Vue, one of Europe's largest cinema operators. Good to see you, especially, when we
have breaking news on a day like today.
Look, a lot to get to with you. But starting with the uncertainty that even this kind of ruling, but also that President Trump's continues to put in
front of negotiations, you know, as well as I do, he is going to use all the political and economic power he can to elicit what he wants from the
U.K. and Europe.
Do you feel that this is another level uncertainty that could hurt your industry?
TIM RICHARDS, CHIEF EXECUTIVE OFFICER, VUE ENTERTAINMENT: No. I mean, I think, we certainly have heard this before. And I think, certainly, when
it's a very easy sound bite to put tariffs on our industry, the details are a lot more challenging to try and decide, you know, what is a movie? What
is an American movie? What is a foreign film movie?
Because so many movies now, in fact, most movies are shot on so many different locations. And, you know, is it the script? Is it the -- is it
where it was actually shot? It was the financing behind it, the director, the cast, you know, it's virtually impossible.
So, that's not something that keeps me up at night right now.
NEWTON: A lot of other things do though, including this blockbuster deal, or deals that are really at the heart of our parent company, Warner
Brothers Discovery. Two competing bids, we've got Netflix, and Paramount Skydance.
Your business in the eye of this storm. At issue is, if Netflix does actually get this deal, do you believe that as promised, Netflix will still
have a significant rollout of -- pardon me, I can't speak. Theater releases.
And if you doubt it, why? Why do you believe Netflix won't live up to their word on those theatrical releases?
RICHARDS: Well, I think, first of all, I think the big -- the big part of your question was the if they get it, and I don't think they are going to
get it personally. Because you can see the talent coming out now, you can see James Cameron coming out this morning or last night, talking about a
Netflix deal would be disastrous for the industry.
But, I think, if I was a shareholder of Warner Brothers Discovery, putting the economics of the deal aside, the biggest concern here is going to be
European competition authorities and British U.K. competition authorities. They are going to be given a very hard time, and it's very likely that they
will get regulatory approval in domestic. But internationally, they are going to be scrutinized and scrubbed very hard.
[16:55:00]
This could take a long time. There are absolutely going to be speed bumps and guardrails put in and undertake --
So, this is not something that's going to get an easy pass.
NEWTON: I'm interested to hear -- I'm glad that we are putting that other issue on the table, because we talk a lot about the regulatory environment
in the United States, but not globally.
But look, Paramount is the other bidder here. Would that be any better, really? Tim, I mean, look, this is consolidation, after all.
RICHARDS: Well, look, I mean, I think the ideal scenario here, which is not going to happen, is that Warner Brothers, where I also spent seven years of
my life, in this incredible institution, this incredible studio, is now, unfortunately, up for sale. It will be sold, and it will be sold to one of
the two of them.
But it comes down to credibility. You've got Netflix and Ted Sarandos, who, for 20 years, have not supported the theatrical industry at all. We are one
of the largest -- second, well, the largest private operator in eight countries in Europe. We have never played a Netflix film, and most of our
large competitors have never played a Netflix film.
And the only time that Netflix have released movies is if they want to get a nomination for either a BAFTA or an Oscar. And Ted Sarandos is actually
admitted to that as well.
So, you know, I think that as recently as late last year, they are talking about, you know, movies are really made to be seen at home. And that's
directly from Ted Sarandos.
Three weeks ago, Ted Sarandos announced that he -- his team had suddenly discovered, after an unconditional 83 billion pound or dollar bid that
Warner Brothers actually make movies, and now he supports theatrical releases with 45-day windows.
On the other hand, you have a very highly respected filmmaker with David Ellison, who has a 15-year track record of releasing movies theatrically.
He has supported the industry. He has delivered some of the biggest movies of all time.
And you look at the two of them, and you just think, well, who is going to be the most credible, and who is really going to support our industry going
forward?
NEWTON: Well, this is still going to continue to be a long, drawn-out drama. Tim, as you were speaking, we were showing of the revamp of your
theaters, you got a whole new vision for it, and we'll have you on. Certainly, when a lot of those things are completed. But it has to do. We
are looking at some of it right now.
Revamped theaters, no concession stands, hot food, a completely different experience at the theaters. We'll see if it works to get a lot of us off
our couches and into those theaters. Tim Richards, for us, really want to thank you.
RICHARDS: No, thank you.
NEWTON: Thanks.
Now, Wall Street ended higher after the Supreme Court struck down that tariff decision. As I said, though they are not convinced the markets in
terms of if this will go their way and if it will actually help.
I'm Paula Newton in New York. That was QUEST MEANS BUSINESS. "THE LEAD" with Jake Tapper starts now.
(COMMERCIAL BREAK)
END
