Microsoft Q4 earnings, Spotify’s subscribers rise, and Instagram walks back its changes

The Verge's Nilay Patel, David Pierce. and Alex Cranz discuss the quarterly tech earnings from Apple, Microsoft, Spotify, and more. Further reading: Meta and Apple in ‘deep’ competition to build the metaverse, Zuckerberg tells staff Yes, it’s weird for the two-year-old Meta Quest 2 to go up in price Meta might let anti-vax posts back onto Facebook and Instagram Instagram walks back its changes Microsoft Q4 2022 earnings: Windows and Xbox fall in $51.9 billion quarter Meta reports revenue decline for the first time in Q2 earnings Here’s where to buy the Meta Quest 2 before it costs $100 more Alphabet Q2 2022 earnings show profits dropped compared to last year Comcast’s broadband business stopped growing for the first time ever Spotify’s subscribers rise to 188M amid podcasting setbacks Spotify amps up fiction podcasts with new leader of scripted content Spotify paid $123 million for audiobook company Findaway Spotify has stopped making its Car Thing dashboard accessory Apple’s latest iOS 16 beta ensures you can’t hide your mistakes with an edit Apple’s new Home app in iOS 16 is better but still half-baked SpaceX says Dish’s 5G plan would be ‘detrimental’ to millions of Starlink users You can re-watch Game of Thrones in 4K on HBO Max next month President Biden’s awesome video conferencing setup starts with a $7,000 Zoom gadget Asus’ compact Zenfone 9 comes with incredible gimbal-like camera stabilization Email us at [email protected], we'd love to hear from you. Learn more about your ad choices. Visit podcastchoices.com/adchoices

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

• 0:00Speaker 00

  This episode is brought to you by On Investing, an original podcast from Charles Schwab. Each week, hosts Lizanne Saunders, Schwab's Chief Investment Strategist, and Colin Martin, Head of Fixed Income Research and Strategy for the Schwab Center for Financial Research, bring you fresh insights on what's happening in the markets and why, and what the implications might be for your portfolio. Join Colin and Lizanne as they explore questions like, how do you evaluate corporate bonds that look interesting? And what sectors are on the move right now? Download the latest episode and subscribe at schwab.com/oninvesting, or wherever you get your podcasts.

• 0:45Speaker 00

  This episode is brought to you by On Investing, an original podcast from Charles Schwab. Each week, hosts Lizanne Saunders, Schwab's Chief Investment Strategist, and Colin Martin, Head of Fixed Income Research and Strategy for the Schwab Center for Financial Research, bring you fresh insights on what's happening in the markets and why, and what the implications might be for your portfolio. Join Colin and Lizanne as they explore questions like, how do you evaluate corporate bonds that look interesting? And what sectors are on the move right now? Download the latest episode and subscribe at schwab.com/oninvesting, or wherever you get your podcasts.

• 1:41Nilay Patel?

  Hello and welcome to The Vergecast, the flagship podcast of infinite scrolling vertical video, which is happening to you whether you like it or not.

• 1:49Alex Cranz?

  Not on Tumblr.

• 1:50Nilay Patel?

  It's just been the theme of the week.

• 1:53Alex Cranz?

  There's like two, two social medias that don't do it yet.

• 1:56Nilay Patel?

  Yeah, it was Twitter, which can't do anything.

• 1:59Alex Cranz?

  And Tumblr.

• 2:00Nilay Patel?

  Which can't do anything. The two least innovative social media platforms have not yet pivoted to TikTok.

• 2:04Alex Cranz?

  They're just out there like, "We're boring. Love it."

• 2:07Nilay Patel?

  Everyone else, YouTube.

• 2:07David Pierce?

  Tumblr's still out here, they're like, "Do you like a slideshow? Can I interest you in a gallery of images?"

• 2:12Nilay Patel?

  Has Pinterest figured out how to make money yet?

• 2:14David Pierce?

  No, that's a whole, that's a whole can of worms. Pinterest has all the exact same ideas as everybody else, except that they can't make any money off of them. Because they're nice, and there's no money in like, being nice. And so, this is the, this is the problem of Pinterest.

• 2:27Alex Cranz?

  But they're not nice. Pinterest is the worst one.

• 2:30Nilay Patel?

  Alright, here's the story. This has been a test for every social person we've ever hired. The Verge has 1.3 million followers on Pinterest. 7 million people look at our Pinterest every month.

• 2:42Alex Cranz?

  Wow.

• 2:43Nilay Patel?

  And we do nothing. Like, it's just... So if you can figure out what to do with our Pinterest, and how to turn it into money, send me a note, send me a TikTok, send me a Pinterest pin with your ideas, and we'll talk. But I will tell you, for 11 years, we've been like, "What should we do with our Pinterest?" And these poor, the poor people who interview are like, "We don't know." And then we just move on to the next thing.

• 3:08David Pierce?

  And then Pinterest says, "That's how we feel," and hires them, I'm sure. That's, that's how it is.

• 3:12Nilay Patel?

  Right now, what we're doing, what it looks like, um...

• 3:14Alex Cranz?

  You can follow people on Pinterest?

• 3:18Alex Cranz?

  I hate it so much.

• 3:19Nilay Patel?

  Are you a Pinterest fan? Please call David Pierce personally.

• 3:23Alex Cranz?

  He'll love it.

• 3:24Nilay Patel?

  And we should, we'll do a whole Vergecast segment on people on their Pinterest. By the way, we haven't introduced ourselves. I'm Neel, I'm your friend. David Pierce is here.

• 3:30David Pierce?

  Hi, I'm, I'm your friend who's just DMing you Pinterest pins all day.

• 3:36Nilay Patel?

  And Alex Trans is here.

• 3:37Alex Cranz?

  I'm your friend who hates Pinterest the most.

• 3:40Nilay Patel?

  Just like yelling in bars about Pinterest.

• 3:42Alex Cranz?

  Just hate it.

• 3:43Nilay Patel?

  Get off of Pinterest, Katie.

• 3:44Alex Cranz?

  Hey, stop using it. Don't send me your boards. I don't wanna, I don't care about the furniture. I won't be able to buy it. So why are you sending it to me? You're just sending me like, a link to another link to another link, and I'm in hell.

• 3:57Nilay Patel?

  Pinterest is a recursive link nightmare.

• 3:59Alex Cranz?

  Yeah, it's the worst. Every time I'm like, "I wanna get some cute eyeshadow," nope.

• 4:03David Pierce?

  Do you ever Google something, and then the first result is a Pinterest link?

• 4:06Alex Cranz?

  Yes.

• 4:07David Pierce?

  And then the Pinterest link leads you like, legitimately back to like, a Google Shopping result?

• 4:11Nilay Patel?

  Yes.

• 4:11David Pierce?

  And suddenly, like, it's, there's just like, the internet's black hole comes and just swallows you.

• 4:16Nilay Patel?

  I'm fairly confident this is how we get 7 million views a month on our Pinterest. And of those, 1.3 million have been like, "I like this experience enough to hit follow." I don't know why. So if you can figure it out, just like, let me know, because we've been wondering for a while. We'll take pitches, we'll run the pitches on the Vergecast. Here's what you should do with your pen. Maybe it's a horrible idea. No, it's a beautiful idea. Really reconsider that in the middle of saying it.

• 4:43David Pierce?

  This is what the Vergecast hotline is for. 866-VERGE11. Call us and tell us how to fix Pinterest. I'm in. I will do this.

• 4:50Nilay Patel?

  All right, there's a lot of news this week. Meta, it's funny because the Wednesday show Alex Heath was on to talk about Atlanta the Giants and Meta and Instagram turning and TikTok. And since Wednesday, we're recording this on Thursday, it's going to go out on Friday, but since Wednesday, there's been infinity more news about TikTok and Instagram, like, just the most. So we got to talk about all of that. Meta had earnings. Mark Zuckerberg is yelling at everybody. Gary from Chicago, world of pain for Gary. Oh, Gary. It's actually earnings week. So Microsoft had earnings, Apple had earnings, Alphabet, the band formerly known as Google, had earnings. Comcast broadband subscribers are flat. Peacock

• 5:34Nilay Patel?

  isn't growing. They say they have content problems, which is like, very confident thing to say. Like, the problem with Peacock is the content. Yeah. Spotify, so we got to talk about that. We got some gadgets to talk about. But let's start with Meta in this Instagram situation, because we started the week with a big Alex Heath, David Pierce feature on Mark Zuckerberg, just telling everyone that they're lazy and they they should work harder, get out. And it was kind of unclear, like, in what direction. Like, if you work in sales, marketing at Meta, like, I'm not sure what you're supposed to take away from that instruction. Like, Meta is a huge company. They hired like 40,000 people in a pandemic. And he's like, realistically, some of you shouldn't be.

• 6:17Nilay Patel?

  Which is the thing he said at an all hands meeting. Alex and I run the staff meeting for The Verge for 100 people every week. And like, I've never taken a formal how to run a staff meeting, like, class. But I would say instinctively, I know that one thing you should not say is realistically, some of you should not be here.

• 6:37Alex Cranz?

  I've definitely had CEOs say that at companies I've worked at. Just like, some of you, you know, you should just quit. It'll be easier for you. And you're like, whoa. It's not a, it's not a good thing to hear from your boss, especially when your boss is Mark Zuckerberg.

• 6:52Nilay Patel?

  The god emperor of Facebook.

• 6:53Alex Cranz?

  Yeah, like, not good.

• 6:55David Pierce?

  But I will say, we talked a bunch about this in the run up to the story. And the story after it got published got exactly the reaction we were hoping for, which is that a lot of people, like, the vast majority of people are like, that is ridiculous. Facebook is a bad product. Meta is a bad company. Mark Zuckerberg is a bad guy. Everybody's very mad at everybody. And then there were a bunch of people who read this stuff where Mark is like frustrated at how sort of soft the company has gotten and he's mad that he can't get people to have meetings. And there are a lot of people who read this stuff and are like, yeah, I kind of get where Mark's coming from.

• 7:26Nilay Patel?

  Yeah.

• 7:26Alex Cranz?

  Yeah.

• 7:27David Pierce?

  And it was just like, there's just enough of that, like, yeah, he might not be totally wrong here. Like, I don't think you say that on a staff meeting with your 77,000 employees.

• 7:34Alex Cranz?

  Well, you do if you're Gary.

• 7:37Nilay Patel?

  Right. So the meme of the story is this opening anecdote that Alex had, which, and I feel bad for Gary because the question's pre-recorded. So Zuckerberg gives this entire speech, right? Everyone's need to work harder, focus up. Some of you gotta get out of here. We're tightening the performance reviews. And then the first pre-recorded question is Gary from Chicago. And his question is, are we gonna have extra vacation days next year? Because we had extra vacation days in pandemic. And Zuck is like, you can probably guess how this is gonna go. Like, that's what he says. He says, you can assume from my tone how this is gonna go. And he canceled the extra vacation days. And I just feel bad for Gary. Like, he didn't know.

• 8:15Alex Cranz?

  He had no idea.

• 8:16Nilay Patel?

  If someone had told him before he prerecorded his question. But then the people who like played the prerecorded question also could have picked a different one.

• 8:25David Pierce?

  Yeah, Gary from Chicago got kind of hung out to dry on that one.

• 8:28Alex Cranz?

  Gary from Chicago had some enemies.

• 8:31Nilay Patel?

  I've known a lot of Garys from Chicago. I used to live in Chicago. I know a lot of Garys. I get it. I get. That city is not about, you know, when you move to New York, everyone talks about work all the time. This is a good experience everybody has in New York. You move from anywhere else in the country, you get to New York, and then suddenly everyone, all they talk about is work. That is the heartbeat of the city. Chicago is mostly about finding a friend with a boat so you can hang out in the playpen on Lake Michigan in the summer. Like, that's most, it's like, what bar are we going to? What are the drinks like at that bar? Do you have a friend with a boat? I lived there for a long time. It was the, that was the circle of my social life. So I feel Gary very deeply.

• 9:09Alex Cranz?

  He just wants to be out on the boat, using his meta days, having a good time.

• 9:14Nilay Patel?

  I never actually ended up with a friend with a boat. Maybe because I was so aggressive about wanting a friend with a boat.

• 9:19Alex Cranz?

  You, sir, do you have a boat?

• 9:20David Pierce?

  I also feel like, personality wise, like, you're the friend with the boat.

• 9:24Nilay Patel?

  See, that's really the problem.

• 9:25David Pierce?

  That's like a job you had in your circle of friends. Everybody was like, which one of us needs to get a boat? And they were all like, it's definitely Neelai. And you just like never quite got the message.

• 9:33Nilay Patel?

  Well, I moved out of Chicago. I had to start paying New York City rent, man. Things change. So Mark gives this big speech at the all hands. We got it shaped up. We ran a story, I think it was very good. David helped write it. Mike Isaac ran a story at the Times of a memo that was like tightening our culture. Same kind of deal. Inside Facebook, Zuck's turning up the heat. The next day's earnings, Meta's earnings are going down. Remarkable stat in our story and in general, Apple turning on app tracking transparency. The Ask App to Track button cost Facebook $10 billion. Which is the exact amount of money that Mark has spent on Facebook Reality Labs, the Metaverse division.

• 10:15Nilay Patel?

  So like, literally the thing zeroed out. He was like, I got an extra $10 bill. I'm going to spend it on VR and build the next platform. And Apple's like, what if you didn't have that money? So like, you know, enormous pressure on Facebook to survive the current moment so they can execute on the big pivot to the metaverse. The results are down. TikTok looms, right? People are switching from Instagram and Facebook to TikTok. And Zuck says in the earnings call, we're gonna put even more algorithmic content in the feed. We're gonna, right now it's 15%. It's going up to 30. And then the Kardashian chaos. That was the two Ks, by the way. The Kardashian chaos.

• 10:54David Pierce?

  No.

• 10:55Nilay Patel?

  Takes place. Kylie Jenner says, make Instagram, Instagram again, which is a meme that's floating around. Kim Kardashian retweets it or reposts it. And then Adam Mosseri has to make a video where he explains to you in the exact tone of voice, I used to tell my four-year-old that it's time for bed, that it's not going away. And then today, right before he came on air, actually, they walked it all back. Mosseri sat down for an interview with our friend Casey Newton, which is published on The Verge, and they're walking it all back for a minute, and then they're gonna do it again.

• 11:24David Pierce?

  I love it. Yeah, the clear thing here is like, the direction has not changed, right? There's the thing where Instagram walked it back and it seemed for a minute like it was like, oh, if Kylie Jenner doesn't like what you're doing on your platform, you change what you're doing on your platform, which is like a thoroughly non-crazy way to run your platform. Like, if you make Kylie Jenner happy, like, odds are you're gonna make an awful lot of money over time. But they're very much in on this idea that, like, Reels is everything. Full-screen video, it's the future, it's the whole thing. Adam Mosseri was basically just like, the way we built this was bad, and everybody hated it, and the usage data, and that was the crucial thing he said, like, this company is very good at weathering criticism, right? Like, everybody who works at Meta has spent the better part of 20 years, like, listening

• 12:09David Pierce?

  to people talk about how awful the product is, and just sort of laughing hysterically all the way to the bank. But what happened this time is it sounds like people hated the changes they were making and thus stopped using the product. And that is the thing that is going to immediately make Instagram and Facebook, like, turn on a dime and do something else.

• 12:26Nilay Patel?

  Mosseri said to Casey, people are frustrated and the usage data isn't great.

• 12:33Nilay Patel?

  It's very much on the like, the food's horrible and the portions are small. Like, yeah, it's nothing about this is good. You don't like it. So we're turning it off. But even on the same interview, he said to Casey, hey, this is still where we're going. We're gonna figure it out and we're gonna come back again with another shot. And he framed it again, Adam, Adam's been on Decoder, Adam's great, we know Adam. His tone with a lot of this stuff is like, you need a timeout. It's fine. I understand you're upset. I'm listening. I hear you. But we're still gonna turn the whole app into video and that, that's, you know, because I'm your dad. And like, this is like very, very direct. Casey asked, is there a vision for Instagram? Misery was like, yeah, we still, you know, it's to make the most engaging social media app.

• 13:18Alex Cranz?

  It's to make money. Like, that's just his, I don't know, I keep thinking about all the algorithms that they're pushing out here now, right? Like, like, part of the hatred for this was, yes, it was the full video and everybody hated the video. But it was also they were using algorithms to like, thrust this in front of people's faces. When people were like, I just wanna look at pics of my friends. And they're ignoring the fact that repeatedly people are like, hey, you know what I don't want? A bunch of garbage. I don't wanna watch the people like pour paint on something and then say, now it's glass. Like, like, all, all the crap that we saw on Facebook all these years. They went and they started doing it on Instagram and then were shocked that everybody was upset. And it's like, yes, because you've already done this. You ruined the blue app that way.

• 14:00Alex Cranz?

  And, and now you're gonna just do it again. You're not learning from any of your mistakes.

• 14:05Nilay Patel?

  The core thing, and I'm curious how you two feel about this. His thesis is the way people communicate is changing and now it's all video. And even if we did nothing, this is like his quote from his video. Even if we did nothing, we see that video is rising in the app. And that's people's native format. And it's like, maybe, but like, also, you're in charge of the app. So if you start nudging people into video, you're gonna goose the slider on video in a way that you cannot like account for or control for. And I just, I don't know that it is true that suddenly a bunch of people who built their businesses on Instagram, like Kylie Jenner and Kim Kardashian, woke up one day and like, you know what? Video is my native format. They built businesses on this platform.

• 14:49Nilay Patel?

  And this is true of YouTube. If you just like zoom out and look at YouTube, I always say this, every YouTube creator eventually makes a video about how mad they are at YouTube. And it's because the sands of YouTube shift beneath your feet. And you have to go from making prank videos to like making kid content to doing like six hour live streams.

• 15:08Alex Cranz?

  Becoming a UFC fighter.

• 15:09Nilay Patel?

  Yeah, but you just have to like change with the algorithm in a way that is not sustainable or does not reward passion. And it feels like that moment for Instagram is here, but instead of the algorithm is gonna reward different subjects, different things. They're like, actually, you built a photo sharing business and now it's TikTok. And I just don't think anybody's ready for it.

• 15:30David Pierce?

  I think that's right. And it's, it's why it's a bigger change. Cause like, to your point, everybody gets mad on YouTube, but YouTube is like, feels solvable to creators in a way that it's like, there was that great, uh, I think it was a Taylor Loren story about all the creators who started making videos about the Amber Heard Johnny Depp trial. Uh, and just very nakedly were like, I'm just gonna pivot back to the thing that I'm doing. But this is how I'm gonna get a lot of views. I'm gonna get in the partner program. It's like, it is a puzzle to be solved and a game to be won. And it can be very frustrating in that sense, but it's at least like, you sort of understand the field that you're playing on. And like Instagram and Facebook have just like changed the sport that you're playing every three years for its entire existence. And it gets, it's just gotta be exhausting.

• 16:13David Pierce?

  And it's like, okay, there was a certain like kind of photo. And then it was like, oh, the, everybody likes the galleries. And then it was the stories and then it was like, and now it's reels and like, it'll be something else eventually. And it just like, I can't imagine just constantly having the rug pulled out from you like that over and over and over again, as a person trying to figure out how to like build a business on this platform.

• 16:33Nilay Patel?

  Yeah, I mean, I think that's like the underlying story of the creator economy. It's like, on the one hand, it is very frustrating. On the other hand, lots of people have figured out how to make a lot of money doing it. So, yeah, so it goes. But fundamentally, it's every so often, the platform that you think is the most stable platform in your life becomes the least stable. So you actually, every creator that I've ever talked to is like, I need to be diversified. I need an audience on all the platforms because if YouTube goes sideways, I'll have Instagram. And when Instagram goes sideways, I'll have TikTok. And when TikTok goes sideways, I'll pivot back to YouTube. And it's like, that sounds exhausting and I understand why all of you are burned out.

• 17:06David Pierce?

  Like, yeah.

• 17:07Nilay Patel?

  That's the game.

• 17:08David Pierce?

  Moserius said a thing that I thought was really interesting. They were talking about the friends and family thing. And he said, basically, that all of the like friends and family, people talking to people they know, activity on Instagram has shifted to DMs and group chats. And he was saying like, more photos and videos are shared in DMs in a day than are shared into stories. And more photos and videos are shared into stories in a day than are shared to feed. Yeah. Which is wild. So it's actually like the pub, the thing we think of as Instagram, like the, the public, you know, nine squares on the screen, Instagram is actually like the least important Instagram at this point for most people. That's fascinating to me on a bunch of levels. And also then it's like, okay, if nobody cares about the feed anymore, let's just turn the feed into like a money pile for everyone involved. And it's like cynical as all hell, but it sort of makes sense.

• 17:53David Pierce?

  And then on the other side, he's like, well, we, we don't have any control over how people use the app. And that just always makes me think of like, there was this story about Gawker Media. Uh, I have no idea if it's true, but it feels true. So I have always thought of it ever since, where they did an experiment where they would change the size of the text box and see how long people would write based on how big the text box was on the page when you were writing something in the CMS. And, and they found that there was like a measurable difference that like, if you give people a tiny text box, they will write less. And if you give them a big one, they will write more to fill the text box. And it's just like.

• 18:23Nilay Patel?

  That does feel true. I have no idea if that's true.

• 18:25David Pierce?

  I was like, that feels the most true. I don't either, but like I, I heard it from people who are trustworthy enough that I like, believe it enough to buy into it. And it's like, that's the kind of thing that if you're making a product like Instagram, you make 150,000 decisions like that every single day. And so the idea that they have no control over how people use Instagram is just a crack of shit. And people always say it and it kind of makes me angry.

• 18:46Nilay Patel?

  It is true, by the way. I, I will post to stories like once in a while and then like putting something on the grid for me is like, ooh. That's gonna last forever.

• 18:57David Pierce?

  You're a big close friends user. I've noticed that recently.

• 19:00Nilay Patel?

  Yeah, I try to keep my-

• 19:01David Pierce?

  It's an honor to be in the group.

• 19:03Nilay Patel?

  Here's what I, here's, here's my social media personalities. Like Twitter is like all spiky bracelet. I'm mad at you. Break him up.

• 19:12Nilay Patel?

  Instagram, public Instagram, you know, just wanna be a little human, wanna cultivate some people who recognize I'm not a monster all the time. And close friends is like total schmoo ball, like, you know, and then, and then my LinkedIn is just like ice cold business. I don't use LinkedIn.

• 19:31Nilay Patel?

  It's right up there with Pinterest for me. I don't know what happens there.

• 19:34David Pierce?

  LinkedIn is where you tell made up inspirational stories about people who hired who went on to massive success.

• 19:39Nilay Patel?

  Yeah.

• 19:39David Pierce?

  That's what, that's what LinkedIn is for.

• 19:42Nilay Patel?

  I knew David as an intern. He has skills in web design. Boop.

• 19:48Nilay Patel?

  Some other meta news that we absolutely should talk about, very relevant to like Verge stuff more so than the behavioral connotations of the Instagram text box. The metaverse seems like it's in a weird zone. So the Meta Quest 2, which I always say this because I think it's important to give credit where credit is due. The Meta Quest 2 is a great product.

• 20:07Alex Cranz?

  Yes.

• 20:08Nilay Patel?

  It's a complete-

• 20:09David Pierce?

  I have one hanging behind me. I love it.

• 20:10Alex Cranz?

  Wonderful.

• 20:11Nilay Patel?

  It's like a finished product with an actual app ecosystem. It's, it's just a good product. It is also two years old and they are raising the price by $100, which is not the cycle of things.

• 20:24Alex Cranz?

  No.

• 20:25Nilay Patel?

  Like we're at the, we give them away part of the cycle.

• 20:28Alex Cranz?

  Well, I mean, you are unless you lose $10 billion to your primary metaverse competitor and then-

• 20:34Nilay Patel?

  The primary metaverse competitor doesn't have a product on the market.

• 20:37Alex Cranz?

  They're scared of them.

• 20:38Nilay Patel?

  If you're ice cold Mark Zuckerberg, this is when you flood the market with Quest devices.

• 20:42Alex Cranz?

  Yeah.

• 20:43Nilay Patel?

  So that when Apple releases theirs, everyone's like, I don't need one.

• 20:45Alex Cranz?

  I mean, that person sees ice cold. I think especially on hardware, he is not like at all.

• 20:52Nilay Patel?

  Have you listened to the speech? Realistically, Alex, I don't think she belongs in that.

• 20:57Alex Cranz?

  I don't, I don't, I need to leave Meta. I'm not prepared to be there. But yeah, no, I think it makes sense why they did it. It's still really, really stupid if you do truly believe in the metaverse. But also, I think the metaverse is kind of stupid. So like, I think we are so far away from his big dreams of that ecosystem and that like way of interacting with the internet that like, yeah, this is like

• 21:26Nilay Patel?

  Well, but think about it in a different way. Like, yeah, it's the metaverse and you have the got Horizon Worlds. And if you install like 45 helper apps on your laptop, you can take a meeting in VR.

• 21:35Alex Cranz?

  Yeah.

• 21:36Nilay Patel?

  With your screen shared to a fake laptop that's in front of you.

• 21:38Alex Cranz?

  You look like a Nintendo me character.

• 21:40Nilay Patel?

  It's very good. I will say, it is not, it's so complicated that it's not worth doing with any regularity. But installing all the, if you have a Quest 2.

• 21:48Alex Cranz?

  Yeah.

• 21:49Nilay Patel?

  Installing all the various apps on your laptops, your screen gets shared into Horizon Meetings or whatever it's called.

• 21:55Alex Cranz?

  Mm-hmm.

• 21:55Nilay Patel?

  And then you're sitting in front of your real laptop, but you're wearing a headset and you see a virtual laptop that you're then typing on. You're like, wait, there's, there's like, there's something here and I'm not sure if it's a good idea, but this is, this is one of the dumbest, silliest technology hacks that I've ever participated in.

• 22:11Alex Cranz?

  Yeah.

• 22:11Nilay Patel?

  And if you're listening to this show, I think that appeals to you.

• 22:13Alex Cranz?

  Yeah.

• 22:14Nilay Patel?

  So like, I recommend doing it at least once. And just being like, this is the, like, the amount of like virtual dongles that are required to look at your laptop in VR right now is like out of control. And if you have an Intel Macbook, which is when I did it, the fans are just like, I'm mad at you. You're not in a virtual reality. Listen to me in real reality.

• 22:32Alex Cranz?

  People just assume you're on a plane.

• 22:33Nilay Patel?

  That's very bad. To, all that aside, right, it's a game console.

• 22:38Alex Cranz?

  Yeah.

• 22:39Nilay Patel?

  What, what, what people do in there is they play games and they have in-app purchases and like, it's the same thing. Like, it's an Xbox.

• 22:47Alex Cranz?

  Yeah.

• 22:48Nilay Patel?

  And Xbox sells them expensive at first and get cheaper over time. And they sell every unit at a loss and they make the money on the games.

• 22:56Alex Cranz?

  Yeah, but I think-

• 22:57Nilay Patel?

  And it's just weird that they haven't cracked. Maybe they're not making enough money.

• 23:00Alex Cranz?

  I think the problem is that they're not thinking of it as a game console. I think, I think they are thinking of it as this big window into the metaverse. And they want people to adopt it because they want the metaverse to be created so that they can own the metaverse. And they're not thinking of it as the way like my nephew plays it. I came over to their house. I hadn't seen him in four years or something. I walk in and there's just this little kid in the corner with a, with his headset on, just going pew, pew.

• 23:27Nilay Patel?

  Yeah.

• 23:27Alex Cranz?

  And I'm like, that's great, terrifying and great. And like, that's what it is. It's little kids playing. It's me doing supernatural, your wife doing supernatural. Like, it's people using it as a game console. Meta doesn't understand that. And then they continue to forget how game consoles work. Game consoles work where you release a cheaper version with like, less cool stuff on it. And instead, they're like, yeah, we're going to do the next version. It's going to be even more cool. And it's like, no, you forget your life cycle. Like, consoles now are lasting, what, six, 10 years? They're very, they're two years into their life cycle. This is when they should be thinking about releasing a cheaper one. And instead, like, okay.

• 24:09Nilay Patel?

  Right, what you would do now is you would put out the Project Cambria, which is the next generation one. That would take over your old high price points. And you would still sell the Quest 2 for a hundred dollars less.

• 24:19David Pierce?

  That, to me, is the thing that really jumps out about this is, is the only reason you wouldn't do that is if you couldn't do that. And there's just no way for me to look at this announcement and not think, there is not a next move that is ready or even remotely close to ready.

• 24:35Nilay Patel?

  Well, they've been trying it off a lot, right? Zuckerberg is posting pictures of himself wearing prototypes. They've talked, I mean, they've talked about it.

• 24:40David Pierce?

  I mean, they're, they're working on a lot of stuff. There's prototypes for days, right? But I think there's plenty of next moves. But I'm just saying, like, to your point, like, this is now the moment where you release a thing that is $500. And you either do the Apple move and keep selling the 2 at its current price, or like, drop it by a hundred bucks and try to juice adoption that way. But.

• 24:58Alex Cranz?

  No, I think this is the moment where you release a cheaper, shittier version.

• 25:02David Pierce?

  They tried that, though, and nobody wanted it. It was the Oculus Go, and it was junk.

• 25:05Alex Cranz?

  That was too shitty.

• 25:08Nilay Patel?

  Calibrate.

• 25:09Alex Cranz?

  Calibrate the shittiness. You know, like Nintendo, how many iterations of the DS did we see? The 3DS? There was like, I think I have like, seven that happened, all came out in like, two years of each other.

• 25:20Nilay Patel?

  You bought, you bought all seven?

• 25:21Alex Cranz?

  Yeah. I made bad choices. I have way too many 3DSs, and I like, I don't even play it that much. Like, what is my problem?

• 25:29Nilay Patel?

  Look, I think there's like, probably two things here. One, I think you're right, that they don't want it to just be a game console. They want it to be a computer, right? The vision is to replace a laptop. Or somehow connect via software dongles to your existing extremely unhappy Intel MacBook. But they know it's a game console because he buying game companies. Like, again, it's Meta. This is a company that measures everything. So they have to know that most people are gaming on this thing.

• 25:53David Pierce?

  Well, and they're including Beat Saber with it now if you buy it. Like, that's a, that's a pretty strong indication that they know what you're doing when you turn on your headset.

• 25:59Nilay Patel?

  Yeah, they're throwing you thirty bucks of Beat Saber.

• 26:02David Pierce?

  Yeah, pretty much. Yeah.

• 26:04Alex Cranz?

  You're gonna have to buy that Imagine Dragons, like DLC on-

• 26:07Nilay Patel?

  A game which is only truly fun if you buy the DLC music. They got you. They're, they're like, we're gonna make up that money on the back end. But I will say, they're blaming it on supply chain issues. And they probably can't subsidize this thing the way they were because their revenue's going down.

• 26:24Alex Cranz?

  Right.

• 26:25David Pierce?

  Yep.

• 26:25Nilay Patel?

  Then the next piece of VR news is we just, Alex Spencer, Supernatural. I think Supernatural is the best non-game app on the Quest 2. It's a workout app. It's really fun. Boxing. It's basically Beat Saber, but Peloton. Peloton Beat Saber. I don't know how to describe it in any other way.

• 26:43Alex Cranz?

  That's perfect.

• 26:43David Pierce?

  That's precisely correct.

• 26:44Nilay Patel?

  Uh, they're growing. They're doing well. A couple of months ago, several months ago, Meta went to go buy Within, which is a company that makes Supernatural. Somewhere on $400 million, I think is the reported number. All cash deal, great for Supernatural. And what struck me about it is the CEO of Within, Chris Milk, had been on Decoder and he's like, "Fitness is a killer app for VR. My user base is like 50/50 men and women and they're mostly over 40 and that's not VR gamers."

• 27:09Alex Cranz?

  Yeah.

• 27:09Nilay Patel?

  Right? That's people. So like, what initiates you to buy a Quest? If you're not a gamer, you're not a kid, it's this fitness game. So first Meta goes to buy it and the FTC yesterday sued to block that deal, saying Meta was rolling up all the VR game studios.

• 27:26Alex Cranz?

  Yeah.

• 27:26Nilay Patel?

  And what they should do, if they were truly being competitive, is turn Beat Saber into a fitness platform, which is, ah, it's like one turn too many. You know, like-

• 27:38Alex Cranz?

  What you should do is steal the good idea of the company you're buy, you want to buy and aren't allowed to.

• 27:43Nilay Patel?

  You're a cop. They were basically like, they should compete, right? Especially if you just like look at, if you think Apple is coming, and we think Apple is coming with a product. If you're supernatural, you should be, now you're in the catbird seat, right? You're like, this is the product that makes people buy a VR headset. Cut us a deal, like, who's going to give us better terms, who's going to grow our thing? If you're Apple, you're like, screw it, we'll just do Apple Fitness plus VR, which is probably what Apple do. Yep. And if you're Facebook, we're just going to buy you. And I think the FTC's argument is, they're just buying their monopoly position. We screwed it up by letting them buy Instagram, we're not going to repeat that mistake. Because the FTC really, this version of the FTC really believes they screwed up by letting Facebook buy Instagram.

• 28:25Alex Cranz?

  They did.

• 28:26Nilay Patel?

  But Instagram at that time was like a ti, it was like four people. They couldn't keep the lights on.

• 28:31Alex Cranz?

  They should have known better.

• 28:32Nilay Patel?

  So it's, they should have known better. But there's all these documents from that acquisition where Zuckerberg is like, this is the next sharing mechanic, we need to own the mechanic, we're going to buy it and squeeze it and we'll have it.

• 28:41Alex Cranz?

  Yeah.

• 28:42Nilay Patel?

  And I think, we'll see what happens. I will just say Meta's response to this lawsuit, very funny. They were like, we looked into making our own fitness app and decided we were not in a position to do so. And it's like, you guys think you can make the whole metaverse? You couldn't make a workout game?

• 29:01Alex Cranz?

  I mean, Apple can't make a workout app. Well, well, it can. I love Apple Fitness.

• 29:06Nilay Patel?

  It's, they, but they made one.

• 29:07Alex Cranz?

  Yeah, that's true.

• 29:08Nilay Patel?

  They didn't have to go out and buy, like, you can make a thing.

• 29:11Alex Cranz?

  Yeah.

• 29:11Nilay Patel?

  Peloton is, as we have discovered, one of the worst-run companies in America, and they like managed to do it. It's just like great, like, that, that whole dynamic of, they're in all this trouble, they need to pivot to whatever's next. The users don't want them to pivot, and now they might not even be able to acquire their way out of the mess. Just a hard mix.

• 29:32Alex Cranz?

  I mean, I just really am enjoying how much Meta is in the hot seat right now. It's not quite to the same levels of hubris as what Elon has been doing with Tesla, but there is like a certain level of hubris. There is a certain level of like, you grew too fast. You thought you could control too much of the world and now you're getting slapped by like, reality.

• 29:54David Pierce?

  Yeah. And there was, there was the thing where Meta's belief was always like, our audience is enormous, network effects, network effects, network effects. We're just gonna buy the next thing at whatever price it costs and we will win because we're bigger. And every single piece of that theory is like rapidly being tested. They don't have the money to do it anymore. They don't have the like commanding lead and user base they once did. It's just like the invincible force field that made Facebook successful, no matter what it tried to do, is like rapidly starting to disappear.

• 30:27Nilay Patel?

  All that said, their revenue is only down 1%. They missed earnings, but their revenue is down 1%. They still made like $26 million.

• 30:33David Pierce?

  Yeah, I mean, it's like when they lost users. It's like we went from all the users in the world to all the users in the world except for six. And it's like, well, okay.

• 30:41Nilay Patel?

  We'll see. I will say that whenever I rant and rave about antitrust, someone pops up and is like, you know, big companies just fail on their own, right? You can just wait. And it's like, oh, is this that moment or is it? But Zuckerberg can't be replaced. No one can fire him.

• 30:56Alex Cranz?

  Yeah.

• 30:57Nilay Patel?

  I remind people this all the time. Every quarter, every time they have a shareholder vote, the shareholders of Facebook put forth a proposal to limit Zuckerberg's power and he just votes against it and it loses.

• 31:08Alex Cranz?

  One day, he's gonna like accidentally hit the wrong button.

• 31:12Nilay Patel?

  All right. That's enough Facebook news. We gotta take a break. We'll be right back.

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• 32:30Nilay Patel?

  We're back. Let's see earnings, it's earnings season, let's start, of course, with Apple. Apple did fine.

• 32:36Alex Cranz?

  They made money. Good job, Apple.

• 32:38David Pierce?

  I mean, yes and no. Like, Apple continued to make a lot of money. It's very funny when all these happen in the days together where you're like, oh, Facebook's a big business, and then Apple just shows up and is like, what's up? Oh, you thought Facebook was a cool business?

• 32:53Alex Cranz?

  Just slapping it.

• 32:53David Pierce?

  Check this out. We made eight Facebooks in like 12 minutes. Like, what's up, everybody? But yeah, Apple, Apple made a lot of money. Profits are fine. They made $23 billion in operating cash flow. Like, they're gonna be just fine. But the interesting thing is, the iPhone revenue is up a little bit. Mac revenue was down 10% ish. iPad revenue was down a bit. Wearable revenue is down a bit, and service revenue is way up. And evidently, the thing Apple is blaming is like, all the same like foreign exchange rates that other companies have been talking about. Like, when the euro goes down, they lose money in ways that I confess to just really not totally understanding at all. But currencies are a thing. And also that the supply chain has been a thing, which we've been tracking for months, right?

• 33:37David Pierce?

  Like, a new Apple product goes on sale and like instantly, you can't buy it for like weeks and weeks and weeks. And this is, it is apparently starting to hit pretty hard.

• 33:45Nilay Patel?

  Yeah. So, the Mac sale drop is interesting, right? There's a new MacBook Air. So you would assume, they announced it, we're in that weird window between quarters. They announced the thing, you'd expect MacBook Air sales to drop ahead of the new one, which didn't come out until just now, into this quarter. So that makes sense. But, a friend, Steve Kovach at CNBC tweeted, he just got off the phone with Tim Cook. He says, "The 10% drop in Mac sales is supply constraints and foreign exchange." Which you could still sort of peg to the MacBook Air, because it's hard to get.

• 34:18David Pierce?

  Yeah, right.

• 34:19Nilay Patel?

  Sold out like right away. Uh, it's a new design and it's just not out yet. But overall, that that supply chain issue is starting to catch up to Apple on the Mac side, too.

• 34:28David Pierce?

  Yeah, and Apple has been more immune to this over the last couple of years than most. And like, we've given Apple a lot of credit for like, being the one in charge of its supply chain in such a way that when everybody else got squeezed, Apple just like giggled and kept making iPhones. And yeah, you get the sense it it it has finally come for everybody.

• 34:46Nilay Patel?

  Steve also says Cook told him the impact of the supply chain was less than four to eight billion. They warned last quarter, but they wouldn't say how much. Of course they wouldn't. They had no numbers anywhere in this.

• 34:56Alex Cranz?

  Never numbers.

• 34:56Nilay Patel?

  The most ambiguous financial document I've read. He also said Apple will be deliberate in hiring, but wouldn't call it a slowdown. So Apple's feeling it.

• 35:03Alex Cranz?

  Yeah.

• 35:04Nilay Patel?

  But what's interesting is services are up, right? They're getting better at milking every iPhone customer for more money.

• 35:10Alex Cranz?

  Love that Ted Lasso. What a guy.

• 35:13Nilay Patel?

  We'll see, like, we're expecting all this stuff in September. Right? New watches, new iPhones, new AirPods. All the, all the lines that are down are like some combination of supply chain, the end of the cycle, and new ones coming, like, the end of long cycles. Like, the AirPods have been out for a while, right? Like, the watch, the basic design of the watch has been the same since the beginning. Like, we're expecting big changes, and that's typically what Apple does as well. The question is whether they can build enough stuff.

• 35:42David Pierce?

  Right.

• 35:43Nilay Patel?

  But they made eighty-three billion dollars.

• 35:45David Pierce?

  Yeah, like, Apple's, Apple's gonna be just fine. But yeah, no, I think you're right. And I think the, the question of like, these sort of increased upgrade cycles, too, is the other one that it's been like, okay, when is this gonna come back and actually make a meaningful difference to Apple? That people don't upgrade their phone every year, every two years. Instead, it's like every four or five years. And again, there, there's just no way to know what's what and what accounts for things. But I think like, the last two quarters of this year are gonna be really interesting for exactly the reason you just described. Like, is there still a gigantic audience for any new iPhone? Even if it's basically the same as the last four iPhones? It just like makes blurrier portraits.

• 36:22Alex Cranz?

  But only in some spots.

• 36:24Nilay Patel?

  We'll see.

• 36:25Alex Cranz?

  Just a smudge.

• 36:26Nilay Patel?

  I'll talk about the rest of earnings. It is just earnings season all over the place. Microsoft in a weird spot, David. What do you think?

• 36:34David Pierce?

  Yeah, Microsoft is like, it's a weird time because we're sort of at this moment at the end of like the pandemic crest where we're trying to figure out like who is in actual bad shape or who is in regular shape and all the numbers from the last two years have been nuts. So like Microsoft's revenue is up, the like top line numbers are all pretty good. But like PC shipments have been way down. So the Windows OEM revenue, which is like the money that Microsoft gets from hardware manufacturers who make Windows computers is down. Xbox hardware is down. LinkedIn is up because LinkedIn is just, you just, you can't, there's no, there's no stopping.

• 37:10Alex Cranz?

  It's all Eli.

• 37:12Nilay Patel?

  LinkedIn up 26%. That's the Patel bump, baby. Think Fluence in all day. They just heard we're gonna put Decoder on LinkedIn.

• 37:21Alex Cranz?

  They're like, oh, man.

• 37:23Nilay Patel?

  Turn it up. Turn up the knob.

• 37:25David Pierce?

  Yeah.

• 37:26Nilay Patel?

  I don't know who runs LinkedIn, but he's got a knob.

• 37:29Alex Cranz?

  His name was like Mark something, wasn't it?

• 37:30Nilay Patel?

  Mark LinkedIn.

• 37:31Alex Cranz?

  Yeah, you always, you'd get the emails from him. When LinkedIn first started, they'd always be like, it's Mark. And you're like, oh.

• 37:35Nilay Patel?

  Like Tom from MySpace.

• 37:37Alex Cranz?

  Yeah, basically like Tom from MySpace.

• 37:40David Pierce?

  Somebody wants to connect with you and talk about business. And it's just him giving a thumbs up.

• 37:44Nilay Patel?

  Is Xbox hardware down because they can't ship enough Xboxes?

• 37:48David Pierce?

  Well, it's, so it's two things. It's that and it's also that the most recent Xboxes are now two years old. And there was always going to be a time when they stopped selling in such like absurd volume. And that's basically what Microsoft said. They're like, this is just, they're not new anymore. But also there's the supply chain thing. And this is the weird moment that we're in is there's like, there's the big macroeconomic stuff going on right now. Inflation, everybody's worried about a recession. There's all that stuff. There is like where we are in the pandemic moment. There's the where we are in the supply chain moment. And so what's what and what is causing what is like a big, complicated, messy questions that all of these companies are trying desperately to figure out? Like, do we have a real problem? Or is it just a weird time to be alive is a really hard and difficult thing to suss out right now for a lot of these companies. And I think like

• 38:32David Pierce?

  the Xbox thing is a perfect example of that.

• 38:35Nilay Patel?

  Yeah. I think in general, though, the everyone went to work from home. They bought a bunch of PC stuff. The other earnings that I was again this week were Logitech, which were

• 38:45David Pierce?

  Yeah.

• 38:45Nilay Patel?

  We don't usually pay a lot of attention to logic earnings, but they were like, okay, mice and keyboards, super weird, flat webcam still up. Corporate video conferencing going back up and like everyone's like looking, I was on CNBC and they were like, trying to figure out what it meant. It was just like just sprockets were like springing out of people's brains. Yeah, like, what does this mean? Corporate video conferencing and scriptman's gonna add, does that mean we're all going back to the office? Do I need to throw my computer away? Like, I don't know.

• 39:13Alex Cranz?

  No, everybody got to the office. They're like, wait, why is the the box sticky? And it's time to get rid of it.

• 39:20Nilay Patel?

  Alex is trolling me. So Alex and I are in the office together today.

• 39:23Alex Cranz?

  We are.

• 39:23Nilay Patel?

  And every piece of AV equipment in our every conference room is like broken and like

• 39:28Alex Cranz?

  Sticky.

• 39:29Nilay Patel?

  Just like disaster ways. We just gotta buy some new Logitech stuff. That's the answer. Um, so that's about your earnings. They're they're doing fine, right? Like revenue is up, but Windows and Xbox are falling and it it seems like that's part of that shift. But like, as you said, David, no one knows. Uh, we already talked about Meta, Google slash Alphabet, very strange position.

• 39:50David Pierce?

  Alphabet's the weirdest company to me and it's like, oh, the ad business, very good. The end, all the time. It's all you really need to know about Alphabet is like they sold some ads more than anybody else doing just fine. But then like YouTube's revenue growth is slowing down a bit, which is interesting. They're still just pouring money into all of their other bets, like Google Cloud continues to lose a ton of money. All of the like far out, you know, Waymos of the world are losing money. So it's Google has this like one just like unfathomably gigantic business that seems absolutely unstoppable. And then it's just like bleeding money at various degrees through every other part of the company. It's nuts.

• 40:34Nilay Patel?

  It's what gets me is Google, we saw like Snap had bad earnings and they're like this Apple stuff really hurt us. People are not doing it. Shopify had layoffs because people weren't buying as much stuff online anymore anymore. Meta losing $10 billion because the Apple privacy changes. Google's like, we're good, actually.

• 40:54Nilay Patel?

  Turns out we run every web browser in the world, so.

• 40:57David Pierce?

  Yeah, a lot of people have Gmail accounts.

• 40:58Alex Cranz?

  Turns out monopolies, great.

• 41:00Nilay Patel?

  Well, they don't have the cookie problem, like.

• 41:03Alex Cranz?

  Yeah.

• 41:03Nilay Patel?

  They have not been allowed to own Chrome on iOS. Since Apple's like, no, you're not doing that. They pay Apple for that search placement. So then you go into Google on your iPhone. I mean, this is where like Apple's stuff like really falls apart, like Apple's privacy stuff. They pay to have Google as default search on your iPhone. So then your IP address, or if you're logged into Google, your Google account is searching for stuff. And that data is not third party data for Google.

• 41:33David Pierce?

  Right.

• 41:33Nilay Patel?

  It is Google's data. It's Google's first party data that they're collecting on you when you search on your iPhone. Cause it's the default search provider. And then you use your Chrome on your desktop. They can collect all the data and they can match it up and they can deliver the ads. And then they can track the conversions into sales just as well as they ever could.

• 41:49Alex Cranz?

  But what about if you use Microsoft Edge?

• 41:53Nilay Patel?

  Well, you're still logged into Google. Like, at the end of the day, like, that's the game that Google is playing, right? They've gotten you logged into Google. The problem for Meta is like you have the Facebook app on your phone. That's their data. They are not allowed to track you off of Facebook. Onto whatever retailer you might be shopping on and saying, you saw this ad. And then you went and bought this and we can match up the cookies. And we know that this ad sent you into this site on your browser or wherever you are. And that's what killed their business because their ad effectiveness went down. Google just like, does not have this problem. And so every time Google makes noise about like removing cookies or like doing whatever Apple does, like. It's like very backwards, you would not expect it, but like the European antitrust regulators, like you can't do that.

• 42:36Nilay Patel?

  Cause then no one will be able to compete with you.

• 42:39Alex Cranz?

  Yeah.

• 42:40David Pierce?

  Yeah, a world in which third party data is not allowed is like the best possible case scenario for Google. Because it has the most first party data. Google doesn't care about what you do when you leave its platforms because you never leave its platform. You just, you just basically can't like, and then you like, forget about Apple, like Android. Oh, they own Android, which 90% of the smartphones on planet Earth use. Like, it's just, their lead just gets bigger every time anybody cracks down on any of this stuff.

• 43:07Nilay Patel?

  Yeah.

• 43:07David Pierce?

  Their profit did go down a little bit though. So, you know, they only made 16 billion in profit this past quarter, so.

• 43:12Nilay Patel?

  They probably spent an extra 2 billion on Waymo cars.

• 43:16David Pierce?

  We gotta hire Dieter somehow, right?

• 43:19Nilay Patel?

  Dieter's bag, that's like a line.

• 43:24Nilay Patel?

  Dieter back. I don't know, it's there in a weird, if there is actually a recession, which nobody knows, and consumer spending goes down and advertising spend goes down, then Google is like exposed. But it's just weird, it's not happening the way people think it is. David, you picked this one up, the Comcast numbers, disclosure Comcast is an investor in Vox Media, just on the verge, they're not gonna be happy we talked about this, just rest it short, but you picked up some interesting stuff in the Comcast numbers.

• 43:49David Pierce?

  Yeah, so basically, there's been this interesting thing happening to these companies where they're all desperate to keep selling you cable boxes, they're all desperate to get into streaming, and they're all desperate to keep selling you internet, and the internet continues to be the thing that like funds the rest of it, right? They're like, these other things don't have to work as long as people keep paying a lot of money for internet connection. It turns out in Comcast cases, all three of those things are going kind of badly at the moment. They're still bleeding cable subscribers, because everybody's bleeding cable subscribers, but the broadband subscribers that they have was flat from the last quarter for, I think, the first time ever, and the number of Peacock subscribers is also flat, which is a scary thing for like a relatively small upstart trying to spend a lot of money on like The

• 44:32David Pierce?

  Office and Friends to get people to subscribe to its relatively new thing.

• 44:36Alex Cranz?

  Well, they didn't spend a lot of money on those, right? Like, I think Peacock's big problem is that they haven't spent a lot of money on original programming. Like, they've got Yellowstone, which for some reason, even though it should be on Paramount, they ended up buying it, and Paramount's on record saying, "We shouldn't have given them those streaming rights, that was stupid." They've got like Yellowstone, they've got Office, they've got like, what, really bad British science fiction shows that I watched for some reason?

• 45:03Nilay Patel?

  They thought the Olympics were gonna be their thing, and then it turned out that the streaming Olympics...

• 45:07Alex Cranz?

  They thought like Sports and Friends and The Office was gonna carry them.

• 45:10Nilay Patel?

  A perfect vendetta there for my interests.

• 45:13David Pierce?

  I would frame the money thing slightly differently, though, because the, even if it's true, like they already own The Office, right, so they don't have to like pay more money for that, but the amount of money that you're leaving on the table, not licensing Friends and The Office and Parks and Rec and some of these other shows to other streamers is massive. Like, those deals are worth a ton of money, so it's like, they're spending less for sure, but there's a lot of money that they're putting into the sort of Peacock bucket.

• 45:39Nilay Patel?

  Wait, wait, no. Yes, you're dead correct, but it's even worse because of the way these companies are structured. NBC, you paid $500 million to take the office off of Netflix.

• 45:52Alex Cranz?

  Yes.

• 45:53Nilay Patel?

  Because of how your internal accounting works.

• 45:56David Pierce?

  So it did pay for its own show.

• 45:57Alex Cranz?

  Oh, so they threw some money at it.

• 46:00Nilay Patel?

  Yep. Universal Television had to hold an auction and like Netflix, Hulu, Amazon, and potentially Apple reportedly were like in the auction. So then if you're the big boss, you're like, no, like, we're not leaving the money on the table.

• 46:14Alex Cranz?

  Yeah.

• 46:14Nilay Patel?

  You've got to, you've got to pay up. So like, even in like the case where it's all one thing, they ended up paying the money. And like,

• 46:21David Pierce?

  Yikes.

• 46:21Nilay Patel?

  They need, and they need to spend a lot more money. They're very forthcoming that to make the service work, they need hits. So they're just gonna like spend money on hits.

• 46:31Alex Cranz?

  People need to watch it.

• 46:31David Pierce?

  Can you name any Peacock originals? I can think of one.

• 46:34Alex Cranz?

  Ooh, um, the really great British one about the all-girl band.

• 46:39David Pierce?

  That's the only one I can think of too. Girls 5 Ever.

• 46:41Alex Cranz?

  No, there, there's two of them then. There's a,

• 46:43David Pierce?

  Oh, there's another one?

• 46:44Alex Cranz?

  There's another one which was, uh, oh, I have to look it up. Hold on.

• 46:48David Pierce?

  Girls 5 Ever is excellent, by the way. Everyone should watch it.

• 46:51Nilay Patel?

  When do you, when do you two find time to do this?

• 46:53David Pierce?

  It's like, it's like the Boo Bitch of Peacock, I would say.

• 46:58Nilay Patel?

  I just like, I look at these titles. I went and looked at Boo Bitch after last week. And I just thought to myself, I'm not giving you this hour. Like, I'm not getting younger, you know? Like, I got a daughter. Like, we're gonna, I'm gonna go talk to her. We're not talking about Boo Bitch, I'll tell you that much. She's four. I don't, I don't think that would go over.

• 47:18David Pierce?

  What's she watching on Peacock right now?

• 47:19Nilay Patel?

  She's not watching Peacock. She's watching Gabby Stahlhaus on Netflix, which she loves very much. She's watching Bluey on Disney Plus. But because of Gabby Stahlhaus, uh, she's taken to calling all things that seem like chemistry spa science. This is a real thing from the show, uh, which is very funny because Creighton, who's the producer of Decoder, worked on Gabby Stahlhaus. So he thinks this is the funniest thing in the world.

• 47:39David Pierce?

  That's awesome.

• 47:40Nilay Patel?

  Yeah.

• 47:40Alex Cranz?

  Okay, so like, most of their big ones, they, they had Vigil, which was the one about the woman who was in a traumatic car accident where she nearly drowned. And they said, hey, do you want to go investigate a murder on a submarine? And she said, yeah, I'll be fine. She wasn't.

• 47:56Nilay Patel?

  But what, tell us what they have now. What do they have coming up?

• 47:59Alex Cranz?

  Nothing, right?

• 48:00Nilay Patel?

  They've gotta have something coming up.

• 48:02Alex Cranz?

  I'm, I'm looking. We Are Lady Parts was the British band show.

• 48:06David Pierce?

  I will say, if they had something coming up that they were super excited about, you would think it would have come up on the earnings call. And instead, all they talked about was being in a, it was like, I think a content crunch was the phrase that they used. And it's like, that's not where you want to be.

• 48:19Alex Cranz?

  Yeah, I think they, they really thought they were gonna do this weird mix of what Netflix has been doing, where they buy up a lot of international shows. So they were specifically buying up a lot of British shows. So all these shows that were airing in Britain, they were like, well, they're Peacock originals in the United States. And then they, they were like, well, we're gonna do kind of what CBS and what Apple had done and really go in on big budget Peacock originals. But they were all bad. So it was like Bel-Air, which I think we reviewed, Charles reviewed it and was like, it's fine.

• 48:47Nilay Patel?

  No, no, Charles hated Bel-Air.

• 48:48Alex Cranz?

  Did he?

• 48:49Nilay Patel?

  Hated it.

• 48:49Alex Cranz?

  Okay. Maybe he just said he was excited about it to me.

• 48:53Nilay Patel?

  You know, he was, I think everyone was excited about, Bel-Air's a show, just total tangent. It was like a fan project to make a Joker gritty Fresh Prince of Bel-Air. And so they cut a trailer and then Will Smith was like, I'm gonna make this for real. And then it came out and it turns out that's not a great idea.

• 49:09Alex Cranz?

  No. And then they got Rutherford Falls, which critically very, like, everybody loves it. It's a really great show. I don't know how many people are act, have you heard?

• 49:18Nilay Patel?

  You could be saying, you two could say the names of anything to me and I would believe.

• 49:22Alex Cranz?

  Oh, they had, they had the Tiger King made for a TV show.

• 49:26Nilay Patel?

  You just made that up.

• 49:27Alex Cranz?

  They had MacGruber.

• 49:28Nilay Patel?

  That's fake too. That was already a fake show.

• 49:31Alex Cranz?

  They had Curious George.

• 49:33Nilay Patel?

  That's real.

• 49:33Alex Cranz?

  That's real.

• 49:34Nilay Patel?

  All right. It's, it's time to readjust the Go 90 scale of Doom streaming services.

• 49:41David Pierce?

  Oh, wow.

• 49:43Nilay Patel?

  So Netflix, for the long time, was at zero. So the scale is from zero to 90.

• 49:47Alex Cranz?

  Yeah.

• 49:48Nilay Patel?

  90 is dead.

• 49:49Alex Cranz?

  Yeah.

• 49:49Nilay Patel?

  Quibi hit 90. The scale is named after Go 90, Verizon's failed streaming service, uh, which it went 90 immediately. Uh, that was the one where like Verizon executives were like, what the kids want to do is join gangs on streaming apps. Like, that was like legitimately how they talked about it. Like, our social features are called gangs. Like, I don't remember what it was. It was on the order of that. Go 90, went 90, dead. Quibi, 90, dead. I have long said Netflix is a zero. Netflix has ticked up to like 20.

• 50:21Alex Cranz?

  Oh, that high?

• 50:22David Pierce?

  No, that's too high.

• 50:23Alex Cranz?

  I think it's like 5 to 10.

• 50:25Nilay Patel?

  5 to 10?

• 50:26David Pierce?

  Yeah, I think that's right.

• 50:27Nilay Patel?

  Right, so Netflix was default alive at 0. And you're saying it's 5 to 10?

• 50:30Alex Cranz?

  5 to 10, yeah.

• 50:31David Pierce?

  Yeah.

• 50:32Nilay Patel?

  Alright.

• 50:33David Pierce?

  I think Disney Plus is the new zero, right now.

• 50:36Nilay Patel?

  Disney Plus is the new zero, you think?

• 50:38Alex Cranz?

  Yeah.

• 50:39David Pierce?

  I think so.

• 50:40Nilay Patel?

  Alright. I mean, I think Disney, yeah. HBO Max was living at like 30 to 40 for, when it launched. Just a real mess. I would say they're solidly in that 0 to 10 range again.

• 50:52Alex Cranz?

  Yeah.

• 50:53David Pierce?

  Agreed.

• 50:53Nilay Patel?

  Especially because they're gonna put out Game of Thrones in 4K and we're gonna see if that fixes it.

• 50:57Alex Cranz?

  It won't.

• 50:58Nilay Patel?

  We're all gonna watch that show again in 4K HDR. And then we're all gonna get to the last season and be like, why did I spend my time on this? And then House of Dragons is gonna come out. Like, that's how that's gonna go.

• 51:08David Pierce?

  I'm ready for that.

• 51:09Nilay Patel?

  Peacock feeling like it's at 45.

• 51:12David Pierce?

  I think that's right.

• 51:13Alex Cranz?

  I would say it's almost higher. A little higher. Like, it's not gonna fail. NBC Universal needs it to not fail. Every single broadcaster is trying to own streaming and own their own streaming service instead of getting in bed with Hulu, which Peacock was originally part of.

• 51:30Nilay Patel?

  Yeah.

• 51:31Alex Cranz?

  So...

• 51:32Nilay Patel?

  Oh, Hulu is at like 20?

• 51:33Alex Cranz?

  Yeah. Hulu's ABC.

• 51:36David Pierce?

  Because everybody forgets about Hulu.

• 51:37Nilay Patel?

  No, Hulu is like the one, Hulu for the longest time was the closest study because the people who owned Hulu hated it.

• 51:43Alex Cranz?

  Yeah.

• 51:43David Pierce?

  Yeah.

• 51:43Alex Cranz?

  Every single one of them were like, we don't want to own you. We want to destroy you.

• 51:47Nilay Patel?

  And then Hulu's like, but we persist.

• 51:49Alex Cranz?

  We persist.

• 51:50Nilay Patel?

  Uh, but they've, they've come around because they're owned by Disney.

• 51:52Alex Cranz?

  Yeah. And Peacock is like, or NBC Universal got out of business with Hulu. They, they started Peacock and I think they're just struggling to figure out how streaming is different than broadcast. Like, I think Paramount figured it out pretty quickly when it was still CBS All Access. I'm sorry, I'm a Paramount fangirl.

• 52:12David Pierce?

  Honestly, again.

• 52:14Alex Cranz?

  Again.

• 52:14David Pierce?

  It's, it's like Plex and Paramount Plus.

• 52:16Alex Cranz?

  You know.

• 52:17Nilay Patel?

  Paramount Plus is gonna go, I think Paramount Plus is like over 45 right now.

• 52:21Alex Cranz?

  No, I would say it's way lower than Peacock.

• 52:25Nilay Patel?

  This is, I mean, this is why we have the scale. It's to have these debates, but I, you're wrong.

• 52:29Alex Cranz?

  You're wrong. It's all right. It's fine.

• 52:30Nilay Patel?

  But when Top Gun Maverick comes out, Paramount Plus.

• 52:32Alex Cranz?

  Just shoo.

• 52:33Nilay Patel?

  That, no, that is the day they realized they did not build a tech stack for any demand. Like, right now, they might be doing fine, because like, like, you know, Star Trek nerds are doing Star Trek things.

• 52:42Alex Cranz?

  I'm watching Evil. It's great.

• 52:44Nilay Patel?

  But like Maverick is gonna hit, and everyone's gonna be like, alright, I'm signing up for Paramount Plus. And like, a data center somewhere is gonna be like, we're on fire. You didn't buy enough of us.

• 52:54David Pierce?

  Tom Cruise will save us.

• 52:58Nilay Patel?

  Uh, we'll see. Alright, so that's Comcast, the delightful Good 90s Scale, which is an end with Spotify, which has blessedly been trying to shift its revenue from music to podcasting for, uh, 400 years. Yeah, we've gone through, uh, two different podcast reporters.

• 53:16Nilay Patel?

  Uh, God bless Ashley Carman, she's a blogger now, Ariel Shapiro now writing Hot Pod, signing up for Hot Pod. It's great. They're still where they are. Spotify is just losing money, because they lose money every time you play a song. And then everyone still thinks they don't pay artists enough.

• 53:27David Pierce?

  I was trying to think if I could come up with a company that is like a, a good analog for Spotify. Because Spotify is like objectively a music service that knows for sure that it will never make any money being a music service. And so it's, it, it's now trying to figure out, like, okay, we've, we've been very successful as a music service, but we can't make a nickel doing it. So how do we find other ways to make money around it? So like even just this week, they closed their deal for an audiobook company called Findaway for, which ended up costing them, I think, $123 million. They hired a new person to do fiction podcasts. They're all in on podcasts. They've been saying this for years. And that continues to seem both like a gigantic, like, cultural mess internally and not that good a business.

• 54:12David Pierce?

  It's just like, they, they started to do the car thing and then stopped making it. I'm kinda sad I never bought one, but like...

• 54:18Alex Cranz?

  The little dongle.

• 54:20David Pierce?

  Yeah, it's, and it's just like, what is, what is Spotify? It's, it's gonna end up being this like ultra-successful, super cool thing that never makes any money for anyone.

• 54:29Alex Cranz?

  Spotify's gonna get like nationalized.

• 54:31Nilay Patel?

  By like Sweden?

• 54:32Alex Cranz?

  Yeah, Sweden's just gonna be like, you know, we, we own you. Don't, this is now Sweden.

• 54:37Nilay Patel?

  Like, the EU is gonna be like, we need one tech company.

• 54:39Alex Cranz?

  Yeah.

• 54:41David Pierce?

  The world needs music.

• 54:45Nilay Patel?

  Siemens, we don't even know what they do. It's Spotify. But right, the economics of Spotify, you pay Spotify however much money you pay them a month. Fifteen bucks a month, ten bucks a month, whatever the tier, I don't even know. I don't pay for Spotify, that's why I don't know. Apple Music till I die, because of the lossless, which Spotify won't do. But you pay Spotify however much money a month. Every time you play a song, Spotify gives some of your money to them. It's just a bad, it's a bad deal. Like, they're like, well, our choices are, we can ask the people for more money, which they can't do, because Apple and Amazon will just ruthlessly undercut them at every turn. Or we can pay less money to the artists, which they can't do, because then like Taylor Swift yells at you. And then, or Jay-Z is like, I'mma do title, right? And then like Jack Dorsey's like, what if I bought title?

• 55:29Nilay Patel?

  And then no one knows what the fuck is going on. It's just like legitimately how that went.

• 55:35David Pierce?

  That's about right.

• 55:36Nilay Patel?

  So like, they're just in this hard spot where their margins are fixed, unless they can find something else. And they're like, okay, well, we'll do Joe Rogan. So then you pay us however much money, ten, fifteen bucks a month. When you listen to Joe Rogan, we've already paid him. So we're not giving some of your money to Joe Rogan, we've already given him the money. And if you, lots of people listen to Joe Rogan, will recoup all that cost, and we won't have to give all that money away. So like, that's the strategy. It's just not working, as far, as near as I can tell.

• 56:04David Pierce?

  I think that's right. And there's really no evidence that any of that is going to work, right? Like, audiobooks have never been a gigantic business. Podcasts have never been a gigantic business.

• 56:15Nilay Patel?

  This podcast is gigantic business.

• 56:17Alex Cranz?

  Enormous.

• 56:17Nilay Patel?

  We're on TikTok now.

• 56:20Alex Cranz?

  Follow us on TikTok.

• 56:22Nilay Patel?

  You can't.

• 56:22Alex Cranz?

  It's for you.

• 56:23Nilay Patel?

  It's on the verge, follow The Verge on TikTok.

• 56:26Alex Cranz?

  Follow The Verge on TikTok.

• 56:27Nilay Patel?

  Decoder's on TikTok. I'm not allowed to mention that.

• 56:29David Pierce?

  Oh my god.

• 56:30Alex Cranz?

  Forbidden.

• 56:30David Pierce?

  I've never heard of it.

• 56:33David Pierce?

  But they're just making all these bets that they can squeeze money out of things that no one has ever proven there's money in. And I sort of admire the effort. And like, they, what were the numbers? They have 433 million users and 188 million paid subscribers. Like, those are both giant numbers. That is like, bigger than Netflix, as, as far as like, right, overall subscribers go, right? Like, they're huge. And they lost $127 million in the last quarter. It's like, maybe we're trending in the wrong direction.

• 57:03David Pierce?

  I don't know. And I just, I'm, I'm sort of at the point where it's like, what is there a move here? And they've made all these bets. They tried to go into the clubhouse thing. They bought this company locker room. Then they called it green room and now it's Spotify Live. And if you, listener to the Vergecast, have ever used Spotify Live, I would love to hear about it and, and all your experiences, because that is an app I forgot existed until just right now, this second. And I just don't know. What like?

• 57:26Nilay Patel?

  Yeah.

• 57:27Alex Cranz?

  Do you think they're gonna like, maybe just fight the RIAA? Just be like, I don't know, we want to pay less for these songs?

• 57:33Nilay Patel?

  No, no, no. The, this is the Hulu thing. All the labels are investors in Spotify.

• 57:38Alex Cranz?

  Oh.

• 57:39Nilay Patel?

  Spotify is like a zombie in that way. Like, the labels can be mad at Spotify, but ultimately they're paying themselves. Like, and it's important that they have that hedge against Amazon and Apple. But do you know, Amazon has a dominant position in country music?

• 57:53Alex Cranz?

  Yes, because of Garth Brooks.

• 57:54Nilay Patel?

  Because of Garth Brooks. They signed a Garth Brooks exclusive. And now every country music fan in America is an Amazon music subscriber.

• 57:59Alex Cranz?

  They had the need to feel the thunder.

• 58:01Nilay Patel?

  [chuckle]

• 58:03Alex Cranz?

  Incredible Garth Brooks song.

• 58:04Nilay Patel?

  Why did I open this door?

• 58:05Alex Cranz?

  You just, you...

• 58:06Nilay Patel?

  Alex is like, full Texas.

• 58:08Alex Cranz?

  Like, my hat just came on. Suddenly I'm on a horse in the studio. Liam's very upset. Sorry, Liam.

• 58:14Nilay Patel?

  Full horse. Never go full horse. But if they, they screw around, Apple and Amazon can, you know, they can just, Apple can just subsidize the music service.

• 58:23Alex Cranz?

  Yeah.

• 58:24Nilay Patel?

  They don't need the money. But Spotify does. And the labels need Spotify to exist as a hedge against Apple, so they can negotiate against Apple. So like, it's like a ghost, a zombie, a mummy. Like, it's just like, it's just stumbling through a haunted house of the music industry, like bumping into walls and everyone's like, just don't fall down the stairs.

• 58:41Alex Cranz?

  Just holding hands with Rihanna.

• 58:43Nilay Patel?

  Yeah. All right, that's enough earnings. Let's take a break and do a lightning round.

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• 1:00:10Nilay Patel?

  All right, we're back. We got in with some gadgets. It's been all earnings and Peacock.

• 1:00:18Nilay Patel?

  It's some feelings about Instagram and Go90, which is great. That's us. That's who we are.

• 1:00:22Alex Cranz?

  We cared about Peacock more in this podcast than anybody who actually has ever thought about subscribers.

• 1:00:28Nilay Patel?

  I have spent more time talking about Peacock than watching Peacock at this point in time. All right, let's do lightning round. So iOS 16 beta continues to roll out ahead of presumably iOS 16 in September. Some changes. The public betas are out, they're being updated. Apple rolled out editable iMessages. And then they, I think they rolled it out without a message history? And they quickly realized that they should have a message history.

• 1:00:52Alex Cranz?

  Those are important.

• 1:00:53David Pierce?

  Yes. Yeah, and they also shrunk the amount of time in which you can edit. I think it was 15 minutes before and now it's two. Or maybe that was for the sending. To be honest, like what's an unsend versus what's an edit is a fun philosophical distinction about messages. But it's kind of great. It gives you the edit history. It gives you these like increasingly sort of transparent versions of your message as they scroll up. I really like it. It's really nice.

• 1:01:19Nilay Patel?

  It's the thing, it's the lock-in city. I love it. I use it.

• 1:01:22David Pierce?

  Oh, absolutely.

• 1:01:23Nilay Patel?

  It's the most beautiful jail in all of technology.

• 1:01:25David Pierce?

  I'm so excited to find out how trash it looks if you have an Android person in your group chat. Like the thing that shows up that's like, the message you get that's like so-and-so loved and then shows your message again, like this is going to be even worse. I can't wait.

• 1:01:37Nilay Patel?

  Amazing. New home app in iOS 16. Gentui wrote a review of it, not a preview. Some things are better. It's not out yet, so it's not really a review. We're very weird.

• 1:01:48Alex Cranz?

  We're in that weird space.

• 1:01:50Nilay Patel?

  About these words. But a preview of it, because it's not in public beta. Better, better design, some confusing decisions. Apple doesn't know, like, what people want to do with their smart home, which is mostly like automate things.

• 1:02:02Alex Cranz?

  Yes.

• 1:02:02David Pierce?

  Yep.

• 1:02:03Nilay Patel?

  And they, that's the part where I think it's the weakest.

• 1:02:06Alex Cranz?

  I think you see with, like, all of these Spart home apps, that they're very clearly made by software developers, software engineers, and not by, like, normal, random people. You guys are, you guys are normal too. But, you know, it's made by people whose brains think a very particular way. And so unless you're thinking like a software engineer, it's hard to use these things. And Apple still struggles with it.

• 1:02:31Nilay Patel?

  Yeah, I would say the one note from Jen's piece that really jumped out to me, they've redesigned the buttons that you tap to turn lights on and off. But now the buttons, without any delineation, have two buttons contained within each tile.

• 1:02:43Alex Cranz?

  No.

• 1:02:44Nilay Patel?

  So if you click on the left side, that's where you turn the light on and off. And if you accidentally click on the right side, you get the menu.

• 1:02:52Alex Cranz?

  I don't like that.

• 1:02:52Nilay Patel?

  It's like, what?

• 1:02:54Alex Cranz?

  See, that's what I'm saying. It's like, that's just like-

• 1:02:56David Pierce?

  This is why long presses exist. This is long presses.

• 1:02:58Nilay Patel?

  The long press now puts you into jiggle mode, so you can move all the tiles around.

• 1:03:02David Pierce?

  Oh, God.

• 1:03:03Nilay Patel?

  It's real good. It's real good. Obviously, this is all because of Matter, so there's some hope that Matter will continue to happen.

• 1:03:11Alex Cranz?

  Yeah.

• 1:03:12David Pierce?

  Can Matter fix the menu button?

• 1:03:13Nilay Patel?

  Matter will, no, but like, you'll get more device types in there.

• 1:03:18Alex Cranz?

  No, this is all, they want you to go out and they want you to get the HomePod Mini, so that you never use the buttons, because you're always shouting at, you know who. I can't say her name out loud, my watch will activate. I'm not, I'm not speaking her name.

• 1:03:32Nilay Patel?

  But speaking of HomeKit, Wirecutter came out hard, was it last week, against HomeKit Secure Video?

• 1:03:37Alex Cranz?

  Oh, real hard.

• 1:03:38Nilay Patel?

  They were like, do not buy a camera with HomeKit Secure Video. It's bad and it's crap and none of it works. It's like, that's, it's hard for the Wirecutter.

• 1:03:45Alex Cranz?

  That's, I mean, it's fairly accurate. I have one that's been sitting face down for like three months. I don't know why I still have it plugged in. It always is like, it's recording. I'm like, what is it recording?

• 1:03:55Nilay Patel?

  Yeah.

• 1:03:56Alex Cranz?

  Nothing.

• 1:03:57Nilay Patel?

  Uh, other lightning news? This fight between Dish Network, 5G and SpaceX continues to be my, my, literally the funniest thing that we cover on the site. I mean, it is like so esoteric, right? It's like two companies with networks, like tiny networks compared to the Comcast of the world, fighting, like filing white papers at each other at the FCC about the future of broadband. It's like, you guys, uh, so Dish wants to use 12 gigahertz for whatever future 5G it can dream up. I would just point out to everyone, it's supposed to be building a 5G network now and has not done so.

• 1:04:32Alex Cranz?

  Well, it can't because it's gotta use the 12G.

• 1:04:34Nilay Patel?

  It did so many phone support. Um, and Starlink says this is bad and if Dish is allowed to do this, quote, "The band would become unusable. It would potentially end Starlink service for customers."

• 1:04:47Alex Cranz?

  So shouldn't SpaceX have, I don't know, gone out and, and, and bought the ban that they were gonna need to use it?

• 1:04:55Nilay Patel?

  Well, they, so, F, the FCC opened up the band, like satellite use, this is a satellite band, so they've been using it.

• 1:05:04Alex Cranz?

  Yeah.

• 1:05:05Nilay Patel?

  For satellite uses.

• 1:05:06Alex Cranz?

  Yeah.

• 1:05:07Nilay Patel?

  They have the access to it. But then the FCC was like, "We should open up this band because most satellite companies are garbage. What if we did better stuff with it?" And Dish was like, "Yeah, we're gonna use it."

• 1:05:16Alex Cranz?

  We want it.

• 1:05:17Nilay Patel?

  For a 5G network, which definitely exists.

• 1:05:19Alex Cranz?

  I just know that Starlink did not lot, ask for a lot of permission from like federal international regulators when they started rolling out Starlink. They were just like, "Yeah, move fast, break things." And I would not be surprised if...

• 1:05:33Nilay Patel?

  Let me just give you this quote. This is how petty this fight is. Starlink sent an email to all of its customers, "Tell the FCC this is bad."

• 1:05:39Alex Cranz?

  Okay.

• 1:05:40Nilay Patel?

  And then the SpaceX Senior Director of Satellite Policy, which is a great title, by the way, Dave Goldman, would love to talk to you, Dave, if you're listening. His quote, "We haven't seen anything from either Dish or Dell," Dell, by the way, is part of this Dish thing. "We haven't seen anything from either Dish or Dell where they've been able to get any customers to file in support of their service. Likely that is because they don't really have a service."

• 1:06:03Nilay Patel?

  It's just ice cold.

• 1:06:04Alex Cranz?

  It's just Mitchell. It's just Mitchell.

• 1:06:07David Pierce?

  This person is definitely a pseudonym. This is, this is Elon Musk's Starlink burner account, sending you this email.

• 1:06:14Nilay Patel?

  Anyway, Dish and a consortium of other companies, which are known as the 5G for 12 gigahertz coalition, responded to this equally petty. They've argued, they're saying SpaceX sent a manipulated filing to the FCC and quote, "This tactic, which is commonly used by Elon Musk, is not only disingenuous, but it promulgates an anti-5G narrative that is harmful to American consumers."

• 1:06:45Alex Cranz?

  5G is here to save us.

• 1:06:47Nilay Patel?

  It's like, dude, have you talked to anybody with a 5G phone? They will promulgate an anti-5G narrative.

• 1:06:55David Pierce?

  This has to go to Chancery Court. It's the only, it's the only solution.

• 1:06:59Nilay Patel?

  It's like, it's the lowest stakes, pettiest fight. I cannot get enough of it. God bless you. If anybody from the 5G for 12 gigahertz coalition wants to come on the show, we will welcome you with open arms. Or Elon.

• 1:07:14Alex Cranz?

  I feel like Goldman is like Elon and he's just gonna wear a different, like a mustache. He's gonna show up to Chancery Court, wearing a little mustache and be like, no, no, I'm not Elon Musk.

• 1:07:23David Pierce?

  He's gonna wear his Wario costume from when he was on SNL.

• 1:07:26Nilay Patel?

  No customers support this network because they have no network.

• 1:07:34Nilay Patel?

  David, last one. You fell down one of the funniest Virg rabbit holes of all time with this video conferencing story where Biden has like a startup Zoom gadget and then you found what all the other presidents use.

• 1:07:46David Pierce?

  Yeah, this ate my weekend in a way that I'm not really proud of. But basically like Joe Biden tweets a picture of himself, sitting at a desk in the residence, you know, having COVID, living large. He's got a mask in front of him, a coffee cup next to him, and this like unbelievably cool looking. Video conferencing board on like a wheelable easel there. And I was just like, what is this thing? And why is Joe Biden's Zoom setup so sick? So I spent what I would say is like an inappropriate amount of time looking at YouTube and Getty Images and official White House press pools to see. I learned a lot about how presidents video conference. And they all turn off self view, which I thought was very like responsible of them. Because nobody wants to look at themselves when you're on video conference and the presidents know that.

• 1:08:31David Pierce?

  But yeah, it turns out Joe Biden is using this thing from this like tiny two year old company in Oslo, Norway. It's called the neat board and the one he has cost $7,000 and it's awesome. And I apparently like blew up this company's email inbox by writing about them this week. So to everyone at neat, I'm very sorry for doing this to you.

• 1:08:49David Pierce?

  But yeah, but Joe Biden, the White House is all in on Zoom, has been for a bunch of years now. And he's just, he's just tearing it up and he's got it. He can spin it on wheels. So it can either focus on his desk in the Oval Office, or he can spin it around and have it on the couch. And it's just like, guy knows what's up. Like kudos to the White House.

• 1:09:06Nilay Patel?

  This is like the one thing they've accomplished. I just want to point that.

• 1:09:09David Pierce?

  Yeah, listen, I mean, you don't have to get your agenda done as long as you look good on camera, not getting your agenda done.

• 1:09:14Nilay Patel?

  I'm sorry. It's pronounced the chips and science bill. Oh, sorry. Which is very funny because there was actually, I think, a representative tweeted that like we, we back renamed salsa and we didn't get there. They could have called it the chips and salsa bill. So like as we're speaking, they were so close. They're so close. Chips and science. So they, yes, it is true. The Senate passed it. The House passed it. It's going to Biden, big investment in semiconductor manufacturing. I say this is like happening as we speak. Yeah. Very good. And apparently there's some sort of climate bill, but that hasn't been signed yet. So they've done two things. Other than that, it's like mostly he has a cool video conferencing setup.

• 1:09:51David Pierce?

  But it's very cool.

• 1:09:52Nilay Patel?

  It's true. I want to get one. All right. We're over as always. It never ceases to amaze. It's been a good one. I enjoyed my time with you.

• 1:10:00David Pierce?

  It's fun.

• 1:10:00Nilay Patel?

  I like being in the office, everybody. Okay, that's it. We'll be back on Wednesday. Dave, what's happening Wednesday?

• 1:10:06David Pierce?

  What is happening Wednesday? I'm going to be on vacation in Miami, so we're doing a whole episode on like the work-from-anywhere life. We talked to Thomas Ricker, who is our official van life correspondent. We did a bunch of stuff on space internet. We're going to go even deeper on the 5G dish Starlink stuff, so get excited about that. And then there will probably be a long time of just me lying in a pool telling everyone how cool my life is.

• 1:10:28Nilay Patel?

  Very good.

• 1:10:29David Pierce?

  So look forward to that.

• 1:10:30Nilay Patel?

  All right. You can tweet at us, we love hearing from you. I'm at RecklessDavid, it's at PierceAlex, it's Alex H. Cranz. And then Decoder, next week, our friend Hank Green is going to be on the show. It's going to be really good. Talk about bitching about YouTube. Whew, we're going to get into it, it's going to be good. That's it. Rock and roll.

• 1:10:53Speaker 06

  Thanks for listening to this week's show. And hey, we'd love to hear from you. Shoot us an email at [email protected]. And if you liked the show, share it with a friend. Vergecast is a production of The Verge and part of the Vox Media Podcast Network. Today's episode was produced by me, Liam James, and our senior audio director, Andrew Marino. Our executive producer is Eleanor Donovan. That's it, we'll see you next week.

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• 1:12:08Speaker 08

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