334: Sundar Pichai testifies, Samsung A8, and Verizon's future

This week on The Vergecast, Nilay, Paul, and Dieter devote half the show to discussing what happened when CEO of Google Sundar Pichai testified before the House Judiciary Committee. Congress thinks Google has a bias problem — does it? 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.

• 0:00Nilay Patel?

  This episode of The Vergecast is brought to you by Glenfiddich. 'Tis the season to celebrate. Treat yourself and the ones you love to whiskey that delivers the perfect union of smoky and sweet. Try Glenfiddich Fire and Cane. Whether it's served neat or on the rocks, Fire and Cane challenges convention, packing equal parts citrus and sizzle in every sip. Learn more about the newest experimental whiskey from the masters of Glenfiddich. Visit glenfiddich.com/us. That's glenfiddich.com.us. Note, drinking alcohol involves risk. Please drink responsibly.

• 0:32Nilay Patel?

  Hello and welcome to The Vergecast, the flagship podcast of Vox Media and The Verge. The holiday season, I think we should be the flagship podcast of the holiday season. I am Neel Ippatell, the editor in chief of The Verge. Paul Miller is here. Hello, Paul. Hello. Dieter Bohn is here.

• 0:46Speaker 01

  Good morning, or afternoon, or evening, whatever time you listen to this. I hope it's a good one.

• 0:51Nilay Patel?

  I'm going to just tell the audience right now, our various holiday travel schedules means that we're recording this a little bit earlier. For me, it's like a very normal 10:45 kind of time. These guys are on the West Coast, so it's 7:45 for them. So I'm going to do my best to wake them up by talking about the following things. Now, I think we have to talk about Google in Congress, Sundar Pichai went to Congress. There's some gadget news this week. I want to get into that, particularly that whatever Samsung is doing with taking out the hole for a headphone and adding the hole for a camera, which I think is how they characterize their product strategy. It's very complicated. And then, obviously, we'll talk about Verizon giving up on Oath, which is, you know, I think just a theme of the show constantly for years. But let's start with Sundar.

• 1:32Nilay Patel?

  So it's been a year of tech companies being called up in front of Congress to testify about why they're bad and apologize for existing. Jack Dorsey did it, Mark Zuckerberg did it, and now Sundar Pichai, the CEO of Google, has done it.

• 1:44Speaker 01

  We should put that in a little bit of context, because about a month, maybe a month and a half ago, there was one of these hearings and they wanted to have all the CEOs. And so they set up a table and Google's like, no, you can't have our CEO. He's busy, but you can have our, you know, chief policy, something lawyer, something, something. He's the one who actually deals with the stuff you're worried about. And the committee got very mad and they decided to put an empty chair there and just write Google on it and then yell at the chair.

• 2:18Nilay Patel?

  Yeah.

• 2:18Speaker 01

  Because Google would send the CEO.

• 2:20Nilay Patel?

  A real Clint Eastwood move.

• 2:22Speaker 01

  Yeah.

• 2:22Nilay Patel?

  Screaming in an empty chair.

• 2:23Speaker 01

  I don't think I'm breaking any confidences by saying that when I have told various people at Google that I thought that was a bad move on their part, even if the committee was acting a little bit, you know, grandstanding about it. The general response, I wish that this wasn't just an audio show because I would just show you the grimace emoji, like they would, they would literally turn into the grimace emoji. They'd like, you know. They do that.

• 2:48Nilay Patel?

  I thought you were going to say they literally turned into Grimace, the most misunderstood of the McDonald Land characters.

• 2:53Speaker 01

  What's misunderstood about him?

• 2:55Nilay Patel?

  Everyone else has a role, right? Ronald McDonald is like helping children in hospitals. The Hamburglar got sexy, which was weird for a time, but.

• 3:04Speaker 01

  Rubble rubble.

• 3:05Nilay Patel?

  He steals, he steals your food. Grimace, what are you doing, man? There's a sheriff. Anyway, Paul, what were you saying?

• 3:11Speaker 02

  I was just wondering, is this official, the official makeup session for the empty chair session? Or is this a different thing?

• 3:18Nilay Patel?

  I don't think they would, they would not characterize it as a makeup session, but it feels fairly obvious that everyone understands that Google should have been in front of Congress and they took their shot. I think there's, there's one way in particular that I do think this all worked out better for Google, which is they got their own time and they were not characterized with Facebook and Twitter.

• 3:39Speaker 01

  Yeah, they're not lumped in with them.

• 3:41Nilay Patel?

  And I think Google is doing everything it can to get away from those two. And there have been revelations in recent weeks that Facebook is actually doing everything it can to like seed opposition research about Google and saying they do all the same things. You should talk about them as much as you talk about us. So there's that dynamic is playing out in sort of the PR side.

• 4:01Speaker 02

  Yeah. Google's also leaking data about its social network customers so that it can shut it down quicker.

• 4:07Nilay Patel?

  Yeah.

• 4:08Speaker 01

  Well.

• 4:08Nilay Patel?

  So we should talk about that.

• 4:10Speaker 01

  Okay. They had another problem with Google Plus. They once again discovered that one of the APIs that they offered to developers was able to access more information than it should. And so they discovered it, they shut it down. They don't think anybody actually figured out that this API could do this thing. And then they came back and they said, you know what? Screw it. We're shutting this thing down in like, whatever it was, April.

• 4:33Nilay Patel?

  Yeah, I think it is also fair to say that Google Plus is not Facebook.

• 4:37Speaker 01

  Correct.

• 4:38Nilay Patel?

  So just like Congress, I think we can wait an hour and a half before discussing Google Plus.

• 4:45Nilay Patel?

  Which is exactly how long it took for them to ask a question about that data breach. Anyway, so Sundar Pichai sits down in front of the House Judiciary Committee. Just like the previous hearings, and I think this is kind of important, he outfoxed them. Right, and Zuckerberg managed to do it, and Jack Dorsey managed to do it. Even when there are legitimate problems with Google, and I think there are lots of legitimate problems with Google, the way Congress is set up to question these people provides endless opportunity for them to dodge, for them to hide in the technical details of what's going on, for them to say, "We'll come back to you later and answer your question more fully." Or for them to simply say they don't understand the question. And we saw Zuckerberg do it, we saw Dorsey do it. I think Sundar is, he's like a corporate executive, right? He started as a junior corporate executive and he worked his way up and now he's the

• 5:31Nilay Patel?

  CEO. So he's a little, he's a little less the boy king that Zuckerberg is, where everyone's constantly asking us to apologize for the fact that he doesn't know what he's doing because he doesn't know what he's doing because it's his first job, right? Everyone's like, "It's his first job."

• 5:42Speaker 01

  He's like the enlightened Despot, or like the philosopher king. He's the philosopher king.

• 5:47Nilay Patel?

  Yeah, he's, if you put Sachin Adala from Microsoft in this position, he would have done, right? He's also a very seasoned, very polished, very media-trained corporate executive. That's very much what Sundar is as well. Whereas I think with Zuckerberg, there's always this sense that at any moment he's going to flip a table and be like, "I made this thing." Anyhow, so there are these moments, and these are the moments that, you know, as we wrote stories about the hearing yesterday, these are the moments that played huge with a Verge audience, and I think subsumed any of the very little substance that was actually there. So Steve King, who's a representative from Iowa, he has a checkered past of saying extremely racially charged things, told this story, he asked Sundar, "My granddaughter was playing with her iPhone, just playing a game, and my face popped up, and I won't say what it said around my face. Why did that happen?"

• 6:32Nilay Patel?

  And Sundar literally had to say, "The iPhone is made by another company."

• 6:36Speaker 01

  Yeah.

• 6:36Nilay Patel?

  And he, like, big sigh, eye roll. But really what Steve King is asking is, hey, why does this technology work the way it does? Right?

• 6:45Speaker 01

  Yeah.

• 6:45Nilay Patel?

  And like, why are these things happening that I don't understand? And that exchange is very funny, because it is true that Google does not make the iPhone. It is potentially true there are not even any Google apps or services on his granddaughter's iPhone. None of this could have anything to do with Google. But the question fundamentally was also... No one understands how all of these things interoperate and why things happen. And that's like, really the question you want to ask all these tech leaders. Why doesn't anyone know how your shit works? You just watch it happen over and over again in all these hearings where because that is the real question, everyone's waving their iPhones at CEOs of software platforms saying, why does this work this way? And they all get to kind of weave around it. There was another moment where they had to ask why Googling the word idiot turns up pictures of Trump.

• 7:30Nilay Patel?

  And Sundar Pichai had to patiently explain what a Google bomb is and patiently explain that there's not a little man behind the curtain that like adjusts search results. And then a congressman said, well, I believe that humans are manipulating our search results and nothing can change my mind. And that is not useful, I would just say, regardless of your party affiliation, that exchange was not useful to the operation of the republic or to the American people.

• 7:52Speaker 01

  Yeah, I'm not gonna, I'm not gonna defend King here, but I will say that in some of the other exchanges I saw, it was clear, like in these hearings, a congressperson is performing for the camera, performing for the constituents, signaling to other congresspeople what their possibly changing position on a topic is, and then also trying to like get a question answered, right? Like they're trying to do all of those things at once. And sometimes that turned into like asking a question that in any other context is just completely stupid. In this context, it just felt like 50 to 80% stupid, which is still stupid, to be clear.

• 8:31Nilay Patel?

  Yeah.

• 8:32Speaker 01

  But Sundar Pichai, Mark Zuckerberg, Sheryl Sandberg, Jack Dorsey are all very smart people and they understand those multiple contexts. And they also can like tell when a question is like 50% stupid or 100% stupid. But like you were saying, they can basically reply to whatever context they want to and it will make like a little bit of cognitive sense. And so those questions weren't designed to like reveal truth. They were designed to like position people. And that's just frustrating to watch. Sometimes it's like dynamite to watch because those positions actually do matter, like politics actually matters. But here, what we actually need to know is like a little bit of like, how does Google in fact order things on its search rankings, you know?

• 9:17Speaker 02

  So if you do a Google bomb, right, where you you create a bunch of links that all have in the the link text and sometimes in surrounding context, the word idiot and that link links to a Trump picture, usually hopefully a specific Trump picture to like to really concentrate the effect of the Google bomb. Yeah, that's going to impact page rank. And so that's interesting. And that could be one good way of of explaining it. But there are all there's also the aspect that Google has has a thing that it thinks of. I don't know what the word these quality. Google works to improve, and that's a subjective word, its search results to to highlight things

• 10:01Speaker 02

  that it thinks are more true or more quality. And and those are aspects of Google's algorithm that are way less understood than page rank.

• 10:09Nilay Patel?

  Yeah, no, I think that's absolutely true. And this question came up on both sides of the aisle, right? So there's the classic cry of conservative bias, which you can believe or not believe. Paul, I know that you you think it exists on these platforms. Casey Newton, who writes about this stuff, in the interface every day, says, Well, conservative media performs better than any other thing on these platforms. So there's a real debate to be had there. And there's data points everywhere. But that's happening. And that, you know, Google was accused of conservative bias yesterday. And on the other side, a congressperson said, Well, when I search for my own news hits on MSNBC, what I get is daily caller aggregation calling me an idiot. Like, that's not the thing I want either. So fundamentally, I think

• 10:52Nilay Patel?

  this comes back to, yeah, OK, Google has like a set of quality filters. They're trying to deliver results to a market. They are trying to be more useful to more people. That's why people want to use Google. But in the absence of any competition, there's actually no way to measure whether they're doing a good job, whether people prefer Google's results to another person's results, whether Google's subject, and I agree with you, Paul, completely subjective notion of what quality is, what neutrality is, measures up to somebody else's subjective notions of those things, because they are a dominant provider.

• 11:22Speaker 02

  So they have done a little bit of the work to try and tell you what their subjective opinion of what quality counts as. You can you could Google it.

• 11:32Speaker 01

  So here's the way that Google Search works now. It's not just PageRank anymore, right? It's lots and lots and lots of different algorithms working together in the main search algorithm to try and provide the most useful result. That's generally what Google aims for is useful. And when Google wants to tweak that algorithm, or all of those algorithms, or any of them, or whatever, it doesn't just go out and A/B test it. It pops up and is like, I've got this thing. And then they have an ethical argument of this, is this thing a good algorithm? And then they give it out to the 20,000 is who they, how many they'd say want to hire eventually, humans, search quality evaluators. These are people who live all over the world and supposedly represent a diverse set of,

• 12:16Speaker 01

  you know, different kinds of humans, and they are given guidelines. And if you just Google "search quality evaluator guidelines" for Google, you will land upon a, you know, 20 something page document of, that tells those evaluators what to do. So they will get this new tweak to the algorithm. They will do a bunch of searches. They will, you know, mark up whether it's different from before, and they will say, this is what I think of these results. This is how I rate the trustworthiness of these results. And then they'll go back to Google, and Google will say, cool, this seems pretty good. And then they'll do a tiny ass A/B test out in the real world. And then they roll it out, you know. And I'm skipping a few steps along the way. But the point is, like, they actually

• 13:00Speaker 01

  do have a process to try and minimize quote unquote bias, maximize trustworthiness, maximize usefulness of their search results. But, you know, we can have a long argument about whether this document comprises, like, sufficient, I don't know, trust in what Google's results are. Like, I don't know, I'm just like, did you know that they categorize certain pages as your money or your life pages? Huh. Those, they, they, they pay more attention to those because they're pages that, like, actually matter in terms of spending money or your healthcare or something. And so they have a much stricter filter for letting those pages rank highly than they do for Neelai Patel, because who the hell cares if Neelai Patel's name gets smeared? I care. I can think of one person. It's Paul.

• 13:44Speaker 02

  That's right. I did not know that these people existed.

• 13:49Nilay Patel?

  Well, so this is, I think this is a big problem, right? Google has like a transparency problem. So if you're, let's say I was, for example, the representative from the southeastern, uh, the first district of Wisconsin, southeast Wisconsin, which is a thing I think about all the time. What would like, I ask Google, what would our audience ask Google? People like really pay a lot of attention to Google. You have a transparency problem, right? Why can't I just click on a result in Google and be told how it was given to me? Like, what were the factors? Like, that would be really interesting to a lot of people. It would solve a lot of these problems. And Google probably has a good answer to that, which is, well, then people would game the shit out of that, right? That's already the thing that's happening. So that's a meaningful policy conversation. How much transparency can we enforce on you, knowing that that will come at an extremely high cost because people will game it?

• 14:33Nilay Patel?

  Two, you guys are an ad, a digital ads monopoly, right? Between Google and Facebook, 90% of the ad dollars in digital, that's them. Google and Facebook control 90% of the ad dollars in digital advertising. So how should we think about the fact that virtually no one else can make money on the internet, serving ads, on ad supporting businesses, without doing a bunch of shady shit, without popovers and tracking and all this other stuff that you have to do? Who is your competition? Who is your number one competitor that you are scared of? Right? What, where is the market force that regulates you in the absence of the government regulating you? And you can't tell me it's Bing because, and you can't say competition is one click away because it turns out your monopoly status

• 15:14Nilay Patel?

  leads to incredible network effects where people do click on search results and your algorithm uses that data constantly to prove at a rate that your competitors can't approve. So where's your true competition? Where's that competition? Hey, you guys own YouTube.

• 15:25Speaker 02

  Duck, duck, go.

• 15:26Nilay Patel?

  Right. So duck, duck, go. Because they don't do the ad tracking. It is likely that their, their results to an individual are less good. There's no way to measure. There's no way to know. Right? So like, how can we as the government, me as the representative from the first district of Wisconsin, how can I, putting that idea out there, how can we, how can we track it? How can we measure you? How can we keep you honest in the absence of market competition?

• 15:51Speaker 01

  Okay, so Neelai, this is a lovely dream.

• 15:54Nilay Patel?

  It is.

• 15:54Speaker 01

  How do you imagine asking these questions in the five minutes you get in front of Senator Pichai in a committee setting would have gone?

• 16:00Nilay Patel?

  Mr. Pichai, who is your competition and don't say Bing? Who is, what is the truest, what is the biggest threat to Google search?

• 16:05Speaker 02

  But how are you gonna impress and or intimidate your political rivals with that, that question?

• 16:11Nilay Patel?

  I mean, I'm, I'm, I'm going full prosecutorial style, Kamala Harris style.

• 16:15Speaker 02

  And you didn't say the honorable Senator so and so from.

• 16:21Nilay Patel?

  I'm just gonna wave cell phones at him until he capitulates, which is apparently what Congress does. I'm just saying, there are really problem, you are so big that no one can effectively compete with you. Why shouldn't I regulate you? What is the thing that's gonna topple you and create opportunities for new entrants in this market?

• 16:36Speaker 02

  Well, a lot of these big companies have kinda gotten into this where like, well, maybe you should regulate me, you know? And it's kinda weird, it's kinda awkward.

• 16:46Speaker 01

  But Paul, why didn't you, why didn't you make it sound sexual?

• 16:51Speaker 02

  But there's an aspect of, if there was a regulation on how you be a search company, it would be pretty easy to write that such that Google and maybe Microsoft would be the only companies capable of complying with that regulation.

• 17:03Nilay Patel?

  It isn't, I mean, and that is the criticism of, say, GDPR, which is that it favors incumbents who can do the compliance costs. But at this point, one thing is true. Both Democrats and Republicans are extremely critical of big tech companies. And if there's one thing that gets you to a law, it's that both parties agree that you're stupid, right? And like, that is like abundantly clear, that both parties are agitating for, hey, privacy protection, hey, we should know more how your, how your algorithm works. They might not know the details in these, in these forums. They certainly have staffs and think tanks and lobbyists who are pushing for that stuff.

• 17:38Speaker 02

  To rewind just a little bit, what, in one of your questions, I think there is a really important thing, because I would love every time anything algorithmically happens to be able to have a little dropdown and just find out how it happened, you know? Every time something happens on my phone where it makes me confident my phone is listening to me, I just wanna like, I want a plausible explanation. It doesn't even have to be true.

• 18:01Nilay Patel?

  Comfort me. You need a comfort me button.

• 18:03Speaker 02

  But there's a real aspect to to any multi variant algorithm that you don't really know which variables like like once you run some some fun machine learning stuff on it, you don't really know with very much confidence at all how it's working on the on the inside and which variables are actually determining the the output.

• 18:25Nilay Patel?

  Yeah, and I think that and I think part of the other problem is you don't want to give the game away, right? You are. Google does have competition and it does have bad actors on its platform.

• 18:34Speaker 01

  Wait, who, who?

• 18:36Nilay Patel?

  Facebook, right? You don't want to give the game away to how Google searches, right? Like, someone will reverse engineer it, someone will try to game it, someone will do some bad stuff, Russia will show up. Like, there are actually bad outcomes to being too transparent for all these companies. Is there a plausible middle ground between nothing and something? Yeah, I think probably. But we didn't hear those questions. And I think that's that's where I listen to these hearings and it's really fun to hear Sundar sigh and be like, I don't make the iPhone. Like, I watched that clip 500 times yesterday because it is so funny. But at the end of the day, it's we're not asking the right questions. There were, however, two right questions that were asked. One, are you building a search engine for China? And Sundar said something really interesting, which is we have no plans to launch anything

• 19:19Nilay Patel?

  in China at this time. Not we are building it, not we're not building it, not we'll never launch it, but we have no plans to launch.

• 19:26Speaker 01

  Yeah, not we're building it, not we we started building it and then everyone got real mad at us and we decided it's a bad idea. Not we've canceled our plans, but we have no plans at this time, which is, I don't know, like, part of me wants to say that him saying that on live TV in front of Congress makes it slightly more likely that he can't say, well, we had no plans at that time, but now we do. And so, hooray. And maybe slightly more likely that Google's not going to launch this thing, this Dragonfly thing. But the bigger part of me is like, yeah, no, that that actually doesn't mean much that he said we have no plans to launch this thing at this time.

• 20:05Nilay Patel?

  Yeah, well, specifically, he said, right now. So even even more narrow.

• 20:09Speaker 02

  I don't think we've talked about Dragonfly at all on the Vergecast. Just weird timing of when we've recorded episodes and the news cycle.

• 20:17Speaker 01

  Oh, no, it's conspiracy, Paul.

• 20:20Nilay Patel?

  The lamest conspiracy of all time. So Dragonfly, a project by Google to launch a search engine in China, first reported by The Intercept, picked up by other big news organizations, huge outcry inside of Google to not do this because they'd be building a censored search product for China, which goes against Googly versions of Googliness.

• 20:38Speaker 02

  Or does it?

• 20:39Nilay Patel?

  Right, sure. I really don't agree with you on a conservative bias thing, but I'm gonna let that one go. Anyhow, huge outcry about whether you would allow the government to actually pick what shows up in search, whether you allow a government to aggressively censor a search engine like this. They appear to just be building it to see what it would be like, to see how that would operate. And then Pichai is saying, well, right now, we have no plans to launch. There are lots of projects inside of Google that the employees don't want to do, right? There's working with the military. There's all this stuff, but this one, I think, is the lightning rod of whether they should launch a product in China.

• 21:14Speaker 02

  And there's somewhere between like 100 and 300 people working on it. It's not like a little...

• 21:19Nilay Patel?

  Yeah, side project. And famously, the context, by the way, is that Google was in China and Sergey Brin left. He said, "We're leaving China as a company because we don't want to comply with their censorship regime." So, right, a big reapproachment with China. Pichai said, I think, in an interview after the hearing yesterday, "We might build other products for China around like healthcare or other things." So I think they need to grow. China's one of the biggest markets in the world, right? It's not like Apple isn't in China or Microsoft. Like, their competitors are in China.

• 21:49Speaker 02

  That's an interesting, I mean, that's a really interesting aspect of like, it kind of makes me uncomfortable how hard Apple works to be buddy-buddy with China. And obviously, you know, Mark Zuckerberg has been trying to be friends with China, you know, and he hasn't been very successful so far. But like, the dollar signs are so big for that market that it's, you'd almost be surprised that a tech company wasn't going to do something.

• 22:13Nilay Patel?

  Yeah.

• 22:13Speaker 02

  You know, like, like, I would, it's weird because like, I hate this idea of building a censored search engine. And also, I use DuckDuckGo.

• 22:25Speaker 02

  But I'd be proud of you if you weren't, you know, I, I, it's not like a morally neutral thing to not do it. Like, I understand the very strong motivation to be in that market.

• 22:36Nilay Patel?

  Yeah, I mean, it's, it's a huge market and there's probably all kinds of things you can do, uh, both to make money and to like be a utility. And I think Google generally thinks of itself as a, a utility in that way, but.

• 22:47Speaker 01

  Well, there's, there's other reasons other than just like you can make a lot of money in Google, like the, like now I was saying, the, the, the actual Chinese companies can, uh, you know, work harder to become, uh, more used in the US. And so not being in China is actually like eventually a risk here. If China ever does, uh, open up politically, uh, Google wants to rush in, they will have, they'll be starting as like, you know, naive little babies in the market compared to the other established giants that are there. I don't know, like you could even like, we could talk about Android fragmentation for the rest of the podcast if you want, and Google officially being in China would mean that they would be able to, uh, have the Google Play Store be, uh, even bigger dominant force in the life of Android than it is currently. Like, there's a lot of reasons for them to

• 23:29Speaker 01

  do it, but, uh, so there's a million reasons they should. There's like, you know, there's the one that they shouldn't, which is, uh, oh yeah, like, like, don't censor things, human rights torture, which turns out to be pretty.

• 23:42Nilay Patel?

  Those are pretty good arguments.

• 23:43Speaker 01

  Yeah.

• 23:44Nilay Patel?

  Really, really good. I, I think one of the things that's, you know, you brought up Apple. Apple's there. Apple turned over the operation of the iCloud data center to a Chinese company at the Chinese government's best. Like, Apple does a lot to cell phones in China. That was their growth for so long. But Google like left, right? They said, we are not going to work in China because reasons. Like, the founder of Google said these things. I think it's a bigger deal for them to go back than just, hey, there's money on the table. Hey, there's opportunity on the table. Quite frankly, there's a data collection opportunity in China that's way greater than anywhere else in the world because, uh, Chinese citizens are routinely tracked and have their faces scanned all day. Like. There's a set of cultural norms there. I was actually on a panel last night and one of my fellow panelists

• 24:28Nilay Patel?

  had said, "I just came back from China and people there will happily go the entire day without anything because their faces just get scanned and that will serve as like currency, that will serve as reputation scores." Like, there's a, there's a set of cultural norms there that I think is different, that actually if you are a data collection company like Google poses a bigger opportunity as norms around the rest of the world change. All that said, do you want to build a censored search engine? And I don't think Congress like did that. Like, we just had a deeper conversation about Google and China than, than I think anyone in Congress has had. So they asked the question and they walked away from it and then someone else waved an iPhone at Sundar's face. The other thing they asked about, which I think is interesting to talk about and rarely comes up, I think, I don't think the average YouTuber thinks of Sundar Bhatia

• 25:12Nilay Patel?

  being the guy in charge of YouTube. But he is, right? Even though Susan Murchicky is the CEO of YouTube, YouTube is part of Google, Sundar runs Google. He doesn't really have a great answer for why like YouTube works the way it does, why YouTube moderation is still so like bad fundamentally, why YouTube recommendations quickly lead down radicalization holes on, you know, whatever you want to be radicalized on. He's still just kind of like, "We're working on it. We have policies. We take it down as we see it." And I don't think, I think that answer is quickly going to be not good enough and I think the idea that Sundar is insulated from YouTube is, that needs to change a little bit. Even though he does have deputies in the middle, Google still runs YouTube. It's the second largest search engine in the world. So that was the other thing that Congress touched on yesterday. I think Julia Alexander wrote a great

• 25:57Nilay Patel?

  piece about it for us, but it's just, it's just weird that it's still, everybody thinks about it as two different things. It's almost like Facebook and Instagram. Like, no one really considers back to Facebook and Instagram.

• 26:06Speaker 01

  I do now, because when I use Instagram, I could just feel it that it wants to make every other image in the, the main, the main feed an ad, but it doesn't, it isn't quite willing to just go there. And so, but like, I like, as you scroll, you're like, huh, there's another ad already. And then I, I'm, so now I'm counting the number of posts between ads, just like, because I know it's going to get down to one. And that just smells really Facebook-y to me.

• 26:35Nilay Patel?

  Yeah. And Stories in particular is just Ad City.

• 26:38Speaker 01

  Yeah.

• 26:39Nilay Patel?

  Let's take a break. I'm going to read an ad, speaking of ads. And then, uh, let's talk about some gadgets.

• 26:47Nilay Patel?

  This episode of The Verge Cast is brought to you by Glenfiddich. It's the holiday season, and that means it's time to host a party. Any professional bartender will tell you that serving the right whiskey spells sophistication. But how do you please everyone? When the room is split between those who like their whiskey sweet and fruity, and those who crave a smoky, full-body peaty taste, Glenfiddich Fire and Cane is the answer. Fire and Cane's Deep Flavor Notes Break Convention. Serve Glenfiddich Fire and Cane over ice or neat at your next party, and enjoy its harmoniously rich and smooth union of flavors. Learn more about the newest experimental whiskey from the masters at Glenfiddich. Visit glenfiddich.com/us. That's glenfiddich.com.us. Note: Drinking alcohol involves risk. Please drink responsibly.

• 27:29Speaker 03

  Ladies and gentlemen, my fellow dirtbags and everybody else, welcome to This Week in Elon. I'm your host, Elizabeth Lopato, deputy editor at The Verge. And we are going to talk about the 60 Minutes interview.

• 27:39Speaker 04

  The story will continue in a moment.

• 27:43Speaker 03

  Let's set the scene. You may remember earlier this year, there was this whole thing where Musk was talking about taking Tesla private. 420 is share, funding secured. And then Tesla did not go private. And then the SEC got involved, and they brought a securities fraud case, which Musk and Tesla then settled. And there were some specifics in that agreement. Those specifics were: somebody to monitor Elon Musk's tweets. There was a $20 million fine for Musk, a $20 million fine for Tesla. And Musk was out as the chairman of the Tesla board. So ultimately, they replaced him with Robin Denholm. And Tesla had to add two independent directors to the board. Okay? So this is the knot of the settlement. I'm sure that there are other details I'm forgetting here, but this is the most important part.

• 28:27Speaker 03

  So he goes on 60 Minutes, and he says, "I do not respect the SEC. I do not." He says he handpicked his successor, and nobody's monitoring his tweets. Well, okay. To be clear, the effective date for the settlement is December 28th. So there's still time for these things to be in place, because the deadline has not yet passed. The other piece of this is that, according to the settlement language, Tesla and Musk can both ask for extensions if it is, for instance, difficult to get some of these things in place. So there's also that. But I talked to a bunch of lawyers to ask. Ask if they felt that Musk and Tesla were in violation. And the answer seems to be no. So it's not necessarily a bad legal move so much as it is just a bad PR move. And that's sort of a shame because there was something else interesting that happened

• 29:11Speaker 03

  on that 60 Minutes interview, or at least I thought it was interesting, which is that Leslie Stahl asked Elon Musk.

• 29:17Speaker 05

  There are people who say that the company cannot survive without you.

• 29:21Speaker 06

  I don't think that's true. Yeah.

• 29:22Speaker 03

  You may remember from the filings that they have this language about being extraordinarily dependent on the services of Elon Musk. It's in the risk factor section. So this answer, if it is true, it suggests that Tesla is enough of a grown up company that if Elon Musk left tomorrow, it would survive. And that's probably good news. It means it's a considerably more stable company than it's been before. But that was drowned out by this SEC talk.

• 29:45Speaker 06

  I want to be clear. I do not respect the SEC. I do not respect them.

• 29:50Speaker 05

  But you're abiding by the settlement, aren't you?

• 29:53Speaker 06

  Because I respect the justice system.

• 29:55Speaker 03

  And I think part of that is just that the SEC talk is unusual, especially coming from a CEO. But I think the other part of it is that Musk and Tesla are still under investigation by the SEC. You may remember in the quarterly filing, the same one I just told you about earlier, Tesla discloses that they received subpoenas from the SEC. And there have been reports in the media about an investigation into Model 3 numbers. I called the SEC up and asked them to comment, and they declined, as you might expect. But one of the things that the lawyers I spoke to said was that, you know, these comments may not be great for that investigation because if anything is found and they have to have settlement talks again, the SEC is going to come back with a much more hardline position because the settlement that Musk and Tesla received about the go-private tweets was actually pretty benign.

• 30:41Speaker 03

  Well, OK. So I think it's sometimes instructive to imagine what Musk could have said in public that he didn't, that people would not probably have objected to. So like, you know, like not saying I don't respect the SEC. Would be a move. And then another move might potentially be like, yeah, I did handpick a Robin Denholm. I handpicked her because she's always been very good at telling me when I have a bad idea, and she curbs some of my worst impulses. I really respect that about her. That's why she's now in charge. I think nobody would have been upset by that. I mean, maybe somebody would have. I don't know. The world's big. But I think it would have upset a lot fewer people. Or like the, you know, the moment where he's talking about like the tweet monitoring stuff,

• 31:22Speaker 03

  like, could have just been like, hey, um, so I, I think I know the difference between material information and non-material information, and I send all the material information through certain legal channels. There are so many ways to approach this that could have avoided this kerfuffle, and none of them were used. And then Musk compounded his public relations problem by deciding to fight about it on Twitter. And like, here's the thing, guys, that's a really good way to keep this stuff in the news cycle, is to give reporters more stuff to write about. So he complained about the edit, and Tesla fan site Electric has the unedited transcript of his comments from somewhere. I presume not 60 Minutes. So there's that. You can go read them, judge for yourself whether the edit was unfair or not.

• 32:06Speaker 03

  But I think it's remarkable that Musk has not learned the lesson of this year, which is that doubling down is not a good idea. That sometimes he just needs to take and halt that L. You know what I mean? Just be like, ah, fuck, fine. But the thing that I wanted to get back to, since we talked about the settlement agreement at the top, is that we still don't know who the two new independent board members are. And I don't know about you, but I am dying to find out, right? Who are these people gonna be? And what are they gonna be like? That's this week in Elon. I'm your host, Elizabeth Lopato. Thanks for tuning in.

• 32:39Nilay Patel?

  Dieter.

• 32:40Speaker 01

  Yes.

• 32:40Nilay Patel?

  I want to ask you about something.

• 32:41Speaker 01

  Oh, god.

• 32:42Nilay Patel?

  I want to ask you about the Infinity O.

• 32:47Speaker 01

  The Infinity, the Infinity O?

• 32:50Nilay Patel?

  Yeah. Isn't that what Samsung's calling it?

• 32:52Speaker 01

  Yeah. They just like the, the Infinity O.

• 32:58Nilay Patel?

  Actually, there's two Samsung stories I want to talk about. The first is just ridiculous, which is Samsung got in trouble this week for partnering with a fake Supreme.

• 33:06Speaker 02

  Yes.

• 33:07Nilay Patel?

  I don't know if you saw this. So Supreme, obviously, like the premier hype beast brand based in New York, pop-up stores. I'm just gonna say the word Sam Sheffer because it's what I think about when I think about Supreme. Just, you know, that, that crew, very successful, very famous, beloved.

• 33:24Nilay Patel?

  The twists and turns here are great. In Italy, if you are an Italian company, you get preferential treatment by the government.

• 33:31Speaker 02

  Yep.

• 33:31Nilay Patel?

  So a company in Italy registered the trademark for Supreme, formed a company called Supreme Italia. And they just took the trademarks and logos away.

• 33:42Speaker 02

  Yep.

• 33:42Nilay Patel?

  And Supreme can't do anything about it because Italian law favors Italian companies.

• 33:47Speaker 02

  Yep.

• 33:47Nilay Patel?

  So there's Supreme NYC and Supreme Italia.

• 33:51Speaker 02

  You know, there's, there's also an Italian company called Steve Jobs.

• 33:53Nilay Patel?

  That's amazing.

• 33:54Speaker 02

  Yep. They make jeans.

• 33:56Nilay Patel?

  Okay. Okay. That's the most. Anyway, so there's Supreme and Supreme Italia, which is this company that formed in Italy and just literally just boosted the marks. Like the logo and the whole thing. They just boosted Supreme stuff. Samsung chose to partner with that company and announce a Samsung x Supreme collaboration. And the real Supreme was like, nope, that's not us. And now everyone is mad at Samsung. It is the dumbest blunder of all time.

• 34:22Speaker 02

  Can I just tell you about the time that I traveled to Europe and went to Italy? Like I was of college age, even though I didn't go to college. In Italy with my friend, who's the architect, who'd been staying in Italy. So he knew all about it. He knew the place. I didn't. I felt like really weird being in a foreign country for like the first time. Walking down the street, there's a guy quietly walking behind me, like crouched down, making fun of my butt.

• 34:52Speaker 02

  And like, everybody's looking at me and everybody's looking at this guy making fun of my butt. That was my Italy experience.

• 34:58Nilay Patel?

  Was it in Italian or was it English?

• 35:00Speaker 02

  No, he was just gesturing. He was being quiet, right? He was just gesturing at, look at hilarious.

• 35:06Nilay Patel?

  Was, was anything wrong with your butt at this time?

• 35:10Speaker 01

  That happens to be in Oakland, so I, that's not weird.

• 35:14Nilay Patel?

  Well, but would you characterize it as like, normal butt?

• 35:18Speaker 02

  I thought so.

• 35:20Nilay Patel?

  I'm like, you weren't like.

• 35:21Speaker 02

  To be honest, I thought.

• 35:23Nilay Patel?

  You weren't like, wearing a pair of jeans where the, the whole butt was like, yellow.

• 35:26Speaker 02

  I thought above average butt at that, at that moment in my life.

• 35:30Nilay Patel?

  That's not the characteristic I was looking for.

• 35:34Nilay Patel?

  I'm saying you, you weren't, you didn't have like a tail stapled onto your jeans.

• 35:41Nilay Patel?

  Anyway, so Samsung blunders into Supreme Italia. I, I don't, I don't know. Just one of the funniest stories we covered this week. But then they also put out the new A8 in China.

• 35:53Speaker 02

  Yeah.

• 35:53Nilay Patel?

  Samsung explicitly saying, we're adding new features to our mid-range Chinese phones first because we need to be more competitive in China.

• 36:00Speaker 01

  They do. It's actually a huge problem for them.

• 36:02Nilay Patel?

  So this is a trend that I think we're going to see in China first and we'll see if it comes here. Uh, but phones with, instead of a notch, there's just a hole, just a hole in the screen.

• 36:12Speaker 01

  Yep.

• 36:13Nilay Patel?

  For the front-facing camera. And Samsung, it's in infinite wisdom, decided to brand this hole.

• 36:19Speaker 01

  Yeah.

• 36:19Nilay Patel?

  The Infinity O with a dash, Infinity dash O.

• 36:23Speaker 01

  They have different brands for different types of notches. So I think there's an Infinity U for like, the little thing. And I forgot what the other, other infinities are, but the Infinity O is, let's be clear, it's a notch. Like, it's a notch that just happens to have some pixels light up inside the notch, right? Like.

• 36:40Nilay Patel?

  Oh, really?

• 36:40Speaker 01

  Well, I mean, it's, it's, it's, it's not really a notch. It is like the screen with the hole punched in it. It's a hole punch on the screen. But like, do you get anything out of that little bit of extra screen in the corner next to the hole for the camera? Just, do you think that you're going to get useful, like, screen real estate out of that little, that, those extra pixels there?

• 37:00Nilay Patel?

  No, but it lights, it was probably hard to make. I don't, I'm, I'm trying to be charitable to the Infinity.

• 37:04Speaker 01

  I'm just, I'm just saying, it's a notch.

• 37:06Nilay Patel?

  Yeah.

• 37:07Speaker 01

  It counts.

• 37:07Nilay Patel?

  Look, notch innovation is here to stay.

• 37:09Speaker 01

  Yeah.

• 37:10Nilay Patel?

  I think it's fair.

• 37:11Speaker 02

  It's a detached notch.

• 37:13Speaker 01

  It's a floating notch.

• 37:15Nilay Patel?

  So here's my, here's the one thing I don't know about this phone. Is that screen an LCD or an OLED?

• 37:19Speaker 01

  I'm pretty sure it's LCD.

• 37:21Nilay Patel?

  That makes sense. It's like a, it's like a cheaper mid-range phone.

• 37:23Speaker 01

  Yeah. The Essential phone was LCD and it had the weird U. So like, it's easier to punch holes in LCD things.

• 37:28Nilay Patel?

  Yeah. Is, what I'm just saying, are we going to enter a period of insane hole punched LCDs? Because I would, I would welcome such a time in our lives.

• 37:36Speaker 01

  What kind of, you want like flowers?

• 37:39Nilay Patel?

  Like one in the middle, like, let's just see what happens. You know, like, why not? Like we, some screens have been square for so long. Now they should be square with, with holes.

• 37:48Speaker 02

  The, the Verge ran a headline this week with something like Huawei's Nova 4 hole punch display.

• 37:55Nilay Patel?

  Yeah. So Samsung was, there's like three of them this week.

• 37:58Speaker 02

  Right.

• 37:59Nilay Patel?

  There's an Honor V20.

• 38:00Speaker 02

  Yeah. It's the Huawei Nova 4, but it doesn't have four hole punches. But what if it had four hole punches? That's what I'm saying.

• 38:10Nilay Patel?

  I, this is the time. Look, notches were so 2017.

• 38:13Speaker 01

  Here's the one I'm excited about. The, the Vivo at Nex has a screen on the front and a screen on the back. And we've seen that before, but it's got a full screen on the back. And then the screen on the back has a lunar ring. There's a light ring that runs around the rear cameras and underneath or into the screen on the back itself. And it can light up and do stuff separate from the screen on the back.

• 38:38Nilay Patel?

  Like a notification light or like?

• 38:39Speaker 01

  Yeah.

• 38:40Nilay Patel?

  Like club lights?

• 38:41Speaker 01

  I think both.

• 38:42Speaker 02

  Or like a camera flash.

• 38:43Speaker 01

  It can change to signify notifications or glow softly to create diffused lighting for low light selfie shots. It can also be set to pulse along with your music.

• 38:52Nilay Patel?

  Yep. Club lights. Everything. At the end of the day, there's one engineer who's like, guys, can I, can I add the club light mode? And everyone's like, we knew this was coming, Daryl. And then he gets to do it. And like, that's fine. And I, I respect that, dude.

• 39:04Speaker 02

  It feels like the, the obvious future is that you have a screen where portions of it can turn off and become translucent. And that's where your selfie cam is, right? That's like where we're gonna end up, right? And right now we're just like rummaging around in weird concepts because we're not there yet. But that's where we're gonna go, right?

• 39:26Nilay Patel?

  I think the idea that we're gonna hide more stuff behind the screen and these things will just become giant screens. I agree with you. I don't know about it'll turn translucent and your selfie camera will be there. Because that's a weird outcome for the lens of a selfie camera.

• 39:38Speaker 01

  Yeah, like it might impede the selfie camera's abilities.

• 39:43Nilay Patel?

  Yeah, I think you just end up with a bunch of stuff in front of the lens and maybe you can get around it.

• 39:48Speaker 01

  Instead of like the pop up camera that we've seen on some of these other vivo's. I think that like a portion of the screen should just like slide over just like and then there's a camera underneath it. And then the screen moves back to cover it when you're done. That's what I want.

• 40:04Nilay Patel?

  I'm just, I'm saying more holes all the time. I think it's super interesting that Samsung has to put these features in their mid range phones.

• 40:10Speaker 01

  Yeah.

• 40:10Nilay Patel?

  And I think it's, it's just wild that that's where the market is for these companies. While the market in the United States seems to be tapped out. Do we talk about Apple's crazy every week, every day? There's another line on their homepage to try to get you to buy an iPhone.

• 40:23Speaker 01

  Yeah, it's, we have not, but it's wild. It's getting super weird.

• 40:27Nilay Patel?

  Yeah, the apple.com homepage, if you just look at it. And people have tweeted screenshots sequentially on days. It started with like, buy an iPhone 10R, it's great. And like all the other products. And then they added another line of text. It's like, it's a really good phone. And they added the next day, another line of text and all the other products went away. And it's like a full screen. It's like, really our best display, our best camera. You want it, it's $450 we're trading your phone. And they are just aggressively trying to get people to upgrade to the 10R, which it's a good phone. But there's definitely an element of, hey, the phone market's kind of tapped out. And like the upgrade cycle is really slow. And so Samsung is going to go chase the mid range market in China. And the high end market in the United States is going to be really confused and dry for a while.

• 41:10Nilay Patel?

  And Apple, look, this happens every time with Apple. Their suppliers like, we're doomed. And then Apple sells more phones than ever, but that narrative is certainly out there right now.

• 41:18Speaker 01

  Well, we're never going to know again, because Apple's not reporting how many phones they sell anymore.

• 41:22Nilay Patel?

  Yeah, it seems like they got ahead of that one pretty easily.

• 41:28Nilay Patel?

  But speaking of high-end phones, Galaxy S10 case leaked, indicating that it still has a headphone jack. The A8 has an Infinity O, but no Audio O, which is sad.

• 41:41Speaker 01

  Neil, I think that you are ethically required to buy the S10, as Sam Byford predicts, the last phone ever, flagship phone ever, to feature a headphone jack.

• 41:51Nilay Patel?

  Yeah, I'll buy an S10.

• 41:53Speaker 01

  No, no, not just buy, but use.

• 41:55Nilay Patel?

  Oh, it depends on what that Bixby button does. You know what I mean? Like, that's kind of where I'm at.

• 42:01Speaker 01

  It also has the new One UI with the headers that are three times bigger than the headers on the iPhone, so you don't have to reach to the top of the screen.

• 42:11Nilay Patel?

  That's pretty good. I'll take that.

• 42:14Speaker 01

  Tiny little thumbs. And also, dog with shoes, robot dog butler with shoes.

• 42:19Nilay Patel?

  There's also a robot dog with shoes. You know, I just bought a Sony TV which runs Android, which is just a delightful mess. Just the purest mess in the world. It's so slow. It's such an expensive TV, and Android is such a heavy operating system for whatever it's trying to do in there. And it's fun to have Android on your TV, and then you go and use a Samsung TV that runs Tizen, and you're like, oh, this is so much weirder, but it's also, in many ways, so much better. And then you get to the fact that both TVs aggressively want to turn on content tracking, so they can serve you ads, and then you throw the TV out the window. But it's funny, like, Android definitely has limits, and Samsung can exceed those limits when they do their own thing in some of these places. And you're

• 43:04Nilay Patel?

  like, how did you make the better TV operating system, but then also Bixby? Right? Like, I don't, I can't. It's real bad. All right, I'll buy an S10, and I'll put it in my, I'll buy like a Chevy S10 Blazer from like 1995, and I'll just be the full S10 life. Yeah, it'll be good.

• 43:19Speaker 01

  I like it.

• 43:19Nilay Patel?

  Look, if it's the last one with a headphone jack, that's sad. I think there's a reason Samsung keeps that thing on there at their high end. It's because people buy it because they want it, right?

• 43:28Speaker 01

  Right.

• 43:28Nilay Patel?

  And like, that's what Sam- Samsung as a company is like, do you want a feature? Here it is. Does it, does it work great? Medium. But here it is, it's here, it's available on this phone. Do you want to use the 14th Qualcomm Miracast version? It's on here. Did we QA it? We didn't. But it's here. And that's like, absolutely, it's like, that's their company. I think they're gonna do that stuff. But I continue every day to get tweets from people who miss the headphone jack on their phones. And I think this XR upgrade cycle is gonna just keep doing that for people. Anyway, more gadgets. You want to talk about this OnePlus 6T that is $700 and branded McLaren?

• 44:04Speaker 01

  I think, I think we just did. 10 gigabytes of RAM.

• 44:09Nilay Patel?

  Why? That's some RAM. Android.

• 44:13Speaker 01

  Multitasking.

• 44:15Nilay Patel?

  Okay. Android. And then Dan reviewed the LG Watch W7, which seems...

• 44:20Speaker 01

  Yeah.

• 44:21Nilay Patel?

  Poor Androidware.

• 44:22Speaker 01

  So unfortunately, we didn't have the best headline. I forget who had it, but someone said, uh, oh, it was Mr. Mobile on YouTube. It was the LG W7 review W8 for the next version.

• 44:33Nilay Patel?

  Say it again?

• 44:35Speaker 01

  Wait for the next version.

• 44:38Speaker 01

  It's good, right?

• 44:38Nilay Patel?

  I mean, that's, that's the story of Wear OS.

• 44:40Speaker 01

  Yeah. If you're not familiar, this is a Wear OS watch that has actual physical hands over the screen, uh, which means that it has all of the problems of Wear OS. And then it also has the problems of sometimes you have to wait for the hands to move so you can read the screen.

• 44:58Speaker 01

  Yep.

• 44:59Nilay Patel?

  All right. I'm gonna read another ad, and we're gonna come back. Paul's gonna do his thing.

• 45:06Nilay Patel?

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• 45:46Nilay Patel?

  All right, Paul.

• 45:47Speaker 02

  Mm hmm.

• 45:47Nilay Patel?

  Every week, my friend.

• 45:49Speaker 02

  Yeah.

• 45:49Nilay Patel?

  You do a thing. It's got the same name.

• 45:51Speaker 02

  Always.

• 45:52Nilay Patel?

  You rely on your consistency. What is it?

• 45:54Speaker 02

  It's called Don't Brick the Jacket.

• 45:58Nilay Patel?

  Okay.

• 45:59Speaker 02

  And.

• 46:00Nilay Patel?

  Where is this gonna take us?

• 46:02Speaker 02

  So remember that Google Levi collab?

• 46:06Nilay Patel?

  Yeah. Dieter, don't you have one?

• 46:08Speaker 02

  Jakarta.

• 46:09Speaker 01

  I don't own one. I reviewed one and I have, I have to send it back.

• 46:14Nilay Patel?

  I just, I just remember you and I both insisted that we would buy one and it turns out we didn't. Anyway, Jakarta.

• 46:20Speaker 01

  Yeah.

• 46:20Speaker 02

  Jakarta. It'd be great if they break the jacket. I don't think that's happened yet, but there's a software update. There's a new feature for your jacket. And it's like, it's like, it's like a find your phone thing. But it alerts you if you get too far away from your phone and your phone will vibrate and your, I guess if the jacket moves too far away from the phone and the phone will vibrate and the jacket will vibrate and like cuff will light up.

• 46:47Speaker 01

  Yeah.

• 46:47Speaker 02

  But I just really like this idea of a software update for a piece of clothing.

• 46:52Speaker 01

  Yeah.

• 46:53Nilay Patel?

  Yeah.

• 46:54Speaker 02

  It, it just seems like the future.

• 46:55Speaker 01

  Like it's for the cuff on the clothing.

• 46:57Speaker 02

  I guess it's the cuff. I guess it's the cuff. I mean, really, it is just a.

• 47:03Nilay Patel?

  Well, if you don't charge the thing in the cuff, it doesn't work as a jacket.

• 47:08Speaker 02

  See, that's what I want. I want a software update that could make it not be a jacket anymore. Like it would be porous all of a sudden.

• 47:16Speaker 02

  I'm all wet because I forgot to charge my jacket. That kind of thing. That's, that's where I was going with, with, well, that's where I go every week with Don't Brick the Jacket, you know?

• 47:29Nilay Patel?

  It's beautiful. I, I, I'm gonna buy, I'm gonna ask for this. I got a birthday and Christmas coming up. I'm getting a Jakarta.

• 47:34Speaker 01

  Don't do it. I mean, do it. It's fine. It's a fine jacket. Uh, I like, compared to the regular trucker jacket, that it's got elastic on the cuffs. So you can like have the water get in your cuffs. I don't know, whatever. For Levi's, the Jakarta jacket has already done its job, which has made me and a bunch of other people just buy a regular Levi's trucker jacket, which costs 50 bucks.

• 47:57Speaker 01

  And is great. If you want to spend whatever a Jakarta jacket costs 200 bucks, go forth and do it.

• 48:04Nilay Patel?

  Yeah.

• 48:04Speaker 01

  But I'm just telling you, you can get something that is just as good from Levi's for 50 bucks.

• 48:12Nilay Patel?

  But will I, will I have the joy of software updates from time to time?

• 48:15Speaker 01

  No, you will not.

• 48:17Speaker 02

  This is a great time to tell you, Dieter, that it's $350.

• 48:21Speaker 01

  God damn.

• 48:22Speaker 02

  And that it, there was a 30% off sale that ended on December 9th.

• 48:28Nilay Patel?

  Ah, foiled again.

• 48:31Speaker 01

  It is slightly better than the basic trucker jacket because it is a commuter version. It's got a, it's got a dip.

• 48:36Nilay Patel?

  Also, it has a computer in it.

• 48:41Speaker 01

  If you wear it in Italy, nobody will make fun of you.

• 48:45Nilay Patel?

  Guaranteed to have butt mowers in Italy.

• 48:54Nilay Patel?

  All right. Speaking of ridiculous, I want to just end here by talking about Verizon, my favorite company, personal for me and Paul, because we used to be at Engadget, which I still love and cherish our time there and all the people there. We still know a bunch of them. So our buddy, Tim Armstrong, who was a CEO of AOL, which owned Engadget, he bought the Huffington Post, it's true. He bought TechCrunch. He sold the whole shebang to Verizon, sold all of AOL to Verizon. And then he convinced Verizon to buy Yahoo. Then he glued AOL and Yahoo together into a new company called Oath.

• 49:30Speaker 01

  Inside Verizon.

• 49:31Nilay Patel?

  Inside Verizon.

• 49:32Speaker 01

  Yeah.

• 49:33Nilay Patel?

  He asked everybody at the new company, Oath, to write three-word oaths. It's a true story. It's on our website. Everyone had to submit a three-word oath to work at Oath. Unsurprisingly, this failed, which I think everyone saw coming.

• 49:44Speaker 01

  Yeah.

• 49:45Nilay Patel?

  So Verizon, so think about what's happening at AT&T right now. AT&T bought DirecTV, AT&T bought Time Warner, they now own all the Warner stuff. So AT&T's big plan is they sell you a network connection, they sell you a phone. On that phone will be CNN. Harry Potter, HBO, like some streaming service that competes with Netflix, they will zero rate that, almost 100% will zero rate that, and that'll be the thing you get for free. Verizon's plan was not to buy Harry Potter and Game of Thrones, but to buy AOL and Yahoo.

• 50:16Speaker 01

  No, no. They bought AOL and Yahoo so that they could do more ad tracking, but I just can't let you finish what you're about to go on here about what their particular strategy was with AOL and Yahoo, without saying that Verizon's plan, to be clear, was also Go90.

• 50:34Nilay Patel?

  Yes. So Verizon also had Go90, which was their super failed YouTube competitor, which they just shut down.

• 50:41Speaker 01

  Yeah.

• 50:41Nilay Patel?

  But fundamentally, what Tim Armstrong wanted to do was compete with Google and Facebook by having enough content and enough data to ad-track the shit out of you.

• 50:52Speaker 01

  Yep.

• 50:52Nilay Patel?

  Right? That was his big plan. We can build an ad-serving system that competes with Google. Armstrong, by the way, famously an ex-Google executive, he was like a Google sales guy, that when Google moved to automated exchanges and like computer-based auctions, they realized they didn't need like a slickster sales guy. So I think he's always wanted to kill Google and prove that his ideas were right.

• 51:14Speaker 01

  Yeah.

• 51:14Nilay Patel?

  Anyway, all this happened. Verizon bought Oath. Then they got a new CEO. His name is Hans Vestberg, which is a choice name.

• 51:22Speaker 01

  Yeah.

• 51:23Nilay Patel?

  Hans decided that he didn't want to be in the media business, shut down Go90, booted Armstrong, installed a new CEO of Oath, and then on their recent quarterly results said, "We've reevaluated the business. It is actually not worth anything."

• 51:36Speaker 01

  Yeah.

• 51:38Nilay Patel?

  There was a line I saw quoted somewhere. Hans Vestberg was just at the Business Insider Ignition Conference, and the line was, "He didn't even fake enthusiasm about his media business." So this Oath disaster inside of Verizon, combined with Go90, means... As we go into the next era of, and so we don't know what's gonna happen with oath. And I hope everybody there is great. There are a lot of great people who work at Engadget and TechCrunch. Huffo is actually doing great work lately.

• 52:03Speaker 02

  Yeah.

• 52:03Nilay Patel?

  So as properties, they're, they're very good. And I don't mean to denigrate them, but Paul, we work for AOL. I, I thought Engadget was really good when we worked there too. And I can't say that they were ever good stewards of us as, as owners of a media business. And I think that is just happening at the high, once again.

• 52:20Speaker 02

  And it's funny because like, was it the AOL Time Warner merger is one of the most famously disastrous mergers.

• 52:28Nilay Patel?

  Yeah.

• 52:29Speaker 02

  And so now AOL, maybe AOL is just the worst thing ever.

• 52:33Nilay Patel?

  Yeah. If there's a lesson here, it's don't buy AOL. Oh, by the way, uh, uh, Yahoo owns Tumblr, you know, Verizon basically made Tumblr delete all of the porn on Tumblr, which has like far reaching consequences for the Tumblr user community. It's just a mess over there. Like the idea that Verizon owns Tumblr, you just know Hans Vestberg was like, the what? We own what? No. Right? No, no, no, no, like 5G y'all, that's what we do here. And that is basically his focus. His focus is we're going to be first to five, the biggest, best 5G network. And that's how we'll get, gain subscribers.

• 53:05Speaker 02

  Yeah.

• 53:05Nilay Patel?

  So that's a whole mess. Obviously, again, like I said, to, to me and I'm a Paul, probably for you. It's very personal what happens to Engadget because that's where we came from. It's like a thing that I love.

• 53:16Speaker 02

  Yeah. What, what is the, the thinking? Are they gonna shut it all down? They're not gonna just turn off the lights?

• 53:22Nilay Patel?

  Or are they gonna sell it for bits and bobs? Like, that's a thing.

• 53:25Speaker 02

  Yeah, they could, they could do that. I mean, them writing down, it was like the goodwill, something, something.

• 53:30Nilay Patel?

  Yeah, everyone, everyone used this phrase goodwill impairment, um, which sounds insane. So basically just to unpack what that means. So if I, Paul, if I was to buy your web design business and your value of your web design business was a million dollars and I bought it for 1.5, I'd have $500,000 like goodwill. Like it's the value over the, the total value.

• 53:51Speaker 02

  Uh, the nice, the, the nice guy buffer.

• 53:54Nilay Patel?

  Yeah, goodwill. So goodwill impairment is. We're just writing out the other, the additional value that we ascribe to this business that we think we can get to, that we bought into, and now it's worth like $400 million out of $5 billion. Like a $4.5 billion goodwill impairment charges. All of that extra value we thought was here is gone.

• 54:15Speaker 01

  Yeah, so now that they're saying that value is gone, they're, they've, they've got like, I think it's easier for them to do stuff with it. And so I'm worried about the stuff they're gonna do. By the way, I just want to point out that somebody's job at Verizon was to go find that number, to go like track it down. And so someone called them up and said, hey, I need you to go goodwill hunting.

• 54:36Nilay Patel?

  That's good. That's good. I mean, they're not a great content company, so I don't know that they had like the jokesters on the team to like really, really nail that joke. But here, so here's, okay, so there's all that. It's a mess. It's personal, whatever. But more abstractly, we're gonna enter into the next phase of mobile competition. I think this is wild, where Verizon is gonna go up against AT&T. And AT&T has tons and tons of zero-rated content to give to people. And T-Mobile is not shy about zero rating anything it can, right?

• 55:04Speaker 01

  And T-Mobile bought Level 3, so they've got like a, a third-rate OTT TV service called Level 3, something that you can get in like four towns right now, and maybe they'll roll it out nationwide eventually.

• 55:15Nilay Patel?

  I think when they go to, when they go to 5G, that's gonna be like their, their TV play on top of whatever they do, right?

• 55:21Speaker 01

  Yeah, but it's like, it's, it's, it's basically like Dish, anyway.

• 55:24Nilay Patel?

  Sure, it's not great, but it's gonna be the thing.

• 55:27Speaker 02

  Level 3 is pretty good technology. I looked into it.

• 55:30Speaker 01

  Yeah.

• 55:31Nilay Patel?

  Yeah, but as a consumer TV service, it's not.

• 55:34Speaker 02

  I have no idea.

• 55:36Speaker 01

  It's good technology. It's not Game of Thrones.

• 55:39Nilay Patel?

  Right, so, so let me, let me just pull this back in the abstract. The 5G moment is here, a year from now or two years from now. It's certainly not here now, but the 5G moment arrives. You have dollars to spend. I don't know which way this cuts, but I think your, your options are gonna be. You can spend your money at Verizon, which... It seems like they're gonna do everything and have like the best network.

• 55:59Speaker 02

  Yep.

• 55:59Nilay Patel?

  Right?

• 56:00Speaker 02

  You're talking from a consumer perspective.

• 56:02Nilay Patel?

  Yep. You've got dollars in your hand. You want to spend them on a 5G service. You can spend them with Verizon. You will have data caps. Verizon is not shy about its data caps. You will probably spend a lot of money because Verizon is expensive and you will get no content, right? They're out of the content business. It's unclear if they want to make deals for content. Right now, they want to sell you a network service. You go to AT&T, which is extremely motivated to have a network as good as Verizon's, right? They're not going to stop. And on top of that, you get a bunch of free stuff, a bunch of free Warner Brothers stuff, but they will aggressively throttle Netflix or whatever they're gonna do, right? They want you on CNN and Harry Potter. Or you can go to T-Mobile, which will give you Netflix for free. Will probably not have as good of a network, just that's where T-Mobile is in terms of coverage. Maybe in terms of speeds, it'll be really fast.

• 56:46Nilay Patel?

  And they will zero rate the hell out of everything and maybe you'll get some like weird level three TV package in the deal. That is not like-

• 56:53Speaker 02

  And presumably by then they'll have like completed the Sprint merger.

• 56:57Nilay Patel?

  Yeah. Who knows? Or yeah, or you can just go to Sprint and be like, I don't, I don't know what I did with this money.

• 57:03Speaker 02

  Or you could get Comcast's mobile service. What's it called?

• 57:07Nilay Patel?

  Or you can get Google, Google Fi. You can get Xfinity Wireless. Like, there's other stuff. But the three big ones in the United States, AT&T, Verizon, those choices now look awfully different for the dollar, right?

• 57:16Speaker 02

  Yep.

• 57:17Nilay Patel?

  Which in some ways is good, but if you're Verizon, suddenly the idea of net neutrality has to look good to you.

• 57:24Speaker 02

  Oh, my God.

• 57:25Nilay Patel?

  Right? It's like a weird incentive place for them to be in where they don't have this like zero rating thing to do with their own content or this incentive to go make deals the way T-Mobile does. Suddenly you're gonna say, well, we have the best network. These networks are just run fairly. We'll win. That's like a weird development in this world and I'm very eager to see how it plays out.

• 57:45Speaker 02

  You think that Verizon is going to become a huge net neutrality advocate? That's what you're predicting?

• 57:50Nilay Patel?

  No, I'm saying the incentives around their network will shift as AT&T gets more aggressive with their content.

• 57:56Speaker 02

  Well, it's interesting because I feel like we're like in like act two of the great content wars. Like, we've left the Shire, you know?

• 58:07Speaker 02

  And so now there's, you know, there's Netflix and Amazon and Hulu, like there's all the services, you know, that we, we, we sign up for. And then there are the, the bandwidth providers, both like home and mobile. And yeah, they're pretty confusing and conflated in like a case like AT&T where like Disney is fairly all, pretty much all content and Verizon is apparently going to be all service. Like I, I think, I think there's a lot of interesting connections that can happen there too.

• 58:42Nilay Patel?

  Yeah, I think Verizon Disney tie up to zero rate Disney plus or whatever is like, that's just out there for the taking, right? But it's, that's, I think that's the act too. But I think it's wild to think that just depending on how aggressive AT&T is, the best competitive play Verizon might have is to say, hey, maybe zero rating should not be possible. Maybe everyone has to treat this stuff the same. Cause the last thing they're going to do is zero rate AT&T services for Verizon customers, which

• 59:07Speaker 02

  Right, right.

• 59:08Nilay Patel?

  They could lower their prices. Like just think about their moves. Like you're trying to attract a customer with dollars and she's looking at AT&T's bundle, which has stream CNN for free, get these weird cut down Game of Thrones episodes that they keep talking about, which sounds honestly horrific. Get all this Warner content for free with the same great coverage, you know, same great map as AT&T, blah, blah, blah. And then Verizon's here being like, well, we had Yahoo, but we fucked it up.

• 59:36Speaker 02

  Okay. I don't want to get too wonky, but there's like a theory in business, like vertical integration is efficient up to like a point, right? And AT&T's version of vertical integration might not be more efficient than Verizon's. You know, it's not like AT&T's getting all that content that they're sharing with you for free, you know? Like that, that stuff costs money. Where Verizon's in a position where like, oh, you want access to our eyeballs, you know, they, they can negotiate, like they can Walmart people and get like good deals on content and maybe content companies will do, because like, right now, a lot of content's being produced almost at a loss to gain market share, right? Like AT&T can't do that forever.

• 1:00:21Nilay Patel?

  So this was more or less the argument AT&T made against the government when the government tried to prevent the merger. That just went up for appeal. They made their cases again. I will say that the, you know, appeals court did not look favorably behind the government being like, no, but, but really.

• 1:00:36Speaker 02

  Wait, AT&T's argument is that being vertically, vertically integrated with content is less efficient?

• 1:00:42Nilay Patel?

  No, that's why I said it's more or less. Their argument is, we are still huge distributors. I mean, it's like a very technical argument about whether or not the price of one cable channel will go up 10 cents. Like, it's in the weeds there, but you pull out, they're, they're saying the same thing you're saying, which is, we still have to access the customer and those distributors still have the leverage over us in a way that us owning one distribution channel does not favor us.

• 1:01:05Speaker 02

  Right.

• 1:01:05Nilay Patel?

  And that all boils down to, we promised not to raise prices. I just think it is the height of foolishness to think that this won't result in higher prices for cable customers, right? To get HBO and CNN. Like, we, we know what they're gonna do. Like, let me ask you a question. Paul, do you think the cable company will raise prices, given the opportunity to raise prices? Like, why, like, why, why do we have economists on the stand in front of a judge to be like, I can prove the cable company will raise prices? Like, yes, history suggests the cable company will raise prices, given the opportunity.

• 1:01:36Speaker 02

  I, huh, yeah, you're right. It's just, oh my God. I just, I just, you know, the, I want, I want us to proceed quickly through part two, because you know what I actually want? I want gigabit internet in my house.

• 1:01:48Nilay Patel?

  Yeah.

• 1:01:48Speaker 02

  That's what I want. And I feel like we've been, like, all this money has been all in the content wars for the past like five or so years. And I want more money in the Paul's fastest internet ever wars, you know?

• 1:02:03Nilay Patel?

  So I think.

• 1:02:04Speaker 02

  I want to be a great Twitch streamer.

• 1:02:06Speaker 01

  That's not going to happen for you, Paul.

• 1:02:08Nilay Patel?

  Well, no, I think there's a moment, and I think these moments come and go, and I think we've probably lived through enough of them where you could actually chart them, where the access layer becomes commodified. This is me yelling, "Everyone's a dumb pipe, just shut up." And then to sell, to get a new customer, because, you know, most people that you want to address outside of rural areas have internet access. To get a new customer, you have to add perks, right? So then you end up in content wars.

• 1:02:32Speaker 02

  Right.

• 1:02:32Nilay Patel?

  Maybe with 5G, because the access layer won't be commodified, that race to, "Do we have sufficient coverage? Is the network reliable? Is it faster than the other guy?" That cycle might break down where the perks are less important than the access. But once, five years from now, when 5G is a commodity again, maybe AT&T will buy Yahoo, and that will be, you know, like, who knows where Yahoo will go? But I can, you can kind of map that cycle.

• 1:02:58Speaker 01

  Five years from now, AT&T is going to be strolling down a sidewalk, and they're just going to walk by a store window, and they'll be like, "Oh, hey, look at that. I didn't know that. Oh, sure." And they'll just walk in and be like, "How much for Yahoo?" And they're like, "Oh, that old thing? I forgot we had that in the window. 20 bucks." Well, I don't know about 20 bucks. How about 15?

• 1:03:18Nilay Patel?

  So I sold my old plasma TV. This is a true story. So you got to get rid of everything in the apartment, and babies crawling. Plasma TV is too heavy to hang on the wall in the apartment, because there's no wood studs. You got to hang it off the drywall. Plasma TV is way too heavy. So I put it up to sell it, and the exact thing happened. Some guy emailed me within an hour and said, "I've always wanted this TV," because it was like the top-of-the-line Panasonic plasma from 10 years ago. "I've always wanted this TV. I'm coming to get it right now." That is Yahoo. Was top of the line. He's like, "See it in the story." Like, "You know, I always wanted that. I'm just going to have it, and then I'll have it. We can look at it from time to time." It's like an old Walkman.

• 1:03:57Speaker 02

  Bring back the Yahoo Directory. Just try to start categorizing everything manually.

• 1:04:02Nilay Patel?

  See, that's your answer to Congress. Human-curated listings of the internet. All right, that's got to be it. I propose that we now human-curate the internet.

• 1:04:13Speaker 02

  I just wanted to add something to my story about Italy. I think he was on roller blades.

• 1:04:20Speaker 02

  I think he was, that's why I couldn't hear him, was rolling silently behind me.

• 1:04:25Nilay Patel?

  Paul, I'm definitely getting you. Do they make like a long jacquard jacket, like a duster?

• 1:04:31Speaker 02

  Hide my shame?

• 1:04:34Nilay Patel?

  The first duster with a computer in it. You're gonna look like, like an old timey formal cowboy. But you'll be able to control your music at the same time. It'll be great. All right, that's it. It is the holiday season. We're gonna be off for the next couple of weeks, basically. We'll come back in the new year. If you need to buy gifts, we have a great holiday gift guide. Go check that out. We encourage you to. It's full of really fun stuff. We got t-shirts for you to buy. Dieter, what's that promo code?

• 1:05:02Speaker 02

  Promo code?

• 1:05:03Nilay Patel?

  Yep, that's store.theverge.com. Just type in promo code. It'll be great. You can follow us on Twitter, Instagram, or at Verge. Please hit us up on Apple Podcasts. Give us those five stars. We love it. There's a new episode of Why'd You Push That Button this week. Why'd You Push That Button? Been on a real tear lately. Ashley and Kevin are just doing a great job with that show. It's about why people pick the emoji skin tones they pick, which is a real phenomenon of people picking different. It's a wild. Just listen to it. It's great. If you missed it, on Tuesday, I interviewed Shruti from Reply All about what's happening in Foxconn and Mount Pleasant. I will say, one of my favorite media outcomes of this past week was that CBS 58 Local News in Wisconsin did a segment about Reply All's segment. And the headline was Podcast Pays Attention in Mount Pleasant.

• 1:05:48Nilay Patel?

  That wasn't really the headline, but it was like very close to the headline. But that episode of Reply All about Foxconn and Mount Pleasant was terrific. I encourage you to listen to it. And then listen to the interview with Shruti. It was like an out of body experience for me to interview somebody about my hometown. Just a weird thing that happens. For someone to know way more about the place that I grew up, because she was there. She went and reported it for a long time. Check that out. And then you can listen to Rico Decode with Kara Swisher. You can listen to Pivot with Kara and Scott Galloway. We got a new show on the Vox Media Podcast Network, of which we have the flagship Function with Aneel Dash. Aneel is great. He's got a new show called Function, which is about how technology's done really works. Go check that out. And then you can tweet at us. I'm at Reckless. Dieter's at Backlon. Paul's at FuturePaul. It's holiday time. We've got an interview with Nick Woodman, the CEO of GoPro, coming next week.

• 1:06:33Nilay Patel?

  But then we're gonna take a break to get us to the holidays. We'll be back in the year. See you then. Rock and roll. Pa. Pa.