Can Meta still make the metaverse?

This episode is all about companies in flux. First, we chat with The Verge's Alex Heath about all things Meta — whether the company is still serious about the metaverse, why its AI plans seem to be going so well, what "OG Facebook" really means, and what headsets to expect this year. After that, The Verge's Chris Welch takes us through the last year at Sonos, from the disastrous app launch to the pretty good headphones that were totally derailed by the disastrous app launch. Can the company get it together in order to launch its next big swing, a set-top box codenamed Pinewood? Finally, we answer a question on the Vergecast Hotline all about business cards. Because, yes, it's 2025, but sometimes you still need a place to put a business card. Further reading: Mark Zuckerberg tells Meta employees to ‘buckle up’ in internal meeting Meta says this is the make or break year for the metaverse Meta’s Ray-Bans smart glasses sold more than 1 million units last year Meta’s AR / VR hardware roadmap through 2027 Meta CTO says the company is working to ‘catch’ leakers Zuck wants to bring the “OG Facebook” back. The Sonos app fiasco: how a great audio brand nearly ruined its reputation Sonos CEO Patrick Spence steps down after disastrous app launch Sonos’ interim CEO hits all the right notes in first letter to employees Sonos Arc Ultra review: don’t call it a comeback (yet) Sonos Ace review: was it worth it? | The Verge After a bruising year, Sonos readies its next big thing: a streaming box Adobe Scan Email us at [email protected] or call us at 866-VERGE11, we love hearing from you. Learn more about your ad choices. Visit podcastchoices.com/adchoices

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:03David Pierce?

  Welcome to The Vergecast, the flagship podcast of completely unnecessary corporate pivots. I'm your friend David Pierce and I have a new webcam. This will not be interesting to anyone who is just listening to this show, which is most of you. But if you're watching this on YouTube, you'll notice frankly that I look both hopefully better and probably slightly worse. So I've had this Sony ZV1 lying around for a while. I got it with the intention of upgrading my video conferencing and podcast video setup. But it turns out that whenever you introduce like an actual camera to your system, it makes everything more annoying. There are more things you have to turn on and off. There are more systems you have to figure out. There's more really awful Sony software that you have to download.

• 0:47David Pierce?

  And so most of the time I just end up using a webcam like this one, just a normal Insta360 webcam. But then recently I was like, okay, I'm going to try and upgrade and see if I can make myself look a little better. So in a certain way, this camera is a huge improvement, but it also only does 720p when you're using it as a webcam, which it's 2025. That's ridiculous. So we're trying this out. We'll see how it goes. And if you're wondering why it's nighttime behind me, that's because it's nighttime behind me. And this, at this point, is the only time I have to endlessly mess with my desktop setup. Because during the day I have to like, you know, work like a real person. It's awful. I don't recommend it. Anyway, that is not what we're here to talk about. Today on the show, we are going to do two things.

• 1:30David Pierce?

  First, we're going to talk about Meta, which is a company very much in transition. This is a company called Meta who seems to be interested in lots of other things and not the metaverse. So we're going to talk about that. We're going to talk about how the company has changed internally and externally and what 2025 holds for the company as well. Then we're going to talk about Sonos, which is actually a company in a similar spot. After a year full of a huge number of self-inflicted wounds around the app and the Ace headphones and the way that it responded to the app and to the launch of the Ace headphones, Sonos is just in a weird place. But I think the company is actually kind of unusual and interesting.

• 2:14David Pierce?

  And we've talked about it a ton on this show, but I thought it might be good to just try and tell the whole story all at once and see if we can figure out what it means. We also have a hotline on a sort of unusual topic, which is a thing I have not thought about in a while, which was fun. And we're going to get to all of that in just a second. But first, I feel like I'm like zoomed in a little too far. And now I'm going to spend just an outrageous amount of time mucking around in the camera settings, trying to make all this work. This is the Vergecast. We'll be right back.

• 2:44Speaker 01

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• 4:10David Pierce?

  Welcome back. Let's talk about Meta first because I think if you look at the sweep of the tech industry right now, whether you want to talk about technology in general or AI specifically, or how tech and politics are interacting, I think you could argue that Meta is the single most central company in all of that right now. Whether you want to talk about the future of social and what it means for us to be people online in this information ecosystem, or do you just want to talk about like AI glasses and the metaverse and whatever. But at the same time, this company seems to be changing. They've changed a lot of content policies recently. Mark Zuckerberg went on Joe Rogan's podcast and talked about needing more masculine energy at Meta. This company just feels like it

• 4:55David Pierce?

  is not going to be the company we've known it to be for a very long time. And frankly, even as Meta has changed a lot, I feel like we've been able to sort of chart its path. But this feels like an inflection point. And I just want to see if I can make sense of that. So I asked Alex Heath, who chronicles Meta and many others in his newsletter for The Verge called Command Line. It's very good. You should subscribe. He is inside of Meta in a way that very few people are, and I figured it could help us out. So let's just dig into this. Alex Heath, welcome back to the show.

• 5:25Speaker 05

  Hey.

• 5:26David Pierce?

  It's been a minute.

• 5:27Speaker 05

  Yeah, it has.

• 5:27David Pierce?

  We haven't done this in a little while.

• 5:28Speaker 05

  Yeah.

• 5:29David Pierce?

  It's nice to see you again.

• 5:30Speaker 05

  Good to be back.

• 5:30David Pierce?

  Um, I want to talk about Meta because there's been a lot going on with this company the last few months. And I've been thinking a lot in particular about a memo that Andrew Bosworth sent about the metaverse that I want to talk about that's really fascinating. But it feels like you've been inside of a lot of these meetings that the company's having. You've been reporting on a lot of the goings on. They're very mad at you specifically about some of the leaks that are going on. And I feel like Meta is in the middle of becoming a very different kind of company than frankly than it was six months ago, or three years ago, or like when it changed its name to Meta. And I'm curious, like, does it, does it feel like this company is becoming something else right in front of our eyes right now?

• 6:13Speaker 05

  I'm not sure. I mean, I see what you're saying about becoming a different company. I feel like Meta changes more than any of the other big tech companies. Like, it's definitely more chaotic. I think that's just a function of Zuckerberg controlling the company and it really being a...

• 6:32Speaker 05

  I would say imprint of his psyche at any given moment.

• 6:36David Pierce?

  Yeah, he can get away with being chaotic because there's no one to stop him, really.

• 6:40Speaker 05

  Right. And so, you know, it was interesting. I reported on this all hands meeting that Zuckerberg had with employees a couple of weeks ago now. And I did a little word check and he said the word metaverse once in an hour. He said AI a lot. And I think that's a pretty good indicator of where things are at. But I don't actually buy the external analysis that's out there that this means they're giving up on the metaverse stuff.

• 7:11David Pierce?

  Oh, interesting. Okay. Well, so let me, let me just read the bit of Bosworth's memo that, that has stuck in my brain. And then I want you to explain what you mean by that. So he, he basically said it's going to be either, quote, "the work of visionaries or a legendary misadventure." And then he said, "We have the best portfolio of products we've ever had in market and are pushing our advantage by launching a half dozen more AI-powered wearables. We need to drive sales retention and engagement across the board, but especially in MR, mixed reality. And Horizon Worlds on mobile absolutely has to break out for our long-term plans to have a chance." It's like, literally like, this is either, either we're geniuses or idiots, is like, in his words, the thing that they're using. And I think you're right that a lot of people took that to mean, obviously, it's not going to work this year. So Meta is going to

• 7:54David Pierce?

  be out on the metaverse. And this is just him setting the scene for that. Why do you think that's not what's going on here?

• 7:59Speaker 05

  Oh, I think that's right. My point was more just that the AI focus or pivot, as some would say, does not mean that the metaverse stuff is going away. I think Zuckerberg actually used the phrase like walk on shoe gum at the same time in this all hands meeting. And they are still spending an absurd amount of money on Reality Labs, which is the division Bosworth, who you just mentioned, runs that builds all the metaverse stuff. I think maybe it would be helpful to just like, put that in context before we talk about all the devices, like,

• 8:31David Pierce?

  Please.

• 8:32Speaker 05

  I was looking through Meta's filings with the SEC, their annual report. They spent, well, actually, more specifically, Reality Labs reduced their profit by nearly $18 billion last year.

• 8:46David Pierce?

  Wow.

• 8:47Speaker 05

  That's a lot of money and that's keeps going up year after year. That's more than Amazon paid for Whole Foods. It's more than 3X what OpenAI spent to run its entire company last year. It's the total market value of Snap, the company, is what they spent on Reality Labs last year.

• 9:03David Pierce?

  They just lose a snap every year.

• 9:05Speaker 05

  So to say that they're giving up on the metaverse, it doesn't bear out in the numbers that they report to the SEC. And I thought another interesting thing, I'm a nerd about this stuff, is that they said in this report that this year, they expect to spend half of Reality Labs' spending on wearables, which is everything not Quest and not Horizon. And historically, they were spending most on Quest. But what has happened in the last year or two, and something we reported out of that meeting that Zuckerberg had that he disclosed for the first time, is that the Meta Ray-Ban glasses are growing a lot faster than they anticipated.

• 9:46Speaker 05

  They've sold over 1 million units of them, which isn't a lot in the grand scheme of the Quest. You know, the Quest sells millions of units a year. It's already at like what a solid gaming console, you know, annual sales would be. But they see a lot more potential in what the Ray-Bans represent because they see it as a much more mass consumer device than the Quest, which even despite their best attempts over the years, still remains a gadget for teen boys and gamers, I would say, mostly.

• 10:18David Pierce?

  Do you think Meta's right to think that there's more mainstream potential in the Ray-Ban glasses?

• 10:23Speaker 05

  I don't know. I think they're easier to wear. You know, Meta knows internally that one of the biggest barriers to adoption for the Quest has been that it's just not comfortable and it doesn't look good when you wear it. It's not a thing you wear out, right?

• 10:37David Pierce?

  Right.

• 10:37Speaker 05

  Whereas Ray-Bans are things that are, and the other glasses are going to do, are designed to be worn out. They're designed to be used more like you would use a phone. Whereas the Quest and mixed reality, even with the mixed stuff they're doing, it really is more of an isolating experience, something that you would use in your House. And I don't think that's going to change. I think if anything, those two product lines will further separate from each other before coming back together. I do think they will come back together, but it may take like 10 years when the tech gets really good enough. So yeah, that's kind of the state of where things are. And just back to your original point, like, are they changing? I think the change is that the Ray-Bans and Zuckerberg's excitement about them, and also his kind of obsession with everything AI that they're doing.

• 11:20Speaker 05

  And how that intersects with the Ray-Ban specifically has really shifted a lot of the attention and a lot of the spending into the wearable segment.

• 11:28David Pierce?

  Right. I do think though, if I were to galaxy brain all of this for a second, it seems like Meta has been desperately trying to invent its own more or less solely controlled platform for a very long time, right? It got, it got hosed by mobile in so, so many ways. And Apple's, Apple's control, well, mobile made Facebook, but also like kept it from making a lot more money than it could have. And Apple has made Meta's life very hard in a number of ways over the years.

• 11:57Speaker 05

  Poor Meta, they're only worth $2 trillion.

• 11:59David Pierce?

  I know, it's gotta be awful, honestly. Like, I feel bad for Mark and his gold chains, but um. So I think a real impetus for trying to make the metaverse happen was based on the assumption that, okay, this is going to be the next platform and we have to be the ones who make it. Like, I think that's been very important to this company. And I think if you squint a little at the combination of Meta AI and the Ray-Ban smart glasses, there's a platform in there. And that, that maybe what is happening is Mark Zuckerberg is looking and saying, okay, I can bet many, many, many billions of dollars on this really expensive, really complicated virtual world thing that is at best a ways away.

• 12:38David Pierce?

  And at worst, just not interesting to most people. Or I can invent this other platform that I sort of accidentally discovered just by partnering with a cool company in Italy. And so like, that's where I'm like, maybe, maybe the big thing that Meta needs, it thinks it can get out of this combination of AI and smart glasses much more quickly than it can get it out of the metaverse.

• 13:01Speaker 05

  Yeah, I think the metaverse is more of a grind. I think if antitrust did not exist, if scrutiny of meta did not exist, they would have probably just like bought Roblox for an absurd amount of money right now and made it Horizon Worlds. That's really what they want it to be.

• 13:15David Pierce?

  That's such an interesting parallel universe in which that was allowed to happen.

• 13:18Speaker 05

  Right, like, I think it would, and the reason that Bosworth says in that memo that Horizon has to work is that they can't just have dumb hardware that doesn't have software, right? The Ray-Bans have the AI, the voice stuff, the camera, they have utility. The Quest is a content device, it's an entertainment device, an immersion device. And for Meta's business model, which is ads, right, to really extend into the metaverse and eventually pay for all this, they really need a social platform that is embodied avatars that works in that kind of a context. And Horizon is still way behind, you know, it's still way behind where Roblox is, way behind where Epic is with its Fortnite kind of world-building experiment that it's earlier

• 14:03Speaker 05

  in than Roblox but making progress in. So, I mean, he's right in that sense, Horizon needs to work, they need to have their own social experience on this, they're just not there yet. I mean, look, would a lot of companies, you know, much smaller than Meta, kill for having something like the Quest? I don't know, I mean, it sells millions of units a year, they don't really make money on the hardware, but they are seeding the world with millions of these devices. You know, they're not very retentive devices, that's been a big problem though, is that like, unless you're a gamer or like a young boy who likes to troll people in virtual reality, it's, they're just really not something that people come back to.

• 14:46Speaker 05

  I'm also like speaking from experience there, it's just not something that is...

• 14:50David Pierce?

  Yeah, mine's sitting right over there, and I haven't picked it up in a frustratingly long period of time.

• 14:55Speaker 05

  Yeah, because you don't have a really good reason to, unless there's like a game or something that you really want to play. Whereas the Ray-Bans are like, these could actually just be your glasses, right? And they actually just upgrade what your glasses can do. And you know, that's where things get really interesting. And you know, something that Zuckerberg said in this recent All Hands about that is that, you know, this is going to be the year where basically they know whether AI glasses, as they now call them instead of air glasses, are going to be this next mass market iPhone level thing, based on the sales trajectory, or whether it's going to be, in his own words, a grind. And if you had to describe Meta's entire hardware adventure over the last 10 years, it would definitely be a grind.

• 15:40Speaker 05

  So they're prepared to keep grinding, but I think, you know, this year it's a matter of whether, look, do the Ray-Bans end the year at 5 million sales, 10 million sales? Do the devices they're planning to ship, you know, later this year, really, you know, get people excited? Or do they flop? You know, that's the stakes. And I think he feels the stakes of that.

• 16:02Speaker 05

  But, you know, we have yet to see those devices. They're coming very soon.

• 16:05David Pierce?

  What are those devices? You've scooped the roadmap so many times, I've lost track of what's coming. And there's the Orion ones, which you saw last year, we talked about on the show. And those are not coming this year, but something on the journey to that is coming this year, we think, right?

• 16:20Speaker 05

  Yeah, Orion is not, and Orion itself, and it was very clear on the write-up for us, that it is not the thing they are going to ship. A version that is like it will ship, and it will not ship until at least 2027. And it's going to be very expensive. It's going to cost like what a decked out MacBook Pro costs. What is happening later this year is the first pair of Meta-designed glasses. So what they've done with Ray-Bans and Luxottica to date, I think they've really rode the coattails of that brand. And, you know, Wayfarers are just this like, super classic, cool, classic design that everyone...

• 16:56David Pierce?

  It does sort of feel like if you have access to Wayfarers, why would you, why reinvent the wheel?

• 17:01Speaker 05

  Sure.

• 17:01David Pierce?

  I don't know.

• 17:02Speaker 05

  Well, because they had already been building this device with... The hardware takes a long time and this device was already in the works way before the Ray-Bans took off. It's called, it's codenamed Hypernova. It's going to have a heads up display. It's basically their version of Google Glass. It's going to be much better than what Glass was 10 years ago, but it's going to have the heads up display for things like showing the photos you take, incoming notifications, your interactions with Meta AI, getting some more visual feedback. They're going to be pricey. I wouldn't be surprised if they're at least a thousand dollars. And the stakes are that, again, these are not designed as Ray-Bans. They're Meta Glasses. And I think Luxottica will obviously play a role in how they are

• 17:44Speaker 05

  distributed and maybe we'll do things like prescriptions for them. But this is Meta's first real like shot at can we do glasses ourselves from a societal acceptance perspective, right? Sure. And they're going to be pricey and they're going to be an early adopter thing. And if it ends up being just a bad product, that's really not good for what Meta is trying to do over the long run. And then they're also going to be doing a lot more with Luxottica that I think while there's still risks there, it's way less risky, again, because of the fact that Luxottica is designing these things and Meta is basically just like the tech supplier. So they're going to do glasses with Oakley for athletes. I wouldn't be surprised if we

• 18:26Speaker 05

  see, you know, Luxottica owns Supreme now. Would be surprised if we see Supreme glasses down the road. They're going to do all kinds of these glasses with Luxottica. But those are going to be, you know, a few hundred bucks, not AR, at least to start. And then Hypernova. And the reason Bosworth says in that memo, you know, we're going to have half a dozen wearables this year is they're going to have variants of Hypernova, but they're also going to be finally shipping this thing that I wrote about with Orion, which is their wristband, which Oh, right. is really one of the coolest pieces of technology I've used in a long time. And I'm really interested to see how the world at large receives this thing. It's how you controlled Orion and it's how you'll control Hypernova, these glasses later this year.

• 19:11Speaker 05

  And it's uses EMG technology to

• 19:15Speaker 05

  Basically read your mind. They don't say that and that's not what's happening, but it feels that way.

• 19:20David Pierce?

  Yeah.

• 19:21Speaker 05

  Where you can, you know, do a very subtle pinch gesture to click, drag, that sort of stuff. Interact like Minority Report style with things. And it's the first time I've used like a new input method in a really long time that felt supernatural. I would put it on par with like, you remember the first time you did eye tracking with the Vision Pro?

• 19:42David Pierce?

  Sure, yeah.

• 19:43Speaker 05

  Something like that where it's like, wow, this is just a way more natural way to interact with something. So that's going to be really interesting to see how that works with the glasses later this year. And it will give people a taste of what's coming with the full fledged air glasses in a few years. But the Ray-Bans for now are very much what they're putting a lot of, you know, marketing and investment into. We just saw the Super Bowl ad. And I think they're going to be riding that hype wave for a while.

• 20:12David Pierce?

  Yeah, I mean, it seems like Meta in a really interesting way is both trying to do the opposite of Apple, which we've been talking about for a while, right? Apple is like, we're going to build the best thing humanity can possibly create. And it's going to cost $700,000 and no one's going to like it, but and then, and then we'll figure out what to do from there. That hasn't gone so great. Meta, I think, sort of by accident, frankly, seems to have found the exact opposite approach. Where they're like, we're going to take a thing that you already like. We're going to make it a little bit better and then we're just going to kind of keep adding stuff from there. And so it feels like the question for me is, I think the Meta Ray-Ban thing is, is like, that's, that works. Like that, I think is going to be a thing that will show up in mainstream glasses everywhere, right?

• 20:55David Pierce?

  The like, your glasses are now also headphones and a little AI chatbot. And there's a camera in the temple, like done. I think that is absolutely a mainstream use case not very long from now. The question is how far up you can go from there before you start losing people.

• 21:11Speaker 05

  Yeah.

• 21:11David Pierce?

  And to me, that's the big question of this year because we're going to see a lot of people try, right? There were all those companies at CES that were doing the little like green heads up display right in front of the eyes. Some people will like that, some people are going to hate that. It's and so Meta seems like it's it's trying to like pull up on the the like, how much can this thing be chain? And I think this is going to be an interesting year to see whether any of that actually matters to most people, or if everybody starts to be like, oh, you've just made a thing I want to wear less, which defeats the purpose of the whole thing.

• 21:42Speaker 05

  Yeah, and that's the real stress for them with Hypernova, the glasses that they're putting out with the display is and the band is like, we're taking Ray-Bans that have tech in them and giving you like a roughly $1,000 Google Glass Redux device, but it's Meta. You know, all the brand concerns there. And by the way, there's like a mind reading band that you have to like relearn how to interact with a computer. And like, maybe early adopters will love it. If they don't, that's pretty tough for, you know, something that Meta is spending billions a year on and has yet to really see any meaningful, you know, profit from. But do not discount Zuckerberg's willingness to grind this out. It's really interesting to me that like in the 10 years that Reality Labs has been

• 22:25Speaker 05

  going now roughly, I think it's been like eight, is that, you know, there's been so much written about how this is a, you know, waste and how it's going to tank Meta. And Meta has literally added like a trillion dollars in market cap since it started Reality Labs. So they can afford to walk and chew gum, as Zuckerberg says, it's just a matter of how long and like, if the products don't actually get used or received well in the next year or two, it's going to really set them back. And you know, he said in this meeting, like, we have a wide open, you know, field right now because Apple's dialed back, you know, Google's still trying to get its, you know, whatever, the 15th version of its AR strategy off the ground.

• 23:07David Pierce?

  No one's afraid of Google's hardware division.

• 23:09Speaker 05

  Yeah. And so they have the early start and it's a matter of whether they can capitalize on that and whether these products will really hit or not. And they've got a, you know, the quest is like, we don't talk about it as much because it's just not as exciting anymore. But like, they have to make that work. They have to make it retentive. They have to find a way to make money from that multi-year investment. And Horizon, they really needed to be a thing that is like a creator platform as well, that people want to build worlds in. And that's where the AI stuff starts to intersect. It's like AI NPCs, generative world building, where it could kind of accelerate that stuff, but they're still so behind Roblox and Epic on just the tooling and the ease of use.

• 23:51Speaker 05

  So I don't even think Horizon is even in the App Store still. I think it's just a web app. Maybe that's changed recently, but.

• 23:57David Pierce?

  I mean, it's, it's one thing to look at Horizon as like a sort of primitive version of a technology to come. And it's like, okay, well, clearly they were too early. This thing isn't very good yet. Maybe there's a roadmap to it. But you put it next to Roblox and Fortnite, which people are functionally using for the exact things that Meta is looking for. And it just, it just looks like a disaster.

• 24:18Speaker 05

  Yeah.

• 24:19David Pierce?

  So let's talk about the social thing on the other side of this, because I think if I were to give Meta credit for one thing in particular, it's that it has figured out how to make AI in a way that makes sense for literally everything it's doing. Like what you just described is like Meta has built all this AI so that it works for Reality Labs. It also has made these classes a hit in part. It's also powering the ads business, which is really like, that trillion dollars is like in large part because Meta has made its ads better thanks to AI. Like, we don't talk about that because it's really boring, but like, that's what happened.

• 24:51Speaker 05

  Yeah.

• 24:51David Pierce?

  Google is like, you can write emails and Meta is like, our ads are better now and everybody gives them money. But then on the other side, there is like Facebook and Instagram and Threads, which I feel like we don't talk about anymore because they're just like, they're like furniture. They just sort of exist and we don't worry about them. But then like in, in, on earnings calls and in meetings and stuff, Zuckerberg is talking about bringing back the OG Facebook and they're talking about bringing AI to more of Facebook. Like, what, what is coming on the social side of Meta that you're hearing about?

• 25:22Speaker 05

  The OG Facebook stuff is something I'm still digging into and very interested by. They've been trying to position Facebook as a Gen Z app for the last few years. They're keenly aware, and we saw this actually in the stuff we saw through the Haugen leaks, that if they start to lose younger users over time, it's really bad for a social network company. So they have to make Facebook something that like, you know, is not just something you check once a year to see why your parents are saying what they're saying to their friends on social media, right? It needs to be a thing that is like relevant beyond Marketplace or whatever. And Groups is working for them a little bit there, but I thought it was interesting on

• 26:03Speaker 05

  the last earnings call, he said he wants it to be a lot more culturally influential.

• 26:08David Pierce?

  I mean, don't we all, right?

• 26:10Speaker 05

  Yeah, don't we all? This, I think, has to do with ego a bit. I mean, this is what started the company. It is one of the biggest products of all time that has had the most longevity, but it has lost its influence, no question.

• 26:25Speaker 05

  That's going to be really tough and I'm not sure how they make it cool again. They've been trying, like I said, for years. But Instagram, you know, is staying strong for them. It's not growing quite as fast still as they had hoped, but it's just like really saturated in culture and that's really good for them.

• 26:40David Pierce?

  Instagram actually strikes me as the most sticky thing. Like, if, if you were to say, like, I've come from the future, it's, it's 2029 and there's only one Meta service left, I would, I would guess it's Instagram at this point. I really would, which I would not have said a few years ago.

• 26:57Speaker 05

  You might be right there. It's definitely got staying power and relevance and it's more, you know, used by, by younger people, obviously. Threads is earlier, but like, it's still riding a lot of Instagram's engagement loops. They really haven't made it a standalone growth entity. And they really haven't figured out like how it relates to X and Blue Sky. I think the next year or so, especially on the political front, will be really interesting for that. But yeah, man, bringing Facebook back, who would have thought, 20 years later?

• 27:30David Pierce?

  It will be, purely from a like, reporting and person on the internet perspective, it's going to be fascinating because that would be- A truly unique moment on the internet to bring something like that all the way back around to the point that it became like a must visit destination for young people, which it was like,

• 27:52Speaker 05

  Yeah.

• 27:53David Pierce?

  Facebook was the most like when I was in college, it was the most important thing on the internet.

• 27:57Speaker 05

  Yeah.

• 27:58David Pierce?

  And, and it is, it is no longer that to I think anybody. Getting that back would be really something.

• 28:03Speaker 05

  It would. And, you know, I've done a lot of actually reporting and analysis of that, like over the last 10 years, Facebook itself has done actually a lot to fragment the internet and fragment the social internet specifically by cramming video in there for ads, by cramming AI into their stuff from people you don't follow. Instead of trying to actually address the core thing that Facebook was, which was a place you could reliably see interesting stuff from the people you actually know. They basically just slowly mutated the product over a decade to be something that is like unrecognizable and not personal at all for people that are under 45. And undoing that seems really tough. I'm sure there's a lot of people who haven't

• 28:48Speaker 05

  deleted their accounts, but like getting them back in. And I think the internet actually could use what Facebook originally was, though. Doesn't it? It feels super fragmented with X and Blue Sky and all and group chats. And a lot of the group chat activity is because Facebook pushed people out of feeds that were strangely starting to feel foreign and bad and like they were killing democracy into group chats. Can you get them back out of group chats into a feed of your friends? That's going to be really interesting to see. I'm, I'm very skeptical of that, but it's something we're going to be paying close attention to.

• 29:19David Pierce?

  Yeah, it is one of the, one of those things that if he's serious about it, there are a few CEOs other than Mark Zuckerberg who could make the hard decisions required to do that.

• 29:27Speaker 05

  Yeah.

• 29:27David Pierce?

  Because it would, it would cost you a lot of money, like just pretty straightforwardly.

• 29:32Speaker 05

  You know, he actually, people didn't catch that. He actually hinted at that in the last earnings call. He said something, I'm paraphrasing, but it was almost throwaway line where he was like, and we're going to do things that like will impact near term results, but it's going to be good for the future. So I think the Facebook app, what you see when you open it is going to change pretty dramatically in the next year.

• 29:52David Pierce?

  Fascinating. Listen, if, if Mark Zuckerberg can get me using Facebook again every day, that will be the tech CEO coup of the century. And I, and there are a lot of those going on right now. Last thing before we go, there's been a lot of fallout internally that you've been tracking and reporting on after Zuckerberg goes on Joe Rogan and talks about masculine energy. They've done some layoffs. Part of what I'm thinking about when I mentioned, like, this feels like a different kind of company, is just like, they've changed the way they talk to staff in these all hands. Like, Mark is yelling about leakers and posting your stories about the leaks about the leakers. Like, what is your read on kind of the vibe inside of Meta as those things shift?

• 30:32Speaker 05

  Well, I mean, it's tough. Meta is a huge company. I think when you talk about the vibe of a 77,000 person company, you have to obviously acknowledge that it's not a monolith, and there are a lot of lifers still. There's people who try to tune out the drama. There is a strong, growing faction of disillusioned, you know, pissed off people at, you know, what has happened in the last couple of months with all the MAGA-fueled content changes, the Joe Rogan stuff, taking tampons out of the men's room, all this culture war, anti-woke stuff, and then how these layoffs have been handled. You know, he basically

• 31:13Speaker 05

  copied Elon with that and said they were going to be targeting low performers, which is rough. It's a rough way to go out to have the CEO saying, you know, this person's a low performer, and have it be SEOed to death for forever. So that's not endeared a lot of goodwill. I think there's going to be a lot more to come on the employee versus management tension there. Kind of reminds me of where Google was, I don't know, six or seven years ago, when they were really going through all that employee upheaval. And Google still has it, but they've largely stamped it out, or at least, like, tamed it to such a degree that it doesn't feel, I don't know, as dramatic as it does at Meta right now. But Meta is very much going through a cultural shift, which is what I've been

• 31:58Speaker 05

  writing about, where it was probably the most open internally big tech company, and they're realizing they can no longer do that with how big it is, and also just how pissed off some people are at how things are going. And so they're clamping down on that stuff. And we saw some of that with the Francis Haugen leaks and how they reacted to that, but this feels like the next turn there. And I do think Meta will look a lot different, not just externally, but internally, in the next year or so. And I think Zuckerberg is determined to come out on top.

• 32:28David Pierce?

  And just keep posting through it as we, as we've seen many times that he's just gonna keep posting. Gotta keep posting. All right, Alex, thank you as always. Thank you. All right, we gotta take a break and then we're gonna talk about Sonos. Be right back.

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• 34:14David Pierce?

  All right, we're back. We've talked a lot about Sonos on this show over the last year. I think more than most companies its size, actually. It is just a weird, interesting, important company in this space. I think if you're a listener to the show, I would say there's a higher than average chance that you own some Sonos stuff. This company has just kind of been around in our lives as things that people who like technology like for a long time. But then Sonos kind of spent last year setting all of that goodwill on fire. And we've talked about a lot of the news moments here. Sonos released an app. Sonos released headphones. The app went terribly. The headphones were fine. Patrick Spence, the CEO, ended up being ousted. We've talked about a lot of that, but I think I want to go back and understand

• 34:59David Pierce?

  the full story and see what happened inside of that company and what we can learn. So again, it helps that I have access to one of the people who knows this story the best, Chris Welch, who has been chronicling this story for us since the beginning and has gotten lots of scoops and has some big scoops on what's to come from Sonos. So let's get Chris and just dive into this. Chris Welch, welcome back to the show.

• 35:21Speaker 07

  Hello, David. It's good to be back. There's been a lot that's happened in the last few months.

• 35:25David Pierce?

  There really is. And for once, I have not brought you here to test terrible microphones. But what I want to do is I want to talk about like the last 12 months of Sonos, which is a thing we've covered a lot on the show, but we've covered it kind of in newsy moments. And I have found myself, the further we get into the Sonos story, I feel like the less I understand what actually happened here and what is going on inside of this company and what is going to happen next for Sonos. And you, you had this big scoop last week about Pinewood, the set top box that Sonos is working on, which I think is going to be another moment in time. But I just want to sort of as best we can tell the story of really 2024 for Sonos and kind of what that means going forward. Does that sound right to you?

• 36:11Speaker 07

  Yeah, absolutely.

• 36:12David Pierce?

  Okay. So I want to start, I think it was in March of last year, when you had a scoop that Sonos was releasing a new app. What, do you remember what you knew about this app at the time that was like what we thought was coming back in March?

• 36:30Speaker 07

  So the word back then is they were working on a new app for their headphones, the ACE. And at the time, we didn't realize it was going to be like the whole new Sonos app. But that's what it came to be, like a whole huge overhaul of the Sonos app, like a whole do-over essentially of like all the core technology in there and stuff like that. And so it was a huge project. And there were good reasons for doing so because like so much of the Sonos like foundation is ancient. It's like the Sonos APIs held together like. Duct tape and bubble gum, like it's been around forever and they've like barely worked on it. And so it's like, kind of amazing that Sonos' whole platform still works as well as it does all these years later. So they had good reasons to redo the app and start from scratch and do a big overhaul. But the way they went about it was just the worst way imaginable.

• 37:15David Pierce?

  Right. And I, in retrospect, we've, we've definitely connected all of this change to Sonos is about to launch a pair of headphones and needed this big sort of infrastructural upgrade like you're talking about. What do we know about what actually needed to happen there? Like, was this a thing Sonos actually had to do together? That it was like, these headphones are coming out, we have to do this new technical upgrade to make this possible? Did they just sort of decide to do it all at once for big, you know, launchy branding energy? Like, what was actually necessary here to get the headphones out the door?

• 37:48Speaker 07

  I think the leadership thought the whole process was going to be a lot easier than it was. Because from the start, the ACE were like, built only to support the new app. They didn't, they never worked with the old one at all. It's like from the jump, they were like designed for the new app. And so they, they had planned all this like coincide at the same time. And so I think they were very, very optimistic. And like, why they like decided to like, put the app out and not do a beta or anything like that is still kind of a mystery. That's something I'm sure that Patrick Spence is very mad about these days.

• 38:20David Pierce?

  Yeah.

• 38:20Speaker 07

  His choices back then. And so, yeah. So the plan was to like do it all at once, put the headphones out, make a big splashy introduction for the ACE. This whole situation has now caused those headphones to fall on their face. And I don't think they're ever going to recover, unfortunately. So it was all for naught, unfortunately.

• 38:38David Pierce?

  Yeah, okay. So I'm getting ahead of myself in this story here, but I, that, you just brought up one of the things I have been thinking about the most with the Sonos story is, obviously by now, everybody knows the Buns. App ships in May, total disaster, kind of ruins Sonos in a very real way. The headphones are very good, right?

• 38:57Speaker 07

  Yeah.

• 38:58David Pierce?

  Do you, is there a parallel universe in which Sonos does like the least with the headphones? Like ships the, the app with like whatever tiny upgrades they needed, but didn't try to sort of reinvent everything about the entire Sonos system to make the Ace work? The Ace ships and it's a huge hit like is that, could that have happened?

• 39:21Speaker 07

  I think it was always going to be a pretty uphill climb for the Ace, just because there's so much competition, like Sonos saw this as a huge market opportunity and it is a huge market. But you've got long time heavyweights like Apple, Beats, Bose, Sony, brands that have been around forever have their reputation. And so they were coming in with these headphones that are very good, like they're super comfortable. They sound great. The TV audio swap feature is very neat. And so, yeah, they had like good aspects, but trying to like top, you know, face off against Apple and, and Bose is just a pretty daunting task.

• 39:54David Pierce?

  Fair. But it does seem like even in that case, I think there's an interesting thing that I think was happening at Sonos and has been happening for a while where like this company is desperate to be a mainstream brand.

• 40:07Speaker 07

  They're desperate for growth.

• 40:08David Pierce?

  Sure.

• 40:09Speaker 07

  One key question about this whole situation is like, should Sonos should ever have gone public in the first place? Because now they're a company that is like after growth above all else, finding new customers, trying to expand their customer base. And it's like, how does an audio speaker company really do that? How much growth is there really? And so that's like, should they have stayed private like Bose and just like done their own thing forever and just like put out nice new products every few years and just made a decent amount of income and revenue and just been happy with that. But they are public now and I think their biggest stock shareholder is BlackRock. And so these like giant corporations that are going to like push them to like grow and grow and grow. And so.

• 40:48David Pierce?

  Right.

• 40:48Speaker 07

  Yeah.

• 40:49David Pierce?

  Yeah, I mean, it is a thing I've always wondered is, is what was it that caused Sonos to stop wanting to be? Kind of a niche, high-end audio company. And there are lots of those out there, right? Like, I think about like Bowers and Wilkins a lot, which is like a company that a lot of people really care about. But if you're not like an audio person, you've probably never heard of it. And one of the things that Sonos did for so long that was so impressive was it had this kind of high-end technology. Its stuff was very good, but it was like known to humans. Like, regular people bought Sonos stuff in a way that most people were not running around buying Bowers and Wilkins stuff, right? And that's no shade to Bowers and Wilkins. It's just like a different kind of brand. But Sonos had found this thing where it was,

• 41:30David Pierce?

  it was like a luxury audio company without being sort of snobby about it in a way that was actually really powerful for Sonos. And it feels like if it had just stayed there, it could have done that thing for a very long time. And instead, it was like, okay, what can we do that will make us, I don't know, relevant to people who don't otherwise care? And what I've always wondered is like, is that Patrick Spence being like, how do I be cooler and fancier and more famous? Or is it investors being like, where is the quarterly growth? And it sounds like maybe it's a little of both, but mostly the second thing.

• 42:06Speaker 07

  Yeah, I think Patrick Spence is a, quite a story. Because I think like, for the most part, he was a pretty good CEO. Like, Sonos had a lot of good products under him. You know, the ARC, the Rome, the Move, you know, quite a few string of hits. They were good products, at least. But like, this whole app debacle was like really his undoing. And like, he should have, you know, played it much safer than he did. And like, part of that shift was like all the marketing. They brought in this guy from Dyson, Jordan Saxmar, who got fired last week, or this week, rather. And his whole thing was like, he wanted to make Sonos more fashionable and like more mainstream. And like, that was his world. He came from Dyson, like high fashion, you know, fancy tech. And so like, and so he didn't hold the Sonos core customer base in high regard.

• 42:48Speaker 07

  Like, he saw them as kind of like niche and wanted to like expand and grow and grow and grow. And the ace was the whole. Big fixture of this whole plan.

• 42:55David Pierce?

  Right.

• 42:56Speaker 07

  Didn't didn't quite pan out. And like the marketing around the ACE was strange. Like they spent a lot of money. Like if it's like last fall, you couldn't miss the Sonos ACE subway campaigns in New York.

• 43:04David Pierce?

  They were everywhere.

• 43:05Speaker 07

  But they didn't really say anything about the headphones. It just like photos, pretty photos and like showed the headphones, but they didn't say like what they did, why they were different from like your standard Bose headphones. And so like they spent a lot of money, but like for what gain? Not much. So like that was his whole idea is just to like make Sonos more fashionable, more beautiful and like bring in like that crowd and not sure it was the play.

• 43:26David Pierce?

  Well, that's, I mean, this is the thing I find so fascinating is like there's a version of that strategy that I think could have worked. Right? Like Sonos, Sonos as a sort of lifestyle brand kind of tracks for me, right? Like, I think in the way that people recognize Bose as more than just a set of headphones, like people, people know Bose for like the science of sound stuff and Beats is a lifestyle brand, but in like a very different direction. I think like I can see why Sonos would make that decision, but then like you have to keep shipping things that are good, which brings us back to the app. And so this, this is kind of the, the moment that you've chronicled a lot at Sonos over the last, whatever 10 months since this happened, but the app ships in May, the response is horrific, like immediately off the jump.

• 44:10David Pierce?

  Everybody hates the app. Uh, it becomes, it, it starts to snowball and become a huge problem. Like what, what is your sense, having reported this out months later of kind of what the summer was like inside of Sonos? As all of this is roiling and going on.

• 44:25Speaker 07

  I think they knew what they were in for, uh, quite honestly, cause like, uh, there were people inside Sonos who knew from the jump that like it was buggy, not where it needed to be to like stay on target for that launch. And they had people like, they had a small group of, uh, beta testers who, who like definitely were complaining, but like felt like they weren't getting any feedback for those complaints. They were just like filing bug reports and getting nothing back. And so, yeah, it was just a slow, slow roll of a very big disaster coming and like they should have seen it coming. They should have, you know? Paused, or at least like delayed the ace until the fall. Like I've always wondered like, why not just, you know, punt the ace to like the holidays and put them out. Then the app would have been in a slightly better state than it was then. And so, but now they just went full

• 45:07Speaker 07

  steam ahead. Uh, yeah, people were like crunched. They were like working overtime, like hours and hours and hours. Uh, their chief software guy, Nick Millington, was sending out video messages to like all the staff saying, you know, please, everybody work a little bit harder, put in a few more hours. And people were just burned out. And yeah, and like, yeah, and people, people at Sonos really care about Sonos. Like that's what I've learned covering them so much. Like they've got a great staff, very passionate about the brand, uh, but they were pushed, uh, to their limits. And like then, you know, so the app happens. And since that they've laid off 300 people and like, they've all lost their jobs because of like bad decisions by Spence and, and his cohorts. So, yeah, it's been tough to see.

• 45:42David Pierce?

  Draw that line for me a little bit, actually, because I think this is, there was an interesting thing that happened where I think the perception of the app debacle became so bad. And I think to some extent, we can talk about this, but like, I actually think we will remember the app as being worse than it actually was. Uh, it, it made a huge mistake of pissing off the people who like Sonos the most, but which is, which is a stupid thing to do. But as a, as a like, it's not like it broke every Sonos speaker in existence, right? And I think the way we remember it is like it completely destroyed everything. And it's like, no, they, they just didn't ship a sleep timer, right? Which is like, there was a bunch of stuff missing and that stuff is real. But I think it was not the like five alarm fire of a disaster that it could have been, but it became that over time.

• 46:28Speaker 07

  For some people it was like, honestly, like I think, and like sometimes it'll work and then it would just stop working like out of nowhere. Like all your speakers will like vanish from the app. And like, if you were having a party or hosting like a big event and like, that's when the app went on the fritz, I could see how that would be infuriating. So like, yeah.

• 46:41David Pierce?

  Especially for a company whose whole thing was that that never ever happened. Like for years, that never ever happened to people.

• 46:47Speaker 07

  Yeah. Yeah. So there are some issues like, uh, just like products, just like vanishing from the app for no reason, uh, and stuff like that. But like on the whole, like for me, it's been fairly solid since May. Like I haven't had that many problems. I've had like the occasional, you know, issue or bug, but on the whole, it's just like, yeah, things are missing. Features were absent for months. That took way too long to bring back. And so like this all just tells you like, there should have been a beta from, from the very beginning. They should have had two apps like out at the same time during this transition. And so, yeah, it's just kind of. I don't know, it just boggles the mind that like no one there like made that decision. So it was too late.

• 47:22David Pierce?

  It reminds me a little of the, the stories we've heard about the, the humane pin from last year, that there were groups of those early testers who were basically screaming as though they were blue in the face about like, this thing doesn't work, you can't ship it. And, and eventually, and I think it's, I'm, I'm actually sort of sympathetic to tech companies in this spot because you hit a point where it's like, okay, we have, we have booked ad campaigns. We have, we have giant inventories sitting in a warehouse that costs us money every day. We don't sell it. This stuff is, it is hard to pull back once you have already committed, right? And so I think what you see over and over, these companies do is just, just keep charging through. And I think it's usually a mistake, but I also completely understand why these companies keep making that mistake.

• 48:04David Pierce?

  It is just a, it's a hard moment, but like when, when the people who make these products are screaming at you about how they don't work, uh, you should probably listen to them. It's just a good rule of thumb, I would say.

• 48:15Speaker 07

  I agree, like they saw the aces like this, like huge moment where they would like have this new revenue driver and a big new product. And so I think their mindset was like, let's just get it out and like, let's see how it goes, we'll fix it afterwards. They didn't realize like how bad the bugs would be for so many people all at once. Uh, and so, yeah.

• 48:34David Pierce?

  So is that, is that the kind of, like I, I mentioned sort of drawing the line from bad app launch to, uh, sort of corporate chaos, lots of people get laid off, huge changes, Patrick Spence is out, uh, sort of walk me through that spiral, I guess. Like, how do we get from that launch to Sonos becoming sort of internally a very different company?

• 48:54Speaker 07

  Yeah, uh, so the app came out, uh, there were months and months of like, just bad vibes on the Sonos subreddit, just complaints everywhere, every day. And so it's been a pretty sad place for a few months.

• 49:04David Pierce?

  Did you have a lot of people constantly telling you to keep yelling about how bad the app is?

• 49:09Speaker 07

  Yeah, yeah, of course.

• 49:11David Pierce?

  Yeah, I remember there were times where you were getting emails like all day, every day from people being like, you're not being mean enough to the app.

• 49:16Speaker 07

  Yeah. And so like Sonos didn't help itself. There was one interview, one statement they sent me where the now ex chief product officer said that it took courage to put out the app, which is never a word you want to use in this industry.

• 49:28David Pierce?

  Yeah. Again, while we're giving free advice to tech founders, don't say that. Just it didn't, it didn't work for Apple when they talked about courage. It didn't work for Sonos. Like, don't talk about your courage in putting out products people don't like.

• 49:38Speaker 07

  Yeah. So that, that didn't help. And it took like just way too long for Patrick to come out and like make an apology. Like it took several weeks. Like he had said, oh, we're working on it. And then finally he was like, we apologize. I think back in November, they put out this like multi-step plan. Like, we're going to be much more careful with our software now. We're going to bring in a quality unbud person was the role I think they had planned. And, and just like have like much more steps to make sure this would never happen again. And more transparency for like people inside the company, like if they're saying, like trying to sound alarm saying like, hey, this thing is a goddamn mess. Like, what are we doing? And so.

• 50:11David Pierce?

  Do you think that was good faith? I mean, there's, there's a certain piece of this, I think, that was like, like we were just talking about. They heard the feedback. People, people knew there were people who were unhappy, people who were making this stuff presumably knew there were bugs. And you eventually sit around a conference table with executives and decide, well, the, the benefits of going ahead outweigh the costs of going ahead. We're just going to keep going. Like, do you think this idea of like, let's hire more people to yell at us about when our products are bad was a real good faith effort?

• 50:42Speaker 07

  I think it was because I saw like how huge this had grown, this controversy. And I think, yeah, I mean, part of that plan was they were going to like, if Sonos didn't meet its targets, the top executives like weren't going to get their bonus, which that provision like just made people like, what? Like, who cares about your bonus? Like, this is the most tone deaf thing I could ever imagine. Uh, and so, yeah, that didn't go over super well. People were like, super skeptical, which made sense after like going through this whole mess. And so a few months later, Patrick was out. Tom Conrad, who's a longtime Sonos board member, Tom is a product guy. So like, if you want someone to like steer the ship back in the right direction, he had his first earnings call last week. He was like, we have a lot more work to do. So he was pretty like mindful of like where they are and where they have to go.

• 51:27David Pierce?

  Where do you think that is at this moment? Like, where would you put Sonos kind of in its, in its own journey at this point? Because I think to me, maybe the most lingering thing from what happened last year is that I think Sonos has burned a lot of the.

• 51:44David Pierce?

  This stuff just works goodwill that it had, right? Like, I suspect you and I have both told many people in our lives over the years to buy Sonos stuff. And so much of the logic is, it sounds great. It's 30% more expensive than everything else it competes with. But it works. And it is, it is, it is worth the price. And I think, to some extent, that's still true for a lot of Sonos products, but I think they have-

• 52:09Speaker 07

  It's still true. Like, no one else does quite what Sonos does when it comes to like, whole home audio and like, playing your TV sound over like, all the speakers in your house. Like, there's WIM, but that's like, more of a niche, even more niche than Sonos. And it takes a lot more setup and, and that kind of thing. And so like, no one else really like, offers that core Sonos value. Um, and so I think that's still there.

• 52:26David Pierce?

  But it seems like Sonos has kind of burned that perception in a, in a real way. Like, deserved or not, it has, it has burned that perception from people. And so, and I guess this brings us a little bit to Pinewood, which is, uh, well, why don't you explain? You've, you've seen that you know what the thing looks like. You've heard a bunch about it. What is Pinewood?

• 52:47Speaker 07

  Uh, so they got back on track late last year with the Artic Ultra. We should mention that, uh, which was great. Fantastic soundbar. And so it proves like, they, they still know how to make a very good speaker, you know? Uh, and so that, that was promising. I think that helps boost morale at the company, uh, back to where it needed to be.

• 53:01David Pierce?

  But even like, I read your review of, of that, of the Ultra, and you're like-

• 53:05Speaker 07

  Don't call it a comeback, yeah.

• 53:06David Pierce?

  That's the thing, even still, it's like, this thing is great. It is, it is proof positive that Sonos can still do the thing that it does very well.

• 53:14Speaker 07

  But the next thing is gonna be like, the key indicator of like, where we're going.

• 53:17David Pierce?

  And there's still some reservation in you that is like, I, I don't know if I can just wholeheartedly tell you this thing is wonderful and you should get it and it will make your life better. Because like, there's just something that Sonos name doesn't quite communicate the safety and excitement that it once did. And I wonder what it'll take to get that back. But you're right, it is also not, it's not how Sonos proves it can do the thing it's been trying to do for a while.

• 53:41Speaker 07

  Yeah. So I think that's gonna come through the app. Uh, we'll see how much better it gets. And then Pinewood, uh, which I think is coming this year, as far as I know. A very expensive streaming box. That can also serve as an HDMI switch. So you can plug in like your gaming consoles and your other devices and it can like see all that stuff and switch between them. And you can make your own custom Sonos surround sound speaker setups. So you don't need a soundbar to have surround anymore, or you won't. That'll be like one of the core selling points of Pinewood, but like this does feel like the same kind of vibes as the ACE is like you're getting into this like super saturated market with like people that sell like $40 streaming boxes like Roku and Amazon.

• 54:19David Pierce?

  Yeah, if anything, it's harder than the high-end headphone market because at least people who are spending what $250 and up on headphones understand the kind of value prop there and like you know what you're getting when you spend more money on headphones. On streaming boxes, all we've seen for a decade now is just an absolute race to the bottom. Like they will literally give you a television now because it's so because there's just no money in selling you the hardware. And so I think it's really interesting to see, especially after coming off of the ACE, which I think was designed to do the same thing, right? Like bring the Sonos brand and ethos into a very sort of adjacent, but very different kind of market.

• 55:00Speaker 07

  Yeah.

• 55:01David Pierce?

  To see them willing to run this back. And, and I feel like even in the story you wrote about Pinewood, there seems to be some consternation inside the company about like, how do we not make the same mistake we made last time? And, and is this the thing that will actually get us there? If the ACE wasn't it?

• 55:17Speaker 07

  Mm hmm. We'll see like what it, the final form of this thing, like what it looks like, what it's priced at. I've heard it's going to be priced between 200 and $400, which if it's on that upper end would be obscene for like what it is compared to like the Apple TV 4K or like the Nvidia Shield, which is nowhere near that expensive. So I think they have to nail the marketing and the messaging, which they put this person Lindsay in charge of marketing. Now she's been at Sonos for 20 years. So if anybody can like speak to like the core value and like what's at Sonos apart should be her. So that's promising. But as far as like what this device will do for the company, like will it make a big difference? Hope it'll bring in some revenue and it'll help grow the business. You know, they keep talking about like new product categories, like even on last week's call, they were talking about like, we're going to be careful about spending every dollar making

• 56:02Speaker 07

  and like helping to grow the company and like grow the Sonos ecosystem. And it's just like, how? Like with what products? Like, you know, like I'm just waiting for like a new Sonos 5. Like that's my favorite all in one speaker. It's been around forever. They haven't, they haven't updated it in forever. It's clearly not a priority for them. That's the product I want to see, or some kind of like era 500, like a higher end speaker. But I think for now it's going to be Pinewood. After that, they're working on like a full on like receiver, like an audio receiver. Not sure how far along that is, but that's in the works. But like most of all is like the app, like most important of all is the app, this core experience is what Tom Conrad called it last week on the call. He was like, we've got to fix our core experience because if we don't, like nothing else matters.

• 56:43Speaker 07

  And so he's cognizant of that, which is promising, but they've got a long road ahead. They've got to build back all that goodwill. They've got to keep their employees happy, which, you know, that's its own set of challenges right now.

• 56:55David Pierce?

  I think I, I am curious how you would rate Sonos' chances at being a great software company? Because I would argue Sonos has been a really great like firmware company. And it is very good at making products that work well and work well together. And that is like sincerely an accomplishment. I don't know that I have ever experienced user facing Sonos software as like really great. And I think Sonos has had some really interesting ideas over the years, right? Like putting all the music stuff into one app, I think was a really interesting idea. They've done a bunch of really interesting work on sort of multiple voice assistant stuff that I think honestly has mostly come to nothing, but is like full of good ideas.

• 57:38David Pierce?

  And, and again, with all of this stuff that we're talking about with Pinewood, the idea of like, we're going to bring all this stuff into a more functional sort of universal search system is the right idea. Like I, I want all of the things that Sonos wants to do. But I feel like the track record of them executing on these good ideas in software is not impressive. But maybe I'm, maybe I'm being too pessimistic because I mostly just use like the Spotify AirPlay thing to my Sonos speaker. So maybe I'm not giving Sonos enough credit, but like, is there a good software company inside of this company?

• 58:09Speaker 07

  Uh, I think there is. I mean, uh, so like last week, Tom said that, uh, the hardware team or the software team is like twice the size of the hardware team. So they've got a lot more people working on, on software than hardware. And so you would hope that there's a good software company inside there. I think there are people who would care, who want to like fix this app and get it to where it needs to be. Like the ideas in the app are good. You know, its design is, is nice. But as far as like, will it ever be like an Apple type UX quality? I don't know. You know, we, and people have been saying forever, like, why won't Apple just buy Sonos? They could probably get a bargain right now if they wanted to.

• 58:40David Pierce?

  Probably true.

• 58:41Speaker 07

  Uh, but as far as like Sonos' core software ability, you know, we'll see. I mean, it's usable. It works. It did work. Uh, and so I think it, yeah, it's fine for the purpose. People don't expect like miracles from this company. Just make the stuff work.

• 58:55David Pierce?

  Right.

• 58:55Speaker 07

  I mean, stuff like volume started to like take a long time, like changing the volume on a speaker. If that has lag, then you've, uh, you've certainly gone astray. Uh, and so things like that are slowly getting fixed finally. Um, but yeah, there's a lot of, a lot of work to do. Lot, a lot of polishing.

• 59:10David Pierce?

  Yeah. Yeah. It's, it's going to be a really interesting year because I think the, the fact that Sonos is working on both a high-end receiver and a set-top box signals to me that maybe this company is not exactly sure what its audience wants from it. For me, it's just like, just keep making roams. Just give me more and more, like go the, the like Logitech Ultimate Ears strategy and just give me roams of every imaginable shape and size and price. And I will almost certainly end up buying them all. Uh, the Rome 2 is great. So that's fine.

• 59:39Speaker 07

  Rome 2 is great. The Move 2 is fantastic. That, like, that's my favorite thing of theirs right now is the Move 2 speaker. It's so good.

• 59:44David Pierce?

  If it wasn't so huge, I would probably have gotten a Move.

• 59:47Speaker 07

  Yeah, yeah. Fair. Uh, but like Pinewood, you know, I think it was so far like towards the release under Patrick that they couldn't just cancel it. Like, you know, they spent all that money on like R and D and like, you know, it's getting out the door. So it's like, close enough. Let's get it out, see how it does. Hopefully, you know, they can like find the right messaging. The right appeal and sell it to their core customer base, which people have been like asking for like custom like surround sound option out of Sonos forever. So yeah, so if it offers that like people will pay for it. Some people will will buy it. And if they can like, you know, like somehow do like unified search with Netflix, which has always been stubborn about like trying to like have their content mixed with other services. Like if they can make that work somehow, and I don't see how Sonos would be that company, but maybe I'll be surprised. Yeah. So we'll see.

• 1:00:27David Pierce?

  Yeah. As ever, Sonos seems to be working on the thing I would want. And we'll just, we'll see how it actually goes. But yeah, what is the state of the Sonos app at this point before we go? I have essentially stopped using it in all of the chaos. It's fine. But like, are people happy again? Is it back?

• 1:00:44Speaker 07

  It's up and down on the Sonos subreddit. That's my main way of like gauging how things are going. I just check in. And some people say it's gotten a lot better this last month, like in particular. So I think, you know, yeah, they're making steady progress. I don't think layoffs helped make an app better, especially when there were quite a few engineers who were let go in this latest round, which seems kind of mystifying. But slowly but surely they're getting back to where it needs to be. And we'll just have to see like, was too much damage done all for a set of headphones that could have been great. But I mean, one of the funniest quotes last week on the call, the CFO was like, the Ace came out at the worst possible time, like in regards to our app. It's like, well, whose fault was that?

• 1:01:23Speaker 07

  Like you, who could have known? Who could have foreseen that the situation that would just ruin your headphones forever? So yeah, they're going to have phones. It is sad. They cost a little bit too much, I think, for what they are. So like a price cut would help, I think, boost those up a little bit. But, you know.

• 1:01:41David Pierce?

  Yeah, I look forward to buying like a refurbished pair of Ace when the Ace 2 inevitably come out. And I'm sure I'll like them very much. All right, Chris, thank you as always.

• 1:01:52Speaker 07

  Thank you, sir. It's been a pleasure.

• 1:01:55David Pierce?

  All right, we got to take one more break, and then we're going to come back and take a question from the Vergecast hotline. See you in a sec.

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• 1:03:35David Pierce?

  All right, we're back. Let's get to the hotline. As always, the number 866-VERGE-11. The email, [email protected]. Send us all of your questions. We try to answer as many of them as we can. We've gotten a few recently that have sent me on like huge, giant reporting journeys that are going to turn into fun stuff on this show. So all of your thoughts, questions, big or small, send them all to us. This week, we have a question about business cards.

• 1:04:00Speaker 08

  Hey guys, my name is Derek. I, in the past, we're talking several years ago now, was able to take a picture of a business card when somebody handed it to me. And my phone, my Android phone, it prompted me to add it to my contacts. It was one click, it was really easy, it generally works pretty well. Sometimes there was a misnumber, but most everything worked well. Now, if I take a photo of a business card, who will prompt me to go buy business cards? Which is not useful at all. I was wondering, is there a current way to do this? Or is this just a lost bit of history to the internet?

• 1:04:39David Pierce?

  Alright, so I have two thoughts on this. One is that I miss when phone cameras did a better job of kind of automatically adapting to what was in them. Right now, you have lots of options in your camera, and they do a pretty good job of like seeing what's in the photo after you take the photo. One of the cool things AI can do is pretty usefully recognize what's inside a photo. But cameras increasingly don't even try to do this in real time. I think they realize that doing something like scanning a business card in your phone camera app is a relatively niche feature, which is true. And so in the name of making these very important camera apps simpler, they just decided to take all that stuff out. Which, fine, I suppose I understand.

• 1:05:24David Pierce?

  But I do miss that. And I think the idea of having a camera that recognizes what you're looking at and adapts itself accordingly is actually about to make a comeback. We're thinking about things like visual intelligence and all of these multimodal AI systems that relies on understanding what's on the other side of your camera. So it's possible that we are going to inadvertently re-solve this business card problem, just not yet. In the meantime, there are basically two places you can go. One is a business card specific app. And there are lots of those out there. There's one called Haystack that's pretty popular. There's one called Hi Hello that's pretty popular. There's BizConnect.

• 1:06:05David Pierce?

  There's one called CamCard, I think, which sounds creepier than it actually is. But anyway, all of these things want to be more than just business card scanning apps. They want to be like contact management and CRM systems. They're designed for people who like get a lot of business cards and have to do a lot of lead generation and following up. They do a pretty good job with business card scanning, but I don't recommend using them. They all want access to your contacts. They all want you to subscribe to stuff. They all want to be a bigger platform than just a place to scan a business card. You can use those apps, but I don't recommend it. What I would do instead is use a more generic document scanning app. And there are a bunch of ways to do this. You can do something like take a picture in Apple Notes and then actually

• 1:06:48David Pierce?

  search for that person's name if you want to just store all your business cards in a note. Google Drive also does this very well. You can just take a picture in the Drive app and it will scan the document and upload it. And then if you search for the name or whatever, it'll actually surface the business card. That's the simple way. The most impressive way, I think, and the thing I would recommend to anyone looking to do this, is just to use the Adobe Scan app. It's free. It again wants to upsell you into the whole Creative Cloud ecosystem and make it all really complicated. But you can just avoid all of that and just take pictures with the Scan app and do everything you want. And the thing that I really like about it is when you open the Scan app, it lets you choose what you're taking a picture of.

• 1:07:30David Pierce?

  You can, you can pick a whiteboard or a book or a document or an ID card or a business card. And that actually, again, adapts the camera to take different kinds of pictures and pull different kinds of information out. On the business card one in particular, when you take a picture, it will actually allow you then to save it directly to your contacts. It will extract the information out and dump it into your contacts and it does that directly on your device in a way that I like very much. The Scan app is not perfect. It seems to really want a business card that is optimized in a very specific way, like big company logo at the top and then below it in like smaller bold letters, person's name.

• 1:08:12David Pierce?

  And then below it, lots of information. If you get one like that, it will almost always get it right. But I'm looking at one right now that has the first and last name in big blue letters. And right below it in smaller letters, the company name. And it thinks of those things in reverse. So it thinks this person whose name is Daniel is the name of the company. And it thinks their company is their first name. So I had to go in and fix that a little bit. But it got their email address right. It got their phone number right. It like pulled all of the relevant data pretty successfully. Certainly easier than manually typing this whole thing into the contacts on my computer. There are, again, lots of apps that will scan information on business cards and like use OCR, optical character recognition, to pull it out so that you can find it later.

• 1:08:57David Pierce?

  But Adobe Scan is just the most straightforward, most simple one that actually will pull out the information and then let you put it where you want it to, which is in your contacts. And it does it with no strings attached, as long as you ignore the occasional upsell to Creative Cloud. And hey, if you already pay for Creative Cloud, terrific, you can also have PDFs of your business cards. So that's what I'd recommend. Put the Scan app on your home screen and you can also use it. It's really handy for doing things like scanning documents and turning them into editable PDFs. It's really great when you want to take a picture of a whiteboard or any kinds of these other things that you want to make not only accessible, but actually extract the information out of and make it useful in some other way. That's like Adobe's whole thing, right? They want you to then

• 1:09:40David Pierce?

  go use Acrobat to mess with the PDF. But the good news is you don't have to. You can just dump all this stuff where you need it to be and move on with your day. So that's my recommendation. Use Adobe Scan. But also, I am curious if A, you found a way in the default camera app on your phone to do something cool and interesting with this, or B, if there's another app for scanning business cards in particular, but really documents of all kind, that you like better than Adobe Scan. I want to hear about that, too. This is a thing I encounter more than I've realized in the past, not even just with business cards, but like in an effort to go fully paperless and just dump all of the paper bills and like I got a speeding ticket the other day because Washington DC has the speeding cameras

• 1:10:22David Pierce?

  and they are ruthless. And it would be nice to just be able to like take a picture of that, pull out the information and upload it. And you can kind of sort of do that in lots of ways and they kind of sort of work, but it does feel like this could all be better. And Adobe Scan is the best I've found, but if you have a better idea, especially if it is wonky and complicated and involves a lot of weird AI stuff, I want to hear all about it. For now, that is it for our show. Thank you to everybody who was on the show. Thank you to everybody who called the hotline and thank you, as always, for listening. There's lots more on everything we talked about. All of Alex Heath's coverage of Meta in his command line newsletter and elsewhere. All of Chris Welch's Sonos coverage. Lots of stuff. He convinced me to buy a pair of the new PowerBeats Pro headphones.

• 1:11:06David Pierce?

  You can read V Song's review all on the website. I'll put some stuff in the show notes, but as always, read the website. It's a good website. If you have thoughts, questions, feelings, or again, scanning apps you think I should use, you can always email us at [email protected] or call the hotline 866-VERGE11. We genuinely love hearing from you. This show is produced by Will Poor, Eric Gomez, and Brandon Kiefer. The Vergecast is a Verge production and part of the Vox Media Podcast Network. Neelai and I will be back on Friday to talk about, God help us all, politics, AI gadgets, big phones, small phones, foldable phones, and everything else. We'll see you then. Rock and roll.

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