Meta's Awkward Pivot, Crypto's Future, Amazon's Challenge — Crossover With Techmeme Ride Home

Techmeme Ride Home is a top-rated tech news podcast and its host, Brian McCullough, joins us for a crossover episode airing on both feeds. In this bonus episode, we discuss Meta's attempts to turn Instagram into TikTok, how Amazon can handle its next chapter under CEO Andy Jassy, and what the future of crypto looks like after the crash. Stay tuned for our travel hacks at the end of the show! Learn more about your ad choices. Visit megaphone.fm/adchoices

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

• 0:00Alex Kantrowitz?

  This episode is brought to you by Genesis. What does it actually take to put Agentic AI to work across an entire enterprise? I recently spoke with Genesis chairman and CEO Tony Bates about why orchestration is emerging as a competitive advantage in customer experience and what companies need to get right in the AI era. Then I sat down with Adam Mitchell, head of enterprise business solutions at Voya Financial, to go inside a large-scale Agentic CX transformation, including the business decisions, trade-offs, and lessons along the way. You can watch both conversations now on my YouTube channel today. It's never been more challenging to get frontier compute. How do you know where to look, who to trust, or how much to pay?

• 0:43Alex Kantrowitz?

  Akash is an open cloud that provides easy access, flexibility, and peace of mind. That's how companies like Razer were able to cut their inference cost by 15 times. Visit akash.network/alex for a free consultation. That's akash.network/alex for a free consultation.

• 1:03Alex Kantrowitz?

  Hello and welcome to the Big Technology Podcast, a show for gullfated nuanced conversation of the tech world and beyond. I'm Alex Kantrowitz and

• 1:10Speaker 01

  I'm Brian McCullough. Welcome to the Tech Meme Ride Home experience, as Chris likes to say, but the Tech Meme Ride Home podcast in general, the experiences are bonus episodes.

• 1:21Alex Kantrowitz?

  So we're doing this together. We're doing a crossover episode where it's kind of a little bit of Big Technology Podcast, a little bit of Tech Meme Ride Home, where we're airing it on both feeds in an attempt to give our listeners, A, a fun episode, and B, a little bit of a entry into a show that we like. I'm a big fan of Tech Meme Ride Home, been on it a couple of times. Brian, can you tell us a little bit about what Tech Meme Ride Home is all about?

• 1:45Speaker 01

  Yeah, it's literally a daily show, at least weekdays daily. 15-minute roundup of the tech news, but it's not just reading headlines because you could get a robot to do that. I tried to do a tiny bit of analysis, but also bring context. So I'll tell you what the, you know, five or six big stories of the day are, but then here are the tweets around it. Here's what people are saying around it, and it's sort of like If people know TechMeme, it's a thing that people go to multiple times a day to find out what's been happening today. I do the same thing in a 15-minute podcast snippet. And so the idea is, is on your ride home, which is why we call it the TechMeme Ride Home, I'll catch you up on what you missed because hopefully you were doing real work and making real things happen.

• 2:28Alex Kantrowitz?

  Who are we kidding?

• 2:29Speaker 01

  Right.

• 2:30Alex Kantrowitz?

  But, you know, ride home or not, because a lot of us are working from home now, even still, it's a great way to catch up on tech news. You can listen to it every day. And I'll do a quick intro of Big Technology Podcast for people that don't know it. We air once or twice a week. It's an interview podcast with tech insiders and outside agitators. Actually, now that we're talking about it, I think the shows are really good compliments to each other.

• 2:53Speaker 01

  Yeah.

• 2:53Alex Kantrowitz?

  Where you can go deep, you know, and catch up on the news if you're listening to both shows throughout the week. And with my show, what I try to do is get somebody who's in those headlines, whether it's a journalist or someone who's making waves in the industry, somebody who's been on the outside and is criticizing it. So for instance, a couple of weeks ago, I had Jonathan Haidt, who's a professor who wrote a long story about how social media is making us uniquely stupid. Last week I had, or two weeks ago, I had Blake Lemoine, who was the Google engineer, who was actually fired almost as we were recording for going out in public and saying that it's chatbot Lambda AI was

• 3:37Alex Kantrowitz?

  sentient. And then, most recently, a couple of days ago, we had Brendan Nyhan on, who's another professor, and gave the counterpoint to Jonathan Haidt's "social media is making us stupid." His perspective is, you know what, maybe it's not all that bad. We still don't know a lot of things about it. So we try to get nuanced, try to get deep, and we try to give people a look beyond what they just read.

• 3:59Speaker 01

  Well, and you're, you know, listeners to my show will know this, hopefully, but if you don't, you know, Alex is a real reporter, whereas I'm a more of a gadfly, you know, I would never call myself a reporter because I'm a founder and now a VC. What I'm trying to say is, is that you You do actual reporting and like digging into the weeds. You do the stories that I read on my show and summarize. You have Nick Clegg on, you know, I'm not going to get Nick Clegg on my show. So you're doing the sort of work that is sort of beyond me. By the way, if anyone can hear, we're in my kitchen in Brooklyn. So that police helicopter that goes over.

• 4:38Alex Kantrowitz?

  And Brian, you know, you're, I look at you as the pod guy. Actually, I think big technology podcast never really would have gotten off the ground. If it wasn't for you, I saw, you know, you had been talking about how the podcast industry was expanding and even before I launched big technology, I wrote to you and said, what's the deal with this podcast thing? And you're like, oh yeah, it's good. There's interest. It's a good business. It's fun. You should do it. And I found that that was, was really helpful and generous of you, of your time and advice to, you know, give me that kick in the butt I needed to start the podcast.

• 5:12Speaker 01

  Well, and now I'm trying to get him to start a venture fund like I did. So watch this space in a few years. Yes, if there's a big technology, technology fund, that would be great.

• 5:24Alex Kantrowitz?

  Yeah, well, it's not a great time for, for VC right now. It's not a great time.

• 5:28Speaker 01

  I disagree, but you'll think I'm talking my book.

• 5:32Alex Kantrowitz?

  We'll get to that in the second half. And we do know actually that there's a lot of dry powder out there. So VCs have a lot of money to deploy and they are deploying it. So it's not like funding has entirely dried up. But why don't we start with the public companies in the second half? We can talk about whether we're in a recession, if that's something we want to debate, what's happening in commerce, what's happening to startups. But the big story in our neck of the woods, at least over the past, you know, couple of weeks, couple of months, maybe has been this very awkward pivot to question mark that Meta has been up to. What is Meta pivoting to? It's pivoting to the metaverse, obviously, which is still sort of this ill-defined space,

• 6:13Alex Kantrowitz?

  which might be VR, which might be AR, which might be, you know, playing a video game on a 2D screen. That's obviously the future of the company. They're no longer Facebook. They're Meta right now, but as they wait in order for that, you know, hypothetical reality to potentially take off. What they have right now is their existing flagship business, AKA Facebook and Instagram. That doesn't seem to quite really know what it is. Because if you look at social media, you have, you know, obviously friends and family, which is the bread and butter of Facebook. Uh, you have interests, which has been something that Instagram has been about, something that Twitter is about. Instagram just does a much better job of it. And you have entertainment, which is what TikTok has been about.

• 6:58Alex Kantrowitz?

  Now TikTok is blowing Instagram and Facebook. I wouldn't say completely out of the water, but it's really competing it with in a way that these companies haven't seen before. And in the past few weeks, we've really seen the company stuck saying, you know, we wanna emulate TikTok. But we don't quite know exactly how much we can do that without sacrificing what's making people use these apps.

• 7:22Speaker 01

  Well, the users.

• 7:23Alex Kantrowitz?

  Read on it, Brian.

• 7:24Speaker 01

  The users told them that.

• 7:26Alex Kantrowitz?

  But that, so that, this is what I'm trying to figure out here because the users tell Facebook all the time.

• 7:32Speaker 01

  Every, every time they change.

• 7:33Alex Kantrowitz?

  To. We didn't like the news feed, Facebook went forward with the news feed, turns out it was a revolutionary format. We hated the fact that they were copying stories from Snapchat. You know, felt that it was wrong, they did a good job on that. And now we all use stories. What exactly is different in your opinion here with the real situation?

• 7:50Speaker 01

  I, I actually do think that we're at a different inflection point because what the users are saying now is that the way people use social media has evolved. And it's maybe, it's not always evolved because why did Snapchat become Snapchat? It was because a certain demographic wanted a different thing out of social media than what was existent at the time, right? And.

• 8:15Alex Kantrowitz?

  And that is?

• 8:15Speaker 01

  Well, that was the ephemerality, that was the stories.

• 8:19Alex Kantrowitz?

  Basically a way to share without broadcasting to everybody you know.

• 8:22Speaker 01

  Parents, exactly.

• 8:23Alex Kantrowitz?

  Mom, your dad, your gym teacher from sixth grade, your cousin that you hate.

• 8:26Speaker 01

  So now take that and multiply it by five where I go to TikTok for a certain use case. I go to Instagram for a certain use case. I go to Twitter, I go to WhatsApp. Um, you know, it, it, there's a thing I just read that said, you know, WhatsApp is like the biggest messaging platform on the planet that, um, you know, entire.

• 8:50Speaker 01

  Countries on the southern half of the globe run their businesses on. No doubt. And Facebook's only innovation with WhatsApp has been to put stories on top of it, right? So this is, I'm getting to what I think is different now. I think that we're 20 years into social media, if you go all the way back to Six Degrees and Friendster and things like that. We're not, as a society, we're not new to this anymore. We are mature users of social media as a platform. And so we have our use cases. And what the users are saying right now to Zuck is, "Don't make Instagram TikTok, because I go to TikTok for TikTok stuff, for what it serves in my life.

• 9:32Speaker 01

  And if you are going to just TikTok-ify Instagram like you snapped Instagram, stories to Instagram, you're only going to make me abandon Instagram because I have a use case for Instagram that you're obviating, that you're making worse." Messing up friends and family stuff. Well, or whatever, you know, if it is, if it is the celebrities or whatever, right? But, but the point is, is that I think, I think. It's a great tagline for Instagram. Instagram, the celebrities or whatever. For celebrities or whatever. It works for a billion people. Exactly, but I do think that the problem is, I want to get into what I think the

• 10:16Speaker 01

  real motivation of all of this is, but I think the problem is that Zuckerberg and Meta/Facebook writ large were able to continue to stay ahead of the curve by absorbing, sometimes literally acquiring companies, sometimes copying what they do. And that can't work in, in a world where, they were basically existing in sort of a monopolistic ecosystem that they created of their own. And because Snap's still extant, because there's no way they're going to be able to buy ByteDance, like, you have these different flavors, you have Pepsis to Cokes. You can no longer say, "There's Coke, and there's Cherry Coke, and there's Coke 1 and

• 11:01Speaker 01

  Coke 0." People are gonna go for a Mountain Dew every now and again. And if you shove Mountain Dew in my Coke, why am I buying Coke? That's literally what people are saying to them. And I don't know that this is a problem that they can't, that they philosophically.

• 11:18Alex Kantrowitz?

  Really want to face. Well, okay, so let's talk about the evolutions because you mentioned that social media is 20 years old. Yeah. True, and so the way that we have found content on the internet has actually gone through a series of evolutions and I think this is kind of leading us to where we are today. So at first it used to be that there were websites that you would go to, okay, then maybe you would search for different topics and you'd find interesting content that way. The revolution that Facebook ushered in was that you would find stuff based off of what your friends and family were sharing and you use those people as curators for the content that you would find online. It turns out that actually the content that we like to watch, a lot of it is gossipy, a

• 12:02Alex Kantrowitz?

  lot of it is, you know, what's going on in my hometown, what's going on with the people that I know. And Facebook exploded because it really filled that curiosity in an amazing way. So the natural way that you would think is you're gonna, if you want to follow people, you follow, you know, symmetrically based off of people you know. Twitter, okay, now Twitter said, what if you follow people that you are interested in? Asymmetrically, right. You follow what you want and it's you do the work to curate what you want to see? Yeah. And that will be Twitter. And it didn't work, it's an amazing product, no doubt about it, it has its flaws, it's an amazing product. But that one innovation could only get Twitter so far. Instagram copied with, copied them, brought some friends and family in, still went visual,

• 12:45Alex Kantrowitz?

  but it still made you do the work, it was just a lot easier and, and you could figure out the Instagram experience much more because you were picking the pictures. Hold on, I just want to finish this one part. The thing, so, so up until TikTok, we had been sorting our feeds on our own based off of people that we followed and the algorithm was a second layer on that. Yep. TikTok flipped that on its head. Yes. TikTok basically said, it doesn't matter who you follow. Yeah. We're going to, via our algorithm, show you the content, you know, that we think you're gonna like the most and that follow will just be one data input into our feed, it won't be the whole feed. And that changed the game. And now I think where you, what the issue is that you have with Facebook and Instagram and even Twitter to some extent is that

• 13:31Alex Kantrowitz?

  They're still playing that old game where the content that you find to them primarily is based on who you follow. So it doesn't matter if they're trying to prioritize their reels more often until they either fully say, "We're gonna be what we were in the past and you're still gonna like that. It might not be as popular, but there's a use case for that." Or, "We're giving up on that completely and saying we're gonna go the TikTok style. Algorithms recommend maybe we do a tab to show you friends and family." But until Facebook decides, "We want either column A or column B," you know, it's not, I don't think it's a matter of mixing sodas. I think it's a matter of making a clear decision one way or the other of what their strategy is. And they're stuck in the middle right now. They don't have a vision and that's why we're seeing them go back and forth.

• 14:13Speaker 01

  It's so funny because on my show, we keep falling into this thing of doing the history of how social media has evolved. So I've had this conversation a couple of times now. You missed one important ingredient, I also think, from Snap, which is that Snap made entertainment inside an app. How many times did Facebook try to pivot to video and make watching videos and watching TV shows and we're gonna spend however many millions of dollars to create these shows and things like that? That's what TikTok learned or perfected from Snap, which is, I know that TikTok is a social network in the sense that users also create the content that's on there. But nine times out of 10,

• 14:56Speaker 01

  when you go to TikTok, you're just scrolling to watch stuff. It's a lean back medium. Zuck has always wanted that. And so that's the other thing that I feel like philosophically, they're halfway across the river and the oars have fallen underwater, you know?

• 15:12Alex Kantrowitz?

  Right.

• 15:12Speaker 01

  And so they're stuck because this is kind of where he's always wanted to go.

• 15:16Alex Kantrowitz?

  But hold on, before we move on on that, I think that, I think you're giving Snap a little too much credit on this. They do have their Discover part of the app, but they monetize per user at a lower rate than Twitter does. And the reason is, in my opinion, is because most people stay in the chat part of Snapchat.

• 15:37Speaker 01

  Right.

• 15:38Alex Kantrowitz?

  So it's less about the Snap, it's more about the chat. And the entertainment, they do have a successful entertainment tab. Obviously, that's where a lot of the revenue is coming from. But I would say, I'll make an even more extreme statement here and say that TikTok is the first, the first social company, maybe outside of YouTube if you want to account, count YouTube, but they're the first social company that actually made this lean back experience.

• 16:04Speaker 01

  That's what I was saying.

• 16:05Alex Kantrowitz?

  Not only possible, but popular.

• 16:06Speaker 01

  Yeah.

• 16:06Alex Kantrowitz?

  But I don't think, I don't, I would almost say that YouTube is the pretender of that.

• 16:10Speaker 01

  Well, that's true, that's true. But also, in my sort of historical discussions of this, you know, talking about be real, I'm always like, it doesn't matter what the gimmick is that makes you rise to the top and get popular. In the end, the way that you last is if you hook a certain generation in the chat part of it, like you said, or of, you know, if a certain generation, if that's how they communicate with their friend circle, then that's how you last. And that's what happened with Snapchat. And that's what happened with Instagram for a certain generation. That's what happened to Facebook, that's what happened to Friendster and Myspace. They capture certain generations where the social graph, that's how you communicate.

• 16:47Alex Kantrowitz?

  Let me ask you this then, do you think, I never thought about this before, but do you think TikTok might be a little bit vulnerable then?

• 16:53Speaker 01

  Oh, for sure.

• 16:53Alex Kantrowitz?

  Because it doesn't have a chat function?

• 16:55Speaker 01

  Yes, but you've seen the rumors like I have that they're, you know, thinking of doing a music app, they're, they're, they're more, they get the benefit from standing on 20 years of experience, is they're gonna do a fully, I'm sure, integrated, they're gonna have a Spotify competitor, they're gonna have, you know, a Facebook Marketplace competitor, they probably already do.

• 17:21Alex Kantrowitz?

  I don't know, I mean, if you're, if you're TikTok, you have this one thing that you do better than anyone else, which is a

• 17:26Speaker 01

  Yes.

• 17:27Alex Kantrowitz?

  This amazing algorithm and easy creation flow. And as soon as you start, you know, with Instagram, the thing that they, we talked about this on the past on my show, Kevin Wheel, who's the former, had a product for, for Instagram was on, and we talked about a little bit how, how Instagram didn't, and I think this is from Sarah Fryer's book, No Filter, never wanted that hamburger menu, you know, those three bars on top because it became too Too crowded and then you sort of lost the elegance of using the app. The appeal of using that app goes away a little bit. And right now, after adding all these features, Instagram has the hamburger menu. And I think even before the TikTok competition ramped up to the way that it is.

• 18:08Alex Kantrowitz?

  At this point, you started to see Instagram start to fall a little bit in the way that it was appealing to people. One more question about this.

• 18:17Speaker 01

  Yeah.

• 18:19Alex Kantrowitz?

  We started, so Brendan Carr, another former guest of Big Technology Podcast, FCC Commissioner, is pushing hard. I don't know if it's for the US to ban TikTok or whatever it might be. Now, when this happened during the Trump administration, it sort of felt like a bit of a sideshow. And it ended up being one where this deal was brought to Microsoft, it fizzled. It was brought to Oracle, it fizzled. Nothing really came of it in the end. But I think that the US, Europe are going to start eventually having some serious issues with TikTok being owned and operated in China for all intents and purposes. And it not being, you know, fully transparent.

• 19:04Alex Kantrowitz?

  Because in the past weeks, we have seen, you know, a number of stories about how ByteDance, for instance, which is TikTok's parent company, has pushed, you know, pro-Chinese government propaganda in one of its apps. And, you know, there's every now and again, these flares of rumors that some of the same stuff is happening within TikTok, whether it's trying to influence or a lack of data privacy or data security that we thought existed there. Brian, how big of an issue do you think this is going to be as we look forward?

• 19:39Speaker 01

  Depends on if China invades Taiwan in the next 18 months.

• 19:42Alex Kantrowitz?

  I mean, yeah, like, I was actually thinking about that. Like, imagine, I mean, it's sort of a, I mean, let's say TikTok was owned by Russia.

• 19:51Speaker 01

  Yeah.

• 19:51Alex Kantrowitz?

  And Russia invaded Ukraine.

• 19:52Speaker 01

  It'd be already shit.

• 19:53Alex Kantrowitz?

  So what happened?

• 19:53Speaker 01

  It'd be already shit.

• 19:54Alex Kantrowitz?

  So I mean, if China invades, we don't, let's, you know, set the ground here. We don't know if China's going to invade. Is it possible? Sure. But is there a moment where it becomes impossible? Because impossible for the United States to have TikTok. It's, I'm not saying it's likely, but it's not out of the pale.

• 20:11Speaker 01

  There, there is a moment, and, and I, I actually would posit that it wouldn't require China invading Taiwan for that moment to come.

• 20:21Speaker 01

  And I, I also do believe that they would do some intermediary step, like forcing a divestment like they attempted to do.

• 20:28Alex Kantrowitz?

  They tried, yeah.

• 20:29Speaker 01

  Trump administration, but yeah, for sure. I don't know, I don't know. As we've seen now, at least, you know, six degrees, Friendster, MySpace, Facebook, Instagram, Snap.

• 20:46Speaker 01

  Now TikTok? Am I missing one? I feel like I'm missing somebody. Twitter, Twitter in there in the middle.

• 20:50Alex Kantrowitz?

  Very easily forgettable.

• 20:51Speaker 01

  What I'm saying is, is that some of them go away. TikTok is probably one of those that is maybe more likely to be a, as Rand Brederich said, a trivia question 10 years from now. Than others.

• 21:06Alex Kantrowitz?

  Yeah, it's pretty vulnerable. And you look at the companies that are coming for it. YouTube, for instance, which I think has a billion people using Shorts every day or, or month or something like that. And Facebook, which is obviously making this a priority. Facebook, I think in its earnings call last week said Reels volume is up 30%. Now, everyone looked at the fact that its revenue declined for the first time ever, which is a big problem. But a lot of that is because they're moving to this new format and it takes time for them to set up the sales team and monetize the way that they could their traditional ad formats.

• 21:38Speaker 01

  Before we move on from, because we originally started this to talk about Meta and, and I have, I have two big things I want to talk about Meta before we move on from.

• 21:47Alex Kantrowitz?

  Yeah.

• 21:48Speaker 01

  This is, this leads to something that you said maybe 10 minutes ago. Scott Rosenberg in Axios this week said, quote, "The era in which social networking served as most users' primary experience of the internet is moving behind us. This leaves a vacuum in the middle. The space of forums, ad hoc group formation and small communities that first drove excitement around internet adoption in the pre-Facebook era." Things like Discord, this is me now. But this is also Rand Broderick in Garbage Day. He goes on to say Rosenberg said that the Internet is separating into messages, messengers, and discovery engines with a gulf in the middle for genuine social networking. So what if what we're seeing, and this is why Meta seems adrift,

• 22:29Speaker 01

  is the monopoly era of social networking is ending? And this is what I'm hinting at by saying it's now splintering into multiple different competitors that no one competitor can gobble up, no one competitor can copy sufficiently, no one. And so in that sense, I don't know that Zuckerberg, and I'm using Zuckerberg specifically because this is going to be my second point, knows how to grok.

• 22:57Alex Kantrowitz?

  So my perspective on this monopoly era question is that there's never been a monopoly in social media. I don't think it's possible, and this is not a popular perspective, but I'm just going to say what I believe. I don't think it's possible to be a monopoly if with one notification. On the iPhone, you lose $10 billion in a year, which is what's happening to Meta, probably more. The fact that Apple cut off their tracking. If you don't own the operating system, if you are an app on an operating system that's controlled by your direct competitors, it is a very tough argument to make that you are a monopoly. Now, I know people will say social networking is its own category. Facebook is a monopoly.

• 23:39Alex Kantrowitz?

  But you can't just look at the one moment if it's a dominant company. TikTok today has people using it more time on average than Facebook ever had in its history. That's astonishing. And I think that's like really important context when it comes to this monopoly question. I also think that Facebook did see this movement into smaller communities come and really pushed, you know, there was two groups, exactly. Groups had two moments in Facebook. It had that first moment where like it was Facebook 1.0 and everybody was hanging out in groups and like showing that as a way to display their identity. And then people were like, I don't really need groups, I have the news feed. And then groups made a big comeback because the problem we described in the beginning, this idea of not

• 24:20Alex Kantrowitz?

  Wanting to share in front of your everybody you know, you'd much rather share with a smaller group that are interest based. And that actually revitalized the newsfeed in a way that's like total, totally underappreciated. And this is kind of funny because when Facebook did this whole pivot to privacy thing a couple of years ago, I guess they've done it four or five times at this point. But when it pivoted to privacy, what it really meant was pivot to smaller groups because it knew people didn't want to broadcast on the newsfeed. So I think that this idea that there's a gap that Scott brings up. You know, I'll just say to that, maybe, I mean, it does seem to be like a very like tech insider centric, US centric.

• 24:58Alex Kantrowitz?

  Point of view where like you look at the fact that Facebook still has, and the latest number is what 3.7 billion people using it every month. What's Discord's numbers? I mean, I'm sure that they have like pretty engaged communities and these chat apps are certainly, you know, starting to rise. But I think that with the pivots that Facebook did, the focus on groups, the acquisition of WhatsApp, which I think will probably go down as an all timer. Even better than the Instagram acquisition.

• 25:26Speaker 01

  For sure.

• 25:27Alex Kantrowitz?

  The building out of Messenger and then, you know, the, the work that they did with Instagram messaging. It, and it does seem to me that a lot of that activity that we look at as a gap. If we sort of discount, you know, some of the coastal locations in the US is still happening.

• 25:46Speaker 01

  All right. Last, last point on this, and this is sort of the bigger one, which is why I'm talking about Zuck, which is. Last week, there were a couple of stories about the Zuckerberg internal meeting or whatever, where he says certain people shouldn't be here and I'm okay with that and stuff like that. And sort of like wartime CEO sort of talk and stuff.

• 26:10Speaker 01

  When we're talking about social networking, like this was actually, people forget this, but before Facebook's IPO. One of the reasons that people were bearish on social networking is like it's, it's so fad based. Sure, there's, you have a hundred million users now, but talk to me in three years, right?

• 26:28Speaker 01

  I do think that it's not faddish in the sense that people completely abandon it like they did MySpace. What I think happens, and Zuck knows this, is that it's faddish in terms of you hook a certain generation and that's their jam. And then somebody else hooks the next generation coming up unless you get there first, right? And in those articles, there was one in The Times and one, I can't remember.

• 26:53Alex Kantrowitz?

  The Verge.

• 26:54Speaker 01

  The Verge. What he's talking about is relevancy, not only with the audience, but with the talent that Meta can hire, the employees that he can attract to Meta. Here's my question to you, and this is a harsh one. No one is ever going to confirm this, but I'm pretty sure Zuck was going to run for president. That's why he was doing that tour around the country in 2016. Didn't work out.

• 27:23Alex Kantrowitz?

  That would have been one campaign to watch.

• 27:26Speaker 01

  He, um, they obviously wanted to do crypto, you know?

• 27:30Alex Kantrowitz?

  We know that.

• 27:31Speaker 01

  Didn't work out. And now, the metaverse. If you are a young, talented, 25-year-old engineer, and you have your choice of companies to work for, how can you look at Meta and not see anything other than a giant project to keep Mark Zuckerberg relevant and interested in coming to work? The problem with Meta right now, I would posit, is it is the most in need of its founder stepping aside.

• 28:12Alex Kantrowitz?

  Ooh, that's interesting. Okay, so I will, for the sake of argument, try to articulate the Meta position. I think that the, you still come in to work with the ability to potentially

• 28:28Alex Kantrowitz?

  Influence a product that three billion people use.

• 28:31Speaker 01

  Indeed.

• 28:32Alex Kantrowitz?

  That will always be a big appeal. Then you look at like, so let's say you're deciding between tech giants. There are drawbacks everywhere. You know, Apple tends to hire overqualified people and make them pull their hair out for a number of years and sort of hate their jobs. They make pretty stuff, but it's a very top-down culture. You probably won't be listened to at Apple. And so, you know, if someone wants to, you know, if someone's a little bit more ambitious, you know, maybe Meta is a good place. Amazon, I've wrote about this in my book, Always Day One. Fascinating place to work. Four years at Amazon and you're trained in a way that no other company will train you. There's a ton of autonomy there. The only downside is that you work like crazy.

• 29:16Alex Kantrowitz?

  And it's for some people and not for others. So that does sort of say, okay, a segment of the workforce is not going to go Amazon. I remember one of the most interesting conversations that stood out to me. You know, because obviously they have a lot of holiday volume at Amazon. Where I spoke with one ex-employee from the retail organization. He got the job. He tells his family daddy's going to war and he didn't see Thanksgiving for six years.

• 29:40Speaker 01

  Yes.

• 29:42Alex Kantrowitz?

  You know, Google, Google is interesting, but is there really that big of a difference between Google and Meta? Okay, a couple hundred billion dollars on the market cap.

• 29:51Alex Kantrowitz?

  You know, but it's still, it's a search, search company.

• 29:54Speaker 01

  But this is what I'm saying to you.

• 29:55Alex Kantrowitz?

  And Microsoft is boring.

• 29:56Speaker 01

  Yes.

• 29:58Alex Kantrowitz?

  Though a good company, boring.

• 29:59Speaker 01

  What I'm saying to you, and this is true of a lot of companies, like if you go to Tesla, you're working for the god Elon Musk.

• 30:06Alex Kantrowitz?

  Yeah.

• 30:07Speaker 01

  At Meta right now, you are working for the god Mark Zuckerberg. As he flails, it feels obvious to everyone watching that he is grasping at straws, that he's looking around for things. Someday, Ready Player One is going to be real. Do we want that? Doesn't matter. Mark wants it because he wants, remember the thing, when people psychoanalyze Zuckerberg. Remember, he loves civilization, he loves Roman emperors.

• 30:35Alex Kantrowitz?

  He cuts his hair like Caesar.

• 30:36Speaker 01

  Cuts his hair like Caesar? I'm not gonna say.

• 30:39Alex Kantrowitz?

  August.

• 30:40Speaker 01

  He named his kids, yes, yeah. After, anyway. The, he, I think, psychoanalyzing billionaires is something that I try to avoid, but I do it more than I should. I think Zuckerberg realized that, what am I gonna do? Take over half the world like Angus Khan? No, in the modern era, the thing that is the most power is, all of the planet plays in my sandbox, right? And so, he's feeling that start to, the sandbox is starting to lose sand slowly. And he's trying to grasp for the next thing to keep everyone playing in my sandbox, playing my game of civilization.

• 31:18Alex Kantrowitz?

  But, yeah. But, you know, sorry, go ahead, finish your thought.

• 31:23Speaker 01

  I feel like that that's transparently what is happening here. The old ideas of we're connecting the world, there's lots of things that are connecting the world. Like, this is not, social network is not new, it's 20 years old. If I'm young and I want to put a dent in the universe, do I want to do it just to keep a middle-aged man feeling relevant and feeling like coming into work?

• 31:45Alex Kantrowitz?

  Well, I would say this, that if you're a CEO of a company, your job is to grow that company. And if you're working in social media, you are gonna deal with existential challenges all the time. This question of like, are we gonna be relevant tomorrow? Has always been with Facebook. So, and I think that like, this idea of like, you know, are you going to, you know, be in it for, you know, something exciting, or to help, you know, aggrandize a CEO? I mean, it's kind of, it's one of the features of capitalism, is when you take a job, that's what you're doing. So, but, you know, I think people can find, listen, it's definitely, I'm not gonna, you know, I'm just trying to round out this conversation.

• 32:25Speaker 01

  Yeah.

• 32:26Alex Kantrowitz?

  I don't think it's in a good place. I think it is flailing a little bit, and.

• 32:31Speaker 01

  Let me come back to.

• 32:32Alex Kantrowitz?

  We'll see, I'll say, we'll see what happens when, you know, all these crypto jobs start to dry up, or many of them start to dry up.

• 32:41Speaker 01

  Yes, that's true.

• 32:42Alex Kantrowitz?

  And then, you know, because all the talent was going to crypto. Now that it's not gonna go to crypto in the way that it was before, because there's just, what it was, $3 trillion yesterday, and now it's $1 trillion, and we'll see how far it will fall. Then we start to see what jobs people are interested in, and.

• 32:58Alex Kantrowitz?

  And I don't know, just saying, maybe working on Instagram, all your friends choose Instagram. If you find a way to get in there, take on that challenge and right the ship, that's going to be something to brag about.

• 33:09Speaker 01

  Except that they seem to be willing to sacrifice Instagram in the, in the hope of staying relevant, as I'm saying, let's put a bow on it by highlighting, underlining the other thing you said, which is if you're on someone else's platform and they can change a thing and you lose $10 billion worth of revenue.

• 33:29Alex Kantrowitz?

  Yeah.

• 33:30Speaker 01

  Did you really have a good business model? But to his credit, that's what Zuck has known all along. And why do you think he wants to make the metaverse?

• 33:39Alex Kantrowitz?

  Well, I remember, so I sat with him for my book and the last chat, the last end of that chapter is all about, is all about operating systems. And I was like, what do you feel about the fact that you're the most vulnerable of all tech giants? And you could see him sort of, you know, grimace when he talked about Apple and, you know, very proudly hold up an Android phone because it's, you know, not Tim trying to constrain him. And obviously, the metaverse is the idea to try to get beyond this. However, it seems like it's going to be, you know, quite some time. Okay, I know we want to speak about regulation. We want to speak about Amazon and Shopify, this idea of, you know, the recession, quote unquote, or maybe, you know, bold print that we're in, the travel world, and then your thoughts on virtual reality.

• 34:24Alex Kantrowitz?

  So why don't we take a break and come back right after this?

• 34:28Speaker 01

  Cool, except for the fact that on my show, we don't take breaks.

• 34:31Alex Kantrowitz?

  Well, you'll have to do an edit point right here or leave this in. Okay, so for Big Technology Podcast listeners, we'll be back after this.

• 34:40Alex Kantrowitz?

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• 35:25Alex Kantrowitz?

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• 36:07Alex Kantrowitz?

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• 36:40Alex Kantrowitz?

  And we're back on the Big Technology Podcast and the Technium Ride Home collab crossover episode. This is fun.

• 36:46Speaker 01

  Yes.

• 36:47Alex Kantrowitz?

  It's nice getting a chance to hang and talk with you, Brian.

• 36:50Speaker 01

  Just two neighbors, you know, hanging out in the hood.

• 36:53Alex Kantrowitz?

  That's right. We don't live far away at all. So I took a shot at the coast, you know, in the first half, but here we are in Brooklyn, so.

• 37:01Speaker 01

  Yes, exactly.

• 37:02Alex Kantrowitz?

  Obviously, I'm in a glass house and I'm throwing rocks. What do you want to talk about next?

• 37:09Speaker 01

  Let's do Amazon real quick because I specifically don't have a lot to say about it other than I want your opinion on what you think of Andy Jassy's first, is it a year or six months at this point?

• 37:22Alex Kantrowitz?

  Somewhere in the middle.

• 37:23Speaker 01

  Yeah, I feel like he's pulling back, obviously, from certain Bezos things. Is that more? Uh, personality difference, would you say? Or is it one of those things where if somebody's been in charge for two decades, you have a change of regime? Like, new ideas are gonna flood in because the dam has been broken.

• 37:45Alex Kantrowitz?

  Yeah, I think it's area of expertise. So Bezos has always been a retail guy. He started the bookstore. You know, he started the everything store. AWS was a side project, right? The web hosting thing was something that he effectively... So Andy Jassy, for folks who don't know, was the first person to shadow Bezos as his technical advisor. Bezos thought it would be a good idea to have him take every meeting that he took and

• 38:10Speaker 01

  Bill Gates used to do that.

• 38:11Alex Kantrowitz?

  Exactly. Watch how he ran the company. And then the idea was that once Jassy was done after a year and a half or so, he'd be able to go run something influential within the company. And eventually what he did was, you know, take this product that they were building and run AWS and obviously built it into an extremely successful business. That, to me, clearly is, if not the future of the company, at least the future of the company's profits, right? The retail organization operates basically at breakeven. It has this advertising business that's doing well and making it look profitable, which it is when you add in the advertising. But it is interesting that Jassy is coming from AWS. And I think the challenges, there will be serious challenges for this company, obviously, when he started in the pandemic.

• 38:56Alex Kantrowitz?

  You know, they ramped, I think it was what, in 2024 months, they doubled their capacity, their fulfillment capacity. And let me tell you something, in 2019, they had a lot of fulfillment capacity. So the fact that they, you know, built these fulfillment centers, hired so many people, you know, and operated in the method where as if the pandemic was perpetual and now they have to pull back? I mean, that is a very, very difficult problem to manage. And that's the, you know, AWS, you know, seems to be trucking quite well. The real question is...

• 39:29Speaker 01

  Still growing 40% of it?

• 39:30Alex Kantrowitz?

  Yeah, yeah. It's crushing. So the retail organization is now the question mark at Amazon, which is wild. And I think this is compounded by the fact that Jeff Wilkie, who was the CEO of Worldwide Consumer, Amazon, left the company pretty much as soon as Andy Jassy was named CEO.

• 39:48Speaker 01

  Because Wilkie was hoping it was gonna be.

• 39:50Alex Kantrowitz?

  I think there's a story there.

• 39:51Speaker 01

  Yeah.

• 39:51Alex Kantrowitz?

  I've heard some chirps, but you know, I'd like to get a little bit more reporting before I nail that one down. And then Dave Clark, who also ran retail, is now on his way to Flexport. I'm hoping to have on the show at some point. So what do you do if you're the AWS guy, which Jassy is? You have the biggest challenge for your company is retail. And those two pillars of the company that your company leaned on to make that retail business run smoothly? Not there anymore.

• 40:24Speaker 01

  Let me ask you an unfair question that I asked on my show recently.

• 40:28Speaker 01

  This is completely unfair. What are the odds at the end of this decade? Amazon has not spun out AWS? So I guess to frame it properly, by the end of this decade, is AWS inside of Amazon, one big tent? Or are they separate companies?

• 40:47Alex Kantrowitz?

  I think that it will hold on to AWS as long as it possibly can, unless it's forced, and I don't think it's gonna get forced. I have two reasons for this.

• 40:56Speaker 01

  Okay.

• 40:56Alex Kantrowitz?

  One is spinning off a company sucks.

• 40:59Speaker 01

  Even if it's Jassy's baby?

• 41:02Alex Kantrowitz?

  Yes. And because if you think about it, if you go into fulfillment centers, all these fulfillment centers are powered by AWS. If you look at the, you know, things like the Echo and, you know, that's run on AWS. When AWS goes down, this stuff goes down. So I think it would be really difficult to extract, you know, these or to de-link these two businesses. They're actually more linked than many of us imagine. And yeah, I don't know. I also think that like AWS does pump out a lot of cash, which will always make it's almost like this one plus one equals three type of thing where it makes the retail business look better. What do you think? It seems like you think that this is going to break out.

• 41:44Speaker 01

  I do.

• 41:45Alex Kantrowitz?

  Why's that?

• 41:46Speaker 01

  Just because I think that.

• 41:51Speaker 01

  I think that the consumer business, I understand what you're saying that AWS powers all the things, it'll power them going into healthcare, you know? But I think that the consumer business makes more sense as a consumer business that focuses on consumer things, even consumer healthcare. And that AWS makes more sense as an arms dealer, serving everyone. And I think that also Jassy being the CEO makes that more likely. But this is one of those things where no one's gonna really hate us if we're wrong either way. This is impossible to prognosticate on.

• 42:31Speaker 01

  But this does lead me into, I do want to hit Shopify real quick because Shopify is the, no Albanian army, that was the Netflix analogy. Shopify was the rebel alliance taking on Amazon and they haven't like round-tripped all the way back to their IPO valuation because they went public and no one knew who the fuck they were. But they have really round-tripped from their heights. And so, do you have any sense of what's going on there? Like, the glib thing to say is that this is another pandemic casualty, but that can't explain, their market, gross market, whatever GMV stands for, I can never remember, is

• 43:16Speaker 01

  still growing.

• 43:17Alex Kantrowitz?

  Right.

• 43:18Speaker 01

  Why all of a sudden are people so bearish on Shopify?

• 43:22Alex Kantrowitz?

  Well, it's a great question. I think there's been this great meme going around where it's like you never want to be Canada's most valuable company.

• 43:30Speaker 01

  Right.

• 43:31Alex Kantrowitz?

  Like, people talk about research and motion at BlackBerry and it's like that didn't work out very well.

• 43:35Speaker 01

  And Nortel.

• 43:36Alex Kantrowitz?

  Yeah, this is a thing, so, welcome to club Shopify.

• 43:38Speaker 01

  Yeah.

• 43:39Alex Kantrowitz?

  You haven't broken a curse. I mean, it is still worth $43 billion, but it's trading, it's been trading in the 30s and, let's see, last November it was at 157. So that's one heck of a decline. Couple of things that come to mind. One is that I think investors were largely trading Shopify in belief that it had a future value to bring. And when the rate goes up, then all of a sudden that goes by the wayside and you've seen Shopify and lots of e-commerce get hit. I also think there was this belief that during the pandemic that we would just stay

• 44:11Speaker 01

  Yeah.

• 44:11Alex Kantrowitz?

  in that e-commerce world. We haven't. I would also posit that Shopify had more than just the storefronts. That it wanted to make work. It wanted to do its own fulfillment network.

• 44:23Speaker 01

  Bought a fulfillment company, yeah.

• 44:24Alex Kantrowitz?

  That where what's going on with that? It's gone. It's gone nowhere.

• 44:27Speaker 01

  Okay.

• 44:28Alex Kantrowitz?

  And then like I one last thing. And we talked about, you know, is your business going to be vulnerable if Tim Cook makes a decision?

• 44:36Speaker 01

  Hmm.

• 44:36Alex Kantrowitz?

  But it seems clear to me that the fact that companies using Shopify can no longer, you know, optimize their ad campaigns and

• 44:44Speaker 01

  The cost of acquiring customers has gone up.

• 44:46Alex Kantrowitz?

  It's gone up. And if you're on razor thin margins, which a lot of retail companies are. And all of a sudden, you know, Apple says, all right, people, if you don't want to be tracked, you don't have to be tracked. Everyone's like, I don't want to be tracked by Facebook anymore. But meanwhile, it does end up hurting a lot of these shops, which in turn hurts Shopify.

• 45:02Speaker 01

  Yeah, I that's that's dumb of me. I had forgotten the the ATT angle.

• 45:07Alex Kantrowitz?

  And one more thing, the supply chain. Could you imagine being, can you imagine, let's say, let's take this one example. You are a small business owner that, you know, you got laid off or you got fed up with your job in, let's say, May or June 2020. And you said, all right, it's time for me to create, you know, everyone's at home. I'm going to create finally my dream company. So online. You know, we'll do stuffed pigeons and your stuffed pigeons start flying off the shelves, the virtual shelves that is. And with Facebook ads, you have very low cost to reach people.

• 45:36Speaker 01

  Right.

• 45:36Alex Kantrowitz?

  And the business seems to be doing great. And then all of a sudden, you can't get your shipments of, you know, crates of stuffed pigeons in from China. Because it used to cost $2,000 to ship that container. Now it costs 2025. Now the cost is coming down. But when you get hit by this on all angles, you might shut down. And that is something that Shopify, you know, will either get hit by or at the very least, the growth, the growth that they expected to continue when conditions were good is much harder to come by with all these factors.

• 46:08Speaker 01

  Or we're in a recession. Look at my segue power here.

• 46:11Alex Kantrowitz?

  It's pretty good.

• 46:13Speaker 01

  Yeah. Last week's earnings, you know, everybody in tech reported last week and there were some. Bad reports, Meta maybe, one of them, you know,

• 46:23Alex Kantrowitz?

  Of course that was bad.

• 46:24Speaker 01

  Shrunk for the first time. Except for the fact that it wasn't disastrous and no one, like Tim Cook said, we see weakness here and there. Google was an interesting one, Alphabet.

• 46:34Alex Kantrowitz?

  Yeah.

• 46:34Speaker 01

  Because if anybody has a sense of the global advertising market, and thus what you're talking about, customer acquisition, and they didn't really sound the alarm that, boy, we're seeing cutbacks everywhere, recession is coming. I'm not going to ask you, no one, there's no one on this planet, even Warren Buffett, that can predict if we're in a recession, predict when recessions come. But what is your thought in terms of if tech was, tech ballooned during COVID because tech was the first to say, hey, listen, we're still doing pretty good over here. I know everybody's been laid off, but if they're saying, it's not that bad, we're seeing weakness, but it's not that bad.

• 47:19Speaker 01

  Is that tech being exceptional? And maybe there still will be a recession, but tech will be fine? Or maybe we're not having a recession?

• 47:27Alex Kantrowitz?

  Yeah, I think tech will generally do better than most sectors in a recession. Talk about Amazon Web Services, which we were just talking about. It's not like enterprise companies are going to shut down their websites because, you know, the economy is contracting a little bit. That business will still do strong. I saw some analysts talk about how they expect it to go down 10%. You know, that seems ridiculous to me. But I also think that a lot of the, you know, not-too-bad moment that we saw was largely because we were expecting really bad.

• 47:56Speaker 01

  Yeah.

• 47:57Alex Kantrowitz?

  But it was still bad.

• 47:58Speaker 01

  Yeah.

• 47:58Alex Kantrowitz?

  Like with Apple, for instance. They were expected to, you know, take a $4 to $8 billion hit.

• 48:03Speaker 01

  Right.

• 48:04Alex Kantrowitz?

  You know, because of supply chain and shutdowns in China.

• 48:07Speaker 01

  But iPhone still grew 3%.

• 48:09Alex Kantrowitz?

  Yeah, it grew, but MacBooks didn't grow as much as they wanted. You know, they said, okay, we came in a little bit under than the, you know, the $4 billion that we expected. And everyone's like, hot damn, Apple, you crushed it.

• 48:22Speaker 01

  Yeah.

• 48:22Alex Kantrowitz?

  They still took this $3-plus-billion-hit.

• 48:24Speaker 01

  Yeah.

• 48:25Alex Kantrowitz?

  So, I don't know, what's your take? What do you, do you think, do you think we're in a recession?

• 48:30Speaker 01

  Here's the interesting thing. Recession are, at least in our lifetimes and at least going back to the 20th century, a binary thing. Like, you either, it's all or nothing. Like, everything's down and like, there's this weird thing where we have inflation right now, but jobs, everybody's, not everybody's employed. Take this in the spirit of-

• 48:52Alex Kantrowitz?

  We're close to full employment.

• 48:53Speaker 01

  Full employment and wages still going up. You have, like, I guess what I'm trying to say is, what if we had, like, a spotty recession? I guarantee you, for certain sectors of the tech economy right now, full-on recession, full-on, we've seen layoffs-

• 49:12Alex Kantrowitz?

  Crypto. You're in a depression.

• 49:14Speaker 01

  But, but that's my point, is that, like, maybe it doesn't matter, because if, depending on where you are in the economy, you're going to be experiencing one thing or another.

• 49:26Alex Kantrowitz?

  Yeah. Do you remember after the pandemic, they were talking, or mid-pandemic, they were talking about this K-recovery?

• 49:32Speaker 01

  Yes.

• 49:32Alex Kantrowitz?

  Where half of the, you know, half of folks, you know, do well have to do poorly.

• 49:36Speaker 01

  Right, right, right. So what if, what if, like, in aggregate, everything muddles along and says, "Not that bad," just like we said with the tech, but if you look at certain areas of the elephant, they're bleeding out-

• 49:50Alex Kantrowitz?

  Yeah.

• 49:50Speaker 01

  And other areas of the elephant are perfectly fine. It just depends on what part of the elephant you're looking at. That might be what we're doing right now?

• 49:59Alex Kantrowitz?

  And it's, it's interesting. I mean, the stock market last week had a very nice up. I think the stock market was up-

• 50:04Speaker 01

  This month-

• 50:04Alex Kantrowitz?

  Something like 7% in July.

• 50:06Speaker 01

  This month was the best month since 2020-

• 50:08Alex Kantrowitz?

  Right.

• 50:09Speaker 01

  For the stock market.

• 50:10Alex Kantrowitz?

  And people said there, I mean, we're, the S&P is still down-

• 50:12Speaker 01

  By this month, I mean July. Yes, sorry.

• 50:14Alex Kantrowitz?

  Yeah, the S&P is still, is still down significantly on the year. It's definitely in correction territory.

• 50:20Speaker 01

  Well, and here's the other-

• 50:21Alex Kantrowitz?

  You know, there were people predicting it was gonna be 38%, and it's not, it's definitely not there yet.

• 50:25Speaker 01

  You keep talking about crypto, and so, again, it, I'm saying, my thesis is, it depends on where you look, because, last week, there was another story of Katie Wu, somebody raised another $500 million crypto fund, right? Right. So if you're saying to me, oh, well, you said sort of obliquely that, well, all those people that were attracted to crypto startups, they're not gonna, the crypto startups are gonna be gone. I don't know. They're still a freaking, Andreessen has a $5 billion crypto fund. So you see what I'm saying? Like, I get it and I see it in the startups, like, you know, companies that a year ago we'd be looking at to invest in and they asked for a $30 million valuation

• 51:08Speaker 01

  are coming and very happy to get 10, you know, so.

• 51:11Alex Kantrowitz?

  Are you still investing in crypto companies?

• 51:13Speaker 01

  Um, I've only done two or three.

• 51:16Alex Kantrowitz?

  When was the last one you did?

• 51:19Speaker 01

  Uh, not last quarter. So it would have been in the spring.

• 51:23Alex Kantrowitz?

  Yeah, I think that we'll still see action in crypto, but.

• 51:27Speaker 01

  But this is my point. This is my point.

• 51:29Alex Kantrowitz?

  Right.

• 51:30Speaker 01

  Okay. Valuations have come down.

• 51:32Alex Kantrowitz?

  Yeah.

• 51:32Speaker 01

  People have been writing, VCs have been writing notes about, you know, hunker down and, you know, and yes, I had an investment blow up in three weeks.

• 51:42Alex Kantrowitz?

  Wait, wait. Tell that story. How much can you share about that?

• 51:45Speaker 01

  Um, well, very good founder who, and literally calls me on the phone three weeks after the check clears and says, listen, the $2 million that I needed from, it was a million dollars from one other investor, a million to close this round, they walked. They're literally ghosting me not returning their calls, my calls. And so, listen, I'm gonna return your money.

• 52:09Alex Kantrowitz?

  Ah.

• 52:09Speaker 01

  The check cleared three weeks ago. Okay. Now, at the same time, like, I've seen rounds where not me, but the lead investor said to the company, your valuation is absurd and it got cut in half in two days. Okay. So everybody's in flux, right? But my point that I'm trying to make here is that, like you said about dry powder, there's still tons of money. The biggest rounds that I've seen this summer.

• 52:39Alex Kantrowitz?

  Right.

• 52:39Speaker 01

  Continue to be crypto. So you're saying that crypto is whatever, but the, what we, $100 million A rounds, $50 million seed rounds were common six months ago across the spectrum. You only see those in crypto right now.

• 52:54Alex Kantrowitz?

  Do you think that crypto is still gonna be that hot place to work like it has been over the past couple of years?

• 53:02Alex Kantrowitz?

  Maybe it is. If that money is coming in, maybe it is.

• 53:05Speaker 01

  Yes.

• 53:06Alex Kantrowitz?

  I'm looking at the blowups of like

• 53:08Speaker 01

  And I want to say to you

• 53:09Alex Kantrowitz?

  Three Arrows Capital and Terra Luna.

• 53:11Speaker 01

  But this is based on founders that I'm talking to. Young people believe in this.

• 53:17Alex Kantrowitz?

  Okay, so I, you know, I'll admit, maybe I'm, maybe I'm wrong about the extent of the damage in crypto. I do look at the big blowups and, and

• 53:25Speaker 01

  You asked me, am I investing in crypto?

• 53:27Alex Kantrowitz?

  Yeah.

• 53:27Speaker 01

  I'm not. So that must mean I'm a skeptic on some level.

• 53:30Alex Kantrowitz?

  Right.

• 53:30Speaker 01

  If I'm not putting my money where my mouth is.

• 53:32Alex Kantrowitz?

  Uh huh.

• 53:32Speaker 01

  But I'm also saying that I'm seeing the energy, the energy hasn't left. And also, I was involved in the crypto space during the crypto winter in 2017, 2018, after the ICO boom went bust.

• 53:44Alex Kantrowitz?

  Yeah.

• 53:45Speaker 01

  And those people disappeared for a certain amount of time. Now, listen, Brian, you weren't plugged into the circles where it's still, I get it, I get it. It's not like that where a wind swept the plane and it was clear. People are still working, people are still churning, people are still raising big rounds.

• 54:03Alex Kantrowitz?

  But there is, yeah, it is interesting. You know, it's, it's this balance because like, I don't doubt that that's true. I also know that we're seeing a lot of, a lot less NFT profile pictures on Twitter where it has been, and this, this is the optimist case. We gave the optimist case for Facebook, you know, let's give the optimist case for crypto. And I spoke about this with Gavin Wood on my show a little bit ago. He's the co-founder of Ethereum.

• 54:30Alex Kantrowitz?

  It could be that a lot of these bad actors, you know, do get swept out of the system. And, you know, it has its mini financial crisis and actually starts to build based off of that base, learn those hard lessons and be useful in a way that people hoped. However, I would say the one issue with that is that it's, you know, deregulated by default. And so, you know, when, when the mainstream banking system goes down, it learns lessons, it writes some laws, maybe weak laws, but laws that are good enough to keep it out of that same trouble again. And that's how it evolves and gets better. I wonder what if that happens with crypto.

• 55:02Speaker 01

  I want to, I want to say this last thing about crypto and stress again that I don't, I don't have any skin in this game. I'm not like a crypto maximalist. I'm not a crypto pessimist. But let me, let me play the devil's advocate of crypto pessimist right here. And Jason Calacanis has sort of been banging the spell for a while and he's clearly a pessimist. Although not, Jason once told me that he thought he was going to put 5% of, everyone should put 5% of their money into Ethereum just as a hedge for the future or whatever.

• 55:32Speaker 01

  Here's the cynic's take that I've heard of crypto and it's a cynic bull case.

• 55:39Speaker 01

  They need one more pump to happen. The big pools of money do. So there's a lot of people that have told me, oh, I guarantee you crypto will go back to its highs at some point over the next three years because all of this money needs it to happen. And the reason is because in the coin tokenization economy, you don't need 10 years for your investment to pay off. You just need your investment to get hot. Yeah. Have an ICO and have a liquid coin that you, and so there's so much money going into crypto that they're going to need to pump those bags one more time to get out clean. But who's going to put that money in? Is it going to be the retail?

• 56:20Speaker 01

  It's the $5 billion, oh, to, when the pump happens? Oh, yeah, right. No, it's, retail's gonna be left holding the bag like it has in the past. I wonder if people are learning their lesson now. The only fly in that ointment is if the SEC or FTC does crack down, let's say tomorrow the SEC goes to Coinbase and says, by the way, 90 of these coins on your exchange are, what's the word I'm looking for? Securities. Securities.

• 56:52Speaker 01

  That's gonna put a crimp in a lot of things. You mean, we're not going to be able to trade bullshit to coin anymore? Yeah, right, right, right, right. So there's, there's a race between can we pump the bags? This is the cynic's take. This is not Brian's take. Right. One more time. And then we'll get out.

• 57:09Alex Kantrowitz?

  Yeah.

• 57:09Speaker 01

  It's like every bubble. Can you get out Indiana Jones style, pull your hat out before the door crashes down?

• 57:15Alex Kantrowitz?

  I think it might be over, but I could be proven wrong. I do think that there's potentially interesting applications of this.

• 57:21Speaker 01

  Positive take is, tons of smart people believe in this. There's tons of energy.

• 57:27Alex Kantrowitz?

  That to me is just, it's not enough. I need more than that.

• 57:32Speaker 01

  Um, okay. Let me give you, this is adjacent. Um, this is at the end of our show running notes here.

• 57:38Alex Kantrowitz?

  Yeah.

• 57:39Speaker 01

  I felt that way about VR.

• 57:41Alex Kantrowitz?

  Yeah, yeah. Let's talk about.

• 57:42Speaker 01

  And so this gets to the metaverse because crypto plugs into the metaverse as sort of like your.

• 57:49Alex Kantrowitz?

  Doesn't really have to though.

• 57:50Speaker 01

  Digital property, but that's, this is the bull case.

• 57:53Alex Kantrowitz?

  Okay.

• 57:53Speaker 01

  Okay.

• 57:54Alex Kantrowitz?

  I love this example that you're about to cite.

• 57:57Speaker 01

  Okay, um, on, uh, whatever the app is, it's one of the.

• 58:01Alex Kantrowitz?

  VR chat?

• 58:02Speaker 01

  VR chat. I think it might be on by Meta. I can't remember. Somebody has created a virtual Kmart that thousands of people play in all the time. And you do essentially role-playing games in the same way.

• 58:14Alex Kantrowitz?

  Right. You work as a cashier in VR.

• 58:17Speaker 01

  Right. And, and you, you go and you buy something and you check out and whatever. Listen, Alex, in 1990, I was the captain of a starship in a text-based Star Trek role-playing game on the Prodigy message boards. Okay. This is the sort of grassroots from the bottom up.

• 58:36Alex Kantrowitz?

  Right.

• 58:36Speaker 01

  Sort of creativity that says to me, there's energy in a space. Okay. It doesn't say to me, there's energy in a space if people create a coin that its whole purpose is to just get a $10 billion market cap and then all of a sudden rug pull and go to, you know, wherever. People with no monetary incentive, nothing other than this is just cool. I want to do this. That, and I've been skeptical on VR since I've been an adult because since I've been an adult, VR was always the next big thing and it never has been. You see things like that happen where there's no goddamn good reason for this. It's just, it's fun and people want to do that. That's where then eventually accidentally someone creates a business out of it later on.

• 59:20Speaker 01

  So your skepticism about crypto is, and I agree with you, that it's been a lot of the pretty people doing a lot of just get rich quick stuff. But in a winter, people in crypto, in VR, do things like, hey, let's create a virtual Kmart.

• 59:37Alex Kantrowitz?

  Yeah.

• 59:38Speaker 01

  And play in it, thousands of us every day.

• 59:39Alex Kantrowitz?

  Yeah, and I think that really goes to the size of the market question, right? Which is, is the size of the market in VR gonna be more than gaming? There was an article that we both read before, and I think it was by Ryan Broderick or Casey Newton, about how Facebook is actually selling an amazing number of Oculus headsets compared to the Xbox or the PlayStation. But if that's the comp, you're looking at it in the gaming world, right? So there is, you know, a ceiling there. It is a great gaming service that people might really like, but it's not this new verse, new universe.

• 1:00:18Speaker 01

  Right, because you're not hearing of someone playing the Red Dead Redemption of VR, or the Fortnite of VR. You're not hearing that because it's not happening.

• 1:00:26Alex Kantrowitz?

  Yeah, but even that is a gaming use case. And if it is, great, it's a good business for them. But it's a gaming business, which means that its total addressable market is much smaller. And now I think we're in the same place with crypto, where we know there's gonna be something, I think. And the question is, is it the change-the-world use case, like the Web3 evangelists want it to be, which their parallel would be Zuckerberg and change the company into Meta? Or is it gonna be something smaller, maybe akin to gaming for the Oculus? And if it gets into like Xbox territory, great, you know, that's pretty good. But we'll see what happens.

• 1:01:01Speaker 01

  You know, real quick, and then we'll do our last one, which we should do the travel one.

• 1:01:06Alex Kantrowitz?

  Travel one, yes.

• 1:01:07Speaker 01

  See, you and I have similar hosting instincts.

• 1:01:11Speaker 01

  You know Bobby Goodlobby?

• 1:01:12Alex Kantrowitz?

  Yes.

• 1:01:13Speaker 01

  He's done Twitter threads and he did a Twitter space and I've tried to get him to come on my show to talk about this. But here's my biggest problem with crypto right now as an investor and as just an observer of the space. Is that Bobby's thing was like, can we just get the religion out of this? Like, why does it have to be? It's almost like crypto as a space is hamstrung by the fact that it has to adhere to the dream of Satoshi or whatever the fuck, right? And so it is, I never asked you if I could curse on your show, I'm sorry. If you have to go back and-

• 1:01:46Alex Kantrowitz?

  You can now.

• 1:01:47Speaker 01

  If you've got to go back and edit, I apologize.

• 1:01:49Alex Kantrowitz?

  Yeah, yeah.

• 1:01:51Speaker 01

  That's my problem where in this space, there are good ideas that I see happening, even in things like DAOs, which seem crazy to people and stuff like that.

• 1:02:02Speaker 01

  But, good idea, good idea, good idea, and then we're going to do it on the blockchain and do a token. And half the time, I'm like, but why?

• 1:02:09Alex Kantrowitz?

  Yeah.

• 1:02:09Speaker 01

  What is the point of, well, because we have to adhere to this religion that we've come up in? And on top of that, like, the point that I've made on my show is, the number one thing to get a company successful is to delight a customer. And if every time you try to delight a customer, you make them jump over this hurdle that you have imposed because of your religion, that complicates it and makes it less delightful to them, then you're not going to have a successful product.

• 1:02:41Alex Kantrowitz?

  Right, and I think that's spot on. I think that like, there's a difference between building technology that's useful to people, which I think a lot of people in crypto are trying to do, and running a religion. And I think that it has become a religion for a lot of people who do see, you know, these messianic use cases for it. And so, you know, Bobby and I, we've gone back and forth, maybe I can tell you off the air about it, but uh- I don't know, we got into some spat, but I think everything's good now. But his idea of taking the religion out of crypto, there's only one reaction to that. I'm doing a stand ovation.

• 1:03:14Speaker 01

  Yeah.

• 1:03:14Alex Kantrowitz?

  Standing up and applauding, take the religion out of it.

• 1:03:17Speaker 01

  Yeah.

• 1:03:17Alex Kantrowitz?

  And you might be able to.

• 1:03:18Speaker 01

  And by the way, the blockchain can have use cases.

• 1:03:21Alex Kantrowitz?

  Yeah.

• 1:03:21Speaker 01

  But that's my point, is that you're bending over backwards to fit everything into this blockchain mold that you have.

• 1:03:27Alex Kantrowitz?

  Exactly. And we've seen that on like the three avatar show where like people come in and try to give use cases for Twitter and they're just absolutely destroyed. Okay, travel?

• 1:03:36Speaker 01

  Yes.

• 1:03:37Alex Kantrowitz?

  So I read this great story on Curbed about how you can no longer flight hack.

• 1:03:43Speaker 01

  Yes.

• 1:03:43Alex Kantrowitz?

  And like even like, you know, they, the people who are like airline, you know, status members or.

• 1:03:50Speaker 01

  Mile runners. Can I tell you a story? This is why I wanted to do this.

• 1:03:53Alex Kantrowitz?

  Yeah, yeah, yeah.

• 1:03:53Speaker 01

  I once flew, I've only been to Hawaii once in my life. I flew to Hawaii for 24 hours because I was doing a status run because Delta was doing this insane deal. That I would, it was, it was like, it was like a $1,200 ticket, right? And so it's like a, I was living in Detroit at the time. So I can't remember, it was like a 15 hour flight each way.

• 1:04:16Alex Kantrowitz?

  Where did you connect? In the Philippines or something?

• 1:04:18Speaker 01

  No, it was direct.

• 1:04:19Alex Kantrowitz?

  Oh, okay.

• 1:04:20Speaker 01

  Yeah, yeah, yeah. But that was the point. No, no, no. I had to drive to Pittsburgh from Detroit, fly out of Pittsburgh.

• 1:04:27Alex Kantrowitz?

  I knew it couldn't have been that easy.

• 1:04:29Speaker 01

  Exactly. But it was a $1,200 ticket. So it was, okay, wait. I can either try to do all this with the credit cards or do these many flights. I'd have to do like four or five flights.

• 1:04:38Alex Kantrowitz?

  Yeah.

• 1:04:39Speaker 01

  This one flight, it'll be over in three days. I'll get to see Waikiki Beach and I'll turn around and come back.

• 1:04:45Alex Kantrowitz?

  Yeah.

• 1:04:45Speaker 01

  Right. So I, I am.

• 1:04:47Alex Kantrowitz?

  So you did that to get status.

• 1:04:48Speaker 01

  To get status because I ended up getting like 70,000 miles or some shit and they were MQMs and.

• 1:04:54Alex Kantrowitz?

  Yeah.

• 1:04:54Speaker 01

  So listen, I'm, I'm a points guy and a, a flight runner from way back. So I get this.

• 1:05:01Alex Kantrowitz?

  Yeah, but like all this stuff that's happening is basically, the article says that you can't really hack flights. It's just going to be miserable, you know, for you or, and you know, basically there's not much you can do. The kicker is amazing. It says if it's if it's less than seven hours drive.

• 1:05:18Speaker 01

  Just drive.

• 1:05:19Alex Kantrowitz?

  And, you know, this is another great line. Airlines will laugh in your face as you scroll the points guy while maybe getting your third round of COVID in the airport. Like it has become such a disaster. I'm saying this as I'm about to get a flight. So, you know, pray for me, everyone. But, but I do think that that the state of travel right now, it's a pain that, you know, a lot of us are traveling over the summer.

• 1:05:43Speaker 01

  You should have on your show. Do you know Rafat Ali, who runs?

• 1:05:47Alex Kantrowitz?

  Yeah, yeah, I do. Yeah. Although I have, I'm happy to have him. I don't mind. I feel like every time I see Rafat tweeting one of my stories, like he's always saying something negative about it. So.

• 1:05:57Speaker 01

  You and your, you and your media.

• 1:05:58Alex Kantrowitz?

  I got, I think, yeah, I got, I got a lot of haters out there. I think Rafat might be among them. But if he wants to come on the show, you know, he's welcome. And the people who don't like what I'm doing, like, I'm happy to have him on.

• 1:06:09Speaker 01

  The point of what's happening with travel right now is forget mileage runs and, and points.

• 1:06:16Alex Kantrowitz?

  I didn't even know there was such thing as mileage.

• 1:06:18Speaker 01

  Hackers. Oh, there's, there's entire websites that used to exist. And I did this more than a decade ago. So I haven't done it recently. But like, that will tell you that will scan the things and be like, if you, if you fly to Taos and then down to Fort Lauderdale and do this, you'll get the maximum. It's all about getting the maximum amount to get the status and get them, whatever. And airlines know that. And that's how they fill. Look, the, the point of this travel stuff is, forget that. You can't even do connecting flights. Yeah. Don't plan a, don't do a trip that requires you to have, forget a 50 minute layover, layover in Detroit. A three hour layover in Detroit might not work for you. Like, that's the point. Like, and, and the interesting thing to me is like,

• 1:07:02Speaker 01

  it's, it's sort of like how people in America don't realize that inflation as a problem is global. Like, I first started hearing about this from my friends in Britain, when like Heathrow was like lines for 12 hours and people's bags getting lost or whatever. Like, this is to me, and you're closer to this than I am, this is the whole, this is the. The globalization infrastructure that has existed since the 90s, COVID broke it. Now, either it's reconstituting itself and rebuilding, or it's not, but right now, it is not functioning as a healthy system.

• 1:07:41Alex Kantrowitz?

  Yeah, I think this is definitely a COVID outgrowth where people were at home for so long and are now doing what's called revenge travel.

• 1:07:48Speaker 01

  Yes.

• 1:07:48Alex Kantrowitz?

  And I've done it, and it's awesome, but it just stinks being in the airport. So my advice here, so why don't we end with our number one travel tip?

• 1:07:58Speaker 01

  Yes.

• 1:07:58Alex Kantrowitz?

  And then, my advice to everyone is if you're flying, this is hilarious segment to end on. Ladies and gentlemen, if you're flying this summer, my one piece of advice is, it's obvious, but it's served me well, is if you can help it at all, just go carry on. And there's a form of backpack that I just discovered. It's called the MCL, which just means the maximum, no, MLC, the maximum legal carry-on. And you can get it, and it's like a 45-liter backpack. Go out, make the investment. I'm gonna try to fly with it now. I'm not checking that thing. And then you won't worry about your bags. You've just gotta worry about the delays and stuff like that, and the crowded airports, and the cancellations. But I will take one big issue

• 1:08:39Alex Kantrowitz?

  off of your plate, and if you can roll your clothes up and fit it in that carry-on, you're gonna be a happy camper.

• 1:08:46Speaker 01

  Well, I don't know about your MCU backpack, but, because I haven't even thought of the losing the bag stuff, but I would say no connecting flights. That's the other thing.

• 1:08:58Alex Kantrowitz?

  No connections.

• 1:08:59Speaker 01

  Pay the extra money to go direct, or fly at 5:00 AM to go direct, because that lessens the odds of stuff going bad.

• 1:09:07Alex Kantrowitz?

  Can I tell one more story before? So I was flying from New York to Vegas, doing a bachelor party for one of my friends, not in Vegas, in Utah. It was clean, wholesome fun, you know, hanging out in Zion National Park, which was awesome. And We, there was a storm on the way to Nevada and that would have added about an hour of flight time and the copilot that was coming in, you know, with that extra hour was now illegal to fly because he would be in the air too long.

• 1:09:37Speaker 01

  Right, right.

• 1:09:38Alex Kantrowitz?

  And so like we were just sitting there and just waiting, you know, to be deplaned. And then some guy sitting in like row 15 raises his hand and he's like, I'm a pilot. I work for Delta. Just put me in the copilot seat and I'll get you there. And he apparently hadn't started drinking yet. So they're like, they told us this all over the intercom. They're like, all right, well, we're going to log him in and away we go. And it was, it was a miracle and we got there.

• 1:10:02Speaker 01

  So your, your, your travel tip is fly with a pilot.

• 1:10:05Alex Kantrowitz?

  Get your pilot's license and pray for the best. This has been fun.

• 1:10:11Speaker 01

  Yeah. Alex, listen, again, you've been on the show a couple of times. So people know, big technology podcast, big technology newsletter. If, if, if someone listening right now, what would you rather than do? Listen to the podcast or subscribe to the newsletter?

• 1:10:24Alex Kantrowitz?

  I, I think the podcast is where, is where folks who, especially if you're here to this point of the show, you enjoy the audio format. I, I work hard on both. But if you want to check out the podcast, like I said, I think it's a nice compliment to Tech Mean Ride Home. And if you're a big technology podcast listener and you're here with us to this point, I recommend Tech Mean Ride Home. You're going to like it and it's a nice compliment to my show. And I think listening to, to both of them, you know, will just make the experience much richer, you know, for, for each episode.

• 1:10:57Speaker 01

  And you'll hear Alex on it even when he's not verbally on it.

• 1:11:01Alex Kantrowitz?

  Are you reading my dumb tweets?

• 1:11:02Speaker 01

  When he has, when he has a scoop, I will do the, the story on my show and read his dumb tweets. And yeah, absolutely.

• 1:11:09Alex Kantrowitz?

  So apologies for the tweets. I've worked hard to reel those in, but it's just the impulse.

• 1:11:15Speaker 01

  I don't think of you as a dumb tweeter at all.

• 1:11:17Alex Kantrowitz?

  Thank you, man. Thank you. Brian, this has been fun.

• 1:11:19Speaker 01

  Yep.

• 1:11:20Alex Kantrowitz?

  How do you usually sign off your show?

• 1:11:22Speaker 01

  When I do the thing with Chris Messina, I stumbled onto my closing catchphrase is, I love everybody.

• 1:11:28Alex Kantrowitz?

  That's a great one.

• 1:11:29Speaker 01

  Do you want to know why?

• 1:11:30Alex Kantrowitz?

  Why?

• 1:11:31Speaker 01

  Because we usually do them late at night, like nine, nine PM on a Thursday. And so to get to sleep afterwards, I have to take gummies.

• 1:11:39Alex Kantrowitz?

  Oh, okay.

• 1:11:40Speaker 01

  So I'm, I'm stoned half the time when we end our show at like 10:30 at night. And so just one night I'm like, I don't know, man. I love everybody.

• 1:11:49Alex Kantrowitz?

  That's a great way.

• 1:11:50Speaker 01

  So now I say, I love everybody. So I love everybody.

• 1:11:52Alex Kantrowitz?

  Okay, well, just a quick thank you to the team that helped me with Big Technology Podcast, LinkedIn for having me as part of the Podcast Network, Nick Watney, the master of audio, and all of you, the listeners, and to all Tech Meme Right Home listeners that have stuck around, would love to have you on the feed. We do our show every Wednesday with a Tech Insider, our Outside Agitator. And with that, I just want to say, I love everybody. I love Alex. Thanks, man. Thank you.

• 1:12:23Speaker 02

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