How Apple lost control of the App Store

Everywhere you look, antitrust fights have the potential to reshape the tech industry. Nilay, David, and The Verge's Jake Kastrenakes start by digging into the latest ruling in the Apple / Epic trial, in which a furious judge rips open the App Store in a way Apple likely never saw coming. The way we pay for apps is about to change, and fast. After that, it's time for an update on the Google and Meta trials, as Google tries to preserve its search empire and Meta tries to make the case that basically every company on the web is its vicious competitor. Finally, in the lightning round, it's time for another installment of Brendan Carr is a Dummy, plus some notes on this week's Worldcoin launch and the strange new Meta AI app. Also: party speakers. Always party speakers. Further reading: A judge just blew up Apple’s control of the App Store ‘Cook chose poorly’: how Apple blew up its control over the App Store The future of the App Store depends on the difference between a ‘button’ and an ‘external link’ Apple must allow other forms of in-app purchase, rules judge in Epic v. Apple Apple exec ‘outright lied’ during Epic trial Apple confirms it will appeal the App Store order. Epic says Fortnite is coming back to iOS in the US Sundar Pichai says the DOJ’s antitrust plan could kill Google Search Google confirms it’s close to getting Gemini support on iPhones The TikTok ban is back in court — in Meta’s antitrust trial TikTok’s head of operations takes the stand. Reels isn’t Instagram’s ‘core’ experience. TikTok doesn’t compete with Meta for ‘personal social networking.’ TikTok’s legal entanglements collide. The TikTok ban makes another cameo. TikTok’s friends tab is not exactly a hit. TikTok and Reels are ‘indistinguishable.’ Are YouTube and Instagram the top competitors for TikTok? TikTok predicted Instagram would redesign its app to focus on Reels. Meta prepared for a ‘flood in traffic’ ahead of the TikTok ban. Facebook execs worried Google would buy WhatsApp and make it ‘a cross-platform iMessage.’ Facebook worried most about Google or Apple buying WhatsApp. Google had a ‘long shot’ chance of becoming competitive in social with WhatsApp. Facebook exec worried about losing the business to mobile messaging apps. ‘I was really worried that this could become the end.’ ‘This shit is getting scary.’ WhatsApp showed ‘absolutely no signs of morphing’ into a social app. Facebook floated starting from scratch on messaging. Facebook didn’t know how it would make money from WhatsApp. Facebook didn’t fear WhatsApp becoming a social competitor. Meta releases AI app to compete with ChatGPT Brendan Carr congratulates himself Brendan Carr’s FCC is an anti-consumer, rights-trampling harassment machine Brendan Carr’s Bizarro World FCC Sam Altman-backed Worldcoin cryptocurrency launches in the US 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.

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• 1:32Nilay Patel?

  Hello and welcome to Verchast, the flagship podcast about being right, about esoteric legal opinions, four and a half years later after you wrote that blog post.

• 1:42Speaker 05

  So it's a niche, but it's ours.

• 1:43Nilay Patel?

  I mean, honestly, what else is it?

• 1:46Speaker 05

  You bid your time, and finally, finally.

• 1:50Nilay Patel?

  It took a long time, but I can say, we can all say, it's a flagship podcast of people who can say, "I wrote this blog post four years ago and I was right."

• 2:00David Pierce?

  That's true.

• 2:01Nilay Patel?

  That's where you want to be in life, and I welcome our tiny but dedicated community. Our competitor podcasts in this field, as you know, are weak.

• 2:09David Pierce?

  Yeah, we're going to win this Webby next year for sure.

• 2:12Nilay Patel?

  I'm your friend Nilay, that's David Pierce.

• 2:13David Pierce?

  Hello.

• 2:14Nilay Patel?

  Jake Kastrenakes is here.

• 2:15David Pierce?

  Hey, good to be here.

• 2:16Nilay Patel?

  Obviously, what we're talking about is the big Apple ruling that came down this week. Apple was found in contempt of court, referred for criminal proceedings because an Apple executive lied in court under oath. I was joking with a big tech executive today that sometimes I think we founded The Verge 13 and a half years ago to cover this story.

• 2:38Nilay Patel?

  Like, we just needed to be here because Apple got in trouble for lying about the difference between a button and a link and how much those should cost. And The Verge was just lying in wait to be like, yep, buttons and links, that's what we do here.

• 2:52David Pierce?

  I had the exact same experience reading the ruling. We're going to talk a lot about this, but I had this distinct moment of being like, oh, where do the buttons go is The Verge? That's the whole, the whole question we are here to answer.

• 3:05Nilay Patel?

  Yep.

• 3:05David Pierce?

  Is where do the buttons go?

• 3:07Nilay Patel?

  Yeah, there's a line in there that says a better designed button would make the market more competitive. And I was like, well.

• 3:12David Pierce?

  We did.

• 3:13Nilay Patel?

  That's The Vergecast. Like, I don't want to tell you. That's our whole show. That's all we ever talk about. So we're going to talk about that at length. All of us have been covering that story, every inch of that story for a long time. So we're going to talk about that. Meta is still in trial. It's antitrust trials ongoing. David was at the Google trial, or Sundar Pichai was on the stand this week. We, we'll talk about Brendan. We always talk about Brendan. He lurks, he looms over the ecosystem. But first, I want to start with a party speaker update.

• 3:44David Pierce?

  A party speaker update?

• 3:46Nilay Patel?

  Very important party speaker.

• 3:47David Pierce?

  Party speaker capitalism is in the running to become the newest podcast within a podcast at The Vergecast.

• 3:54Nilay Patel?

  So as you all know, it is our belief that the market for gigantic Bluetooth party speakers with LED lights in the drivers is bigger than anyone can comprehend. It's right in front of you, but it's so big you can't see it.

• 4:07David Pierce?

  Just like the party speaker.

• 4:08Nilay Patel?

  It's a worldwide phenomenon. It is driving the whole tech industry, and no one wants to talk about it. Shoved under the rug. And we talk about it here on The Vergecast. We're five generations into these things. The market is demanding them, people are providing them. Over and over again, they're getting bigger, they're getting bolder. So we've asked people to send us these party speakers in the wild. It's like cryptids. Have you seen Bigfoot? I will say a lot of people send us photos of the speakers in the box in the store. I appreciate you. I love that you see a speaker and you think of us. It makes me happy. That's not what we want. That's not in the wild. You know what I mean? It's, that's in captivity. It's restrained.

• 4:49David Pierce?

  The speaker zoo, as we call Best Buy.

• 4:52Nilay Patel?

  I want to see what's really happening. I want to see what this market really looks like. So we've gotten a million pictures of speakers in stores, but that's not quite it. I appreciate you, but that's not it. We've gotten a second million set of photos of speakers at kids' baseball and softball games.

• 5:08David Pierce?

  Yes, those are, those are very good. Those qualify.

• 5:10Nilay Patel?

  These are the primary market, from what I can tell. Walk-on music for 12-year-olds who are about to just hit a dinger. That's what party speakers are for. Everyone's very happy about this. Great. I would like to understand what is going on in Europe based on the imagery we have received from our listeners in Europe. So Daniel sent in a picture of two people riding a scooter, like one of those bird scooters. The person in front is sitting on what appears to be a three-foot party speaker with his hands on the handlebars. And then there's a person standing on the back on the brake and they're just cruising.

• 5:49David Pierce?

  This might be the coolest picture I've ever seen in my life.

• 5:51Nilay Patel?

  It is one of the most European pictures I've ever seen in my entire life. We'll run it. We'll put smile faces over the faces, the whole thing. Watch it on YouTube, you can see the photo. We'll, we'll put it in the container post on the website as well.

• 6:01David Pierce?

  Everybody looks really cool.

• 6:03Nilay Patel?

  Daniel says he thinks that the speaker is on, the lights are on. He took the photo from his car. I appreciate you having the wherewithal to be in your car, see this, pull out your phone, snap a photo, think of us and send us the photo.

• 6:15David Pierce?

  Yeah, there's a little motion blur in here. Like something's happening.

• 6:17Nilay Patel?

  That's what you want. Like if you run a tech podcast, you want people to see this and be like, I need, I need to send this in. That's the kind of citizen journalism we're looking for. Daniel says he thinks it was on because the lights were on, but he was in a car so you can hear it. And then he said, and then he says, somehow it's not the first speaker on scooter I've seen in Oslo either.

• 6:41Nilay Patel?

  So there's a hot new trend in Norway where people are putting speakers on the scooters and cruising around with the speaker as a chair. I love it. I love it. Send us more photos of that.

• 6:54David Pierce?

  Is it possible that portable stool that plays music is an underrated feature of the party speaker?

• 7:03Nilay Patel?

  I'll just say this, it's a cryptid, right? It's everywhere. It's nowhere. No one can see it. There's no research. The great analysts of our time are not writing party speaker notes to CNBC. You know, like, we have to do this together ourselves. Otherwise, no one will understand it. Okay, so that's one. Again, I don't know what's going on in Europe. And then there's even more European speaker activity. Fabio writes us. Fabio sent us a video. He says, I'm writing you from Milan, Italy, where I realized I have witnessed the largest concentration of party speakers outside a US Navy ship for weeks without realizing it. Yesterday, as I was walking through the Portaventia subway station, I think is how I pronounce it, I saw LEDs lighting up a kid-sized party speaker and realized

• 7:47Nilay Patel?

  I was the right person in the right situation to send you an email that would fill your heart with joy. I love you, Fabio.

• 7:53David Pierce?

  You were right, Fabio. It did.

• 7:55Nilay Patel?

  The subway station there in Portaventia is the ideal place for people of all ages, genders, nationalities, and passive lives to gather and train their dance moves. What each of these groups had in common was party speakers blasting music in the echoing hall, all different songs, different genres of music. I'm saying there were four-plus speakers, but only because I managed to film four speakers. But believe me, there were more. And then he sent us a video of competing groups of European teenagers, like, practicing dances in the subway station with different speakers. And they're all, like, kind of next to each other.

• 8:29David Pierce?

  This suggests a possibility that I had not even considered until just now, which is a party speaker arms race.

• 8:36Nilay Patel?

  Oh, yeah.

• 8:37David Pierce?

  That is, the party speakers, the only way to outdo someone else's extremely portable party speaker is with a larger, extremely portable power speaker with more bass and more lights.

• 8:49Nilay Patel?

  More lights.

• 8:49David Pierce?

  And this is, this is, this is how, like, the way Apple gets you from a MacBook Air to a fully kitted-out MacBook Pro, you just, you gotta go up the line, or you're gonna get bested on a party speaker.

• 9:00Nilay Patel?

  So wait until you're the next one.

• 9:03Nilay Patel?

  So I said last week, my dream, because we had heard that the US military has a lot of party speakers in it. And I said, can someone please send me a picture of a party speaker next to a fighter jet, preferably taking off. I will say I requested taking off at dusk. But we got the next best thing. Jason, who is a literal fighter pilot who listens to the show, thank you very much, Jason, says, I can confirm that the US Navy is a target population for the party speaker market. I am a pilot in a US Navy F-18 squadron, and our sailors love the big party speakers for providing something to listen to while working in the hangar while shoreside or in the hangar bay of an aircraft carrier when deployed. They can't wear AirPods while working. They need to maintain clear ears, and the work environment can be loud. So you need speakers to pump out a good amount

• 9:48Nilay Patel?

  of volume. Anything that has lights added cool factor. The Navy units don't own purchase them. Our sailors do it on their own dime to make work a bit more pleasant. It is not uncommon to have dueling party speakers playing very different music separated by 100 feet. It is chaos for the ears, but it helps with morale. And he sent us a photo of a party speaker next to an F-18, which rules. And he actually gave us the model number of the speaker. It is an Edison PSL 800. I love it. This is like maybe the best photo we've ever gotten at the birth.

• 10:19David Pierce?

  It really is. It's very good. And I also, I like this because you can sort of imagine the meeting at Sony and all these other companies where they were like, should we, should we make it so that you can like, use a bunch of them sort of together? Like you can, you can chain them together via Bluetooth or whatever. And somebody's like, who in the hell is going to put more than one of these in a room? Look at the size of this thing. Why would you need more than one? And the Navy's like, listen, guys, I need six of these all at once together.

• 10:45Nilay Patel?

  So a lot of them can do like Aura Cast and actually be chained together. Like this is a part of like a mesh audio standard that exists. Everyone's very, they've all done the, the bad thing, which is they took the standard and they named it their own thing. So you don't know, but it's actually this thing called Aura Cast. And so you can chain like 100 speakers together with just a standard that exists that all the companies support.

• 11:06David Pierce?

  That's good.

• 11:06Nilay Patel?

  But that's not what we're seeing. We're seeing groups of competing teens playing different music on different speakers right next to each other. Groups of sailors doing fighter jet maintenance, playing different songs and different speakers right next to each other. This is like the, the end result of I'm listening to my own TikTok on the subway. But now with like, this is your arms race.

• 11:30David Pierce?

  We're all listening to everyone's TikTok on this.

• 11:34Nilay Patel?

  I love it. I love it. All of you, thank you for emailing us, even the people who send us pictures of the speakers in Walmart. This is an escalation. You got to send us even better pictures and videos of party speakers in the wild. We have to figure this out as a community. There's, there's no market intelligence on party speakers. If there is, it's like locked away in the Sony vaults.

• 12:00Nilay Patel?

  We're going to bring it out. We're going to bring this to light. The media is not talking about this.

• 12:06David Pierce?

  The mainstream media could never.

• 12:08Nilay Patel?

  Say, do you see this in the New York Times? Right? You turn on CNN at night. Are they showing you pictures of fighter jets with party speakers? Edison PSL 80s? 800s? That's what I'm not into. Whatever. They're not talking about this.

• 12:23Nilay Patel?

  I love it. Thank you all so much for sending this stuff. We want to see more of it. It is, it is very funny to me. And I love that we're doing this little project together. All right. We should talk about Apple. It's a big one. Middle of the night filing from Ivan Gonzalez Rogers, the judge in the case Epic versus Apple, that case filed in 2020. Big trial, right? Epic said Apple had a monopoly over its own devices, which is very.

• 12:51Nilay Patel?

  Yeah, it's a very big argument to make in 2020 that, like, you have to rewind your brain. This is the beginning of the modern tech antitrust era. Right? All this stuff hadn't happened. The idea that Meta and Google and Apple would all be facing federal lawsuits about having monopolies was not on the table in 2020 when Epic filed this case.

• 13:10David Pierce?

  Epic also picked this fight very specifically and very aggressively. Like it, it, it dropped the 1984 commercial. It dropped, it did a thing with payments inside of Fortnite designed to get kicked out of this, like. Antitrust moves slowly and this case has taken five years. But Epic has pushed harder and more aggressively and more like with more spectacle than anybody else in this entire whole realm of antitrust fights.

• 13:42Nilay Patel?

  Yeah. And it, it, against Google, it has won in like substantial ways. Against Apple, you know, it's really interesting is, again, it was, it was so early that I think the judge in that case. Looked at that Pixar arguments. It looked at the standards, the sort of like 1980s antitrust standards that we had. Again, 2020, pre-Lina Khan at the FTC, right? This is the Trump administration, this case was filed under. So we hadn't had this big conversation about changing antitrust standards and whether Ronald Reagan was bad. All this stuff that created the conditions that we're in now. This is before all that. So I think the judge looked at all of that and said, well, I'm not going to be the first judge in this case

• 14:22Nilay Patel?

  to accept this pretty big idea that Apple has a monopoly over its own devices in this specific way. Like, no, I'm not, it's just like, not gonna happen. But I have all this evidence that the App Store is bad and that Apple restricts competition on the App Store. And I'm sitting in California and there's a California unfair competition law. And I'm going to say, under this California unfair competition law, which is very broadly construed, Apple has to stop prohibiting developers from even saying, "You can buy digital services and digital products elsewhere for a cheaper price." Because at the time, Apple prohibited Netflix and Spotify and Epic and anyone else

• 15:05Nilay Patel?

  from even saying, "This subscription is $3 cheaper if you do it on our website."

• 15:10David Pierce?

  You couldn't even say, "You can also subscribe on our website." You couldn't even have a link to your website. It was like, in the Apple ecosystem, the broader internet did not exist and was not allowed to exist. And that was, that was the, that was the thing Epic won on, right? Like, it lost on some of its bigger swings, but like, we all spent a lot of time in those years talking about the phrase "anti-steering provisions." And it's like, and that, that became the thing here.

• 15:36Nilay Patel?

  Well, so, you know, there's this narrative, I could argue this either way, but there's this narrative that Apple won most of the case and Epic only won the small thing. And anti-steering was the whole thing. It was the whole thing. What Epic really wanted was to put the Epic Game Store on iOS and control its own store. But you only want to do that if what you're mad about are Apple's rules for its store.

• 15:59David Pierce?

  Sure.

• 15:59Nilay Patel?

  And what is the biggest rule? The biggest rule is the Apple tax. Like, far and away, the biggest rule is that to put a button to buy anything in your app, you have to pay Apple 30 or 15 or whatever percentage structure it worked out to by now. And if you get rid of that rule, the incentives for wanting your own store kind of fall. Right? You've solved the problem. The only reason you want another store is to have lower rates. Or in the case of the alternative stores we're seeing in Europe, to do apps that Apple otherwise wouldn't let you do. Emulators and porn apps and stuff like that. But for the vast majority of developers, all they really cared about was I can't do purchases in this app without paying Apple a fee. Like Netflix doesn't care.

• 16:44Speaker 05

  You can look to Europe, like we haven't seen that much change. We have, which might be because Apple's rules are so strict over there still. But how many, you know, brand new ideas for apps or models for apps are we seeing over there that couldn't exist in the App Store? Right? Apple was just like, here's emulators.

• 17:02Nilay Patel?

  Well, so the number one model was emulators. And the instant that happened, Apple changed its rules to put emulators in the store. And so you see like competition leads to results. But my point is, the whole game here was always anti-styric. It was always letting developers say you can transact for cheaper somewhere else. And Apple lost, it just lost. And so in the realist way, the biggest part of the problem was being dealt with by the court. And I think this judge, and then rewind your brain to that period in time, was looking at the landscape of antitrust policy and antitrust law and saying, yeah, I can't just like change the law before it's time.

• 17:45Nilay Patel?

  But she just wasn't going to do it. That's not, it's not how district courts work. Maybe courts of appeals do that. Maybe Supreme Court does that. They love doing that. But the sort of district court judge in Apple versus Epic wasn't going to say, you know what? This Lena Kahn's a real firecracker. Like, it just like wasn't going to happen. So the Apple lost in this state court.

• 18:03Nilay Patel?

  Claim, they litigated it, Ninth Circuit, they lost, they asked the Supreme Court, Supreme Court said, no dice, this is done. And then I think Apple didn't take it seriously. And they, Jake wrote the entire narrative, which we should talk about. They did, played all these games to fake compliance with this ruling because they weren't taking it seriously.

• 18:23Nilay Patel?

  And I got caught, like caught in the worst way. And now the judge is like, actually, we're not just doing my small anti-steering rule. We're doing the big one. Like, you're not allowed to do anything because you've delayed for so long, you've made the harm worse. So now it's a free for all. App developers can do anything they want effective immediately to do transactions in their apps. No more fees and you have no choice. And she says, it's worth reading this entire opinion full because it is full of bombs. She's at the end, she says, this is an injunction, not a negotiation. So it's like, this is over.

• 18:58David Pierce?

  I do think, I think the narrative here is important. Uh, and Jake, I know you wrote this through and you should kind of give us the timeline because I think, I think saying Apple didn't take it seriously actually lets Apple off the hook a little bit. I think Apple basically got this ruling and had two years worth of meetings about how to give two middle fingers to this ruling. And to continue to get what it wants and to essentially like, we talked about it on the show as malicious compliance. Like this was the most malicious possible version of compliance. To the point where Judge Gonzalez Rogers decided, actually, this isn't compliance at all. You, you have gone out of your way to not comply with this order while looking like you're complying with this order. And in fact, lying to the court about how you're not complying with this order.

• 19:42David Pierce?

  But Jake, you, you ran down the timeline here. Can you just give us like the short version of it?

• 19:46Speaker 05

  Yeah. And the judge is pissed. Like she, she sees through all of it and is furious about how it went down. Yeah, I think Apple has for a really long time operated in this environment where it can kind of just, you know, control whatever it wants and do things how it wants to. Nobody's really on them.

• 20:04Speaker 05

  They, they make some tweaks around the edges and say, sorry, see you later. And they got this ruling and, you know, back in, in 2021.

• 20:14Speaker 05

  And it was, it was, it felt pretty narrow and it was kind of open-ended. It was just, right, you have to allow links and buttons. You have to allow them to go to the web. You can still charge if you want to. You just have to do it in a reasonable way. And so, Apple sat down and they went, okay, how are we going to comply with this? And they kept looking at options. And basically, each time they would look at something, as the judge kind of paints the picture, they often had this sort of like Goldilocks array, right? There was the, hey, let's do the great version of this where developers love it and, you know, it really hurts us. Let's do the middle option where we do a little bit of restriction. Or let's just go all out and make sure that devs don't get too much here and we protect our profit.

• 20:59Speaker 05

  And so, you know, first, they go, okay, what percentage cut do we want to take on the web? Should we do no cut? Should we do a little something? Should we do something else? And they're like, no, no, no, we should do, we should do it, we should take a cut. What cut should it be? You know, Phil Schiller's like, I don't think we should do a cut at all. Tim Cook goes, eh, 27%. Let's do 27%. How do they get to 27%? Eh, they just invent it. You know, how should these links and buttons look? Should they be rich buttons that are clearly buttons? No, they should be text links because we don't, we want them to look ugly. Should there be a screen to notify you that you're going out to the web? Oh, we should make sure it's a big giant pop-up that takes over the whole screen.

• 21:42Speaker 05

  And so, every single time the judge looks at this and goes, they internally discussed options that were not so bad. And then they chose the worst option. And I think there's this thing that happened where they had some leeway. They could have put some restrictions in place. They could have done a fee. They could have done a big pop-up. But I think when they chose the worst option every time, the judge just goes, sorry, all you've done is maintain the status quo. I said that this is anti-competitive. You can't just continue to be anti-competitive. That's exactly what the injunction says to do. And when she gets to the end of this, she's just like utterly put out and just saying,

• 22:25Speaker 05

  I don't think there's any reasonable world in which Apple believed it was actually complying with the injunction I put down.

• 22:33Nilay Patel?

  So, there's another turn to this. The anger is doubled, tripled, quadrupled.

• 22:40Nilay Patel?

  Because there was a first hearing about compliance and Apple showed up and lied to the judge and said, we commissioned this report that says, here's how much value we provide, and this is why it's these rates. And they had an executive, a VP of Finance, come on in and say all these words about when the decisions were made. And the judge didn't buy it in the room at that time. And she sent them away and she ordered document production. She got all their emails and all their slacks, all their meeting notes, and said, we're going to have another hearing to find out what you were doing in real time to see if what you are saying to me is true. And so all of the stuff that we have, Jake wrote it through, it is just a story. The judge wrote a story, in her opinion, and

• 23:21Nilay Patel?

  we just, Jake just translated it from legalese to like, human. It's just a story about Apple having these meetings backed up by notes. At moments, Apple engineers and PMs and designers are literally discussing how to make the language scarier because the execs will like it better. Like, that is a literal phrase that we have from their slacks.

• 23:43David Pierce?

  And then an Apple executive showed up in court and tried to argue that, yeah, in design terms, scary doesn't mean what you think it does.

• 23:50Nilay Patel?

  Yeah, it's a term of art.

• 23:51David Pierce?

  Jeff Rogers is just like, no, it's not.

• 23:53Nilay Patel?

  This is, all designers are like, scary it up a little bit.

• 23:56David Pierce?

  Yeah. People say that all the time.

• 23:58Nilay Patel?

  Uh, Jake, what did the judge say? It strains incredulity or something?

• 24:01Speaker 05

  Oh, she, she, she just said, it, it strains common sense. She was just like, like, absolutely, like, come on, I cannot believe you are lying about scary having a specialized meaning. Like, you, you wanted to be a scary message. They kept adding scarier language. So, at the end of it, Tim Cook looked at it and was like, we need to add some more. Like, they all just wanted that this is, we're talking about the full screen pop-up that appears when you click a web link, that, that is this big warning that you're leaving that, leaving the app. It's like, they, they had an option that was just a little pop-up that said, hey, you're opening Safari. And they're like, no. Like, giant paragraph of text.

• 24:41David Pierce?

  Yeah. And, and just, Neel, I to finish what you, you were just saying, the, the thing that they discovered after getting all of this documentation was that this study that Apple had commissioned, basically saying, here's why we're worth 30%, that they said they then made all of their decisions about, actually came at the end of all of this process.

• 24:57Nilay Patel?

  Yeah.

• 24:58David Pierce?

  Where Apple had spent months and years debating what to do here and then gave themselves data at the end to justify all the decisions they had already made.

• 25:06Nilay Patel?

  And then showed up in court and lied about it.

• 25:07Speaker 05

  Well, and this was a particularly big deal because the last time around, the judge had said, hey, okay, you can charge a commission for stuff outside the App Store. It just has to be based on something. And so in this ruling, she's going, what is this based on? You had the opportunity to value your technology, to figure out what it was worth. And you just didn't do any of that. You decided on a number and then worked back to, to get up to that number.

• 25:34Nilay Patel?

  And that was a big, I think she even calls it an out in the ruling. This is a big out for Apple, right? It's not, everyone gets to put their buttons in and not pay you any money. It's, we understand, the court understands that you spend a lot of money developing iOS and the iPhone. App developers, you, it's fair to expect them to pay you for that work in some way. Figure it out. Figure out the formula that's fair so that developers can make good decisions. And there, it feels like they're participating in the market. And Apple picked a bunch of numbers that basically made it impossible for developers to leave in app purchasing. Right? Instead of 30, they picked 27%. And every developer in this record as well says, well, Stripe is going to cost us more than 3%.

• 26:15Speaker 05

  Yep.

• 26:15Nilay Patel?

  So this is just not worth it to us. And judge says, well, that's just not right. Like, you just picked a number because it sounded good. And you know that developers aren't going to leave. Like, here's all this evidence of these executives talking about how developers won't leave. The only person, by the way, who comes off looking good in this entire sequence of events, Phil Schiller.

• 26:32David Pierce?

  Phil Schiller, yeah. Kudos to Phil, who was, who was the one saying, we should not take commissions and fees.

• 26:37Nilay Patel?

  You know, Phil ran the App Store for years. I think he's still, you know, he has like some emeritus role at Apple now. I think he still plays a very active role in the App Store. He's the one who talks to developers. Like, he is the face of that organization to developers.

• 26:54Nilay Patel?

  He, I, you know, he used to work with Steve Jobs very closely. I think he was there in like the Power Book years when Apple was not a behemoth. I think he knows what it's like to be the underdog and need those developers to do what you want them to do instead of punishing them to do what you want them to do, which is what you can do when you're very powerful. And at every turn, he's like, well, what if we do the right thing? And Luca Maestri, Apple CFO is like, what if we just charge them all the money we can? And Tim Cook is picking the finance team. Literally, the words Cook chose poorly are in this decision. And I, look, we have a lot of people listening to us. This isn't, we're not interpreting the decision. This is the judge saying it as clearly

• 27:36Nilay Patel?

  as she can. This is over. I have made these findings a fact. This is what happened. And this is what Apple has to do now. No more ceases. Actually, at the very end, I think the last line of the ruling is there will not be another bite at the apple, which you can just see her just hit and return at the end of that one. Bang!

• 27:57David Pierce?

  Take it out of the typewriter, done and done.

• 28:01Nilay Patel?

  But yeah, there's something there where, look, you know, these are big businesses. They have to print a bunch of money. Apple's stock price affects things like firefighter pensions in this country. Like, these are massive load-bearing pillars of the American economy. They have a lot of people that they are beholden to. But you can just see that they picked the finances over the product over and over again. And if they had just figured out a way to make in-app purchases worth more to developers than leaving the ecosystem, the developers, I think, would have picked in-app purchases every single time. It's just easier. And they didn't. They instead, they punished the ability to compete.

• 28:44David Pierce?

  Right. I mean, that's what you've been hearing from developers for years, right? And that's, that's what Apple knew when it went from 30 to 27%, right? Is even if, even if it was a reasonable financial gain for those developers, which it wasn't because of like payment processing fees, the convenience kills it, right? Like, the, most people I have talked to over the years have always said, I'm happy to play by the platform rules as a tiebreaker just because it's simpler. It makes building my app simpler. It's easier for users who have to click fewer buttons to subscribe. Like, it, when it works financially, it is the better option. And so if Apple had just found a way to make itself a tiebreaker, It would have won and instead it way overshot. And so Judge Gonzalez Rogers just basically blew the whole thing up.

• 29:27Nilay Patel?

  Yeah. So just to sum up her ruling, and it's just literally, she says, to summarize, the court found that Apple's 30% commission allowed it to reap super competitive operating margins was not tied to the value of its intellectual property and was thus anti-competitive. Apple's response was to charge a 27% commission, again tied to nothing, on off-app purchases where it had previously charged nothing and extend the commission for a period of seven days after the consumer had left the app. So if you left the app in a link and then bought something on that website seven days later, you still owed Apple money, which is nuts. Apple's goal was to maintain its anti-competitive revenue stream. The court prohibited Apple from denying developers the ability to communicate with and direct consumers to other purchasing mechanisms. Apple's response was to impose new barriers and new requirements to increase friction

• 30:12Nilay Patel?

  and increase breakage rates with full-page scare screens, static URLs and generic statements. The goal was to dissuade customer usage of alternative purchasing opportunities and maintain its anti-competitive revenue stream. In the end, Apple sought to maintain a revenue stream worth billions in direct defiance of the court's injunction. This is bad. That's just bad.

• 30:31David Pierce?

  Brutal.

• 30:31Nilay Patel?

  And again, this is not, Apple says it will appeal, but this is not gonna be the same kind of appeal, like.

• 30:40David Pierce?

  But in the meantime, also, the other thing is, and this is the flip side of what happened before, is Apple did nothing for a long time because they didn't have to. Now it has to do something. Like, the thing that is going to change quickly is that developers are going to start updating their apps with loud, aggressive ways for you to pay for the app outside of the App Store, because they can now. Like, even, even under the provisions before, there were all kinds of wacky things, right? You could, you could have one link, it wasn't allowed to be in the normal in-app purchase flow, it had to be somewhere else in the app, which was, like, it was all design, it was just shenanigans all the way down. And now, by the rules of this ruling, I can open up my app and the very first thing it shows me is a link to go subscribe somewhere on the web.

• 31:24David Pierce?

  It can't, I can't pay in a button in the app, is the one difference, right? Like, it's still, it can send me to a website that takes Apple Pay, but it can't take Apple Pay right there.

• 31:37Nilay Patel?

  We're gonna find out, because

• 31:39David Pierce?

  We are gonna find out.

• 31:39Nilay Patel?

  This is what I was saying about being right four years ago. Four years ago, the injunction was, Apple can't prohibit developers from using buttons and external links. The difference between a button and an external link exists only in our shared metaphysical reality. Right? We all just decide that as a, as a family, what the difference between those two things are. And like in this ruling, there are literal pictures of buttons and links that the court thinks are competitive and aren't competitive. And Apple every time chooses the least competitive one. It defines button all the way down to a piece of plain text with a little, you know, that little box with the arrow.

• 32:22David Pierce?

  That's a button?

• 32:23Nilay Patel?

  Indicates you're about to go. They're like, that's the, that's a button. You can have that button. And the court's like, that's not a button. And Apple's like, isn't it though? And that's where we're at.

• 32:32David Pierce?

  Right.

• 32:33Nilay Patel?

  And so my headline four years ago is the future of the App Store depends on the difference between a button and a link. Like Apple pushed back on that hard. They're like, we, everyone knows. And then for four years, it's spent time trying to convince the court that these shitty but, these shitty links were actually buttons. This is a real thing that happened in our nation's court system. And the judge eventually got tired of this and said not, and now she said, look, we're, we're not arguing about buttons and links anymore. Here, here's what I'm saying. To make up for all of your bad behavior, you are no longer allowed to impose any commission or any fee on purchases that consumers make outside an app. And that means you have no reason to audit, monitor, track, or require developers to report any purchases or any activities that consumers make outside the app. So Apple had this ability before, but they acted badly.

• 33:18Nilay Patel?

  So the court says, nope, that's gone. I'm just taking it off the table. They're no longer, Apple's no longer allowed to restrict or condition developer style, language, formatting, quantity, flow, or placement of links for purchases outside an app. So anything, any quality of a link is now off the table.

• 33:32David Pierce?

  Those two things right there are the whole ballgame.

• 33:34Nilay Patel?

  It's the game. That's the App Store.

• 33:36David Pierce?

  That is Apple going from what it wanted to the 180 degree, not what it wanted. Like this is the worst case Apple scenario.

• 33:44Nilay Patel?

  Apple also prohibited from prohibiting or limiting the use of buttons or other calls to action, or otherwise conditioning the content, style, language, formatting, flow, or placement of these devices for purchases outside an app. So you can style the buttons any way you want now. So now the difference between a button and link, it doesn't matter. You can style them both any way you want.

• 34:01David Pierce?

  She had a different bullet for links and buttons. She knows what she's doing. Judge Ross just figured this out.

• 34:05Nilay Patel?

  And I say this as a Virg story.

• 34:09Nilay Patel?

  They are not allowed to exclude categories and developers and apps from obtaining the link provisions, which they were going to do, right? They were going to say, uh, games in particular had to keep paying the money.

• 34:21Nilay Patel?

  All those Candy Crush whales are about to get a, you know, 30% discount. They are not allowed to interfere with the consumer's choice to proceed in or out of an app by anything other than a neutral message apprising users that are going to a third-party site. So no more scary language. And they're not allowed to restrict developers' use of dynamic links that bring customers to a specific product page in a logged-in state, rather than just requiring static links that make customers have to log in again.

• 34:47Nilay Patel?

  Again, this is very vergy, right? Apple was saying you can only have static links, so you couldn't carry login tokens through the links. So you would land on, you know, Netflix.com, but it wouldn't know that you were logged into the Netflix app. You have to log in again to get your discount. Apple knows this is friction, so the judge says, no, I'm all the way to mandating the use of dynamically generated links in apps so developers can pass login states. That's, this is the ballgame. To your point, David, this is the whole game. It's the whole game. They got, Apple lost its revenue stream in the App Store. In-app purchase revenue is gone, is going to go down. If they'd played ball, they could have maintained a healthy chunk of it.

• 35:29Speaker 05

  One thing that I don't know if anybody has looked at in like 15 years, or however long the App Store has existed, what does it actually look like for Apple to compete with web purchases? What does it do? What changes now? If they, if they have to contend with this?

• 35:44Nilay Patel?

  I mean, I can think of a million things off, uh, just off the top of my head. App, if you buy everything in the App Store or the Apple system, you have a catalog in one place of everything that you bought. You have a catalog of every subscription that you have. You can cancel those subscriptions. You can manage your purchases. Maybe you can transfer purchases to someone else because there's a shared centrally maintained database of who owns what. You don't need a blockchain for that if you just trust Tim Cook to run that database. Like, there's a million things you can do if you are the central transaction provider that Apple has not had to do or not even been pushed to do because you can't buy anything anywhere else. And so the only thing you can offer outside is it's a little bit cheaper, then you're terrified of that.

• 36:26Nilay Patel?

  But if you say to customers, protect your purchase by buying it with Apple, it will cost a dollar more, but here's all these services you get for that dollar, like, maybe that'll work. It's also easier. You don't have to, you don't have to do anything else. You're just like push this button. But I don't, they haven't had to have these ideas.

• 36:43David Pierce?

  Right. I mean, I, the other thing I think is going to be interesting here is we're going to see a lot of different ideas about how to solve some of this friction. I mean, it's not, it's not not ironic that the simplest way to pay for things on the web is Apple Pay. And, and in many ways, what is going to happen here is people are going to punt from a thing that gives Apple a huge commission to a thing that gives Apple a small commission. And that's fine, but we're also seeing pretty quickly. Any company that collects payments is going to try to find a very quick way to collect payments on the web for your app subscription. Like this, this is going to become a really interesting competitive business. Like Stripe is out here already promoting stuff that it's doing.

• 37:27David Pierce?

  Patreon has big ideas about what it's going to do. Like the, the quick internet transaction market has never had to be interesting in this space because there hasn't been a reason to do it. And so not only is Apple going to have to figure out how to compete, all these other companies are going to have a chance to figure out how to compete. And I think that to me is where a lot of this stuff gets super interesting. It's like Netflix is just going to want me to input my credit card number, right? But in a, in a fair fight against in-app purchases, where they are now at the same price, because they can be, because Netflix doesn't have to pay 30%. There's actually fascinating competition to see who can give me the most to be the one where I put in my credit card details.

• 38:07Nilay Patel?

  The thing that gets me at that, which I, I was not expecting this outcome. I knew there would be a fight about buttons and links. I just want to call, I want to point this out.

• 38:16David Pierce?

  Yeah, we're all very proud of you, Neil.

• 38:17Nilay Patel?

  I'm very proud. If you're not proud of yourself, if you don't love yourself, you know, no one else can, can love you back. Is that true?

• 38:25David Pierce?

  Let's go down that rabbit hole for a while. Should we talk about this for a minute?

• 38:28Nilay Patel?

  Is that just a Coldplay lyric? I'm not a hundred percent sure. All right. It's a weird time in America. I'm coursing with emotions.

• 38:36Nilay Patel?

  This outcome from, you know, our standpoint as consumers is the best outcome. Because instead of we will force the App Store to compete head up against an entire other App Store with different rules and weirdo experiences and, you know, all this other stuff you're worried about. It's actually just everything's going to get cheaper in the same App Store that you love today.

• 39:01Nilay Patel?

  That Apple could have solved this so long ago. Like that it's nuts that we're talking about like alt store in Europe and how Epic might do Epic Game Store and we are having these pitched antitrust battles and you gotta get all the way to like, can you construct a legal argument using the existing consumer welfare standard to prove that Apple has a monopoly on its own platform? And at the end of the day, they just screwed it up and they got to the result that I think most developers wanted, which is we're still gonna rely on the App Store for discovery, for distribution. And now we can just collect more margin from the things people buy in our apps with alternative payments.

• 39:39David Pierce?

  Or there's another version of the upside here, which is now all of a sudden there's a stuff that if you're a developer, you can put into the App Store as in app purchases if this forces Apple to be more competitive on that front too, right? Like, step one is everybody just goes and buys stuff elsewhere. But like, the best case scenario is there is a step two where Apple is forced by that to be more competitive and play ball within app purchases so that you can start to do things like buy Kindle books in the App Store again. And they're like, we've talked a lot over the years on this show about all the kinds of things that you can't do in the App Store because it's not a 30% margin business. And things like, things like books and audiobooks are like right there on that. And so we've made the experience awful.

• 40:23David Pierce?

  And so if this works and becomes actually competitive, it actually turns back towards making the App Store version of everything better. I'm not counting on that because Apple will appeal to death before it allows that to happen. But like, the tie here should be good for both sides and ultimately for however you want to use the app, it should be better when these fees start to fall apart.

• 40:47Nilay Patel?

  I'm glad that you have a good and kind heart because you went to people will buy art and culture more easily and I went to, oh, fuck, the NFTs are coming.

• 40:58Nilay Patel?

  What can't you buy in an app right now? What you know what definitely isn't a 30% business or NFT?

• 41:05Nilay Patel?

  There's 30% of nothing is what? So we'll see what happens. There's that, but I do think we're going to see a new kind of competition here.

• 41:15David Pierce?

  Yeah, it's good. And the joy in the developer community.

• 41:19Nilay Patel?

  Yes.

• 41:20David Pierce?

  Is unreal. I mean, it truly is like we've just gotten an outpouring. And Jake, I think you've seen more of these than I have even over the last several hours as this has been happening of just the grand enthusiasm from people who are like, oh, my God, finally the day has come. We can play on the App Store again.

• 41:36Speaker 05

  Yeah, developers are usually pretty wary about criticizing Apple. And here everybody's just like, got it, let's go, we're ready. We've been waiting for this, like we have the product ready, we're submitting it, like people are ready to go.

• 41:48David Pierce?

  There was one, Ryan Jones, who's the developer of an app called Flady that I really like. It's, I always follow Flady because they're always at the forefront of like interesting Apple features. Like whenever Apple releases anything, Flady is there. I'm like, cool, great job, Flady. And Ryan Jones, who runs the app tweeted, so what's going to happen? Starting tomorrow, apps in the US will have save 20% with Apple Pay type buttons right next to normal buttons. Or better yet, only have the link out button on the paywall. Apple specifically cannot limit anything about the buttons. That's something I had not even thought of, that people might just bypass the idea of in-app purchases entirely. And when you hit the subscribe button, it might just take you to the web, which is a thing everyone is familiar with.

• 42:30David Pierce?

  And suddenly, so like, not only do I have to compete with in-app purchases, I might be able to do away with them entirely.

• 42:35Nilay Patel?

  Yeah, and then, and then you're still completing it in the Apple ecosystem with Apple Pay for a much lower fee.

• 42:40David Pierce?

  Right.

• 42:41Nilay Patel?

  The thing that I think is going to be really fascinating is if developers do this quickly enough and everything gets cheaper or more competitive or more vibrant, there's all this excitement in developer community. And then Apple appeals and starts fighting to put the genie back in the bottle. It still might not matter if they win.

• 42:59Nilay Patel?

  Because you can't, you can't be like, well, we won this court case. So everybody stop it.

• 43:05Speaker 05

  Go make your app worse.

• 43:06Nilay Patel?

  Yeah. Like, we will have run the A B test.

• 43:09Speaker 05

  They like that 30%.

• 43:10Nilay Patel?

  Look, Todd Hazleton this morning woke up and was like, I gotta write this down. Like, the amount of pressure on Apple is out of control right now. So we'll link that piece too. It's really good, but he just listed them. He's like, okay, tariffs, tariffs are going to increase the costs of every product and Apple has to figure out how to work that into its margin. The Google search remedies case, which we'll talk about in a second here, might just take $20 billion off of Apple's bottom line. And that's pure margin. Google just pays Apple $20 billion to be the default.

• 43:40Speaker 05

  Yeah.

• 43:41Nilay Patel?

  It might just go away. That's the, that's one of the very real results of the case that is ongoing. And then the entire part of the business that's growing is services. Every quarter now, it's services. It's growing. It's not Apple TVs and MacBooks. It's not the iPhone. It's not the iPad. It's services. What services? They don't want to say it. They want you to think of severance. It's not severance. It's Candy Crush whales.

• 44:08Speaker 05

  Yep.

• 44:08Nilay Patel?

  Apple's entire business has been taking 30% of Candy Crush whales, and that's been growing for years. And so you, you're going to take that too now. So you're going to lose the 20 billion from Google. You're going to lose the Candy Crush whale money. You're going to increase the margin pressure because of tariffs. Wow, that whole business has changed by the end of this year. The entire, all of the fundamentals of Apple's business will be like flipped. And then what's the next turn that everyone's talking about? Whether you believe it or not, it's AI, AI, AI. Well, they had to delay their AI project. This company is suddenly like real shaky. And that's not to say the iPhone's bad. The thing that they do is really good. It is still like the centerpiece of the modern tech economy.

• 44:53Nilay Patel?

  But you're just like, wow, all of the pieces of this puzzle just got real frayed around the edges, like. What's gonna happen? How do they recover from this? And I'm hopeful that there's smart, creative, really interesting people who work at Apple, that they are finally forced to be creative and invent the next turn as opposed to figuring out more and more ways to extract dollars from the iPhone.

• 45:18David Pierce?

  Yeah, I mean, it is funny to watch this sort of rhyme with the Google trial in that if you sort of boil it all the way down, like, Apple found its version of Google Search in the 30% commission, which is just essentially a perpetual money machine, right? It is, if you want to exist in the world, you have to give us money. That's what Google did with the Internet and that's what Apple did with mobile, right? And it, boy, did it work gangbusters, but is eventually, if you get someone who is willing to peel that apart, it becomes really hard to put back together. And like, Google is furiously fighting to not have happened to it, essentially what just happened to Apple, which is a judge says absolutely not. You just can't do this thing anymore.

• 46:01Speaker 05

  I am curious if Apple, you know, still tries to pull something here. You know, the judge put some pretty strict limits on things, but Apple explored some other options, right? They were like, hey, we could, we could charge people based on how many downloads their apps get. That's one of the things that they pulled in Europe.

• 46:19Nilay Patel?

  But they're not allowed to do it anymore.

• 46:21Speaker 05

  They can't, they can't condition links on that. They could just charge people. That would totally upend the App Store model.

• 46:27David Pierce?

  Yeah, I think if you're Apple, that's pretty dangerous.

• 46:32Speaker 05

  You're probably fearing this ruling.

• 46:35David Pierce?

  Which is the goal, right? Like Judge Gonzalez Rogers here is very much attempting to strike the fear of God into this company. Like, if you cross me again, I will ruin you is pretty much the message of this thing.

• 46:47Speaker 05

  It reads a little like that, yeah.

• 46:49David Pierce?

  I mean, it is going to be really interesting to see because I'm confident there have been meetings all day in Cupertino about it not maybe not how to ignore this, but how to get around it. Like, how do we keep getting our services revenue without this? And some of those meetings are about products and some of those will not be about products. But, but like the this ruling intentionally and in as many words opened the floodgates for developers and is basically like they they get to do this now and you can't stop them or it's illegal. Like,

• 47:22Nilay Patel?

  It also opened the floodgates for regulators. So I was talking to some antitrust people yesterday after the ruling hit and a little bit of insight, maybe you can share that. But the overwhelming feeling was like, finally, someone has called Apple out on their hubris. Apple, the rep around the world when it comes to this stuff is, how dare you? No, we'll fight you till you die. Arrogance and hebrews just absolutely like the comparison was made specifically to Google. And they're like, Google's pretty arrogant and noncompliant as well, but at least they pretend that they're nice. Which tracks, like totally tracks. Like, Google's like, we make YouTube.

• 48:06Nilay Patel?

  Just a bunch of goofballs over here. Apple's like, we make the iPhone and none of you will ever have taste like we have taste. So please shut up. And like, it just bit them in the ass here. Like, they didn't have to get to this position. And now they're totally constrained.

• 48:22David Pierce?

  Well, and to that point, one of the things Apple has said over and over throughout this whole process is, and every big tech company does this, is they they yell and scream about security and privacy, right? That if you do this, if you allow developers to put links in their apps, it will devastate privacy on the internet. People will be opened up to fraud. Everything will be horrible. And all over this ruling from Judge Gonzalez Rogers, it just says, that is a lie. And that's not what you think. That is not how you feel. And I can prove it. Right? And that is like, the the stuff in this documents was, you had a meeting about money, and then you told a story about privacy. And those two things have nothing to do with each other. And I am tired of hearing the privacy story because it's about money. And that is

• 49:04David Pierce?

  like, we've all kind of known that. But it's it's different to say it when you have the meeting minutes in front of you. And it's like, oh, you know, it never came up in this meeting about whether it should be 27% or 30%? User privacy. Turns out you don't actually care, except as a justification to the public who you hope don't really understand what's going on.

• 49:24Nilay Patel?

  The thing that I heard specifically yesterday when I was talking to some folks was if the DOJ is smart, they will take this ruling and amend the complaint against Apple for antitrust to include a bunch of what you're saying, right? That you can take your complaint and amend it. The complaint is basically the iPhone's monopoly and Apple uses it to legally command all kinds of other industries. And there's a laundry list of ways to do that. Well, if you're smart, now you have a bunch of evidence that says, oh, they super do that. And you're gonna amend your complaint to put-

• 49:56David Pierce?

  And all of their defense, again, which is about privacy and security and taking the best care of users, may not actually be what you're worried about.

• 50:04Nilay Patel?

  Yep. So these things begin to stack up. Like, the regulators around the world are looking at this decision and they're looking at this judge saying, you know, actually, I can just body up and punch Tim Cook in the nose. And they're emboldened. Like, the joke I was making last night was like, there are bells ringing in Paris. Like, there's a bunch of happy, gray-suited European lawyers being like, finally!

• 50:25Nilay Patel?

  It's happened. Like, someone has finally landed a punch. And it's because of Apple's attitude. And that is such a known goal. Like, they did not have to get here.

• 50:34Nilay Patel?

  That said, we have a statement from Apple that says they disagree with the judge's ruling. They're going to appeal it. There's an amount of, even all the statements we're getting, the indie app developers, I think, are very excited. The big companies, like Spotify and Match Group, that have been fighting this the loudest, a little more measured. Right? Like, they're all-

• 50:54David Pierce?

  The proof is gonna be in the pudding, right? Like, it's going to be the app updates. Like, I sincerely believe the next 14 days of app updates from all of these companies is gonna be fascinating, because you know-

• 51:07Nilay Patel?

  Here's the one that's gonna be the most fascinating. Tim Sweeney says Epic will put Fortnite back in iOS. How?

• 51:13David Pierce?

  I was talking to Jay Peters about this earlier. Like, this suggests that Epic has been updating the Fortnite iOS app for years, waiting for this day. I'm serious. Like, that is what has been going on, is Epic has been waiting to win so that it can victoriously and ceremoniously reappear in the App Store, triumphant over Apple's monopoly. And it's gonna work. And I guarantee you, every big app developer-

• 51:40Nilay Patel?

  Wait, now, how will it work? So, the mechanics of this case- Epic broke Apple's rules by shipping a secret update to iOS Fortnite that allowed people to purchase stuff in Fortnite without in-app purchases. Apple kicked him out of the store, said, "You broke our rules." Epic said, "Ha ha, I was a troll." And they filed a lawsuit. They've gotten here where Apple's non-compliance with the injunction has gotten Apple in a bunch of trouble. But Epic lost on, "Did you willfully break the iOS developer agreement?" There's nothing in this ruling says Apple has to give Epic its developer account back. So how are they gonna put it back?

• 52:18Speaker 05

  That's a good point. So I think they do have Fortnite ready because they brought it to the EU a couple of months back.

• 52:25Nilay Patel?

  Oh yeah, that's right.

• 52:27Speaker 05

  Yeah, yeah, because they launched that at the Games Store. They had another battle with Apple over a developer account in the European Union, which Apple briefly banned. So it remains unclear to me if they have a developer account in the US or if Apple is required to, by any means, let them have Fortnite on the store. I feel like Apple's allowed to just be like, "Sorry, guys, we're pretty pissed about this."

• 52:54Nilay Patel?

  I will say Tim Sweeney put out what he calls a peace proposal, which is super not a peace proposal.

• 53:00Speaker 05

  No, it's just a nice-

• 53:00Nilay Patel?

  He says, "Epic puts forth a peace proposal. If Apple extends the court's friction-free, Apple-tax-free framework worldwide, we will return Fortnite to the Apple Store worldwide and drop current and future litigation." It's like, yeah, if you've given completely everywhere forever, we'll give you our video game. Cool, buddy. It sounds, David, like Tim is gonna come on to one of our shows soon, right?

• 53:26Speaker 05

  I think so. I hope so.

• 53:27Nilay Patel?

  We've asked for him. So I want to ask him very specifically how he thinks he's gonna get Fortnite back in the store. All right, we should take a break. There's yet more litigation to discuss here on our tech podcast, I'm Phil Funtz, and I'm your speakers. We'll be right back.

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• 55:16Nilay Patel?

  All right, we're back. Now on to active litigation.

• 55:22Nilay Patel?

  Here, here on the America's favorite tech litigation podcast. Well, we opened with party speakers to draw you in.

• 55:30David Pierce?

  Yeah. If people would launch more gadgets, we would talk like, it's about to be developer conference and gadget season again. And I'm very much looking forward to that.

• 55:39Speaker 05

  Wait, can I sidetrack you? Because David, there was something you wanted to talk about up front.

• 55:42David Pierce?

  That we skipped over.

• 55:44Nilay Patel?

  Oh, you're right.

• 55:45David Pierce?

  So we could do a little intermission here. Let's do a brief gadget.

• 55:48Nilay Patel?

  Like a palate cleanser?

• 55:49David Pierce?

  Yeah. Because I need to know, Neela, you in particular, but both of you, we got to talk about the slate truck for like five minutes because we talked about the slate truck with Tim Stevens on Tuesday show. He wrote a great story for us. He's written a couple of great stories for us about the slate truck. I would say, without giving too much away, traffic to our website suggests that this is the most interesting thing that anyone has done in a very long time.

• 56:11Nilay Patel?

  It's neck and neck between slate truck and calling Jeff Bezos a coward.

• 56:16Nilay Patel?

  That's our audience.

• 56:17David Pierce?

  That's about right. Yeah. So let's, what do you think? You weren't here for our talk with Tim on Tuesday. What do you make of the slate truck?

• 56:24Nilay Patel?

  I listened to it actually the other day. I loved him. Tim and I used to work together and gadget it. It's so much fun when he writes for us and does stuff for us. I'm like, take my money. It's, I don't need a pickup truck anymore. I used to need a pickup truck when I lived in the woods on an unpaved road and had to take my own trash to the dump once a week with a baby in the house, which meant the trash could not stay in the house for more than two days. Do you understand what I'm, do you understand what the baby was doing?

• 56:55David Pierce?

  Babies like trash.

• 56:57Nilay Patel?

  Babies make the worst trash in human history.

• 57:01David Pierce?

  Yeah, that's real.

• 57:01Nilay Patel?

  It's not great. So yeah, we, you know, there was a time when I like loaded the bed of a pickup truck like several times a week in a pandemic and drove away and that was great. And then I moved to Westchester. Pickup truck was incompatible with this area. Sold the pickup truck and I saw the slate truck and I was like, what if?

• 57:19Nilay Patel?

  What if I found a reason to take my own trash to the dump?

• 57:22David Pierce?

  But it's not a very pick up-y pickup truck. Like I have never once in my life been like, you know what I need is a pickup truck. And I have still been on the Slate Auto website a half dozen times this week being like, I could buy this car.

• 57:33Nilay Patel?

  They did the one extremely smart thing about the Slate Auto website, even if you're not a pickup truck person or a car person, they, the configurator is so much fun because the thing is so modular by design. You're like, I don't know. Today I want a yellow SUV. Tomorrow, a red pickup truck with a Bluetooth speaker and they usually screw with it. I think they're. Their ability to capture the trends in cars right now with what people are doing with cars and not what like Ford thinks people are doing with cars is super interesting. So every, you know, car culture is dominated by people wrapping their cars. Like all over the place, people buy like car, people buy what, you know, when you're like trying

• 58:15Nilay Patel?

  to buy a car, like a used car, if you're a car person, there's a part of it's like, I want to make sure I get the color I want. There's another part that is like, I know exactly what set of specs and option packages I was looking for. And the color is almost immaterial because I'm absolutely going to wrap this car when I get it. Like, that's just a thing that happens in this world. Lots of people wrap new cars. So for Slate to say, you know what, like, we can just do away with a paint shop or metal body panels and assume that our customers are going to wrap the car to their specifications. There's something about that that I think is incredibly smart. Right? They're, they're not at the, what does the big company think the market wants? They're at the, what is the community doing?

• 58:59Nilay Patel?

  And how do we deliver to the community, the product that might work? And I don't have any of that's going to work. Right? Like it's new, I don't know if the car's any good. No one's ever driven in one. I think, listening to Tim, it sounds like Slate hasn't spent a lot of time driving.

• 59:13David Pierce?

  It does. They've sat in it a lot. That we know for sure, but has it gone anywhere?

• 59:18Nilay Patel?

  There's something about that, which I love, which is like, they're at the fringe of car culture in a very specific way that I think is super cool.

• 59:25David Pierce?

  Yeah, that's fair. Jake, you're, you're famously a truck guy. Everyone who knows you knows you love a cable knit sweater and a pickup truck. What do you think of this thing?

• 59:35Speaker 05

  I, I'm neither a car guy nor a truck guy, but this is the coolest truck I've ever seen.

• 59:39Nilay Patel?

  That's how I feel.

• 59:40Speaker 05

  This is the thing. It's like every single time I, I am in a car, I have a problem with something. The speaker system is terrible. The infotainment system is terrible. I, I love that they're just like. Listen, you are gonna be mad about it anyway. Whatever. Get a, bring your own speaker. I don't care. You were gonna put your phone up anyway. Like, just do it. I, it's, it's like such a delightful approach. It feels very friendly and welcoming and like, I kinda love that, even though it's actually like deeply for tinkerers. The big question to me, and again, not a car guy, people love really large vehicles. And they started with a truck and a small truck.

• 1:00:20Speaker 05

  Like, when I see old trucks in the wild, the wild being the streets, I, I like, I'm like, oh my god, they're so cute. Like, this adorable little truck that, that was actually just a full-sized truck from 10 years ago. So I, I'm really curious how that taps into the market they're going for, but it's a really cool idea.

• 1:00:42David Pierce?

  Yeah, Neelai, is there a, is there a turn towards, obviously, like, everywhere else, it's, you know, the 90s and early 2000s again. Are we gonna do that with cars? Are we gonna go back to like, you know, the, the cars our parents had back in the day? Is that, is that coming? Because that's kind of what the site truck is aesthetically.

• 1:00:59Nilay Patel?

  So, one, I want people to go on TikTok.

• 1:01:01Speaker 05

  And technologically.

• 1:01:02David Pierce?

  And technologically, true.

• 1:01:03Nilay Patel?

  And technologically. They're all gonna have cigarette lighters in them again, it's gonna be great.

• 1:01:07David Pierce?

  I drove around with a boombox on my passenger seat for a long time. Like, that's, that's a real thing.

• 1:01:11Nilay Patel?

  Go on TikTok and just search for the Ford Ranger song. No further commentary. It's just an ecosystem of content that you can be a part of. It's very good. When I say my TikTok feed is trucks jumping over stuff, I'm offering you a door. That's very good. You know, the, the market's distorted. The, the trucks are big and they cost $100,000 because trucks are excluded from some fuel economy standards and people buy them and then you make them bigger and then dentists can write them off on their taxes in specific ways. And then you make them cost so much money because that's just pure margin for the automaker. Like, it's, there's just like a nonsensicality to that part of the market. Because when you show people a picture of like the Rivian R3X, everyone's like, that's what I want.

• 1:01:56Nilay Patel?

  I want a weird little eighties hatchback that goes 300 miles on a charge. Like, give me that. You show people a Ford Maverick, which is still huge compared to the sleigh truck. And I like that's, I want that. Give me that. So there's a distortion in the market that I think everyone thinks is real, but it's like, it really is like a, the tax part of tax. So it's like section one seven. It's like, you can write off the full value of a giant vehicle all at once. If you run a small business and you claim that, yes, you know, your dry cleaners need a truck of this size. And so people do it. And like, there's just a distortion in the market. And I think this is the antidote to that in a real way. But I know why carmakers have been making their cars bigger. I will, the other thing I will, I'm curious if the

• 1:02:39Nilay Patel?

  audience feels this way. I think all cars are ugly right now. Like, they are so ugly.

• 1:02:44David Pierce?

  I agree with that. Yeah.

• 1:02:46Nilay Patel?

  Very, very few cars are just straightforwardly beautiful. And this trend back to sort of classic designs, like very handsome profiles, it just can't come fast enough.

• 1:02:57David Pierce?

  Oh, I totally agree. We, we've been lost in this, like, cars should look like the future thing for a while now. And like, there's a, there's a Hyundai and Genesis dealership just down the street from me. And so like, every day, some new stupid spaceship looking thing comes driving by my front door. And I'm like, what, what have we done here? Like, people love the IONIQs. It's all fine. And every single one has like more weird angles. And it's like, why, these aren't cars anymore. What are we doing here?

• 1:03:26Nilay Patel?

  Yeah. My favorite weirdness in the current car design market is, everyone has decided the headlights should be vertical, but we should still pretend to have very tiny, small horizontal headlights, like eyebrows. And I'm like, this looks horrible. Like, have any of you looked at the cars? I just don't know what's going on. So it's nice to see some classic profiles come back, I think.

• 1:03:51Nilay Patel?

  The car's not going to ship for another year, two years. It's vapor tilt ships, man.

• 1:03:56David Pierce?

  Yep.

• 1:03:57Nilay Patel?

  But you know, who doesn't love dreaming about a vaporware car? It's like America's favorite pastime.

• 1:04:01David Pierce?

  That's what we do here. It's and it's past, it's a render. So at least, at least we're past that point. It's not just a drawing of a car. It is a car and that's, that's something.

• 1:04:11Nilay Patel?

  Yeah.

• 1:04:12David Pierce?

  Jake, thank you for that. I feel much better. Let's go back to the courthouse. There's so, there's so, so much.

• 1:04:19Nilay Patel?

  All right, David, you, let's start with Google because it's simpler. The, the medic case is so complicated. It's going to take us a minute. David, you were at the Google trial in the courthouse this week with Sundar Pichai on the stand. For what I gather, he was just there to say, please, please don't make me sell chrome.

• 1:04:33David Pierce?

  Kind of. I, I actually expected him to be a tiny bit more of that than he was. And so, uh, I've been in the courthouse three out of the eight days now. And I think, uh, we, I've missed a couple of interesting people, but I've seen a bunch of the most interesting moments of the, the remedies trial so far. And the, the thing that has become abundantly clear is that Google is petrified of the part of the DOJ's remedies that suggests that what Google actually needs to do is take its search index, uh, its ranking information, which is just like how it ranks all the stuff when it puts it on the page and the query streams that it gets, which is all the stuff that people are actually searching for, and essentially give that to anyone who wants it at, at what the DOJ calls a marginal cost.

• 1:05:17David Pierce?

  Nobody knows what a marginal cost is or who's going to decide. That is one of the things Google's concerned about. But, uh, of all the things the DOJ wants, that is the one that Google is terrified of. And, uh, so Sundar, when he was on the stand, spent a long time talking about how scary that is. And you could tell the line he had rehearsed either in his head or with a bunch of people who work for him at Google. I suspect both.

• 1:05:42Nilay Patel?

  Yeah. You know, he, he thinks he just workshopped it in the mirror that morning at the hotel.

• 1:05:46David Pierce?

  He's just in the car on his way going, reverse engineer, reverse engineer. Was, but his whole thing was essentially that if, uh, Google has made itself into what it is because it has essentially out invested and outspent all of its rivals for 25 years. And it's true, right? Like no, nobody has tried harder at search for longer than Google. Certainly true.

• 1:06:10David Pierce?

  And the thing he kept saying is if you do this, if you take away all of the stuff that we have done and you give it to everybody else who asks for it. I don't know how, as Google, we can continue to justify investing in search the way that we have. And what he said is if you give people all this data, they can reverse engineer Google. If you have all the information, you have the order in which we rank that information, and you have all the stuff that people are searching for. That's the whole thing. That's it. You can get from there to every single thing about how Google works is Google's argument. They don't have to give you the algorithm, but if you have the inputs and the outputs, you can figure out the algorithm. And he, over and over, was like, if you let people reverse engineer

• 1:06:51David Pierce?

  Google, why would I keep building Google? And it is like, it just forcefully saying that over and over. And he has really interesting thoughts about Chrome, because he started Chrome. Like Chrome was how Sundar sort of made his rise inside of Google in the first place. But the thing for him is he's like, you cannot make us give this away, because it will crush Google Search. And then the DOJ is sitting there being like, yaha, that's, that's the goal. That's what we're here for. And so it's fascinating, like, for so much of this trial, in the, in the liabilities phase and in the remedies phase, these two sides have been talking completely past each other. Google is like, we're very good. And the DOJ is like, everything you've done is illegal. And they're, they just have not been speaking to each other. And, and it was Sundar was the first time that it was like, oh, we're

• 1:07:36David Pierce?

  actually all talking about the same thing now. And, and what Google is saying is, you think that what you have to do is solve some of the problems that you've created. And what I'm saying, it will happen, is it will kill Google. And it was just, it was just fascinating. And like Judge Meta, who is overseeing all of this, has asked a lot of questions about how big a deal this kind of thing would be. In the opening arguments, he asked a lot of questions about what's a behavioral remedy and what's a structural remedy? And does this change within Google Search constitute a behavioral remedy, which is easier to ask for and get, or a structural remedy, which is essentially breaking up Google? And Sundar Pratap's argument is, this is breaking up Google.

• 1:08:21David Pierce?

  Like, he could not have been more apocalyptic about what happens if this happens. And it was fascinating.

• 1:08:27Nilay Patel?

  You know, it's interesting, there's some wonkiness about behavioral remedies and structural remedies.

• 1:08:33Nilay Patel?

  The behavioral remedy is we're going to change the way you act and the government will watch out.

• 1:08:39David Pierce?

  Right. Be cool.

• 1:08:41Nilay Patel?

  Be cool or show up.

• 1:08:43David Pierce?

  Right.

• 1:08:44Nilay Patel?

  For watching you. And there's a big argument, you can actually listen to Rebecca Slaughter, FCC Commissioner on Decoder earlier this week. Her argument is behavioral remedies are more intrusive. Right? It's the government over your shoulder saying what you can and can't do.

• 1:09:00David Pierce?

  Right.

• 1:09:00Nilay Patel?

  And the structural remedy where you break it up is actually the more democratic, small D, democratic solution. Cause you're just like, well, you're broken up now. Everyone try your best with government out. And there's, there's some real back and forth there. Right? Like, do you want a Google that has this administration sitting over its shoulder being like, are you behaving yourself? If you don't, if you love this administration, do you want a Google that has President AOC sitting over their shoulder saying, are you doing what I want? Like, there's a lot to contend with there in the behavioral remedy. Whereas the structural remedy might be the end of Google. If you listen to Sundar Pichai, like it's, it's hard to evaluate which one's like a better idea.

• 1:09:42David Pierce?

  Right. I mean, it is sort of funny. I, I went into this thinking, and I have talked to a bunch of people who confirmed that they were also thinking this, people sort of in and around the trial, that the, the idea that Google should have to divest Chrome was the big swing nobody thought they would get. Right? That this was, this was the thing you performatively give up in order to get the other stuff and that it would wind down to just, just don't, you, you can't pay Apple $20 billion a year. That that was going to be where this landed. The DOJ has argued far more forcefully for the idea that solving search in this way is what has to happen. And Google has come to believe pretty clearly that it's a real threat and that it would be much scarier.

• 1:10:24David Pierce?

  Like you get the distinct sense that Google would much rather sell Chrome than give up this search data.

• 1:10:30Nilay Patel?

  Well, you know, there's like a natural experiment for Google because they're just the default on iPhone. It's like, it's not iOS Chrome that's making them the money right now. Right? It's Chrome search, it's, it's Google searches in Safari.

• 1:10:44Speaker 05

  Right. What they would lose if they lost Chrome, right? If somebody else is operating Chrome, I guess the threat is that they have their own search engine or AI service to replace it. But if they can still offer a cut of search traffic and just say like, hey, if you want to, still just gonna be more Google search.

• 1:10:59Nilay Patel?

  Yeah.

• 1:11:00Speaker 05

  Yeah. You're gonna be paying a lot.

• 1:11:02David Pierce?

  Yeah. To be clear, Google would very much like to hold on to Chrome. And Sundar talked a lot about that.

• 1:11:07Nilay Patel?

  And it's his baby.

• 1:11:09David Pierce?

  It is his baby, but also he talks a lot about the Chromium project, which is, he is correct in saying Chromium is the most important thing in web browsing right now. And it is, it's a technically open source thing that Google fundamentally controls and runs and operates. He said 94% of the code commits to Chromium over the last year have been from Google employees. It spends huge amounts of money on Chromium. Microsoft's browser is based on Chromium. Like Brave is Chromium. Almost all of the browsers people use are Chromium or Chrome. And that, that matters, right? Like, that's a huge deal. And the idea of some other company, like, I asked, I asked a person around this trial,

• 1:11:50David Pierce?

  like, is the idea of OpenAI administering Chromium terrifying to you? And they just laughed at me. And, and Chromebooks change, Chrome OS changes. Like, it is a huge change for Google in a really meaningful way. And all of a sudden, the default Android browser becomes not yours, which is meaningful too. But, but again, like, that is all immaterial to Google if it can't win at search anymore. Like, Chrome only matters because search matters. And if you kill search, who cares?

• 1:12:21Nilay Patel?

  I find this Chrome argument so disingenuous. Can I just say that? Like, I agree, everything is, Electron is Chrome. Half of the desktop apps I'm running right now are Chromium.

• 1:12:31David Pierce?

  Yes, true.

• 1:12:32Nilay Patel?

  Like, right, Notion Calendar is a Chromium app. Like, it's running, it's just an Electron thing, right? Like, whatever.

• 1:12:40Nilay Patel?

  All of those companies have an enormous incentive to make sure their apps still work and that Chromium is good. Google has an enormous incentive to make sure the Android browser is good, which means it will continue developing Chromium, upon which it is based. So this idea that if they don't have Chrome, just like Chrome on Windows anymore, that they won't just immediately fork Chromium.

• 1:13:04David Pierce?

  They can't.

• 1:13:05Nilay Patel?

  That's not allowed.

• 1:13:06David Pierce?

  They wouldn't be allowed. By the rules of the remedies that the DOJ has proposed, Google would not be allowed to do that. It could land elsewhere, but the idea of like-

• 1:13:15Nilay Patel?

  Right, they can negotiate their way out of that and say, "We need to make our first-party browser on Android."

• 1:13:19David Pierce?

  Right. A question we've gotten a bunch from folks actually is like, couldn't Google just make another browser? And there's a ton of wiggle room in it, but like, letter of the law, no, it couldn't. It would not be allowed to.

• 1:13:29Nilay Patel?

  Yeah, I mean, it just feels like that's, that's the give and take here, right? Like, a bunch of people are still very motivated to keep Chromium going. A lot of people don't spend the money because Google will.

• 1:13:40David Pierce?

  Right, that's the interesting counterfactual, right.

• 1:13:42Nilay Patel?

  But if that development moves elsewhere, it's not like all those people have suddenly lost their incentive. Like, Electron as an open-source platform unto itself relies on Chromium. You can just see how that development ecosystem will like help. It won't be as big, it won't be as rich.

• 1:13:57David Pierce?

  Right.

• 1:13:58Nilay Patel?

  You won't get as many like, you know, old-time, classic Google neckbeards like doing Chromium out of the good of their heart, that like, against no revenue, which is a thing that a company of Google's scale can do and a company with Google's culture can do. Like, you know, I've interviewed Sundar before, I'm like, "Is AI killing the web?" For like, an hour, and he's like, "I love the web." And it's like, you believe him, because he made Chrome. He cares whether or not he's actually killing the web. And that was the heart of that conversation last year. I don't know what's gonna happen here, it just feels very much like, Google making search a little bit more interoperable against the worry that someone will reverse-engineer all of search and then make it so that Google is worth nothing to consumers is, is just

• 1:14:43Nilay Patel?

  like fake worry. They're still Google. The people still say they're gonna Google it.

• 1:14:50David Pierce?

  Yeah.

• 1:14:51Nilay Patel?

  Like, you could make Bing an exact copy of Google today and people wouldn't use Bing.

• 1:14:57Nilay Patel?

  Bing has made Bing an exact copy of Google today and people won't use Bing.

• 1:15:04Nilay Patel?

  There's something about this that just seems.

• 1:15:07Nilay Patel?

  I don't know. We'll see what happens, but it feels like they're making all of this. You know, it's like the smartest people in the world are saying, we can't solve this problem. It just never rings sincere to me.

• 1:15:17David Pierce?

  Yeah, no, I think that's fair. And the other thing I should say about Chromium is I've talked to a lot of people who make browsers who would love for Google to be less intense about running Chromium. Everybody I talk to who doesn't work at Google and works with Chromium is like, God, it's so annoying that Google runs Chromium because what they want goes and everything they do is to benefit Google in some way. And wouldn't it be great if we had a neutral thing that just wanted browsers to be great? The problem is that's very expensive and no one has ever done it before. But to your point, no one has ever done that before because Google always has. So like, is there a way in the wings for this to work? It's certainly possible. The DOJ certainly believes there is.

• 1:15:56Nilay Patel?

  Are there scaled open source projects that run the entire world that don't have a Google involved?

• 1:16:01David Pierce?

  Yes.

• 1:16:03Nilay Patel?

  Linux exists. Now, does Linux have its own deeply fucked governance problems? It absolutely does, but like it exists.

• 1:16:13David Pierce?

  Somewhere, Sundar Pichai just heard you comparing Google to the Linux Foundation and started sobbing uncontrollably.

• 1:16:18Nilay Patel?

  I'm just saying, the whole world is like, man, I hope that one guy shows up to commit code to Linux for free. And like, it works. Like thus far, it has worked. All right, that's the Google case where, David, I think you're going to be in that courtroom a bunch. Just down the hall, upstairs?

• 1:16:36David Pierce?

  Down the hall. It's all, it's all pure chaos. My favorite thing is, this is a little inside baseball for everybody. So the way this works is these, these courtrooms.

• 1:16:47Nilay Patel?

  We should say it's the meta case that's just down the hall.

• 1:16:49David Pierce?

  Oh, yeah. The meta case is just down the hall. And what I should say is the courtrooms typically don't allow any electronics at all, right? Like you can't, you can't even type on your laptop while you're in there. You can't have phones, no nothing. So what a lot of media members do who want to like take notes and write stories, there are media rooms for each one of them and sometimes. It's another courtroom and they just get like a video feed of the trial and they watch it there. They move the media rooms around every day. So every morning you show up at the courthouse and it's just pure chaos of a bunch of reporters trying to figure out which room to go to. And every morning there's somebody who thinks they're in the Google trial, but is actually in a meta trial and vice versa. And the other day when I was there for Sundar, they started the morning with a completely unrelated criminal trial. Just like it was just another trial that Judge Meta is overseeing.

• 1:17:35David Pierce?

  And so for five minutes, he just had like a procedural conversation with a lawyer about when they were going to talk to this guy about his crime. And people are like pouring into the media room as this is on the screens being like, who's in the jumpsuit? This is guy in like an orange prison jumpsuit and everybody's trying to figure out which Google executive this is.

• 1:17:52Nilay Patel?

  Yes.

• 1:17:53David Pierce?

  It's fantastic.

• 1:17:54Nilay Patel?

  It wasn't Andy Rubin.

• 1:17:56David Pierce?

  It was not in fact, but so the meta trial, there are like three, there are a lot of things going on in this meta trial.

• 1:18:03Nilay Patel?

  But we should note Lauren Finer is in that, do you, do you and Lauren see each other in the courthouse?

• 1:18:06David Pierce?

  We do, we pass each other in the hallways a couple of times a day. And Lauren, Lauren has become like sort of the, the house mom of the courtroom. Every time, every time I look around, she's like directing somebody where to go and telling them where the cafeteria is. And she's like, no, the medium's over there. Like Lauren lives in the, the district court of DC. And someday she will leave and she will be on the Vergecast and it will be very exciting. But there, there are kind of three threads that I want to talk about from the, the meta trial this week. And the first is TikTok, which has come up an awful lot in the course of the meta trial. Because the like big open question for all of this, and we've talked about this is like, what is a social network? Right. And that, what was it? What was it? One day where TikTok was gone?

• 1:18:49David Pierce?

  Has turned into this incredibly interesting data point of who competes with who, based on what happened when TikTok was gone. And TikTok's head of operations was on the stand this week talking about what Reels is versus what TikTok is and how people use Reels and how people use TikTok. And how Instagram has adapted Reels and its own app to match TikTok. But this question of like, What is TikTok? And how have all the other apps, particularly within Meta, responded to it? Has become like one of the most important parts of this whole trial. And it's deeply bizarre because TikTok is supposed to be gone.

• 1:19:29Speaker 05

  So is it good for Meta or bad for Meta? When people flock to its apps in place of TikTok, right? That shows that they are the sun around which everything else orbits. On the other hand, it shows that people are other places.

• 1:19:44David Pierce?

  It's really true. And also, a lot of different witnesses on the stand this week have been forced to acknowledge that there is nothing remotely unique about Instagram at all.

• 1:19:58Speaker 05

  I mean, over and over and over.

• 1:19:59David Pierce?

  Instagram is just a copy of all these other apps.

• 1:20:01Speaker 05

  Three other apps smashed together.

• 1:20:03David Pierce?

  Exactly. Which I've enjoyed very much. Like, there was a line from, I believe his name is Aaron Pressman, or Aaron Presser, excuse me, at TikTok, who called TikTok reels and shorts "virtually and deliberately indistinguishable in function and user experience", quoting something the company had written in March. It's fabulous. I just love it. It's very good. But this TikTok thing, I think, to your point, Jake, is like, Meta is trying to prove that it has millions of competitors, right? And that TikTok competes with Instagram and Instagram competes with Facebook. And actually, this is like a huge teeming ecosystem of places people hang out and spend their time.

• 1:20:47David Pierce?

  The case against it is that Facebook is a personal social network and that that's what it does. And that that's where it has a monopoly and thus all the stuff that it has done is monopolistic. And the TikTok thing, I think, on balance, probably helps.

• 1:21:08David Pierce?

  Meta, because what they're saying is they've had executives from Tumblr and Pinterest and Strava come up on the stand and say, "We're not a social network. We are about interests." Right? Like even Twitter folks said this, "We're a place to go for things that you're interested in," which is not the same as a place to go to find people that you're friends with. But Meta gets up and is like, "Well, when TikTok dies, everybody comes to our app. And then when TikTok comes back, everybody leaves and goes back to TikTok. So what do we do?"

• 1:21:37Speaker 05

  I do think it's really interesting. Like, it feels to me, and tell me if I'm wrong, but it feels to me like a lot of this case is premised around this idea of the personal social network, you connecting with your friends and your family, which is this very old school, you know, 10, 15 years ago, I guess, vision of social media. And I feel like if Facebook vanished today, I don't know that there would be a one-to-one replacement, right? That is just not how people are thinking about social media anymore, as I think, which may, maybe-

• 1:22:08Nilay Patel?

  Where are all my angriest neighbors to try to send their friends to jail?

• 1:22:12Speaker 05

  There is another app for that. That is next door.

• 1:22:14Nilay Patel?

  That's true.

• 1:22:15Speaker 05

  But like, maybe that hasn't popped up because Facebook has this monopoly and they're being anti-competitive, but maybe it hasn't popped up because people just want different types of experiences on social media. And I feel like that's what we're seeing with all of these other companies that they're calling up.

• 1:22:29Nilay Patel?

  But this was Mark's insight. I mean, this is the heart of the case, is Mark Zuckerberg woke up and said, "Every so often, there's a new thing that people want to do on their phones that gives rise to another social network. There's another kind of sharing dynamic." And so Facebook was whatever it was, hot or not, for colleges. And then he identified photo sharing on Instagram and said, "I gotta buy that one." And then he identified, and there's all these emails where he lays out his thinking, and then he identified group messaging and messaging, and said, "I gotta buy WhatsApp." And so the point here is the anti-competitive move was to stifle the thing that could have taken

• 1:23:10Nilay Patel?

  Facebook's market share. And whether or not they could have bought a TikTok- It's like we're, you're just getting into this place where they became so big that TikTok was too big to buy and also owned by the Chinese government or controlled by the Chinese government. So like, it's like, it's the weirdest one because they, they did try to buy Snap, right? And Evan said, no.

• 1:23:35Nilay Patel?

  I have this quote here from Rebecca Slaughter, who's a commissioner at the FTC. She was a Democratic Commissioner of the FTC. She was appointed by Trump in the first term, legally fired by Trump in this term. But she is one of the commissioners at the FTC who voted this case out of the commission and said, we should go to trial on it. And so I asked her about this market definition thing. I was like, this is dumb, right? Like Meta's narrative about this is like putting us in personal social networking is whatever. And she said, look, all antitrust cases are about market definition to a degree. It's very tortured things that makes people hate lawyers. The concept of antitrust law is very simple. The administration of it gets very complicated. Market definition is always hard. Everyone has a different view about the right way to define a market. It all gets relegated.

• 1:24:16Nilay Patel?

  And then she went on to tell me, what this case is really about is whether Meta bought competitors to eliminate the risk of competition. That is the argument at the end of the day. Did it not want to compete on the merits, but instead take out potential competition through acquisition in order to build and maintain a monopoly in a way that's illegal? It's not more complicated than that. So I think Meta is putting a lot of stock into the existence of MEWE. It's like, here's this dumb thing we can say to make everyone think everything else is dumb. And then you have the actual Federal Trade Commission saying, no, this case is, you saw Instagram as a rising threat and you bought it to kill it. And they've shown that now, I think, pretty conclusively. And here are all of these other threats. If you could have bought TikTok, when TikTok went down, people came to your apps.

• 1:25:00Nilay Patel?

  They're obviously competitors. If you could have, you would have. I don't know how that's gonna go. I really don't. This is, this case is real weird. It's like this old lawyer cliche I keep saying, like, if you don't have the law, you argue the facts. If you don't have the facts, you argue the law. And if you don't have either, you pound the table. This is like, all law professors say this. They think they're very clever. But that's what that's what's happening here. Like Meta is trying to argue the esoteric law of market definition. And the government is like, but you bought Instagram.

• 1:25:29David Pierce?

  Right. And that, I mean, we talked about this last week, but that was the thing that was so damaging about the Kevin Systrom bit of it. And to that point, actually, I think the the most interesting piece of all that this week has been about WhatsApp, which has come up more this week than in sort of previous parts of the testimony. And it has become very clear that Facebook was petrified about what messaging apps might do to Facebook in particular. And there the it was really worried that Google was going to buy WhatsApp and turn it into a cross platform social network, which is very funny, because at the same time Lauren is hearing this, I was sitting in the courtroom, listening to Sundar, talk about how bad Google Plus was and get burned by the plaintiffs for how bad Google Buzz was.

• 1:26:13David Pierce?

  And use they they literally use that as an example of how Google is not able to take care of its users' privacy. That's how bad Google Buzz was. And so, Google, this company that can't make a social network to save its life, Facebook is terrified, is going to spend a bunch of money on WhatsApp, make it cross platform and take over the world with it. Because to your point, they perceived messaging apps as the future of how people interact with their friends and family, which, check, correct, they won. That was it. That was that was exactly correct. The the group chat has taken over the Facebook feed in a real way. And they were worried about iMessage and the all of this stuff, right? They they looked at all the messaging apps out there and said, OK, we are the place people hang out with their friends right now.

• 1:26:57David Pierce?

  That is going to move to messaging apps. It's more private, it's it's easier to administer, like, there's just a lot of reasons for it. And they went and got WhatsApp, A, because they understood that that was going to work. B, because they understood that Facebook's own stuff, including Messenger, was not going to be that. There's been some really interesting testimony from folks at Facebook who were just like, Messenger just wasn't that thing. It was popular, but it just it wasn't it. It wasn't going to win. And then they were they were worried about what iMessage might be. Like, there were questions inside of Facebook about whether Apple was going to turn on ads and more social features inside of iMessage. And Apple's just like, we're not going to do that. That's a stupid idea. We would never do that.

• 1:27:40David Pierce?

  But that's been the other thread of this is, is the same thing Mark Zuckerberg saw on Instagram, which is photo sharing is, is the way people are going to share going forward. And he was right about that. Uh, he was also right about messaging apps. And so now the question is, did, uh, did Facebook sort of neuter WhatsApp by buying it? Or did it help it ascend to new heights, which is the exact same question about Instagram?

• 1:28:05Nilay Patel?

  Yeah. I don't know, man. It, my, did you look at all these cases? The end, like Apple's just first quarter of the year is like, well, Apple's going to be a whole different company. Google's going to come out of these cases. But we haven't even talked about ad tech remedies. Like that hasn't even started.

• 1:28:22David Pierce?

  Right.

• 1:28:22Nilay Patel?

  You, you, you think Google will be a different company if you pull apart search? Wait until you got the money. Google's going to end the year in a totally different place. Meta might end the year in a totally different place. Like we're in for a restructuring of the internet. It's coming.

• 1:28:35David Pierce?

  Good.

• 1:28:36Nilay Patel?

  Something's gonna happen. If you know what it is, but by all means, tell me. I, I think it's party speakers.

• 1:28:43Nilay Patel?

  It's up, but something's, something's up. You can feel it in the air. It should be exciting. It's weird. Like so much other stuff is so foreboding that I think this feels foreboding, but it's, I think it's actually exciting. Like there's space. These companies under all this pressure is going to create space.

• 1:29:00David Pierce?

  Yeah.

• 1:29:00Nilay Patel?

  Other people are going to build stuff.

• 1:29:01David Pierce?

  You look at what happened at the Microsoft case and it's like, uh, because of the Microsoft case, we got Google. Like that's, that's just a thing that happened, right? And we're, we're now doing that at greater scale with a bunch of different companies all at once. And, uh, it's, we're doing it at a very weird economic moment. So I think like, this is ordinarily a time that you would see venture capitalists just like falling all over themselves to invest in everything everywhere. Because suddenly there's, it feels like there might be space in tons of these markets for the first time. That's not happening because they're all in group chats being weirdos with each other.

• 1:29:33Nilay Patel?

  They've got dumber ideas. One of the, um, one of the answers regulars I talked to yesterday said VCs have hated Apple for so long. It is only a matter of time before the money starts flowing.

• 1:29:45David Pierce?

  I, I believe it. I mean, there's so much there.

• 1:29:48Nilay Patel?

  So we'll see, we'll see. I'm just saying it's, all this stuff is happening and you can argue about the, the individual twists and turns. But this is the stuff that creates space for new companies and honestly, it's a little exciting. All right. We gotta take a break. We're gonna run through this later on. It's gonna happen. We'll be right back.

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• 1:31:38Nilay Patel?

  All right, we're back. I think we got it. This one's got to be short, David, this time.

• 1:31:43David Pierce?

  Yeah, I have, I have things to do. For once, I can't just podcast with you clowns forever.

• 1:31:49Nilay Patel?

  We got party speakers to find.

• 1:31:50David Pierce?

  Exactly.

• 1:31:52Nilay Patel?

  Can someone invent a metal detector for party speakers? Think about it.

• 1:31:55David Pierce?

  My Navy ship is leaving soon, so I have to finish this podcast.

• 1:31:58Nilay Patel?

  Please, please, more enlisted service members. Send us photos.

• 1:32:01David Pierce?

  Neel, is it, is it time? It's the lightning round, but is it? Is it once again that time for?

• 1:32:07Nilay Patel?

  It's time.

• 1:32:07David Pierce?

  Okay, it is time for America's favorite non-food podcast within a podcast. That I feel I can say comfortably.

• 1:32:14Nilay Patel?

  Award winning.

• 1:32:16David Pierce?

  Future award, award inventing.

• 1:32:18Nilay Patel?

  Award winning podcast within a podcast. Brendan Carr is dummy. All right, so a quiet, another quiet week for Brendan. He did congratulate himself a lot. So we just said 100 days of the Trump administration.

• 1:32:34Nilay Patel?

  Brendan put out a tweet with just a list of things that he says he's accomplished. He Brendan believes that he strengthened national security and advanced public safety. He believes he's protected consumers and expanded America's space economy. Brendan, all by himself. Is that Brendan's job? He's unleashed high-speed infrastructure. He's restored our leadership in wireless, which, as you know, is under constant existential threat. If you don't upgrade the 5G network, something China. Yep. It's just there, just in the background all the time.

• 1:33:06Nilay Patel?

  And you know, he says he has restored free speech. So it's a long list. You will link it, it's a tweet.

• 1:33:12Nilay Patel?

  Under restoring free speech, he claims that he has joined DOJ Assistant Attorney General Slater and FTC Chairman Ferguson to launch a campaign to smash the censorship cartel and restore free speech rights, which means sending threatening letters from the government about other people's speech. And just upside down world, all over the place with Brendan. So Brendan's very proud of, it's very Trumpian. Everything he says is a thing that he didn't do. Yeah. And a lot of it is just stuff the FTC does. Like he was like, we did a spectrum auction. It's like, yeah, it was Tuesday at the FCC. Great. What I want to call out this week is we, there's a bunch of other 100 days coverage of Brendan that we should call out. We did a big piece, Carl Bodie, who we love working with, just ran down all the stuff Brendan has done.

• 1:33:55Nilay Patel?

  It's basically familiar, I think, to Vergecast listeners, particularly listeners of America's favorite podcast, The Podcast Brendan Carson. That piece is great. Carl is a ferocious writer. He has been the model for how I think about writing for consumer advocacy and consumer rights for a long time. He's just a great job. So go read that piece. I also want to call out, other people have started taking note of Brendan in real, meaningful ways. So FIRE, which is a free speech advocacy organization, not without its own controversies, has a strong point of view on what cases it takes and doesn't take people, a lot of feelings about it. You might almost call it the more conservative free speech advocacy organization. I wouldn't go that far, but some people do. They have a long piece about how Brendan sucks.

• 1:34:39Nilay Patel?

  Like just straightforwardly fire published a piece called Brendan Carr's Bizarro World FCC. They have a cartoon of him with a backwards FCC logo dressed up like like Bizarro Superman. And the caption on the cartoon Brendan is saying, the FCC should operate as the nation's speech police. We're just gonna link it.

• 1:34:56David Pierce?

  A little on the nose, but you know.

• 1:34:58Nilay Patel?

  It's a little on the nose, yeah. But it's not just us screaming it, right? It is some of our nation's preeminent free speech organizations, some which like I'm pointing this out just to point it out, are not always aligned with what people think my politics are. Although I think my politics are basically like free markets are good and don't be racist, which aren't exactly communist, but whatever, whatever you think my politics are. Um, they don't always align with some of these groups. So racism is bad. They call me Uncle Woke.

• 1:35:27David Pierce?

  You just said like eight things that people are gonna make us put on t-shirts now. I just want you to know that, including they call me Uncle Woke. That's, that's, that's just everyone who's listening, please know I will make that t-shirt.

• 1:35:38Nilay Patel?

  Like what, what it's so I get these notes, like I did the piece about calling Jeff Bezos a coward. I got some of the most bananas emails of all time, uh, just like calling me like literally like you are a communist. And I was like, the only political opinions I've really expressed consistently are like free markets are good. Competition makes better products. Like, what do you want from me exactly? Um, and the answer is state regulated speech. Clearly, um, the LA Times is a good piece about Brendan running down all the things he's on. So the coverage is out there. It's not just us. It's not just me, Uncle Woke. Uh, but as always, I want to end Brendan Carr's dummy by saying Brendan, I know you listen. I know you love attention. You do, you, you, you live for it.

• 1:36:23Nilay Patel?

  Uh, come on the show, man. If you can defend any of this crap, you should do it. You should make the argument. You should say the words out loud to me and then win. Don't you want to win Brendan? Don't you want to collect this trophy from me? I'll, I'll make you a trophy if you win that debate and you can have it. You could tweet about it. You can show it to your buddy Elon. The offer's in front of you. I just, I don't think you can do it. So as always Brendan, I think you're a dummy, but you are welcome on Decoder. You're welcome on the Vergecast. You're welcome to one of those, you know, those things that you do on YouTube now where like 20 kids wave flags at people sitting in the sun. We'll do that. Let's go. I don't think you will because I think you're a dummy and I think you know that you can't win. As always, this has been Brendan Carr's a dummy America's favorite podcast for the podcast.

• 1:37:07David Pierce?

  TikTok trends with Brendan Carr is very clearly a podcast we need to launch. So Brendan Brendan.

• 1:37:14Nilay Patel?

  What's that? It's what's it called?

• 1:37:17Nilay Patel?

  Palomium, but you know.

• 1:37:18David Pierce?

  It's like Jubilee.

• 1:37:19Nilay Patel?

  Jubilee.

• 1:37:20David Pierce?

  Is that it?

• 1:37:20Nilay Patel?

  Oh, by the way, if any, if there's any like young reporters out there who want to profile Jubilee, emails. I'm fascinated by this entire situation. Whatever is going on there is some of the weirdest new media that has ever existed. And I, I don't understand how any of it works. I would like to know more. Do you want to write a feature? Send us a pitch.

• 1:37:41David Pierce?

  Love this. Jake, I need, I have a favorite ask.

• 1:37:46David Pierce?

  I put a story that Alex Heath wrote about WorldCoin in our rundown and I didn't read it because I refused to learn anything about WorldCoin. So can you explain it while I don't pay attention?

• 1:37:57Speaker 05

  David, I was worried for, for folks who, who are watching at home. David just drops a gigantic document with a bunch of stories that we may or may not discuss. I try my best to prep for all of them. WorldCoin is so inexplicable. I, I spoke repeatedly with Alex Heath about this story. I've read this story. I edited this story. I still cannot truly explain what WorldCoin is, why it exists, or what it's doing. The, the, the main news, this is the, the, the eyeball scanning startup.

• 1:38:33Nilay Patel?

  Sam Altman's eyeball scanning startup.

• 1:38:36David Pierce?

  It has, it's an orb.

• 1:38:37Speaker 05

  They have an orb, scans your eyes, puts you on the blockchain and that validates your ID. Here's the most important thing. You can now verify yourself on Tinder by getting your eyeballs scanned by Sam Altman.

• 1:38:52Nilay Patel?

  Yep.

• 1:38:52Speaker 05

  And. When you're swiping through Tinder, that's either going to be a clear way to know that somebody is or is not a match for you. So I think that's a big upgrade. The main, the actual news is they're bringing it to the US for the first time. It's, it's legal in most states, not all of them. But they're bringing it to the US. You can now get your eyeballs scanned. You can now get on the blockchain. You can now get some of the world coin. I think the idea is that this is somehow going to help authenticate humans as being humans in a world of AI nonsense happening on the internet. I'm not quite sure where the crypto coin comes in. That still feels a little like fuzzy magic.

• 1:39:36Speaker 05

  It'll be worth value somehow. But yeah, the main, the main thing is they have brought it to the US now. They're opening some stores. You'll be able to go to Razer stores. And while you're shopping for gaming accessories, you can get your eyeballs scanned and get on the blockchain. I would say everything about this feels like Mad Libs. I, I still like, I'm not sure how this all came together. I'm not sure how they decided to partner with Tinder.

• 1:40:03Nilay Patel?

  Well, because they, they need auth providers or they need to prove that being an auth provider is useful to someone. So you're, you're, you know, like you're worried about getting catfished on Tinder. And you're like, you know what? Uh, that's an eyeball scan. That's a real person.

• 1:40:18Speaker 05

  These eyeballs match. Yeah.

• 1:40:20Nilay Patel?

  Yeah, that's like a, it's like they, look, they did this announcement in San Francisco. Alex Heath went, lots of people went. Yeah, Sam Altman was there. People want to be there. The real quotes about all of this came at a previous event that they had last October. Because like any startup, they need scale. Like they need people to scan their eyeballs to make everything work. And so they're announcing the US, which will get them scale. But I just want to read this quote from last year. "To provide access to every human, we need more orbs. Lots more orbs, probably on the order of a thousand times more orbs than we have today. Not more orbs, but more orbs in more places."

• 1:41:03Nilay Patel?

  Then they are launching a service called Orb On Demand that will let people order orbs, much like a pizza you would have delivered to your apartment. So you can push a button and someone with an orb will come to your apartment and scan your eyes.

• 1:41:21Nilay Patel?

  It's so silly. I love it. I love it.

• 1:41:25David Pierce?

  This is all completely vindicated my total uninterest in knowing anything about this story.

• 1:41:30Nilay Patel?

  I love it. Look, the world, soon our social networks will be full of weird AI avatars all trying to bone you and marry Kevin Rus.

• 1:41:38David Pierce?

  And I will prove I'm real.

• 1:41:39Nilay Patel?

  You are gonna have to push the orb button and have an orb show up at your house and verify that it's actually you who is deeply in love with Kevin and not some rogue AI.

• 1:41:50David Pierce?

  And it is me, Kevin, if you're listening. Get at me. I'm right here. I've been right here all along.

• 1:41:56Nilay Patel?

  It's very good. It's very good. All right. Should we do like one or two more?

• 1:41:59David Pierce?

  Yeah, let's do one or two more.

• 1:42:00Nilay Patel?

  We need like a palate cleanser. I would say we need more orbs. A thousand times more orbs is a good palate cleanser.

• 1:42:06David Pierce?

  Let's, let's do, let's do the Trump thing really fast, just so you can take another.

• 1:42:09Nilay Patel?

  I said palate cleanser, man.

• 1:42:11Speaker 05

  Wait, okay, can we talk about some more AI nonsense?

• 1:42:14Nilay Patel?

  Yeah.

• 1:42:14Speaker 05

  There's this, so Meta launched a Meta AI app and it has a social feed of things. People are just sharing their AI prompts. So you can have a conversation with Meta's AI and it'll just post the transcript. You'll be talking to it. You can hear somebody say like, hey, what kind of crackers should I eat today? And then the AI just is like, oh, maybe you could try whole grain. And they're like, I don't think so. It is, I think the idea is to give people an idea of what they're supposed to do with AI. I have to tell you, this is the single strongest argument against AI that I have seen yet. If you scroll through this feed, it is just like total nonsense, nonstop. It is incredible. I can't look away.

• 1:42:56David Pierce?

  It's awful.

• 1:42:57Nilay Patel?

  I mean, that's what they want, right? Is I want to see what, how somebody has jailbroken Meta AI. You know, Mark Zuckerberg gave an interview to Ben Thompson, I think it came out today as we're recording. And he says explicitly, the thing we were talking about a couple of weeks ago. He says the future of Meta, Ben asked Mark, like, what do you want to do with AI? And Mark is like, yeah, I want to do better ad targeting, obviously. You know, we want to help people make more content, you know, feeds full of AI content, all this stuff. And he says this thing in the middle where he's like, eventually we're going to make the ads for advertisers. And you're just going to connect to your bank account and tell us what business outcomes you want. And then we'll, we'll just like deliver you results. Like we'll just have sold your products, right? Which means they're gonna like make videos of your products with AI, write the

• 1:43:42Nilay Patel?

  copy with AI.

• 1:43:46Nilay Patel?

  Generate infinite amounts of creative with AI. Like, you're just gonna, it's like literally a black box. Like, you give them some money, they make an advertising campaign, and then some of your products get sold. And that's literally his vision for the future of AI.

• 1:44:00David Pierce?

  It's so funny to put that next to the thing that Meta executives have been saying for a while, which is that, like, a lot of people go to these services and appreciate the ads as content. And it's like, there just is this belief that actually what people really want is AI-made stuff. Like, that is like a cultural value at Meta, that AI stuff is good and people will like it. And I see no evidence of that fact in the actual, real world.

• 1:44:29Nilay Patel?

  Yeah. Are, you tell us what your objective is. You connect to your bank account. You don't need any creative. You don't need any targeting demographics. You don't need any measurement, except you're able to read the results that we spit out.

• 1:44:40Nilay Patel?

  And it's like, you know, you guys have a lot of, like, ad fraud scandals. Like, you're kind of famous for inflating the metrics, like.

• 1:44:47David Pierce?

  Yeah, give us a lot of money and trust us. We're Facebook. What could possibly go wrong?

• 1:44:50Nilay Patel?

  Uh, I wrote a story about this. I emailed some media people, some ad agency people. I'm sure you read this quote. This is a return. I said, can you respond to this? One person said, "I've reacted pretty viscerally to this. I need a moment to say something smart," which is incredible. And then another person did not take the time, and they just said, quote, "Read the results that we spit out is gold." The full cycle towards their customers from moderate condescension to active antagonism to, "We'll fucking kill you."

• 1:45:19David Pierce?

  Perfect.

• 1:45:20Nilay Patel?

  Perfect. So I suspect there's a war coming between Meta and the ad industry. They're not happy with it. All right, a power cleanser. Just to end it on like the nerdiest note I can end it on, in a happy note. LG has spent 20 years trying to make OLED panels with blue phosphorescent backlights. It says it's ready to manufacture tandem panels that use both fluorescents and phosphorescents. This will bring power consumption down by 15%. There's nothing that makes me happier.

• 1:45:50David Pierce?

  None of what you just said sounds like words to me. We're happy about this? This is good?

• 1:45:54Nilay Patel?

  Everything about the future is predicted first by what happens in this play technology.

• 1:46:00Nilay Patel?

  It's absolutely true. Right? You can't get curved phones or folding phones without curved or bendy OLED panels. You couldn't make smartphones without thin LCDs with low power draw. You couldn't make laptops with CRTs, although some people did try. You see what I'm saying? You can look ahead to what the display industry is doing. You can predict the future. I'm just saying, 20 years in the making, slightly thinner, brighter, better OLEDs are coming and something will happen.

• 1:46:31David Pierce?

  That is exciting.

• 1:46:31Nilay Patel?

  See?

• 1:46:32David Pierce?

  I've been doing a lot of research on the Sony Watchman from the 80s recently for a project that will become very clear to everyone later this year. And the enthusiasm for a slightly different take on a CRT, unbelievable. People were freaking out. They were like, they made the CRT this big and said it this big. It's going to change everything. It didn't.

• 1:46:53Nilay Patel?

  I'm just saying, people react mostly to what things look like and the way you change things, how things look like, you change the display technology. So if you pay attention to that, you will know what things are going to look like and then you know the future. And you don't need an orb to do it.

• 1:47:09Nilay Patel?

  We need more orbs, a thousand times more orbs. That's it. That's the Vergecast.

• 1:47:19Nilay Patel?

  And that's it for the Vergecast this week. And hey, we'd love to hear from you. Give us a call at 866-VERGE-11. The Vergecast is a production of The Verge and the Vox Media Podcast Network. Our show is produced by Will Poor, Eric Gomez, and Brandon Kiefer. And that's it. We'll see you next week.

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