Mythical computers and super apps

Today on the flagship podcast of payment processing fees: 04:36 - The Verge's David Pierce travels to meet Keegan McNamara, an artisan who is making unique computers for more purposeful use cases. A visit to the one-man computer factory 27:11 - Liz Lopatto and Alex Heath join the show to discuss the future of "super apps" in the United States — notably the one Elon Musk is trying to build with X, formerly known as Twitter. Everything Elon Musk told Twitter employees in his first company meeting Can Elon Musk turn Twitter into an ‘everything app’? Here’s what Elon Musk wants to do with X, his ‘everything app’ 1:09:54 - Keep listening for this week's Vergecast Hotline question. What is a custom feed and how do I make one? – Reddit Help Email us at [email protected], we love hearing from you. Learn more about your ad choices. Visit podcastchoices.com/adchoices

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

• 0:02David Pierce?

  Welcome to The Vergecast, the flagship podcast of payment processing fees. I'm your friend David Pierce and I am sitting here organizing my entire life in Spotify. I think for the first time ever. I've been using this app for over a decade and this is the first time I think I've ever done a full reorganization of my life in here. And I'm doing it because there's this one thing that has annoyed me about Spotify for forever, which is that I have the music that I listen to when I'm in the car or, I don't know, at a barbecue or out with friends or just hanging out at home making dinner. That's the music I would call like my music taste. And then there's the music I listen to all day, every day while I work. That's the like feelings-y instrumental music. It's

• 0:44David Pierce?

  a lot of movie scores. It's a lot of kind of ambient bands that I like. I play it a ton, but I wouldn't call that the music that I like and like really want Spotify to tell me more about. And yet every year, at the end of the year, Spotify gives you that playlist with all your favorite songs. And it's like you listened to the Batman soundtrack 650,000 times. Maybe you'd like to hear that again. And I'm just like, that's not really what's going on here. And I kind of always wanted Spotify to separate those things. Then, when I had a kid, it got even worse because now I spend, you know, eight hours a day listening to Elmo's song and I don't really want that in my algorithms either. So I Googled around and was like, this has to be a solvable problem. Spotify has to have figured this

• 1:26David Pierce?

  out. And it turns out they kind of did. There was this feature that Spotify rolled out in February of this year where you can go into any playlist and you tap or click on the three dots in the menu and you go to exclude from your taste profile. And you click it and it pops up this menu that says, "Listening to this playlist will have less impact on your taste profile and recommendations." I don't know what less means, but this is good news. This means I can dump all the stuff that I want to listen to all the time, but don't want Spotify to make recommendations based on, into one place. So that's essentially what I've been doing. I now have this monstrous playlist called Music to Work To in Spotify that is just several hundred songs so far of all the music that I play on repeat.

• 2:10David Pierce?

  All day, every day while I work. And now I have another one called Kid that is just kids' music. And I can just basically put that on and shuffle it and do the same with my work music all day. And neither one will get in the way of what's in my on repeat or my Discover Weekly or my Spotify wrapped every year. This is the dream. I can't believe I didn't know that this sooner. Oh my gosh, it's so much work to move all of my stuff around in playlists, but I think it's going to be worth it. Anyway, we have an awesome show coming up for you today. I'm going to tell you a story about a guy I met in LA who is making a really different kind of computer. And then after that, we're going to talk about super apps because they're kind of lingering in the news all the time. Everybody is trying to build the one app in which you live your entire life.

• 2:55David Pierce?

  And it turns out it's really hard and really complicated. Elon Musk wants to do it now, and I just don't think it's possible. All that is coming up in just a second. But first, I just realized I have like a decade worth of monthly playlists. I've just been saving songs I like every month and now I have a chance to actually put all of those together. I have so many playlists. My Spotify is a disaster. I don't recommend ever actually trying to solve this problem unless you really want to solve this problem, but it's making me feel better already. This is the Vergecast. We'll be right back.

• 3:25Speaker 01

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• 4:27David Pierce?

  Welcome back. I want to tell you about this computer I saw a few months ago, which is unlike any other computer I've ever seen. I first saw it in a picture on Twitter in March of this year, but a couple of months later, I got to see it in person. The Verge's Veeran Pavich and I went to LA, got an Uber up this windy canyon road kind of near the UCLA campus in Westwood, and we went into this cool two-story house right up against a canyon. And we met a guy named Keegan McNamara. I'll tell you more about Keegan in one second, but first, I have to tell you about this computer.

• 5:05David Pierce?

  Keegan calls it the Mythic 1, Roman numeral 1. It's all very fancy. And he built this thing himself, like every single part of it.

• 5:13Speaker 03

  I was pitching it as like something that looks very different from a normal computer. It's made out of wood and it's functionally like very limited compared to a MacBook. It's like a limited computational experience.

• 5:24David Pierce?

  The computer is, in fact, made out of wood, walnut and maple, to be specific. Keegan bought big blocks, then sawed and chiseled them into a shape I can really only describe as a sports car typewriter. You have a slightly inclined tray in the front, where there's a mechanical keyboard with some white keys and some beige keys and a brown leather palm rest. Then, the whole thing slopes dramatically upward, like you're going up a cliff. There's an 8-inch screen in the middle, three little lights on the left side, and a keyhole and an ignition switch, seriously, on the right. The slope goes up to this peak just above the screen and then sort of swoopily curves back down in the back.

• 6:06David Pierce?

  It looks like a retrofuturistic design from the 1950s, like in the era when TVs were in those huge wooden cabinets. This would fit right in.

• 6:17Speaker 03

  What my method was, was like, just look at a bunch of really pretty things. You know, things that I find to be beautiful or interesting for aesthetic reasons. Read what people think about them, read about how they were designed and like the people that designed them. Just sort of, you know, take it all in for a while. And then, after doing that for like a month, two months, three months, you kind of sit down and try to start doing the sculptural aspect or the drawing aspect. And like, things just come. It's very weird. You don't, they're just kind of there in the background and you're not thinking about them. Like, the unconscious is a very strange domain. You know, like, I had a friend come over and he was like, "Oh, so you made a car computer." And I was like, "Yeah, I kind of made a car computer, but like, also it's different in strange ways."

• 7:01Speaker 03

  You know, like, it's just kind of a confluence of a bunch of the things that I find to be beautiful.

• 7:08David Pierce?

  My absolute favorite thing about this computer is how you turn it on. You put a key into that hole next to the screen and turn it to the right. As soon as you do, a red light turns on on the left side. Then, you reach up and flip the ignition switch, and the lights on the left blink yellow, and then green, and then the computer turns on. Turning on this computer feels like launching a missile from a submarine in an old spy movie.

• 7:35David Pierce?

  It rules. The whole thing is powered by an Intel Nook, which is basically an all-in-one configurable mini-computer.

• 7:44Speaker 03

  I mean, the easier option would have been just like a Raspberry Pi. They expose a bunch of pins and, you know, make it, make it super easy to like, make stuff. But I've experimented with Raspberry Pis in the past and I just, in general, found them to be like, rather underpowered. And this was something, when you're making something that's like luxurious and it feels beautiful, you don't want it to be like stunted by the electronics. You want it to feel like blazing fast. And I think that like, modern Intel processors are, you know, modern like RAM amounts, all this kind of stuff. They are unbelievably whip-fast when you're doing something relatively simple. The only reason that they ever get bogged down is by something like Google Chrome, which has just an unfathomable amount of complexity in the software. But yeah, when you're doing like Unix-y stuff, my god.

• 8:28Speaker 03

  And like, an i7 from 2020 is gonna be unreal.

• 8:33David Pierce?

  There's also 8 gigs of RAM in here and 250 gigs of storage. Both are, in a certain sense, massive overkill, because this computer doesn't run Chrome or games or anything complicated at all. For Keegan, it's pretty much a text editor.

• 8:49David Pierce?

  It runs an operating system called Nix OS, which is a version of Linux that's designed to be super modular and configurable. If you want tons of apps and UI stuff, Nix OS can do that. But the way Keegan's computer runs, it's much closer to just a command line. Keegan says he just wanted his computer to be a text editor for writing and reading, not a full-fledged computer in the way that we've come to think of it, with all the power and options and apps and distractions that come with it. He has a MacBook that is great for MacBook things. With this, he wanted something else.

• 9:23David Pierce?

  Oh, and in case you're wondering about what kind of keyboard he would put into a computer designed entirely for typing, oh, boy, did that ever send Keegan down a rabbit hole.

• 9:32Speaker 03

  This is a god-tier mechanical keyboard. Like, this is like two different keycap sets, and they're PBT keys, because I like the thock of that. And like, this is a hot swap PCB underneath. And like, I have like foam padding and an aluminum plate, because I like a little bit of pinginess, but not the pinginess of brass. And like, you know, I mean, you get your welcome to type on it.

• 9:51David Pierce?

  I would very much like to. Oh, man.

• 9:55Speaker 03

  The switches are hand-lubed glorious pandas.

• 9:59David Pierce?

  I mean, these feel fantastic. Not wild about the arrow keys, but I'll get you some. I should be clear here. He didn't build this thing to like, start a computer startup. It was more like a summer project, starting in the summer of 2022. Keegan was a few years out of college and had done a couple of tech jobs, but was kind of disillusioned with the whole space and was trying to figure out what he wanted to do next. And then, one day, he went to the Metropolitan Museum of Art in New York City and happened upon an exhibit called Arms and Armory.

• 10:31Speaker 03

  It's hard for me to explain it this way because it feels weird to say. It feels like it doesn't actually happen to people, but I literally had like a lightbulb moment. The main thing that occurred to me was like, these are functional objects. They're guns. They shoot projectiles out of a tube. You know, it doesn't have ornamentation. It's not made out of like exquisite materials. It doesn't have gold inlay, you know, stuff like this. But there were people, three, four, 500 years ago, that thought it was worthwhile to add that additional layer of like, I don't know, I think the right word is beauty, onto a merely utilitarian object. And I was like, man, nowadays that just doesn't really exist. Like, and especially doesn't exist for computers. I'd been thinking about computers prior in like a philosophical way.

• 11:15Speaker 03

  And so it was just, it was very natural for me to be like, that's the object that is most tractable for me personally to work on. You know, I went home and sat down on my MacBook and I, you know, I like, you're like examining every single facet of the MacBook and like how it's machined and what the choices are. And one of my gripes always with the MacBook is like, when you put it on a table and you rest your wrists on it, there's like this, there's like this sharp edge that like digs into your wrist, like, okay, there's something off here, you know, like, and even just the shape of it, it's like a metal rectangle. Sure, it's like a very well machined metal rectangle, but it is just a metal rectangle. And compared to the sort of like form experimentation and engraving and all this kind of stuff that, that I saw in the guns, I was like, yeah, this is just a completely different

• 12:00Speaker 03

  design philosophy. And I really, I think it's the design philosophy of Johnny Ive, right? And, you know, I respect him, like, he's a good industrial designer, but there's something about modern industrial design that feels like very cold and inhuman to me. Whereas working with materials like wood and leather, you know, it can kind of seem like kitsch up front maybe, but I think that what you end up having in terms of like the felt weight and the psychological weight of the object after, after it's created is just like, it's warmer, it's nicer, it feels more personal, it feels just like better overall.

• 12:30David Pierce?

  Keegan became kind of obsessed with finding this ornate beauty in these everyday objects. He got really into learning about luthiers, the people who make and fix one-of-a-kind guitars in their workshops. He went to the house Ray and Charles Eames used to build the famous Eames Furniture in, which is now a museum.

• 12:48Speaker 03

  When I went in, I was sort of imagining too, like, what would a computer that actually fits inside of this very eclectic, strange house look like? And, you know, I think that this is perfect. Like, I think that this would match the aesthetic almost perfectly. Like, maybe it's not quite rectangular enough, but it's really close and the materials are spot on, and I think it would fit really well in there, too.

• 13:09David Pierce?

  He also got really into fancy cars, not as a car guy, but as a design guy. What can you learn from the shape of a Bugatti? What does the ultra-high-end leather in a Pagani make you feel that's different from the other things that drive down the highway? All that stuff, all those shapes and materials and feelings swirling around in his brain went into what became the Mythic One.

• 13:34Speaker 03

  This back curve right here?

• 13:37David Pierce?

  Mm-hmm.

• 13:38Speaker 03

  That's like, straight out of an Italian sports car. That's like, the rear hip is something that you really don't see anywhere except for in Italian sports cars, which I think that comes from big cats, like tigers and leopards and, you know, all these sorts of things.

• 13:53David Pierce?

  Keegan's other thing is that he only works with hand tools. He's had some practice in woodworking. He learned a bunch from his dad growing up and took a guitar-making class in college. But he also just kind of decided to figure it out as he goes. Again, summer project, not startup founder here. He uses a handsaw to cut the wood into kind of its rough shape, and then a mallet and chisel to do the curves, and then a spoke shave and a card scraper to get everything just right. It's super, super, super tedious. But he says he loves the actual process of woodworking, but also what it means. And this, in our whole time together, is where he got the most philosophical about how he thinks about this stuff.

• 14:36David Pierce?

  And he revealed, I guess, what you might call the unified theory of Keegan McNamara.

• 14:40Speaker 03

  In Shintoism, there are these spirits called Kami that will come to reside in objects that are made in the right way. And you know, the right way is it's open to interpretation. But my personal interpretation, and just from like using power tools in general, is that you're like marring something. And yeah, that's something that I care about in general is like trying to, especially when it's in my own hands, crafting objects that a Kami could come to dwell on in this Shintoistic spiritual understanding.

• 15:08David Pierce?

  I asked him right after that if he felt like there was Kami in the computer he made.

• 15:13Speaker 03

  Yes, to me, this feels like it has been crafted correctly. Like I, you know, if I were Shinto, I would say, yeah, there's a Kami in here. Like for sure, there's a Kami in there. It's been crafted with care and undermined your standing of the right way, which even if it's wrong, I think has some importance.

• 15:29David Pierce?

  Does all that sound sort of ridiculous and high minded to you? Like a kid who made a computer just trying to tell you some mystical story about it? If it does, trust me, you're not the only one. When Keegan finished the computer earlier this year, put the key in the ignition, booted it up, everything worked, all the lights. He was very excited.

• 15:47Speaker 03

  Top 10 Keegan life moments, kind of thing, yeah.

• 15:51David Pierce?

  Then, like you do, he decided to post about this new computer in a bunch of places. He uploaded pictures of the mythic one to Reddit and Twitter, all with the same caption. "I wanted a beautiful computer and couldn't find one, so I made my own." The whole thing went kind of viral. On Twitter and Reddit, most people were really nice. They liked the throwback design and the retro futuristic vibe. They liked the idea of making computers that last. And they loved, they loved the key ignition. Some people actually wanted a mythic computer of their own. But not everyone saw the world the way McNamara did. He pointed me to a Hacker News thread, which is the developer focused site where people talk about stuff. And it was brutal. Let me just read you a few of these. "Oh, Lord, another hipster."

• 16:35David Pierce?

  I think that's the top ranked comment here. Another one says, "Hooray for their four years of instant mastery." One says, "The pseudo-intellectual trad vibes were overwhelming." And then another one says, "It's really cool that this 25-year-old invented PC case modification." There are a bunch like that. Ultimately, Keegan says he figures a lot of the backlash was to his writing style. He'd also posted an essay about how and why he built the Mythic One. And to be fair, it does sound kind of pretentious. Like, here's one section. "Despite little improvement in overall user experience quality, there has been a colossal rapid growth of new applications over the last three decades. Modern personal computers are like a thousand and one multitools made from plastic. People deserve one-in-one tools

• 17:19David Pierce?

  made from high-grade steel. A good exercise here is considering the net impact of various types of applications on individuals and societies." I mean, you can see how that might piss off some tech types, you know what I mean? Say this for Keegan, though. I think he really does believe what he says. I don't think he hates technology, per se. He said that to me a few times. It's just that he believes there are better ways, or at least other ways, to do things. And it turns out that at least a few people agreed with him enough to reach out and see if maybe Keegan might make them a Mythic computer.

• 17:53David Pierce?

  One of those people was Max Novenstern, who has been around Silicon Valley circles for a while and who is probably best known as the co-founder of WorldCoin, the crypto company that wants to scan your irises. And Max had actually been rethinking his own relationship with technology recently.

• 18:09Speaker 04

  Computers are these, like, tools for liberation and also, like, tools for enslavement, you know? It's pretty bifurcated, right? Phones kind of make you feel like shit, right? Computers aren't very productive, or it's like hard to do productive work on your computer. It just is.

• 18:29David Pierce?

  A couple of weeks before Keegan posted about the Mythic computer, Max had tweeted about wanting something basically exactly like it. This was his tweet. It says, "Give me an e-reader with a chatbot and note system and nothing else. Give me a typewriter with the same. Strip computers of their dopamine faucets, leave their crystal balls." Max and Keegan started talking. They knew each other a little bit already, actually, and then reconnected about these shared-device dreams. And Max ended up giving that same prompt to Keegan. No dopamine faucets, just crystal balls.

• 19:00Speaker 03

  So what are the dopamine faucets of a computer? Well, I think most of the dopamine faucets actually just come from the internet. Pragmatically, you can get like most of the stripping of the dopamine faucets by just like heavily restricting internet access. In this case, it's completely gone, but in the case of the one that I'm building for him, there will be like a couple IP addresses that can get through the firewall, namely the ones to like interesting OpenAI products.

• 19:23David Pierce?

  ChatGPT was one of those crystal walls that Max was talking about. Ultimately, he landed on four things that he wanted in a computer. He wanted a really good experience for writing and reading text. He wanted speech to text transcription with the Whisper AI, so he could just pace around his office and dictate to his computer. He wanted ChatGPT integration. And he wanted a receipt printer, so he could quickly print off a grocery list or a piece of text and take it with him.

• 19:47Speaker 04

  It's like a typewriter, a secretary you could dictate to, and then a researcher who can, you could ask questions and they'll give you in plain text, answers to those questions. And so that's a word processor, the MacArthur board, Whisper transcription, and then ChatGPT.

• 20:08David Pierce?

  At first, Keegan balked at some of this. His Mythic 1 doesn't connect to the internet at all, and that's kind of part of his ethos. Again, this is supposed to be a quiet, serene kind of computer. But talking to Max convinced him that if you could essentially boil the whole internet down to a interactive text interface, that that felt more right, more in the spirit of what he was trying to do. And in the future, as more and more of the AI power can be run locally without any connection at all, a computer like this could be just as powerful and not ever need to be online. Eventually, Max and Keegan agreed on a design and a price. They didn't want to tell me the price on the record, but think more like used car money rather than MacBook money.

• 20:50David Pierce?

  Keegan spent the next few months on that computer, and he finished it in late July. He ended up calling it the Mythic 2, and he personally drove it up to the Bay Area and delivered it to Max's house. Max is unfortunately away on vacation for a while, so he hasn't used it yet, so I don't know how he feels, but I know he was very excited to get it. Having built two of these now and talking with folks about more commissions, Keegan told me he's hoping this might be something like his career for a while. He can be a computer luthier in a certain way. And in the process, he seems to hope that he might help change the way we think about computers altogether.

• 21:26Speaker 03

  I can imagine a world where there are like, you know, eight different guys spread out all across the place that like each are very interested in one specific portion of like the metallurgy, basically, of a computer. You got the guy who's doing the processors in his garage. You got the guy who's like figuring out how to do e-ink in his garage. And then you got the guy who's like doing the woodworking. I guess that's me, you know, there's like, there are different components that can be figured out in their entirety, sort of from scratch, at like less capability than what is like industry standard nowadays. But a lot of the time, you don't need the modern capabilities. Like you can get away with having worse, worse hardware.

• 22:01David Pierce?

  I've been thinking about this kind of philosophy for months. And personally, I like my MacBook a lot. But I like the idea of a computer that by design doesn't do everything, that does a couple of things really well, that feels more like a well-made, single-purpose tool than a kind of janky Swiss Army knife. And I especially like the idea of bringing the tech industry back to a place of experimentation and ideas. It's a bummer that everyone converged on metal rectangles for laptops and big candy bar slabs of glass for phones. Those can't be the only ideas or the right answers. I don't think there have to be right answers. When I was talking to Max, he compared what Keegan is doing to the whole idea of the resurgence of dumb phones.

• 22:46David Pierce?

  You know, these devices that make calls and send texts and really don't do much else. I've been fascinated by these, things like the Light Phone and the Punked for years, because I think it's a really interesting and complicated thing. How do you sell people what is an objectively worse phone? It's weird, right? And what does it actually need in order to be useful? You think about it, right? Phone calls, good. Texts, good. You probably need Google Maps. You want something to play music. But do you add Snapchat? Do you add TikTok? Do you add Instagram? Do you add a web browser? At what point have you just rebuilt the thing only slightly worse? I agree that these do-everything, all-in-one devices have tipped a little too far, but it's really hard to figure out where the middle ground is.

• 23:32David Pierce?

  Ultimately, the thing I've come around to is that actually, maybe the answer is lots of answers. Maybe we need to go back to a time where, instead of a smartphone that does everything, we should incorporate a few specific tools back into our lives that do one thing and do it really well. I'm not saying I'm trying to get rid of my laptop or smartphone, because I'm not, I'm really not. But I buy the idea that the industry should be big enough to support lots of shapes, lots of sizes, lots of ideas about what these things are supposed to do and how they're supposed to work. And as these components get easier to source and even make from scratch, and as more people get familiar with how they work and how to use them, I think we might be headed back to that. I don't know that I'd ever want a computer made of wood, but I guess I'm glad somebody's making one.

• 24:25David Pierce?

  All right, we gotta take a break, and then we're gonna come back and talk about a very different, maybe completely opposite, way of thinking about interacting with technology. We're gonna talk about super apps. We'll be right back.

• 24:47Speaker 01

  College football is back. So Hilton called to me, the superstition concierge, to make your fan rituals a reality. Need a room to match your lucky number? We got you. Wanna make sure our team doesn't wash your lucky jersey? Oh, that smells lucky. Hilton's unmatched hospitality can keep up with any superstition. Even a marching band wake-up call at 5:55 in 55 seconds. Hit it! When you need a team that will do whatever it takes on game day, it matters where you stay. Hilton, for the stay.

• 25:17Speaker 02

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• 25:50David Pierce?

  Welcome back. The idea of a super app has been around in tech for a really long time, because it's really not that complicated a concept, right? Basically, what if you could do everything you needed in one place instead of needing a million apps for a million different things? And really, there are two flavors of super app. There's the kind that tries to bundle a bunch of similar stuff into one app, like Uber trying to do ride sharing and food delivery and public transit tickets all in one place. That's all, you know, moving things from one place to another. So they sort of make sense to put in one place. That's a semi-super app, I guess. But imagine if Uber also tried to get you to video chat with your friends in the Uber app, or book doctor's appointments in the Uber app,

• 26:35David Pierce?

  or watch your favorite shows in the Uber app, and look for an apartment in the Uber app. Now that would be a true super app. Lots of companies have tried to build a super app like that, and only one has actually succeeded. We'll get to that one in a minute. But more recently, Elon Musk has been talking about how he wants to turn X, the platform and company formerly known as Twitter, into a super app in its own right. Personally, I think that is just straight up impossible for a bunch of different reasons. But I figured I should check that theory with a couple of people who know this space and Elon Musk really well. So I brought in The Verge's Liz Lopatto and Alex Heath to talk through it all. Alex Heath, hello. Hi. Liz Lopatto, hello. Hello.

• 27:19David Pierce?

  That's a lot of energy for The Verge Cast. Yeah, Liz really won the hello there. Listen, man, I'm hyped. Whenever you tell Liz she gets to talk about PayPal, it all, it all just falls apart. Which is actually, okay, so I've been trying to figure out where I want to start with this, because as we talk about super apps and Elon Musk and X and all this stuff, there are a lot of places we could go. But Liz, you have a very old book that you were just telling us about that makes me think we should actually start about 25 years ago with the first time Elon Musk tried to make X happen. You are like deep in the history of this man and PayPal. And if you go back to the 90s, all the stuff Elon is trying to do now,

• 28:00David Pierce?

  he was kind of trying to do, or at least thinking about trying to do, back then, right? Like build the sort of one app that runs the universe.

• 28:08Speaker 05

  Yeah, so I guess one of the things that I just want to like, you know, if you can think back into like the mists of time, if you will, back to 1999, it was a very, very different time on the internet, as all of us who are online recall, and those of you who are not online due to not yet being born, I'm sorry. Musk is one of the sort of original internet entrepreneurs, and he founded this business called X.com in 1999, which was when he thought it would be like a really cool idea to do electronic payments, checking accounts, stock trading, mutual funds.

• 28:49Speaker 05

  And like, I want to be real, a lot of these ideas seem pretty ahead of their time. At that point, nobody had really figured out how to use an email address for payments, which is something that like, we all do now, right? And so, part of what went on there was there was this unbelievable cash burn. Customers got like a $20 bonus on a cash card when they signed up, and like $10 for everybody they referred. And then there were also all of these problems around verification, where they would give credit cards to just anybody who wanted them, up to like a $10,000 credit limit. And, you know, Musk's sort of idea was just to onboard as many people as possible, because he wanted to have like, a million people using the new credit card by the end of the year. And like, this is like, by the way, Peter Thiel's retelling of this, the million people.

• 29:33Speaker 05

  And so, there were a lot of bad checks. There were, you know, banks that wouldn't allow people to have checking accounts, who were you signing up for this card? They had something like a 50% chargeback rate, which is completely wild. There was just like, a lot going on. And there was a second startup called Confinity, that was Peter Thiel's, that ended up merging with X.com, because they were both burning money really fast, and the VCs involved were like, these are similar businesses, let's like, see if we put them together, if something good happens.

• 30:03David Pierce?

  Let's burn money together.

• 30:04Speaker 05

  Let's burn money together. And Confinity had this very popular product, called PayPal. Part of what went on there is, there was a conflict around PayPal. Musk wanted to rename it to X, and use a different kind of software to run it, or a different kind of code, rather. And nobody else wanted that. And so Elon Musk went on his honeymoon and there was a palace coup and he was thrown out of X.com, which became known as PayPal and is still successful today, sort of despite these sort of rocky beginnings.

• 30:39David Pierce?

  Right. And if I remember right, even then, they had this thesis that like, we want to do all this money stuff. And we think that if we can be sort of the conduit through which money flows on the internet, we can solve everything. It's like, there's a little bit of like, what people talked about with crypto, that they're like, if we can fix internet money, we can, we can change everything about how everybody does everything just through the money. Like, were they talking about that in the 90s? Or is everybody just like retconning that back into Elon Musk's history of X.com?

• 31:11Speaker 05

  I mean, I think that that was, that was sort of the primary goal. Because if you think about how the internet works, it does seem to be missing a protocol and that protocol is money. And so, you know, there have been a lot of attempts to create a money protocol online and crypto is one of them. But I think that was part of what these guys were thinking about. And when I say these guys, I mean both Musk and Thiel when it came to PayPal. And like, if you, you know, were listening to sort of my description of X.com, it does sound a lot like what is called the quote unquote "super app" that seems to be Musk's ambition now with Twitter. And I do think that there is something pretty powerful about the idea of having sort of a unified money protocol.

• 31:51Speaker 05

  But the other thing that maybe is worth mentioning is that here in the US, banks got involved. And so, you know, I have my banking app on my phone. I can upload paper checks to my checking account if I so choose by, you know, taking photos and things. And so there are, I already have that particular offering. And then on top of that, you know, there's PayPal, there's Venmo, there's all of this competition around ways that you can send money and ways that you can transmit money online. And then, you know, you think another layer, you think about crypto. If you're involved in the crypto world, there's, you know, wallets, all sorts of other ways to send money. So it's, it's a highly competitive space, much more so than it was in 1999.

• 32:30David Pierce?

  Right. Which I think is why, Alex, I'm curious how you have seen this space over the years. Because I think you and I have both been covering the consumer internet for a long time. And I think it was like the mid 20 teens, I think, where somewhere along the way, everybody who made any kind of successful messaging or social networking app started talking to me about wanting to be a super app in which you could do everything. And I think it's for the reason Liz just described, which is basically like money on the internet got like pretty easy and there were lots of ways to do it. And so everybody was like, okay, what is our lock in? And it was like, okay, this is where people hang out with each other. What else can we build on top of that? And I feel like 2015, everyone I know was telling me that they were building a super app. Was that your experience too?

• 33:14Speaker 06

  Yeah. Were you in the audience when Facebook had its annual conference in 2016? Do you remember the Messenger chatbot craze?

• 33:23David Pierce?

  Oh, yeah. I do remember that.

• 33:25Speaker 06

  So that was actually David Marcus at the time, who was the former president of PayPal, was trying to bring this very super app vision that we'll get more into, that Elon wants to do to Messenger. And Messenger had 900 million monthly actives already at this point. It was huge. And they made this big concerted effort to get developers to build these chatbots inside Messenger. And the thinking was that you would do all kinds of things besides talking to your friends. You would talk to businesses, you would do customer support that way. And it bombed. I mean, it totally bombed. And, you know, we can go many directions here, but many years later, WhatsApp, Meta's other app, is actually probably the closest thing to what is a true global super app.

• 34:11Speaker 06

  But that's been a much longer road and it's become that in countries that are not the US or Western Europe for very important reasons as well.

• 34:20David Pierce?

  Yeah, no, I think that's right. Well, and I think we should, before we get to WhatsApp, I think we should talk about WeChat, just briefly. And I'm curious, from both of your perspectives, how you think about WeChat. Because WeChat, as we talk about super apps, the like, one piece of software in which you live your entire life, WeChat is the absolute smashing success story. It is like every app you can think of all shoved into one app called WeChat, that is also where you talk to your friends. And I feel like everybody I've talked to for the last 10 years is just trying to do what WeChat is doing. And that is like, everybody's end goal, it's every, whatever VC wants to fund, it's what everybody wants to build, like, this is the future of everything. Liz, do you see a line between those things?

• 35:03David Pierce?

  Like, is the thing that PayPal was trying to do, what WeChat managed to pull off? Obviously, in China, it's a very different country with a very different evolution of the internet. Like, did they kind of get it right? Did WeChat finish the job there?

• 35:16Speaker 05

  So I think it's worth lingering on the differences between China and the United States for a moment.

• 35:22David Pierce?

  For sure.

• 35:23Speaker 05

  Because WeChat is actually bigger than what the sort of vision originally for X.com was, because X.com didn't have the sort of social media component where you can like, post statuses. There was no idea of finance as being a kind of social media, even though I think as everyone who's used Venmo knows, it is. And in fact, you know, if you think about the dollar bill, that is actually media. You know, it's, there's literally a photo on it. Or not a photo, I guess, but a print.

• 35:49David Pierce?

  Well, and in the same way that all these other apps have started with something else and sort of worked their way down to buying stuff, I think realistically, like, if this had worked the way they wanted it to, you get to the point where all of your money is moving around, and then they start to look, and it's pretty easy to like, pull lines out of that into, let's let people send each other money and talk about it, and let's let them buy stuff. Why don't we bring the store in here? Like, you can see how you would arrive at the same place, even from the exact opposite direction.

• 36:13Speaker 05

  That's exactly right. And so one of the things that I think is worth mentioning about WeChat is specifically the Chinese Communist Party, which engages in a great deal of surveillance. So WeChat is a very good way for Chinese authorities to keep an eye on what people are doing, where they're sending money, who they're talking to, and what they're reading. Okay. And this is, by the way, the downside of every super app, is that it is a one stop shop for surveillance. And I don't mean to suggest that the US government isn't surveilling us, because as we all know from Edward Snowden, it is. Sure. But it's a little bit of a pain to put together all of our various social media streams and like the stuff that they're getting from wherever else. And like, this

• 36:53Speaker 05

  is like a one stop shop for the Chinese surveillance state. So that's one way of thinking about these super apps, and it's one way of thinking about WeChat. Like, it's very, very powerful, both for the users and in terms of social control. And so one of the things that I think is maybe interesting here is that in a lot of places where these super apps have traction, there are conditions that are very different than the conditions in the United States. Either the banking industry isn't as developed there and didn't get online as quickly, or there is a level of social control from the government that there isn't here in the US. And so I can see why Silicon Valley VCs would love to have something like WeChat, because that would be very powerful. You know, it'd make

• 37:36Speaker 05

  you a lot of money, and you, there's all sorts of things you can do with all that data. But I don't know from a user perspective, why that's necessarily something you would want, especially knowing that it really could ramp up surveillance. It really could do things that are maybe not in your interests. And again, like, this is just a basic difference between China and the US, besides the fact that there is a lot more competition here, because the US government allows a lot more competition around financial services.

• 38:06Speaker 06

  And to put a finer point on what Liz is saying about WeChat in China, I mean, WeChat literally is an extension of the government in China. You can have your government ID managed and accessible inside WeChat. It is a censor apparatus for the government. And the reason WeChat became so successful inside China when it did is because not only does the government there censor from within, it also censors out things from other countries. And so there was a vacuum where there were not any other, you know, social networks, the most of which were getting created in the Western world, allowed to even exist in China officially. So WeChat became, you know, the blessed service by the CCP, continues to be to this

• 38:50Speaker 06

  day. And to Liz's other point about money and about it being incredibly lucrative, it is, but historically, and you can look at WeChat as a perfect example, it's owned by Tencent, which is a mega cap tech conglomerate, kind of similar to an Apple or an Amazon in China. WeChat as a business actually doesn't make Tencent the majority of its money. The majority of Tencent's money comes from its gaming business. They have a cloud division. They're starting to do a bunch of AI stuff. These super apps by themselves are not wildly profitable. It's when you attach them to these conglomerates that also have, you know, historically the blessing of the government that they operate in, the country they operate in. So it's a very unique situation for WeChat.

• 39:34David Pierce?

  Right. And so, given that, all of what you both just said, which is basically, there are like these giant systemic differences between these two countries that would allow an app like that to work in China, that would almost certainly not allow an app like that to work somewhere like the United States. And yet, every tech company of a given size has this exact ambition. Alex, you wrote a story a couple of years ago, looking particularly at Snap, which you thought was kind of headed down this road and had a real shot at pulling off some, if, definitely not all, but some of that. Like, why did everyone get so obsessed with this if it's not a particularly good business and there are a million really good reasons it's never going to work anyway?

• 40:15Speaker 06

  Well, you know, Facebook Meta has basically cornered the ads market for these social apps. It's incredibly hard, and Snap is living proof of this with where their stock price still is today, to compete with a scaled digital ads business like that. It's really Meta and Google, and that's it. No one's been able to take a meaningful share out of that. And so if you're a Snap, or you're a Discord, or you're one of these kind of up and coming, growing social networks, you're looking at other ways to build a business. And the super app thing is, it's a sexy idea, right? It's also about time spent. If you're a social media site, you want as much time spent in your app as possible, and a super app is something that people use all day, every day. And so the thinking is, can we bring more activity? So like, for example, Snap tried a whole gaming platform, Snap

• 40:59Speaker 06

  Minis, inside the app, and they shut it down because they couldn't make money from it. And you know why they couldn't make money from it? Apple. This is a thing that we don't talk about, really, as it relates to these digital apps. The power that Apple, as the distributor of these apps, or the App Store, and the way the App Store rules work, is extremely powerful. And guess what Apple doesn't like? They don't like app stores that compete with their own. And so eventually you get down this road, if you're building a super app, where you're a store within a store, kind of idea. And the only app, really, at scale that is allowed to get away with this is WeChat. And there's been some reporting on this over the years, that basically, and I believe this to be true, Apple knows that

• 41:41Speaker 06

  it will not sell iPhones in China without WeChat. And so it's let WeChat do things that it will not let any other app of that scale do. And that's why Snap's kind of mini stuff failed. It's why, you know, Facebook has never been able to build its own kind of store within Facebook. They've tried many times. This is starting to loosen with some of the EU regulations specifically, that will allow competing app stores soon. But Apple is the main hindrance, I would say, actually, to building a super app outside of China right now.

• 42:11David Pierce?

  And is that just because a huge part of the business case there is is just payment fees? Like if we can, if we can get shopping in our app, if we can get people sending each other money in the app, and we can take even a relatively small percentage of it, that there's a whole lot of money to be made doing that. And if you can't get any ad money, which you can't, that's one way to potentially make a lot of money here?

• 42:31Speaker 06

  I don't know. I would be curious to hear Liz talk about this because my understanding is that payments businesses are not wildly profitable businesses. They're actually pretty commoditized. The tech is fairly standardized at this point. There's many competitors. There's Stripe. There's Adian in Europe. The banks all have their own competing rails at this point. The big ones. I'm not actually sure payments is in and of itself a big business. Like Liz, I would actually, we could just get into actually right now, kind of what Elon wants to do with X.

• 42:59David Pierce?

  I was just gonna say, this is a perfect segue into this is a bad idea. No one will ever do it. There's no reason to do it. And so Elon Musk is trying.

• 43:05Speaker 05

  Actually, guys, I wanna, I wanna pause here because everything Alex is saying is true. Payments is like not the most lucrative thing on earth, but there is a brand new competitor that I do wanna talk about that went live on July 20th of this year called FedNow. And it lets you, as an individual or businesses, if they so choose, send instant payments through your depository institution account, which is like usually a bank.

• 43:31David Pierce?

  Liz, I straight up thought you were just lying to me. Like, I thought this was like an elaborate bit you were doing. I just Googled this. This is real. Sorry. Keep going.

• 43:38Speaker 05

  Yeah, it's from the Federal Reserve. They've been working on it for several years now, and it's potentially very, very powerful. It's a brand new set of payment rails that we just, we haven't seen how it's going to be used, used yet. You know, there's, we have the first release of it. There's like fraud prevention tools. There's a number of support capabilities. And I think that if you're thinking about payments in a very serious way, the US federal government has just given you some competition.

• 44:07Speaker 05

  So that's that's maybe also worth keeping in mind.

• 44:10Speaker 06

  Liz, I would love for you to just react to this. So Elon held his first meeting when he took over Twitter in November. I got an audio recording of the entire conversation and put the full transcript on The Verge at the time. And there's a section kind of in the middle of the meeting where he gets into the the payments ideas that he wants to implement at Twitter before it was X. And there's this one line that I think really gets to the heart of what he thinks the reason people will want to transact through Twitter will be. And he says, if you can simply have one balance on Twitter that can simply go positive or negative. And when it goes positive, the interest rate is better than you could receive elsewhere. And when it goes negative, the interest rate is lower than you see elsewhere. Now you have a much simpler system.

• 44:55Speaker 06

  Is that actually a compelling reason to do any of this? And is this something that is going to get people to transact in Twitter? I don't think so, but he seems to think it is.

• 45:05Speaker 05

  It doesn't sound simpler, does it?

• 45:07Speaker 06

  Is that even anything? Well, he's saying like they're going to come, and you write about this on the site all the time, Liz. Like, he's saying they're going to compete like so much goes back to interest rates. And he's saying, we're going to focus on better interest rates on the positive and negative end. So that we're the compelling place to store your money. Can he actually do that? I don't think so.

• 45:26Speaker 05

  Well, you know, there have been a number of people who have been trying, most notably Goldman, which has been offering a product both with Apple and also on its own. It's just a savings account. You can't like, there's no debit, you can't withdraw, it's all electronic. So you have to withdraw to another bank account in order to get cash out. But the idea of like high interest savings accounts, like those are not especially new either. And it's something that we've seen a lot of banking institutions move into with mixed results. So, you know, I understand wanting to compete on interest rates. But the other thing that I'm going to say is that, like, I think about this stuff on a pretty regular basis. And I don't pretend to be an expert. You know, I certainly don't have an econ degree or anything like that, but I do, I am interested.

• 46:08Speaker 05

  And I talk about interest rates with, you know, friends and family, and they don't understand them. They don't think about them. And so like, if you are offering a consumer product, as many institutions, by the way, do, it needs to be simple enough to be understood by most consumers. Because I do remember during the era of low interest rates, I had people who were telling me to get certificates of deposit, which didn't make any sense, given, you know, that the interest rate was almost nothing, and I would have been earning less on a CD than I was losing in inflation. So there are like, there just seems to be like a basic lack of, I would say, financial literacy that would preclude something like that making intuitive sense to a consumer. So that's problem one.

• 46:53Speaker 05

  Problem two is that it sounds pretty complex. So if he's saying, you know, if your balance is positive, you get a better interest rate, and if your balance is negative, you get a worse interest rate, that's a lot more complexity than just having one fixed interest rate that you can sort of rely on and do math around. So it sounds like he has some ideas that don't translate easily to a consumer audience. And if you're thinking about a super app, if you're thinking about some of these, these kinds of payment apps, like, like Venmo or PayPal, which mostly make money on the float, what you're thinking about is a consumer audience. What you're thinking about is people need to transact without thinking too hard. They need to, you know, they go out to dinner, one person pays the bill, and everybody else sends them, you know, some amount of money for the bill. That's what they're thinking about.

• 47:38Speaker 05

  And so, you know, in that sense, like, maybe social media can be useful, because, you know, you have your connections with friends. But I also think about the people who I talk to online most often. And they are not the same people I see in everyday life. You know, with all, all love to my internet friends, like David and Alex, because we don't live in the same cities. You know, the people who I'm going to be sending payments to because we split dinner are not the same people as the people who I'm talking to on Twitter all day.

• 48:05Speaker 06

  You're saying your friends at dinner, they're not all on X all the time?

• 48:08Speaker 05

  No, it turns out that I have a bunch of friends who like, have jobs that mean that they're not on the internet all day.

• 48:15David Pierce?

  I genuinely don't even know what that means. That doesn't, that does not, that doesn't track to me at all. But I just want to say one more thing about the consumer business side of this. Like, this is also not been a good business. It turns out that like, like to your point about the Apple Goldman Sachs thing, like Goldman Sachs is by all accounts trying desperately to get out of that business. Because providing simple, understandable ways for people to make sure they pay their credit card bills actually turns out to be a really crappy business. And when you're Apple, that's all fine and good. And I get a notification every month telling me to pay my Apple card. Turns out that's not making Goldman Sachs any money, which is a real bummer for Goldman Sachs. So yet again, this is the kind of thing that seems like it ought to be a good business because you get to be in the middle of people moving their money around between each other.

• 49:00David Pierce?

  And it just might not be.

• 49:02Speaker 06

  I'll play devil's advocate just for one second for Musk, okay? You know how many apps people download per month on average? Take a wild guess.

• 49:10David Pierce?

  Zero.

• 49:10Speaker 06

  Zero. Yeah.

• 49:11David Pierce?

  Yeah. So this is the case for the super app, right? That's the whole thing.

• 49:14Speaker 06

  So, you know, if you're in the US, though, the apps on your phone already do all the things he's trying to build. So that's obviously the thing that wouldn't support his vision here. But he's got one of the last scaled, you know, social media platforms with, you know, hundreds of millions of monthly users. At least, at least some portion of those are real users. We're not sure how many, but it's got a sizable, you know, user base of real people, we think. There is something to be said for like, make it a stickier product for the people who are using it. You can see kind of him putting the pieces together with the creator payments that they've started doing, right? So if you're verified, you're starting to get like, I think it's actually now bi-monthly, just payments to your Stripe account.

• 49:57Speaker 06

  I think it's deeply funny, by the way, that he's using Stripe for all this right now. Like he, they're building it all on the fly. They have none of this like in-house yet. So he's using Stripe. But, you know, say you're a creator, you're getting these payments, which are basically some undescribed rev share of the ads that run against your tweet after certain million plus impressions. That balance, what if that just starts earning interest for you in your X account? And that's, that feeds into the, the money that you can send through the system. And he's talked. In internal all hands about, you know, we have to be backwards compatible with the existing financial system. So they're going to have credit cards and debit cards for X as wild, you know, as wild as that says, as wild as that sounds, that's going to happen. He's going to offer lending.

• 50:41Speaker 06

  So it's going to become this full kind of bank thing and he's been wanting to do it forever. And it's just kind of, it's remarkable that it's like so similar to the early vision, like the late 90s vision that Liz started this conversation talking about. And he seems to just not care that the world has changed and think that I've got a big enough user base that I can make something interesting here and TBD if that will work, but that's, that's what he's doing.

• 51:07David Pierce?

  You also just perfectly described why I think the super app discussion is so fascinating. Because it just makes logical sense every single time, right? No matter which company you are, whether you're, you make, you know, WhatsApp or Snap or Uber, which is kind of trying to do this, or any number of other companies. It's like, okay, well, we have this one core competency. People are spending their time inside of our app doing a thing. What if we do this like slightly adjacent thing? And then if that starts to work, what if we do this other slightly adjacent thing? And over and over and over, you can talk yourself into, every company has to be some kind of like financial juggernaut, because that's what powers a lot of the rest of this. And then you talk yourself into, not only do we want to be a social media app, we also want to be a chat app and then we have to do some entertainment stuff.

• 51:52David Pierce?

  But then people are going to want to like get around. So we should probably be a rideshare company. And it's like, you can talk yourself into trying to be all things to all people, which is a terrible idea in perfectly rational ways, one step at a time. And I feel like we've watched these companies do this for like 15 years. And it's so funny and so bizarre every single time. And now we're just watching Elon Musk do the same thing, but at like record speed.

• 52:14Speaker 05

  You know, David, I also want to just point out something because we've, we've been dancing around interest rates for a minute. I understand I sound like a broken record, but post 2008, there was a very long period of very low interest rates. And that was part of the reason why we wound up with people trying to do blitz scaling. It was part of the reason why we found people, you know, Moving into related businesses that didn't totally always make sense.

• 52:40David Pierce?

  WeWork opening a preschool will forever be my favorite example of that.

• 52:43Speaker 05

  That's right. And so, you know, if you think about it in a way, it was easier to experiment with this kind of thing because there weren't a lot of places to park money that would earn you interest. And so that meant that there was a lot more money available for investing. And if you think about what's been going on over the last two-ish years, the Fed has been raising interest rates. And so that is no longer true. Separately from the fact that, you know, yields on bonds are pretty high right now, relatively high. There's also just a variety of financial instruments that have suddenly become much more attractive than they've been for about a decade. And that's a problem for VCs generally because all of that VC scaling, like blitzscaling stuff,

• 53:28Speaker 05

  you know, typified, for instance, by Uber, that relied on there being a lot of cash available so that you could pour it all into the market, corner the market, and then, you know, jack up the prices, which is essentially what Uber has done. Again, we may not be in conditions for that to continue to occur anymore. And one of the things that has been a real question for me when it comes to Elon Musk, and it's an open question, is that a lot of his success happened in this low-interest rate era. A lot of, you know, what we think of as being Tesla's success, for instance, happened when it was easy to get a hold of money. And even then, Tesla almost went out of business a couple of times. You think about SpaceX, you know, it's still private. It's very much venture-backed.

• 54:11Speaker 05

  And it's a valuable company, you know, it does a lot of important things for the US government. I don't mean to suggest that it's, you know, smoke and mirrors or anything like that. But again, conditions have changed. You think about some of the other projects that Musk has been working on, the sort of more far-fetched stuff like The Boring Company and Neuralink. And you wonder how far they're gonna go in this new environment. And you think about Twitter, which, you know, Twitter has never been an especially successful business.

• 54:38Speaker 06

  True.

• 54:39Speaker 05

  Even though it's been a particularly influential one. And you think about all of the debt that Musk loaded it up with in order to buy it. And you think about the new environment we're in, which we haven't seen, you know, in quite some time. And you just wonder if Elon Musk is prepared for this era of normal interest rates. Like, there just seems like a lot of the things that he has done has been to spend as much money as possible and worry about the risk later. And I'm kind of wondering if it's, if we've reached the moment where it's later and you should be worrying.

• 55:11David Pierce?

  Yeah. Alex, what have you heard from folks over the last couple of years? Because I think, like, Liz, I agree with you almost 100%, but also the other thing that is happening is that all these companies tried this when there was unlimited money to throw at it. And it kept not working still, right? Like, Facebook couldn't make dating happen. And all these companies have tried to expand into this, like, do more things with your life outside of just the sort of core competency of our app. But Alex, I'm curious what you've seen. Like, have folks pulled back on this ambition because of sort of the, like, larger economic changes here that we're talking about?

• 55:45Speaker 06

  From a product perspective, no. I actually wrote a piece in The Virgin 2021 predicting that there were going to be more of these super apps attempts around the world. I wasn't specifically talking about the US, but just broadly for a number of reasons. But because a lot of the kind of scaled, big independent apps that do one or two things, like, they worked as a business in a model where you could track people across the internet. And that increasingly is not happening anymore, thanks to Apple and regulation. And so you have this incentive for all of these companies that make money by how much time people spend in their services to bring more of that activity inside their walled garden, so to speak.

• 56:30Speaker 06

  So you have, like, TikTok doing shopping, right? Where you can, like, buy a thing you see in a video without ever leaving TikTok. That wouldn't have happened five years ago because you didn't need to, because you could still track who made the purchase where. If they went somewhere else, it just wasn't worth the effort. So I do think there's a natural kind of business incentive at play here for all of these kind of time spent based companies to become more like super apps. And the TikTok shopping thing is actually a great kind of very, very fresh example. They're testing like a storefront that looks like Amazon right next to the video feed in TikTok. So to Liz's point about, you know, the broader kind of macroeconomic climate here and the fact that it is, you know, capital is more expensive.

• 57:15Speaker 06

  You can't just like, you know, Tesla's not going to become a trillion dollar company on pure mania anymore. Right? Like that era has passed. Sure, but like, I mean, from everything Musk has been saying since he bought Twitter, he is seems to be painfully aware that things are changing. Like every time he talks to people internally, it's like, we have got to prepare for a recession. You know, I reported on meetings like when he first bought the company where he was talking about the fact that he thinks a very bad recession is coming. Looks like that may not be the case now, but he's definitely been thinking, you know, things are shifting. I don't think he's totally oblivious to it. I mean, he is, he is the richest person in the world. Like I think he probably has pretty good data.

• 57:56Speaker 06

  He's very focused on cutting costs on, you know, I think SpaceX just had its first profitable quarter. I just saw in a media story in like Q1. So he is actually kind of like leading the charge, so to speak, in Silicon Valley of like cutting companies down to the bone to try to make them profitable and get away from this kind of hyper growth era. So I don't know, I don't know if the things are, I don't know if that's, that means that he's going to succeed here, but I do think he seems to be at least aware that things are changing.

• 58:26David Pierce?

  Yeah, I do think to go back to WeChat for a second, one of the things WeChat was able to do that worked so well was essentially just pour money and energy and effort into getting people into the app. Like Liz, what you were talking about with the early days of PayPal, where they're essentially just heaving money at people to use PayPal or X.com or whatever the heck it was. WeChat was able to do that kind of thing for a long time and just work so hard and grow so much that it kind of had won the market. Before anybody really noticed and then you get into that sort of escape velocity and it becomes very hard to lose because people decide it's smarter to just build inside of WeChat than build their own thing because they don't have the money to compete with it and like on and on and that's who you win and that in this era becomes much harder to do right because

• 59:11David Pierce?

  there's no free money to just throw it growing.

• 59:15Speaker 06

  David, it becomes easier to win when you have the full backing of the CCP. I mean like to get to our early point like and and this can maybe kind of bring it full circle a little bit like to what Liz was talking about earlier like do we really want Elon Musk who already has a ton of power especially through like Starlink and how that relates to how physical wars are playing out in in Ukraine. Do we really want someone with all these different businesses and power to have something like a WeChat and he has a business in China that is very important strategically to Tesla. He's got a lot of pressure points that can be pushed around the world by different governments and do we want something like a super app where we transact and do all these

• 1:00:00Speaker 06

  things to be managed by one person who let's be clear controls his companies completely, right? So it's like this isn't like a normal governance situation. So there's there's a lot to be concerned about there.

• 1:00:13David Pierce?

  Liz, I have a strange feeling. I know your answer to Alex's question.

• 1:00:16Speaker 05

  There are a lot of reasons I don't want Elon Musk's super app managing my money and all of the things that you guys have have mentioned are part of it. Part of it is also, you know, I'm a reporter who reports on Elon Musk and like, do I necessarily want him to be able to like, look into my bank account from God view? Do I?

• 1:00:42David Pierce?

  I feel like it is though. Like you you like you a little bit just like root for chaos at all times and like that is chaos.

• 1:00:48Speaker 05

  It's true. And like honestly, I he's gonna find out that I spend far too much money on my cat. But you know, like, as you think about these things, the other thing to think about is Elon Musk's history of implementation, and it's sloppy. And, you know, some of that is like the panel problems that we saw with Tesla, you know, and various other sort of implementation problems. But even if you just narrow your focus to Twitter slash X, there's just been a lot of sloppiness there from the X sign to not getting the X handle until after the name had already been changed, to the various sort of problems that we've had around the

• 1:01:29Speaker 05

  service where we were being rate limited abruptly for a while. And like, this kind of like slap dash mentality is an old Silicon Valley mentality. It's, you know, usually thought of as like move fast and break things. And that does make sense in certain contexts. You know, like the Twitter fail whale was a thing because, because sometimes the service went out because there are too many people on it. But, you know, if you think about the things that you don't want from banks, I'm just going to list some of them. Abrupt frequent service changes, regular service outages, new fees added at random, white supremacists, difficulty with verification, spam and fraud. You know, like, these are all things I don't want anywhere near my money.

• 1:02:12Speaker 06

  Yeah.

• 1:02:13Speaker 05

  And if you just look at how Twitter is operating right now, and you think about it, is like, mm, do I trust Elon Musk to actually handle my money in a way that makes sense?

• 1:02:24Speaker 06

  Right. It's like, all these crypto scam ads that I see in my feed every day. It's like, oh, all I want is to be able to actually send money to those ads.

• 1:02:32David Pierce?

  Right. With one click, they just have your bank account now. That's what everybody's looking for, right?

• 1:02:36Speaker 06

  Yeah.

• 1:02:37David Pierce?

  So, okay, last thing, and then we should go, is I think if you imagine somebody, Elon Musk, or Mark Zuckerberg, or somebody, from a product perspective, manages to build this thing, they accrue all of the value, all of the user data, all the everything to like, be the WeChat of America. Could anyone pull that off from a regulatory standpoint? Like, would Lina Khan and the FTC just throw their bodies in front of one company having this much? This is an argument I've heard, and I genuinely don't know where I'd land on, like, could you even, in theory, pull this off under the US government's nose?

• 1:03:15Speaker 06

  No, there's no chance. I mean, Facebook, are we old enough now to where we don't remember in just 2019, Facebook tried to create a global currency?

• 1:03:27Speaker 05

  Like, I remember Libra. I love Libra.

• 1:03:30Speaker 06

  Yeah. And honestly, Libra was a pretty smart idea for a global currency that had a lot of benefits and was going to be managed by a trust, et cetera. Like, they thought through a lot of the potential blowback. Guess what? It still got shut down. I would say there's next to zero chance that anything like this happens in the US, for all the reasons you just said, David. I mean, if Facebook can't buy Giffy, do you really think like that Congress, especially all the members of Congress who have strong feelings about Musk already, are going to let him build a financial superpower that potentially, potentially like, has more power than the US government? No. Like, no, absolutely not.

• 1:04:07Speaker 05

  I want to pile on to this because it isn't just an antitrust issue, although it is a very sexy antitrust issue. What you're talking about is essentially somebody who's managing the digital dollar. And I feel like the Fed and the Treasury both want to be involved with that. And so not only are you looking at an antitrust issue, you're looking at dealing with other major government agencies. And, you know, there are people out there, Circle is one of them, that are interested in being the purveyor of the digital dollar, that are interested in doing that kind of work, that have talked publicly about wanting to work with the Fed, with the Treasury to have a digital dollar. And that's a very, very different proposition than what we're hearing about with these super apps.

• 1:04:50Speaker 05

  And like, again, if you go back to something like Fed Now, there is like a reality where it turns out like maybe your competition is the United States. Because it turns out the dollar is a really, really important part of why the US is so powerful. The dollar is something that a lot of people transact in around the world. It's a really, really important part of the US's soft power. And wherever the dollar goes, US law goes as well. So whenever you're talking about this kind of like super app, when you're talking about these kinds of big payment companies, you are inevitably also talking about Something much more powerful. And Elon Musk already has a lot of sway in the federal government because, you know,

• 1:05:31Speaker 05

  Starlink is very important because he sends a lot of satellites up for various US military missions. And so there is like this question of how much more power we as, you know, the United States want to hand over to him. Like, he's already like doing all of these things for the military. Do you want him handling the US dollar as well? And I feel like the answer is probably not.

• 1:05:56David Pierce?

  It's a real like, no one man should have all that power kind of situation. It's just where I land. Yeah, I, I don't know. I kind of hope somebody gets further down this road and we can actually have this fight in a real way. Because I think Meta never had a chance because of all the other stuff going on with Meta. The FTC was just like, the whole US government would have stopped Libra if it came to it. I don't think Elon Musk is gonna even get close, but it's, it's gonna be fascinating to see if someone can get well enough down the road that we actually have to have this fight for real, but I'm not convinced we're ever gonna see it. Alex, who would you bet on? Do you still think it's Snap? Could Snap do it?

• 1:06:30Speaker 06

  No, I don't think this is happening. Not, not in the US. I do think it will happen in other parts of the world where countries are kind of more willing to embrace something like this, but I think the US is so against big tech right now. And there's so many established players doing things really well at scale, like banking, that I just don't see how this happens. But, you know, could be my famous last words.

• 1:06:53David Pierce?

  No, I tend to agree. I think instead of a super app, we got like the whole internet. And I think that's probably a better trade.

• 1:06:59Speaker 06

  And like, that's okay. Like, it's actually, I love, it's capitalism, like, I, free market, whatever. Like, I, I love having apps competing for my, my services and my attention. And to have options is a good thing. Like, we shouldn't be like necessarily wanting one company doing everything.

• 1:07:14David Pierce?

  Totally. All right, well, we gotta take a break, but thank you both for, for doing this. I appreciate it. And I will, I will X both of you some money for being here. Thank you.

• 1:07:22Speaker 06

  No, you won't. All right, see you guys.

• 1:07:24Speaker 05

  Bye.

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• 1:08:35David Pierce?

  All right, we're back. Let's get to the Vergecast hotline. As a reminder, the hotline number is 866-VERGE-11. You can call and ask us absolutely anything about tech. Anything on your mind? We want to hear it all. You can also email us, [email protected], if you don't want to call. This week's voicemail comes from Daniel.

• 1:08:53Speaker 07

  Hey, Vergecast, this is Daniel. I always had this question of why social media doesn't recognize the fact that like, people are more than just one thing? Like, why can't I have a whole collection of subreddits for each of my like, quote unquote, modes? Like, sometimes I'm in productivity mode where I just want to see, you know, how to be optimally productive, I guess, and do spreadsheets and that kind of stuff. And then sometimes I'm into my hobby interest mode and I just want to see stuff about like, video games or whatever. The only way I've ever found to do this is to actually have totally separate social media profiles, which is just super annoying to maintain. But why doesn't any social media recognize

• 1:09:36Speaker 07

  that that's a thing that pretty much every person has? Anyway, tell me your thoughts. Bye.

• 1:09:42David Pierce?

  Okay, I have answers to this question for once. I have a, I have a small thought and a big thought. The small thought is that for Reddit, this is actually a thing you can do. Reddit sort of buries this, but it does actually exist. It used to be called multi-Reddits and now it's called custom feeds. And basically, the idea is you can pull a bunch of different subreddits into one thing that you see all as a single Reddit timeline. So like, I have one ironically for productivity. That's all of my like productivity nerd subreddits. And then I have one for all the sports teams I care about. So like, I have the Arsenal subreddit, New York Giants subreddit, and the Yankees subreddit, all in one place. This is a great thing that Reddit does. I don't know why they don't share it more. It's kind of awkward to find.

• 1:10:24David Pierce?

  I'll put a link in the show notes on how to set up a custom feed on the web and in the apps. But it is possible and you should do it and it's great. The bigger picture thing here is I think this is a good idea and I think we're gonna get towards it. I think one of the things we've talked about a lot with the social web and Activity Pub is this idea that there are going to be lots of new ways to sort and filter and display the same kinds of content. So you've heard Elon Musk and others talk about this idea of like open sourcing the algorithm so that you can get different versions of the same experience depending on what you want. So you could show up and say, "I'm in the mood to just go on TikTok and watch bloopers from TV shows that I like." And that's actually an instruction you might be able to give an app like that over time.

• 1:11:08David Pierce?

  Or to say, "I'm in work mode," or "I'm in school mode," or whatever, and actually have these things work separately. It's hard work and it means having different algorithms and systems and it also means making users do more, which most of these apps don't like to do. But I do think that's actually a place that we're headed with some of these tools. The other thing is that I wouldn't underrate how useful it is to have multiple accounts because the other thing is when you're interacting on these, when you're liking stuff and you're commenting and you're posting, having all of that stuff kind of live together in a separate account works really well. So even if we get to the point where you can customize your algorithms, or like I have custom feeds on Reddit, I'm still posting as me.

• 1:11:51David Pierce?

  And so kind of my interactions in my life all live in the same place. And a lot of these companies, Instagram, I think, does this better than almost anybody. Make it really easy to switch from account to account. But I'm a big fan of having multiple accounts. I have lots of accounts on lots of different services and it occasionally gets like awkwardly cross pollinated because you forget what you're logged into. But having a Reddit that I go to when I'm just looking for sports stuff and want to like yell about sports that is separate from where I comment as like a person who people know on the internet is really useful. And if you want to shitpost, you should have an account just for shitposting is my personal and professional opinion. So the point, Daniel, is I think we're headed somewhat towards the world that you described, but also custom feeds on Reddit will instantly make your life better.

• 1:12:36David Pierce?

  I hope that helps. All right, that is it for the Vergecast today. Thank you to everyone who's on the show and thank you so much for listening as always. There's lots more from everything we talked about, including Mythic Computer at theverge.com. We also made a cool video. We have some really fun stuff on the website. Go check it all out. It's good stuff. If you have thoughts, questions, feelings, or sick custom computers that you made and want to tell me about, you can always email us at vergecasttotheverge.com or call the hotline 866-VERGE11. We love hearing from you. And speaking of the hotline, one thing we're going to do at some point in the very near future is an entire Vergecast episode all about The Verge. We're calling it the Meta Vergecast episode. So if you have questions about how we make The Verge, how we make The Vergecasts, what

• 1:13:19David Pierce?

  Nilay's favorite food is, why Alex Cranz has so much weird stuff on her walls, send us all of your questions, call in with all of your questions. We're going to do a whole episode about it. It's going to be awesome. This show is produced by Andrew Marino and Liam James. Brooke Minter is our editorial director of audio. The Vergecast is a Verge production and part of the Vox Media Podcast Network. Nilay, Alex and I will be back on Friday to talk about the Connect, the drama about OpenAI's web crawler, all of your computer rooms, which has been so fun to see, and lots more. We'll see you then. Rock and roll.

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