Netflix and Google Are Poised to Dominate L.A. After the Pandemic

Ben Bergman

Ben Bergman is the newsroom's senior finance reporter. Previously he was a senior business reporter and host at KPCC, a senior producer at Gimlet Media, a producer at NPR's Morning Edition, and produced two investigative documentaries for KCET. He has been a frequent on-air contributor to business coverage on NPR and Marketplace and has written for The New York Times and Columbia Journalism Review. Ben was a 2017-2018 Knight-Bagehot Fellow in Economic and Business Journalism at Columbia Business School. In his free time, he enjoys skiing, playing poker, and cheering on The Seattle Seahawks.

Netflix and Google Are Poised to Dominate L.A. After the Pandemic

In the next few years, as the world emerges from the novel coronavirus, Netflix will lay claim to nearly as big a footprint in Los Angeles as the most iconic of the city's entertainment companies, Disney. Google, another Silicon Valley implant, will not be far behind.

The pandemic will delay some expansion but likely not diminish it because increased time at home is only increasing the popularity of streaming, and the crisis is expected to make tech giants even more dominant.


Though it is officially headquartered in Los Gatos, Netflix is increasingly -- for all intents and purposes -- an L.A. company, a quick rise considering it had little presence in the city before 2017. The streaming giant has already signed commitments for an additional 826,000 square feet of office space and sound stages in Hollywood, meaning that it will have twice the footprint in L.A. as in the Bay Area. Already, Netflix has more than 3,000 employees here, considerably more than it has at headquarters, according to someone familiar with the company.

All together, the so-called FAANG companies – Facebook, Apple, Amazon, Netflix, and Alphabet (formerly known as Google) plus Hulu – will occupy nearly six million square feet of office space on the Westside by 2023, gobbling up 10% of all commercial real estate there. The figures come from a review compiled for dot.LA by the tech office broker HelloOffice, which uses proprietary data to track real estate listings and trends in real time. (None of the companies would comment on their real estate activity.)

HelloOffice

The analysis reveals that a city known globally as the movie capital of the world for the last century has rapidly transformed itself in just the few years to be the streaming capital. They also show the increasing influence of the biggest tech behemoths in L.A. and the extent to which scores of smaller but still significant players are forming an expansive reach over the area; almost half the tenant base on the Westside is made up of companies combining technology and entertainment.

"Tech has now become the bedrock of Los Angeles," said Petra Durnin, head of market analytics at HelloOffice. "Every kind of industry has a tech component."

It might seem incongruous to be talking about office space at a time when nearly every workplace sits empty as employees stay quarantined at home. But while more work will be remote, experts predict most people will return to the office, eventually. A recent study by the University of Chicago found only a third of work could be done remotely. "We will get back to business but with necessary adjustments," Durnin said.

FAANGs are expected to come out stronger on the other side of the crisis as many less-capitalized businesses go under. Meanwhile, stuck at home with little else to watch with sports and live events on hold, people are binging shows like Tiger King and Ozark at record rates. "Like other home entertainment services, we're seeing temporarily higher viewing and increased membership growth," Netflix recently told shareholders, after announcing 15.8 million new subscribers in the last quarter, more than double what it expected.

Rapid growth expected to continue

Google is emblematic of the trend of the last decade that is expected to accelerate, tech giants constantly outgrowing ever bigger L.A. offices.

Google quickly outgrew the trendy 100,000 square feet Frank Gehry-designed offices at Venice's so-called Binocular Building, and expanded a short distance south.

The search giant had a small presence in Los Angeles starting in 2003, but its first major office did not open until 2011 in Venice. It quickly outgrew the trendy 100,000 square feet Frank Gehry-designed offices there and expanded a short distance south to Playa Vista, snapping up 12 acres of vacant land for $120 million in 2014. In 2018, the company moved into a vast four-story, 450,000 square-foot hangar where Howard Hughes built the Spruce Goose during World War II. Last year, Google signed a 14-year lease to take over 585,000 square feet of office space at a transformed Westside Pavilion, starting in 2022. It will be the company's third L.A. campus.

Meanwhile, Amazon and Apple have staked claims on Culver City, which for the last century has been dominated by movie studios MGM and Sony Pictures Entertainment. It's as stark an illustration as any of the transformation from film to streaming.

In 2018, Amazon announced it was leasing 530,000 square feet at a revamped Culver Studios, scheduled for completion next year. Apple has said it expects to have 1,000 employees in Culver City by 2022, working on the company's increasingly important entertainment properties such as Apple TV, Apple Music, and Apple Podcasts. Before the pandemic, the company had started moving employees in stages to a sleek new 125,000 square foot complex next to the Expo Line, a move that is expected to resume when employees are allowed to return to work.

The coronavirus will also delay major expansions from Facebook and Netflix.

The social network was due to move into new offices in Playa Vista this year while the streamer was preparing to move into two large offices in Hollywood that total nearly 700,000 square feet.

Facebook CEO Mark Zuckerberg said last week that the company would begin to open its offices July 6, though any employee who wants to can continue working remotely through the end of the year. Google CEO Sundar Pichai told employees that some essential workers can return in June but the majority who can work from home will likely do so through 2020.

"The stay-at-home mandate has dampened some companies' immediate plans for expansion and construction delays could push some move-ins to mid 2021, but collectively these companies are still expected to occupy an additional one million square feet over the next one to two years," said Durnin.

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ben@dot.la

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The Creator-To-Podcaster Pipeline Is Ready to Explode

Nat Rubio-Licht
Nat Rubio-Licht is a freelance reporter with dot.LA. They previously worked at Protocol writing the Source Code newsletter and at the L.A. Business Journal covering tech and aerospace. They can be reached at nat@dot.la.
The Creator-To-Podcaster Pipeline Is Ready to Explode
Evan Xie

It’s no secret that men dominate the podcasting industry. Even as women continue to grow their foothold, men still make up many of the highest-earning podcasts, raking in massive paychecks from ad revenue and striking deals with streaming platforms worth hundreds of millions of dollars.

But a new demographic is changing that narrative: Gen-Z female influencers and content creators.

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nat@dot.la

NASA’s JPL Receives Billions to Begin Understanding Our Solar System

Samson Amore

Samson Amore is a reporter for dot.LA. He holds a degree in journalism from Emerson College and previously covered technology and entertainment for TheWrap and reported on the SoCal startup scene for the Los Angeles Business Journal. Send tips or pitches to samsonamore@dot.la and find him on Twitter @Samsonamore.

NASA’s JPL Receives Billions to Begin Understanding Our Solar System
Evan Xie

NASA’s footprint in California is growing as the agency prepares for Congress to approve its proposed 2024 budget.

The overall NASA budget swelled 6% from the prior year, JPL deputy director Larry James told dot.LA. He added he sees that as a continuation of the last two presidential administrations’ focus on modernizing and bolstering the nation’s space program.

The money goes largely to existing NASA centers in California, including the Pasadena-based Jet Propulsion Laboratory run with Caltech, Ames Research Center in Silicon Valley and Armstrong Flight Research Center at Edwards Air Force Base.

California remains a hotspot for NASA space activity and investment. In 2021, the agency estimated its economic output impact on the region to be around $15.2 billion. That was far more than its closest competing states, including Texas ($9.3 billion) and Maryland (roughly $8 billion). That same year, NASA reported it employed over 66,000 people in California.

“In general, Congress has been very supportive” of the JPL and NASA’s missions, James said. “It’s generally bipartisan [and] supported by both sides of the aisle. In the last few years in general NASA has been able to have increased budgets.”

There are 41 current missions run by JPL and CalTech, and another 16 scheduled for the future. James added the new budget is “an incredible support for all the missions we want to do.”

The public-private partnership between NASA and local space companies continues to evolve, and the increased budget could be a boon for LA-based developers. Numerous contractors for NASA (including CalTech, which runs the JPL), Boeing, Lockheed Martin, SpaceX and Northrop Grumman all stand to gain new contracts once the budget is finalized, partly because NASA simply needs the private industry’s help to achieve all its goals.

James said that there was only one JPL mission that wasn’t funded – a mission to send an orbital satellite to survey the surface and interior of Venus, called VERITAS.

NASA Employment and Output ImpactEvan Xie

The Moon and Mars

Much of the money earmarked in the proposed 2024 budget is for crewed missions. Overall, NASA’s asking for $8 billion from Congress to fund lunar exploration missions. As part of this, the majority is earmarked for the upcoming Artemis mission, which aims to land a woman and person of color on the Moon’s south pole.

While there’s a number of high-profile missions the JPL is working on that are focused on Mars, including Mars Sample Return project (which received $949 million in this proposed budget) and Ingenuity helicopter and Perseverance rover, JPL also received significant funding to study the Earth’s climate and behavior.

JPL also got funding for several projects to map our universe. One is the SphereX Near Earth Objects surveyor mission, the goal of which is to use telescopes to “map the entire universe,” James said, adding that the mission was fully funded.

International Space Station

NASA’s also asking for more money to maintain the International Space Station (ISS), which houses a number of projects dedicated to better understanding the Earth’s climate and behavior.

The agency requested roughly $1.3 billion to maintain the ISS. It also is increasing its investment in space flight support, in-space transportation and commercial development of low-earth orbit (LEO). “The ISS is an incredible platform for us,” James said.

James added there are multiple missions outside or on board the ISS now taking data, including EMIT, which launched in July 2022. The EMIT mission studies arid dust sources on the planet using spectroscopy. It uses that data to remodel how mineral dust movement in North and South America might affect the Earth’s temperature changes.

Another ISS mission JPL launched is called ECOSTRESS. The mission sent a thermal radiometer onto the space station in June 2018 to monitor how plants lose water through their leaves, with the goal of figuring out how the terrestrial biosphere reacts to changes in water availability. James said the plan is to “tell you the kind of foliage health around the globe” from space.

One other ISS project is called Cold Atom Lab. It is “an incredible fundamental physics machine,” James said, that’s run by “three Nobel Prize winners as principal investigators on the Space Station.” Cold Atom Lab is a physics experiment geared toward figuring out how quantum phenomena behave in space by cooling atoms with lasers to just below absolute zero degrees.

In the long term, James was optimistic NASA’s imaging projects could lead to more dramatic discoveries. Surveying the makeup of planets’ atmospheres is a project “in the astrophysics domain we’re very excited about,” James said. He added that this imaging could lead to information about life on other planets, or, at the very least, an understanding of why they’re no longer habitable.

https://twitter.com/samsonamore
samsonamore@dot.la

Behind Her Empire: Margaret Wishingrad On Creating A Low Sugar Cereal Brand

Decerry Donato

Decerry Donato is a reporter at dot.LA. Prior to that, she was an editorial fellow at the company. Decerry received her bachelor's degree in literary journalism from the University of California, Irvine. She continues to write stories to inform the community about issues or events that take place in the L.A. area. On the weekends, she can be found hiking in the Angeles National forest or sifting through racks at your local thrift store.

Behind Her Empire: Margaret Wishingrad On Creating A Low Sugar Cereal Brand
Provided by BHE

On this episode of Behind Her Empire, Three Wishes founder and CEO Margaret Wishingrad talks about creating brand awareness and shares the key component to running a successful business.

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