iOS 14.5 update features / Apple sales skyrocket / Podcast platforms amp up their product

Nilay Patel is joined by Verge deputy editor Dan Seifert and news editor Chaim Gartenberg to discuss i0S14.5, Apple's earnings, Epic vs. Apple, chip shortages, and Samsung's new laptops. Senior reporter Ashley Carman joins the show to talk about the wave of action in the podcast industry this past week. Further reading: People who are vaccinated don’t need to wear masks during many outdoor activities, CDC says Social media platforms become triage centers as India struggles with a COVID-19 surge The first problem was vaccine supply. Now, it’s demand. Officials lift pause on Johnson & Johnson COVID-19 vaccine iOS 14.5 is out now with new Face ID mask features and Apple’s App Tracking Transparency Why Apple’s new privacy feature is such a big deal Apple’s iPhone 12 and Mac sales skyrocket despite ongoing pandemic Here’s who Apple and Epic are calling to testify in next week’s trial Eddy Cue wanted to bring iMessage to Android in 2013 Apple fined $12M by Russian regulator over App Store monopoly abuse Can Apple get you to pay for podcasts? Spotify launches podcast subscriptions, but you can’t subscribe in-app Spotify’s miniplayer for Facebook launches today Facebook is building its own in-app podcast player Clubhouse is partnering with the NFL for draft week programming SiriusXM acquires Roman Mars’ 99% Invisible and a bigger stake in the podcasting world Spotify is raising prices for lots of its plans Spotify premium subscriber count increases 21 percent to 158 million Spotify is okay with Joe Rogan telling 21-year-olds not to get vaccinated Samsung’s new Galaxy Book Pro and Galaxy Book Pro 360 are lightweight laptops with OLED screens Samsung announces a cheaper entry-level Galaxy Book with no OLED Samsung’s Galaxy Book Odyssey introduces Nvidia’s new RTX 3050 Ti Elon Musk says Tesla made ‘significant mistakes’ with solar roof project 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 week on the Vergecast, Heim Gartenberg and Dan Seifert join the show to talk about iOS 14.5, Apple's earnings, Apple versus Epic, what's going on with the chip shortage, lots to talk about there. Then Ashley Carmen joins to talk about the wave of action in the podcast industry. That's coming up on the Vergecast now.

• 0:16Speaker 01

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

• 1:01Speaker 01

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

• 1:49Nilay Patel?

  Hello and welcome to the Vergecast, the flagship podcast of outrageous earnings. That's right, if you're into money, this is the podcast for you. It's not. It's not at all. I'm Neil I though. I'm your friend. Dieter Bohn is out on vacation this week. He just moved house. Congratulate Dieter. Fancy fancy new pad. But Dan Seifert is here. Hello. Heim Gartenberg is here.

• 2:08Speaker 02

  Hi.

• 2:09Nilay Patel?

  And a little later in the show, Ashley Carmen is going to join me. We're going to talk about all of the action in the podcast world. That's coming up later. Heim and Dan and I need to talk about all of the tech news, Apple earnings, all the tech company earnings, actually, Apple antitrust lawsuits, Samsung event, all kinds of tech stuff going on. But as always, I want to start where we always start with COVID. It's still the biggest story in the world. Vaccines off and running. I will tell you, it's, we're recording this on April 30th, which is actually the day it's coming out. So if we're a little late, I apologize. But seven weeks ago, Joe Biden promised that there would be a vaccine finder website by May 1st. That is tomorrow. So we're keeping track of that. We're going to hold on to that promise. But vaccines are widely available now to anybody over 16 in the United States.

• 2:51Nilay Patel?

  Please go get vaccinated. We are now also learning about the boundaries and limits of what you can do if you are vaccinated. So the CDC updated its rules. If you are vaccinated and you're outside, CDC says, basically, you don't have to wear a mask. There's some some boundaries there still, but that's starting to get back to normal. I was on a plane yesterday. Like, starting to get back to normal. It's pretty good. The vaccine logistics issue has switched from being, do we have enough? Can we get enough? Can we get it to our people? To demand. You're going to hear Ashley and I talk a little bit later about the Rogan podcast and that controversy around vaccine hesitancy. They're trying to get the vaccine in more people. The people often want to take it, which lets us get fully back to normal. So that is the story we have on the site. The Johnson and Johnson COVID-19 vaccine,

• 3:35Nilay Patel?

  the single shot vaccine, unpaused. There was that period of study where they paused giving the shot. It's unpaused. We have coverage of that on the site. And then just in general, vaccination stuff has become a cultural movement across all the platforms. So it's sporting events. Uber is pushing it. Google is pushing it. Like, you just see that has become the focus as opposed to before, which is testing and tracing. And on the subject of testing and tracing. Oh, boy. That Apple Android COVID-19 contact tracing stuff. Yeah, there was a bug in Android exposed some of the logs to the pre-installed apps on the phone. Not great. I would say that system was really hypey when it came out of nowhere, like the ultimate in,

• 4:18Nilay Patel?

  oh, the big tech companies are going to do something about this. And they did. I mean, like, they worked together. They got it out as fast as they could, and they were just still too, a little too behind the curve. So hopefully, I say hopefully, when there's another pandemic, I'll have built all the stuff. But we are now at the point where the story here in America is vaccines. The story elsewhere in the world is not. The story is basic care, oxygen respirators. That's the story in India. But here in the United States, where we are, for the most part, the story is very much vaccines. We have a ton of coverage of that on the site. If you haven't gotten a shot and you're eligible, I really encourage you to go do it. It's how we get back to normal. All right. iOS 14.5 is out.

• 4:56Speaker 03

  Finally.

• 4:57Nilay Patel?

  The single greatest feature of all of the pandemic, which is that you can unlock your phone with your Apple Watch.

• 5:04Speaker 03

  It only costs you $399 to bypass Face ID.

• 5:08Nilay Patel?

  I look, again, I was in an airport yesterday. I was on an airplane. I wore a mask for a total of, what, six hours? Throughout that whole process, I've greatly appreciated being able to just type my passcode into my, my watch and have my phone unlock every time I looked at it.

• 5:22Speaker 03

  It does work very well. If you happen to have an Apple Watch and you've got an iPhone, and you update both the Apple Watch to, I believe it's watchOS 7.4, is that right?

• 5:33Nilay Patel?

  Yeah, 7.4.

• 5:34Speaker 03

  Yeah, 7.4. You get your phone onto 14.5. Both of them have been out since, I think, Monday. So you got plenty, it should be easy to update. It works really well. You toggle a thing in the watch settings and, then it's just, it just kind of happens. For me, it actually like works a little too well. I've been using it in the beta for a while now because 14.5 was, if you weren't following, in beta forever. But I've been using it for a while and sometimes I'll, I'll pick up my phone, accidentally push the power key and it'll like kind of catch a side eye from me and then unlock, even though like I'm just kind of like carrying my phone. So, so it is, it is very effective, maybe too, a little too effective. It's not enough to bother me.

• 6:18Nilay Patel?

  Well, so the thing that it because it be it buzzes your phone, your watch every time.

• 6:23Speaker 03

  Yes.

• 6:23Nilay Patel?

  So every time it locks, because I mean, the anyone's face with a mask will unlock the phone. Right. It just has to see a face with a mask.

• 6:30Speaker 02

  So long as your watch is on your wrist.

• 6:32Nilay Patel?

  Yeah. So like, you know, if you, I don't know, your partner could be looking at your phone with a mask on, but it sees a face with a mask, you're wearing your watch, it's authenticated or unlocked. And so it does a haptic on your watch so that you can immediately lock your phone if you didn't intend it. But that means that in the course of just normal usage, your watch is going insane.

• 6:52Nilay Patel?

  Like I've like checked for phantom notifications so many times in the course of using this yesterday. It was great. What else is in iOS 14.5?

• 7:00Speaker 02

  There are new emoji, which I'm sure is a thing that you were hoping I would tell you about.

• 7:04Nilay Patel?

  It's all I care about.

• 7:05Speaker 02

  There's also one of the new, one of the new emoji is, is the new vaccine emoji, which is great. They changed the syringe to not have blood in it. It looks like a vaccine now, so that's good. But the big dramatic thing, other than the watch unlocking, which is great, is Apple's new app tracking transparency, privacy feature, which has made a lot of people very happy. If you work for like internet privacy organizations and has made Facebook very upset.

• 7:31Nilay Patel?

  Yeah, Facebook is very, very unhappy about this. So this is, I will just say, I miss, I miss Dieter in this moment. Like, this is like a web standards versus apps versus Google has a technology idea that is ill fated and everybody hates moment. It's like the swirl of things that is Dieter Böhm. Let me see if I can do it justice. So right now on the iPhone, if you don't have 14.5, there's a identifier called the IDFA, the identifier for advertisers, that can be tracked across apps. And this was Apple's first cut at don't fingerprint devices. Don't look at the Bluetooth status and the screen size and the IP address and whatever else and try to identify a person. We're just going to give you a number. Maybe sometimes we'll rotate that number in a gesture towards privacy.

• 8:17Nilay Patel?

  That number is still just widely abused. And Apple's, Apple's perspective is that advertisers should have to ask you to track you. Which I think is the right perspective. Like if you open an app and it's going to track you. Pushed, you know, it should definitely ask you, but they've gotten rid of how that initial idfo works, which had some settings elsewhere in the OS and they've put it front center in a dialog box that says, basically allow Facebook to track you across other apps. Facebook is allowed to put in some text there that explains why they would like to track you. In my opinion, there's no sentence that can fit in that box that makes a good case for tracking you.

• 8:53Speaker 02

  The app developers give, they can put like a splash screen before you get there. So like, Apple lets you make your case and as big of a screen as you want, you can grovel and say, please let us track you, you know, it is essential to our business. But Apple isn't really, they haven't changed at all how like idfo works. They're just saying you have to ask first. If users are okay with it, it works exactly the same as it did before. You can do all your tracking and all your ad targeting and all that. But it's particularly telling that like, the response to, oh, if we have to ask permission with this, we're going to lose like 80% of the people who do this, who we currently track, says a lot about the tracking in general.

• 9:35Nilay Patel?

  Yeah. And I would say that on top of you have to ask every time, there is a global setting in iOS where you can just say, never ask me, the answer is always no. And I pushed that button as fast as I could.

• 9:48Speaker 02

  For me, it was already like turned off. The way that it blocks globally is you turn that toggle off. So if you turn it on, then apps will have the ability to ask you. So I don't know if it was because, like I said, I was using the beta, I've been testing this for a while. Who knows where the toggles were set. But like, when I got the final version of 14.5, it was just off for me. So like-

• 10:08Nilay Patel?

  But I bet in 14.4 or whatever, that setting used to be limit ad tracking.

• 10:13Speaker 02

  That's probably right.

• 10:15Nilay Patel?

  And it probably carried over in some other way, because mine was off and I wasn't using the beta. All this is to say, Facebook is very unhappy about this. Other companies are very unhappy about this. All this is next to what Google is doing in Chrome, which is the dominant desktop web browser, where they are getting rid of cookies, third-party cookies from other domains other than the one you're visiting, to limit ad tracking. They have a technology called Flock. Interated learning of cohorts, I think is the acronym there. It's not great. Everybody hates flock, except for Google. All of it, like that whole industry is now in turmoil because Apple is saying, we don't need to track activity across apps without asking. And Google is saying, we're not going to let you just drop cookies all over Chrome. Facebook, I think, is responding by saying, what if everything was built into Facebook?

• 11:01Nilay Patel?

  What if the entire creator economy was inside of Facebook? Which is interesting, and you know, later on, Ash is going to come on, we're going to talk about podcasting. Facebook is building a podcast player into Facebook, like they're, they're just on that road. But the big change in 14.5 is, well, there's the unlock stuff. But the big technical change that's reverberating across the industry is this ad stuff. And I suspect that's why it took so long, so that everybody could be fully in their feelings. And then get to where, where Facebook is now, which is like, oh, this, this won't matter. We'll, we'll find, we'll figure it out.

• 11:30Speaker 03

  Neil, I, all I really want to know about this is how it's going to impact how many car phone docs you get targeted at through Instagram ads? And, and how many you will be buying in the future if Facebook can't track your car phone doc searching habits across the OS?

• 11:47Nilay Patel?

  Well, no, so this is, this is, this is getting, is a good example. This is going to use your Facebook. I buy all the, I buy all the car chargers in Instagram. Like I'm just like in the payment flow. So they know that they've converted inside of Instagram. They got all the, that's first party data for Facebook, right?

• 12:02Speaker 02

  Right. Yeah. First party data, you're allowed to still do, you know, it's, it's open season and you're allowed to track between apps if you own all the apps. So Facebook is allowed to track your Instagram activity and show you car ads on Facebook. And it's allowed to track your Facebook activity and show you car ads on Instagram. It just can't then carry that data and link it to other advertiser profiles from other places. And put that all together to get a better targeted picture. It also affects like a shockingly small portion of Facebook's business model. The information reported, it's less than 5% of Facebook's $84 billion ad revenue is actually impacted by this change.

• 12:42Speaker 02

  So it's more of a, of a, you know, spiritual moral win for Facebook, I guess, that they're fighting this like, I mean, 5% of $84 billion is probably a lot of money, but probably also not a huge amount of money to Facebook.

• 12:55Nilay Patel?

  We need to talk about Epic versus Apple, but I think Facebook is saying, wow, this company has a lot of control over our fate and what we can and cannot do on this platform. So when you say Facebook isn't allowed to combine its data with other data, I mean, Apple's not like the law, like they're not the sheriff. Tim Cook doesn't roll up to your house on a horse and, and prevent you from combining databases. They just can't do it as easily as they were before. Some of the options to do it are, I don't even think Facebook would do it, right? Like, the options are real shady, which is to pull a lot of identifying information off of your phone, off of your laptop, and build a fingerprint that's durable and then combine it with other companies' fingerprints.

• 13:35Speaker 02

  Yeah. So the Apple, the Apple terms prohibit that, too. The thing that gets the big spotlight is that if the stuff is, you have to ask permission. That's the one that Apple can control. But if a user opts out, and it's a little bit of an honor system right now, if a user says, don't track me, Apple's rules say that you can't use anything on iOS to build a profile to track them across apps. And they're saying that they, they will enforce that in the same way that they deal with other violations of the App Store, you know, guidelines, which, depending on the day and Apple's mood, is extremely varied, but.

• 14:11Nilay Patel?

  So this brings us to Apple versus Epic. Epic obviously next fortnight. That trial is starting next week. I don't think we can over cover that trial, but Addy and Liz will be covering it every day. We've got a whole war room set up. It has already begun. They've started releasing deposition, exhibits, other testimony that will form the basis of what happens at this trial. Inside of that, right, we've already seen, you know, emails from 2013 between Eddie Q and Craig Federighi debating whether or not to bring iMessage to Android. And that conversation was just dead ahead about lock-in. Like, it wasn't shaded, right? He's like, we have a great messaging platform. Google has all these other services that people love. We should bring, Eddie Q says this, we have a great messaging platform.

• 14:55Nilay Patel?

  We should bring it to Android and become the industry standard. We'll figure out how to monetize it later. We shouldn't just give the bag to Google, which is really funny if you think about Google and messaging. Like seven years later, we know that that wasn't a real concern.

• 15:08Nilay Patel?

  But at the time, Google was thinking about buying WhatsApp for like somewhere between a billion and $10 billion. And you could see why Eddie Q was like, hey, we've got this thing that people love. Craig Federighi is like, it's good, but it's not like the best. Like it's only marginally better than what's there. If we put it on Android, people will just, they'll buy Android phones.

• 15:24Speaker 03

  They'll buy, specifically, he says, they will buy Android phones for their kids. Like, like he sees it as like, you know, we've got to lock in on the parents already, who are likely iPhone owners in their income bracket or whatever. But their kids, maybe they want to buy a smartphone for it. Those Android phones are a lot cheaper. They would be inclined to buy those for a younger kid, but nope, we're going to lock them in with the iMessage with the blue bubbles. So it's a little ruthless there.

• 15:53Nilay Patel?

  At peace. I mean, they're not bad at business. I keep reminding, I have like, I've reminded like, members of Congress that like, these are some of the greatest business people that have ever existed.

• 16:05Speaker 03

  They are there to sell you an iPhone.

• 16:06Nilay Patel?

  They're there to say, that's their job. They're extraordinarily good at it. Of course they're having this conversation. I just think it's funny that, you know, the, there's no shading of it. Like that's what they're doing and they know that that's what they're doing. And that sort of platform control extends all the way into Epic can't put another payment processor into Fortnite, without jumping through some elaborate set of hoops and getting itself kicked off the store. This is related to, okay, well, I think Apple should force every app to ask you if you want to be tracked. That is a good use of platform control, in my opinion, along for the ride. Like riding shotgun in that car is all payments have to go through Apple's system or you can't be in the store.

• 16:46Nilay Patel?

  And I think we're at a really interesting inflection point of how powerful we want the platforms to be. And the trial step one, the morning, this morning as we're talking, the EU, found in a complaint lodged by Spotify that Apple's App Store rules increase the price of rival music services. There's like a long, Apple's going to appeal. There's a long trial to come. This is years of fighting. But they are waging this war about how much control they have over the iPhone on multiple fronts in multiple countries.

• 17:15Speaker 02

  This is like the the double edged coin of Apple for like the last decade is Apple's push towards privacy is also pushed towards Apple's walled garden. Like we we just had this conversation about AirTags like last week. It's the same deal. Like the AirTags have this whole privacy network and you know, they're secure because Apple doesn't open it up to outside things. But the flip side of that is that Apple's only letting AirTags get you know, access to those radios and AirTags work better than you know, any competitor's thing can make because Apple is Apple.

• 17:48Nilay Patel?

  Yeah. And you know, I'll say, Apple's Apple. Like, we also saw emails between people at Epic who are like, yeah, it turns out bringing Fortnite to iOS was a lot easier because Metal is better than OpenGL. Like, Apple's argument is like, the iPhone's great. We spend a lot of time making it better than its competition for developers. Like, you yourself are admitting that Metal is better than OpenGL on Android. This is what you got to pay for it. I don't think Epic agrees with them. But like, you kind of see how this fight is going to play out at the trial, which again, starts next week. From what we're seeing from this early discovery, the early depositions and exhibits and so on, the fight really breaks down of Epic saying, look at all this control you have, and you're locking people in, so it's harder to switch away. We're like, our users aren't picking

• 18:31Nilay Patel?

  the iPhone anymore. They're not choosing in a free market. They just, it's so hard to leave that they just stay here. And Apple's saying, well, wait, hold on, the iPhone's great, you admitted it. And we got to pay for that somehow. I think at the heart of this is, as time goes on, Apple is getting more and more direct about saying, it's our phone. Even after you buy it, it's our phone. So, the latest example is today, there's the EU ruling about Spotify, about music streaming services being more expensive because Spotify has to pay Apple a cut for every subscription. Apple doesn't have to pay itself a cut. Right? That's just the way it goes. So, EU issues this ruling, there's you know, all this hullabaloo. Apple issues a statement, it's on the site. Just pay attention to this. Like, the tone of this is really interesting. This is Apple. Spotify has become

• 19:14Nilay Patel?

  the largest music subscription service in the world, and we're proud of the role we played in that. Spotify does not pay Apple any commission on over 99% of their subscribers, only pays a 15% commission on those remaining subscribers they acquire through the App Store. At the core of this case is Spotify's demand that they should be able to advertise alternative deals on their iOS app, a practice that no store in the world allows. Once again, they want all the benefits of the App Store, but don't think they have to pay anything for that. Now, that is like, they just want people to be able to sign up on the web. Like, that's all they really want.

• 19:44Nilay Patel?

  The idea that the store, that the apps on the phone are an extension of the store is like, it's a big moving of the boundary in a way that usually running software on your computer is not an extension of the platform vendor, is not an extension of the platform vendor's store. Here, Apple sees the whole thing as one integrated whole, which is very Apple. It's very in keeping with their point of view. But here, I was just looking at our list. Russian regulators fined Apple $12 million for app store abuse this past week, too. We're seeing governments and companies around the world say, hold up. You might control a little bit too much of the overall economy here. And then, you know, I know you're looking at earnings. If you look at earnings this week from all the big tech companies, yeah, it turns out the big tech companies control an awful lot of the economy.

• 20:28Speaker 02

  Yes, they do.

• 20:29Speaker 03

  That, uh, that $12 million fine is gonna, gonna put a dent in Apple's quarter.

• 20:34Nilay Patel?

  Tim Cook is like, I got it in the car. Like, it's in the back of the Aston. Let me just get it for you.

• 20:40Speaker 02

  So yeah, quick, a quick rundown. Basically, every major tech company did earnings this week. Alphabet, Microsoft, Apple, Facebook, and Amazon. Here's a quick rundown on how they did. Alphabet had revenues of $55 billion. Microsoft had revenues of $41 billion. Apple had revenue of $89 billion. Amazon had revenue of $108 billion. And Facebook had a mere $26.1 billion, bringing up the rear.

• 21:04Nilay Patel?

  And this is all growth in pandemic. If you look at their, if you look at the calls they have, the statements from the CEOs, they are all saying things like, we thought the pandemic would accelerate change. It did more than that, and now the change is kind of here to stay.

• 21:16Speaker 02

  Yeah, like, this is astonishingly good numbers for all these companies, like, far and above what I think most of them were even expecting. And following like previous record-setting quarters from during the pandemic, just because these digital services and the companies that run them have become such an integral part of life, especially now, like, Amazon delivers you stuff. You need your phone and computer and internet services and Teams to get online. No, it's easy to see how they've become so big, but it's also hard to argue that they are massive.

• 21:51Nilay Patel?

  Yeah, and it's also hard to argue, you know, when like Facebook and Apple fight and I look at these numbers, it's like, you're fine. Like, like, this is fine. But then I look at like, today, YouTube TV was pulled off of the Roku platform because Roku and Google are in a fight over carriage fees and advertising splits. And it is reported that Google wants Roku to use the AV1 codec, which I feel like is a real Vergecast turn that we could talk about for a long time. They're not, even Google's not using it. So it's like a pretty insane demand. There's a moment now where whoever makes the hardware platform realizes they have control over the software platform and the software is where all of the money is getting made. Like, every button you

• 22:32Nilay Patel?

  push is like an economic decision right now. And that control, whoever controls the operating system, the platform, the hardware, is trying to extend their control and take a cut out of every button that gets pushed everywhere. That has always sort of been true of Apple and the iPhone. But I think you're seeing it play out between Roku and Google right now, in a way that just like doesn't benefit any consumer. Like, you bought a Roku and you were signed up for YouTube TV. Life was great until yesterday. And then you got an email being like, yo, this is going away. And it's like, why? Like, if you were in that ecosystem, and you bought, you buy a new Roku today, because you were like, happy, you can't like, live your life. Because two companies have nothing to do with you are fighting. And when they're done, your prices will not go down. And I

• 23:14Nilay Patel?

  think that's just kind of reflected across this whole, this whole ecosystem. It's reflected in the Epic versus Apple fight. It's reflected in the Spotify versus Apple fight. Big companies are all rich, they're all powerful. They're gonna fight, but at the end of the day, like, you know, you know what Spotify did this week? They raised prices.

• 23:30Speaker 03

  Yeah.

• 23:31Nilay Patel?

  Who cares? One thing I want to call it from earnings, I want to get both of your take on it, because this really has surprised me. Apple's Mac sales went up, and their margins went up because they make their own chips at the M1 now. So they're not paying Intel. So Apple has a bigger, richer Mac business than ever, which makes sense. Great computers, pandemic, work from home. I'm excited to review the new iMac. All that stuff is happening. All that makes sense. iPhone sales went up huge. And I'm like, I'm at home. I've never felt less compelled to buy a phone in my entire life. Can you put that together for me?

• 24:04Speaker 03

  We've actually, you know, we were chatting about this in our Slack this week, trying to find the answer. And like, there's theories. I don't have like, hard evidence to support this. But like, one theory I have is there, you know, a lot of people were sitting at home for the past year. They do have some disposable income. They were not taking vacations. They maybe weren't commuting, weren't going out to lunch every day, all this other kind of disposable income stuff. And a quick way to burn a lot of disposable income is a shiny new iPhone. And so like, you know, that's one way that, you know, you can look to as the sales trends. This is like the second huge quarter for the iPhone 12 as well. The last quarter was big. It was enormous for them. We didn't really expect that. We don't really see 5G being a driving factor, especially if,

• 24:49Speaker 03

  like you pointed out, you're sitting at home on Wi-Fi all the time. But this is now quarter number two. Like, people are really into the iPhone 12 for whatever reason. Maybe it's a square size. Maybe they got some, they got some, some Benjamins burning in their pockets, you know, whatever it is. They love those 5Gs. It's like, they're really into it. And, you know, it's what was interesting to me about the Apple earnings report was if you've been paying attention to any of the consumer electronics industry for the past six to 10 months, there's a huge chip crunch and a huge shortage of these components being available. And that hasn't slowed down Apple's sales, at least yet. M1 Airs

• 25:32Speaker 03

  and M1 MacBook Pros are pretty much readily available. If you want one, you could just go buy one. iPhone 12s are readily available. They do use a lot of internal Apple components, but there's a lot of like, what they're called like legacy components that are coming from other suppliers, the display controller, some other, you know, wireless bits and bobs in there. There's still, Intel still has a Thunderbolt controller in the MacBook Air, etc. So it's interesting that the guidance that Apple gave this week was that they might actually start seeing supply crunches going into the next quarter. Like, like, they are going to hit this point where they're running out of these ancillary parts. And they're just really hard to get right now. But so far, it hasn't really hit them. iPhone sales are through the roof.

• 26:13Speaker 03

  Sales are doing really well. iPad sales are doing really well. Like, people are buying things and they're able to buy them. We, uh, today, actually, as just after, uh, before we recorded this, they opened up pre-sales for all the new stuff that was announced last week. So the iMacs and the Apple TVs and the, the iPads. So those are coming real soon. But, uh, if you are trying to order one, the ship dates are already starting to slip into June, maybe even a little further by the time we're, we're talking here. So we're going to probably see a crunch. And I think Tim Cook said that they are anticipating more of a supply crunch than a demand crunch. The demand is there. People want this stuff, uh, but can, can they actually provide it to them?

• 26:50Nilay Patel?

  Yeah. Let me just put this in context. Cause I want to, I'm very curious for your thoughts on the chip shortage. But just to put that, those numbers in context, Apple's able to execute. They have some legacy parts they need. That's, I'm very curious for your read on that. But just to make a comparison, Ford also announced earnings this week, Ford Motor Company. They're going to cut car production by 50% this quarter because they don't have enough chips to make cars. And like, the number of chips in a car versus an iPhone is like a weird thing to compare. But like, Apple's like at scale with the iPhone, like as many as they can make, running as fast, multiple different components on multiple different process sizes.

• 27:30Nilay Patel?

  Ford's just like, we're gonna, we're gonna cut production by 50%. Like, they're a big company too, and they're facing it in a really keen way. Heim, what's your read on, on that chip shortage stuff?

• 27:38Speaker 02

  So a couple of things. Apple's shortages are probably coming. They're not immune to everything else, uh, that's going on in the tech world. But they are, in a certain sense, more sheltered from it than smaller companies. We've already seen reports like Foxconn CEO said last month or two months ago, that they were already not going to meet 10% of their orders this year. But they start from the bottom up. So their highest margin, you know, companies that they work with get the priority. Uh, Apple's deals with, you know, Foxconn are much, much, much bigger than, you know, the small Kickstarter project or, or your small startup that, you know, is, is ordering things on, on orders of magnitude less. So from just like Foxconn's perspective and from the chip company's

• 28:23Speaker 02

  Perspectives and from the manufacturer's perspectives, it makes sense to prioritize Apple versus smaller companies. And in the sense of chips, Ford is a smaller company. In terms of both chips and in volume and price, the chips Apple's buying are higher powered. They're more lucrative for these companies to make. Unit per unit, you know, a chip making company is probably making more off these, you know, hyper advanced chips that you need for an iPhone versus the comparatively less powerful and and less, you know, critical chips that are in these trucks. So I think that's a big part of it, but also the shortages is also just simply it's

• 29:08Speaker 02

  supply has remained largely constant, demand has gone up and just a host of factors have have given just such a speed bump that I don't think anyone is going to be immune from this, at least for the next coming months. It's extremely possible that we will see another, you know, late iPhone launch like we had the iPhone 12, which didn't launch until October, November.

• 29:31Nilay Patel?

  Yeah, it was late.

• 29:32Speaker 02

  It was a whole, a whole month later than usual, just because and Apple was straight up about it like they had mentioned Qualcomm had mentioned like their suppliers had mentioned like the factories were shut down for a month and that that derails everything. So it's possible we'll see something like that.

• 29:45Nilay Patel?

  What do you make of the argument that things like disk controllers, whatever chips are in cars are on legacy node sizes? And it's not like the ultra advanced five nanometer M1 that's constrained. It's the factories have moved on and there's a bunch of legacy chips at old process sizes. Cause I've, I've heard this argument a few places and I was actually kind of desperate to ask you about it because there's a bunch of parts that you don't need to update to seven nanometer even or 10, right? Like you just leave it at 90 and it's fine and it gets really, really cheap. But then the demand for all your stuff means that it's harder and harder to make that stuff.

• 30:22Speaker 02

  Right. So it's again, it's, and there are economists who I'm sure can talk better, but there's like a finite amount of manufacturing space. Your, your HAB is a physical size. And on a cost per chip perspective and a demand perspective, at a certain point, it doesn't make sense to maintain that legacy equipment for the older stuff when you can be retooling and focusing on manufacturing for these newer, more lucrative stuff, the, you know, the hyper advanced stuff. That said, the reason companies like Ford still use it is that those manufacturing processes are still around and they have been around for so long that they're extremely cheap. And if you don't need to have, you know, an M1 powering your truck, although please do that Ford, I would really love to see that. You don't

• 31:07Speaker 02

  need that in your truck though. So Ford's not paying for it and not jacking up the price of your F-150 to, to include a full iPad in the, in the, you know, headboard. But it's similar to like, you know, with apples. Why, why does Apple, why was Apple still selling, you know, Apple TVs with the A7 chip in it for $180? Just because it was, it was a mature process and they can crank them out by, by the bucket load.

• 31:30Speaker 03

  Is there a part of this where Apple is basically the only one with access to the M1 chips? It is the only source. It's a very huge source or huge buyer of them, of course. But these legacy chips are in everything. You mentioned Ford cars. They are in every single laptop, every single display, every single so on. So is it like, there's just so much demand for chips now, now that we, you know, cars have had computers for a long time, but obviously they are getting much more complex and much more advanced than they used to be. And also so is like literally everything else we touch. So like, is it a demand thing where it's just demand has gone up so much that, you know, the HABs can't, can't keep up on these legacy chips or what?

• 32:11Speaker 02

  Uh, yeah. So it's, it's, part of it is just demand. The, the biggest issue that's really in the, in the chip making industry is that there's not enough chip making. Like this was a storm that was always going to come for, for the industry. There are more companies that want chips than companies, a relative few, a number of companies. You have, you know, TSMC, you have Samsung, there are a couple of Chinese firms, you have Intel, which up until extremely, extremely recently only made chips for itself. And demand has been steadily going up while the number of companies that make it have been staying relatively the same or even decreasing over the last, you know, decades. And then when you add in delays and shutdowns and constraints from the coronavirus,

• 32:54Speaker 02

  there are trade war issues from Trump's, former President Trump's trade war with China. It is like a perfect storm of spiking demand, not enough supply, and no real way to increase those. But yeah, at a certain point, the solution for these companies is not going to come down to how much stuff can the companies make. It's going to come down to how good is your relationship with these companies to get those parts. When there's only a certain amount of chips to go around, it comes down to who can get them.

• 33:28Nilay Patel?

  Right. It's funny because the next turn is like years away, right? There's TSMC building a factory in America. Intel is talking about increasing manufacturing capability in America, but that is not happening tomorrow.

• 33:41Speaker 02

  Decade easily.

• 33:42Nilay Patel?

  Like this crunch is right now.

• 33:43Speaker 02

  The good news is that these companies, TSMC is 25 billion that they're investing, Samsung is investing, Intel's investing 20 billion. These will help, hopefully. Hopefully, they will help to the point where they outpace demand. And there's probably an upcoming crunch, not of who can get the chips, but of who can get the stuff to make the chips. There's a similar supply constraint for processing technology, for the parts and machinery to make these chips. So that will probably be the next bottleneck. But yeah, we are still years away from any of those resulting in meaningful change.

• 34:18Nilay Patel?

  Yeah. And in the meantime, we're just going to argue about who gets a cut of every button that you press on your phone. It's a perfect storm in the tech industry right now. Not enough phones arguing over the money made on those phones. Everybody's getting richer. All right, we're going to take a quick break. We'll be back. Ashley and I are going to talk about the podcast world. We'll be right back with Ashley Carmen.

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• 35:40Nilay Patel?

  Ashley Carmen, you're here. Hello.

• 35:42Speaker 06

  Hello.

• 35:43Nilay Patel?

  Just a ton of podcast news. That's what, I mean, that's, that's what we talk about. There's like a lot of podcast news every week. You've even overcome with it, overwhelmed by it. But this week in particular, just a lot of action that is like big strategic moves about the future of the industry. So you and I have talked about Clubhouse before. Clubhouse is partnering with the NFL for like live draft week programming. Like I'm a person who watches the NFL drafts and I find it overwhelming. Like, I don't know if I need people rambling live, but like, that's the Clubhouse opportunity, right? It's like live reactions.

• 36:15Speaker 06

  Yeah, I feel like you, you would have the good take on this because for me, I mean, the main takeaway from this announcement is like, Clubhouse is getting serious about programming and not just some randos in their houses talking to each other and more like, oh, the brands, the people you want to hear from are going to be here. And specifically interesting that they came with a sports partnership because Spotify recently acquired Betty Labs, which makes a competitor named Locker Room, which its whole thing, as you could probably guess from its name, is sport, people talking about sports. So to come out the gate being like NFL Draft Week, it's on Clubhouse and not Locker Room is kind of a move. It's a move.

• 36:56Nilay Patel?

  It's a good move. And, you know, you and I have talked about this before, so much of the podcast industry is just kind of like rebooting the radio industry. And obviously, sports talk radio is massive.

• 37:06Speaker 06

  Mm-hmm.

• 37:07Nilay Patel?

  So it makes sense that that's what Spotify went after first for their live offering because so much of their strategy looks like radio. And then they would build it out through other things. Clubhouse is coming from the other direction. Which is a bunch of random stuff. And now they're moving towards a more traditional thing. So that's happening. We're obviously paying a lot of attention to that. Speaking of radio, Sirius XM, all the big radio companies are doing acquisitions and consolidation. So Sirius XM acquired 99% invisible. It feels like they're moving their distribution from satellite to the internet. Like, that's just what they're doing.

• 37:40Speaker 06

  Yeah, I think what we've really seen is sort of these radio companies, Sirius, Odyssey, which used to be called Entercom, iHeart Media, really trying to invest in the podcasting space and use their resources to promote their podcasts. Like, if you own 100-plus radio stations, sure, why don't you just play your podcasts on them? Like, do it. It's like the best marketing you can do. So we're seeing that happen. And like, this big Sirius move with 99% invisible was a big deal for the industry because Roman Mars is an independent podcaster who everyone kind of was like, he's making it work. Like, he started a company, he's a podcaster, became big. Like, he's doing the independent thing, only to be bought up by Sirius. And it's kind of like, oh shit, is this, what does this mean for the future of indie

• 38:25Speaker 06

  podcasting? Which is interesting in the context of subscriptions, which we will get to.

• 38:30Nilay Patel?

  Yeah, I mean, what does this mean for the future of indie podcasting? I feel like is the question at the end of every podcast story, because the whole industry has been mostly independents for so long, and the big companies are here. And so, yeah, there's a part of it that's like, well, like all media, there will be big corporations and there'll be indies. And then like, as indie players get older, they're gonna get tired. And they're gonna like cash out. Like, it's just like the circle of life.

• 38:55Speaker 06

  In The Times, he literally said, he's just like, I'm tired.

• 38:58Nilay Patel?

  Yeah.

• 38:58Speaker 06

  And I want my team to have more resources. And it's like, okay, like, fair.

• 39:02Nilay Patel?

  I mean, that show is great. I'm confident we have a ton of overlap with first guest listeners. But it is interesting, as you said, there's the big players and they have the cash, and then there's how will independents thrive? And as we have seen with virtually every kind of media, the best way for independents to thrive is for their audience to pay them directly. That's the Substack story. And so now, Apple last week launched subscription podcasts, and then Spotify launched like a weirder riff on it. Explain that to me.

• 39:29Speaker 06

  Yeah, so let me just do like a very quick overview of the Apple Podcasts so that we can compare it. So the Apple in-app podcast subscriptions is a big deal because it's in-app. So meaning you can view the page of the typical podcast you listen to and literally tap subscribe. You'll get bonus content, possibly ad-free. It's really up to the podcasters what they want to do, and they can set their own subscription tier. The catch with it for the podcasters is they have to pay $20 a year to Apple just to offer it. And then any revenue they get, it goes on a subscriber basis. So it's 30% for the first year of each subscriber and 15% for every year after. And they have to use Apple's backend to upload content, meaning it's not RSS-based, and they won't get the data about their listeners. Okay, so that's Apple.

• 40:13Speaker 06

  So this week, Spotify had its earnings call, and presumably, they knew. People would be like, um, what's up with you guys' subscription situation? So they announced something. Their offering is, is, yeah, it's totally just, I don't know. It doesn't, it doesn't really pull off what Apple did. For one, podcasters have to host with Anchor, which is their creation software. It's free hosting, but still, so NPR is an initial partner. They don't use Anchor for their typical hosting. So what they're going to end up doing is having to upload their special shows that are ad-free, like Planet Money, into a separate feed through Anchor that will be called Planet Money Plus, which will be an entirely separate show.

• 40:56Speaker 06

  So if you listen to Planet Money, you won't even see this in your feed. You'll have to find it separately. Also, all subscriptions aren't done in the app, presumably because Spotify doesn't want to give Apple a cut of any in-app revenue. So you're going to have to navigate to these creators' Anchor webpage, which they're going to presumably just have to paste all over their bios and show notes and shout it out and do anything they can to get you to like go over the hurdle of subscribing, which is the whole reason in-app subscriptions were created in the first place, is because that hurdle is immense. And that's why Apple's such a big deal, that they're launching the in-app.

• 41:34Nilay Patel?

  Then, you know, we, in the show, we've already talked about Apple versus Epic and like, that whole lawsuit is about buying stuff in Fortnite. And here you've got Apple's product, which it has pluses and minuses. I think a lot of people are gonna see it. Like, the Apple Podcast player is huge. It's influential. It's enormous. Apple's already got your credit card number. You can see why people want to partner with Apple, even if they don't get email addresses and data and all the other stuff that podcast creators want so they can do events and other things like that. You just push the button, you're off and running. It's, it's easy. Spotify cannot put that button in its app because they would have to pay the cut to Apple, which just on its face now seems unfair. Like, that is not

• 42:18Nilay Patel?

  a fight between two giants, between Epic and Apple, and that is a fight between podcast creators and Apple and the platforms they want to find their audience on. And it, I mean, it's just funny that this is happening, like, literally with the shadow of the Epic lawsuit.

• 42:33Speaker 06

  Yeah, yeah.

• 42:34Nilay Patel?

  Have you talked to any creators about, I mean, podcasters are like, we're, we are podcasters, but like, the podcast community is pretty religious about RSS feeds and player independence and interoperability. This is all making it more proprietary, making it harder to discover, blocking your audience to a platform. What has that reaction been like?

• 42:56Speaker 06

  So, this, I haven't talked to as many creators about the Spotify offering, but if you're an Anchor creator who's been offered this chance, this is, there's a waitlist right now. They're only doing it with select partners, but presumably that's an easy lift for you, you know? You're already publishing there, no big deal. For the Apple situation, it's a little bit trickier because if you're a small indie podcaster, this is becoming kind of a huge workload. Not only do you have to just edit your show, record it, you know, do all the things that go with podcasting and maybe monitor your analytics and whatever else, you now are having to upload to multiple backends and maintain them. And this is kind of the future thing I see coming, is that as much as this is designed to help indie

• 43:39Speaker 06

  podcasters and might help them bring in more revenue, you end up in a situation where it's like, how is this tenable for, you know, the dream of the, the independent podcaster going out and doing this on their own? Because if it's not a full-time job yet, it's becoming one, easily.

• 43:52Nilay Patel?

  Yeah. You can see how the next turn of the story is like, the wave of startups that help you manage all your podcast platforms. And like they're like, even I can already see the webpage, like one dashboard for all of your metrics and monetization. Like if you run with this idea that we get, Ashley and I get points, I'm just telling you right now, this is, uh, it's our idea. I mean, I want someone else to do it. I don't want to do it. I just want, just cut us a check is what I'm saying.

• 44:19Speaker 06

  I have heard it's very tricky to, to upload things to Apple, like even for hosting platforms, because you have to log in with your Apple ID. And this is why like Anchor, if you upload through Anchor to Apple, it's like on Anchor, it's associated with Anchor's Apple ID. So they own your Apple podcast page. And this is why.

• 44:36Nilay Patel?

  This is what I mean by creators being stuck in the middle. Like Anchor is Spotify. You're uploading through Anchor to Apple. Apple and Spotify get into a fight. Something bad happens to Anchor's Apple ID and upload process, which like Apple turned off Facebook's apps. Like you think these things are happening and they, and they have been happening at an accelerating pace. And it's the independent creator who's just trying to make a simple workflow that gets caught in the middle. And I, there's just a part of this where one of the big arguments for Apple's in-app purchases, okay, Apple is trusted. They already have your credit card. They will convert at a higher rate because it's very simple. You don't have to reenter your credit card. I buy all of that. The other argument is, well, most people

• 45:18Nilay Patel?

  who are going to pay for podcasts in Spotify are probably already paying for Spotify premium. So Spotify is already another big trusted company that has your credit card. And they should just be able to have the button. So independent podcasters can get paid wherever they are. And like, I don't know if Apple and Spotify's politics should be in the middle of that. You know, we just had Amy Klobuchar on Decoder and like, I asked her, what, what advice would you give to these companies? And she was like, lower the rates for all this stuff. And it's like, Apple could just let Spotify have this button. And it would, it would just like bring the heat down. But I don't think they will.

• 45:51Speaker 06

  Well, and Spotify is clearly trying to undercut them because they also are taking no cut for the first two years.

• 45:57Nilay Patel?

  Yeah, we'll see. This brings us to like, I mean, now it's just a wave of Spotify news. They are doing partnerships.

• 46:04Speaker 06

  They're going hard, man.

• 46:05Nilay Patel?

  Yep. So what's going on with Facebook?

• 46:08Speaker 06

  This was super interesting. So Casey Newton, friend of The Verge, we all know Casey. He did that chat with Mark Zuckerberg, I think it was a little bit over a week ago now, where they talked about Facebook's audio plans. And Casey sort of prompted him like, oh, you want to announce something with Spotify, right? So Mark has been talking about all these podcast plans, how they like love podcasting and they love audio. And he goes, yeah, we're working with Spotify to do an integration for music. And I'm like, listening to this, I'm like, wait, what? Like, because I was under the impression this was going to be for both podcasts and music. So Spotify, I talked to them after, they're like, yeah, this is for both podcasts and music. Weird that he just called out music. They announced this week that the mini players launching, I think some people have it in the Android app already on Facebook,

• 46:50Speaker 06

  which just means you can play Spotify from Facebook. So if someone shares a podcast or music, you can like keep scrolling from your newsfeed and like hear it. But then I was like, okay, what's going on? So I reached out to Facebook just to double confirm some things. And sure enough, they confirmed that they are indeed building their own in-app podcast player, totally separate from Spotify, which is some drama. And the reason why this could be a big deal, we don't have any details about how this would work, but my suspicion is Facebook's an advertising company. If they could get podcasters who already have really popular fan pages to upload their podcasts again on another backend and target ads against it and get all that data, that could be huge for Facebook.

• 47:34Speaker 06

  Easy way into audio advertising. So that's my suspicion. They have not said anything like that, just that an in-app player is coming.

• 47:41Nilay Patel?

  I know that Facebook executives all love podcasts. Zuckerberg has said this, other Facebook executives have said this, like, they like being on podcasts because they get room to like actually explain their complicated decisions versus giving the one quote to us or the Times or whatever. That's like, we are very sorry about the bad things we've done. Like, I know, I know the executives are into podcasts because they, they, they get the additional space to try and explain what they're doing. I don't know if they're ever very successful, but they get that space. I also think, again, that the, the context of all this stuff is the amount of controversy that like Apple is in. So yep, there's the Epic Apple lawsuit. Also, Apple turned on the app tracking transparency

• 48:23Nilay Patel?

  button this week with iOS 14.5, which we talked about. That means Facebook can't track you everywhere else. Like, I didn't even, I didn't even set it to ask me for every app. I just hit the global no.

• 48:34Speaker 06

  Oh, yeah.

• 48:34Nilay Patel?

  Like, just don't track you. Like, I don't even ask me if I want to be tracked. That means Facebook can't, they can't sign a deal to track you in Spotify as well. And I agree with that data. They can't track you across the web. Like, all the stuff that they used to be able to do, they can't do. What's the natural response to that? Keep you in that app for as long as they can. So make that app your podcast player. Make that app, you know, where you can listen to podcasts while you're browsing Facebook. Just like, keep you in there. So that first-party data that they use to target ads, they don't have to ask you permission to share it because you, being the good and responsible consumer you are, have already read the complete Facebook Terms of Service and privacy policy. And theoretically, I agree with the full knowledge of how your data is being used. I just don't know if, like, the all-in-one Facebook app is what people actually want, right?

• 49:18Nilay Patel?

  Like, or whether Facebook should just build its own podcast player and, like, go at it that way.

• 49:22Speaker 06

  Well, I don't think people want another app from Facebook.

• 49:25Nilay Patel?

  Yeah.

• 49:25Speaker 06

  I think starting its own podcast app would be like, just don't go. Like, that's just a lot of work. People are very loyal to their podcast players. A third-party podcast player, I feel like it's kind of a hard sell unless you're like a super listener. So, but do people want to listen to podcasts on Facebook? I don't know. Maybe if you're, they, they seem to think that because there's so many people connected to fan pages, that they'll be like, oh, I'm here in the true crime Facebook group. I might as well listen to the true crime podcast in here and have like a listening party or whatever they're gonna do.

• 49:54Nilay Patel?

  I hear this about podcasts all the time. Like, they're great because you can do something else. And that's true. Like, maybe you can cook, or maybe you can do, there's no, I personally cannot listen to something and read at the same time.

• 50:07Speaker 06

  Oh, me neither.

• 50:08Nilay Patel?

  Like, my brain just doesn't, I got one language processing unit and it's gotta be focused at one thing. And like, it is single-threaded. And I just, that part where you're like, listening to Facebook and you're reading comments on something, like, just as a user experience, I'm like, that sounds like too much.

• 50:23Speaker 06

  Uh huh.

• 50:24Nilay Patel?

  Like, I can do something with my hands, maybe. Even then, I like tune out, but. We'll see, we'll see. The reason I brought up another podcast player and another music player is Spotify announced it's raising rates this week. It also had earnings, you know, they've got Rogan, there's a Rogan controversy. There will always be a Rogan controversy we should talk about, but you get to raise rates when you're the monopoly player, right? Like Netflix raises rates because you basically have to have Netflix if you want to like, watch all the things that are coming out. Is Spotify in that position now where it's like raising prices? It's confident enough to do it that it won't churn people off and it's like spending money on all this podcast stuff to keep people in the ecosystem.

• 51:02Speaker 06

  It's interesting because in the US, they only raise prices on the family plan. But in the UK, they raised it across a variety of plans. But yeah, I mean, it's, I didn't think that many people were on family plans until we talked about this in the Verge Slack and everyone's like, oh yeah, I just got the email from the family plan. People who like, maybe don't have families.

• 51:21Nilay Patel?

  Yeah.

• 51:22Speaker 06

  So, but I mean, have families, but you know, everyone has a mom, but.

• 51:27Nilay Patel?

  I, well, what I would say is like, family plan's like a well-known lock-in strategy.

• 51:31Speaker 06

  Yeah.

• 51:31Nilay Patel?

  Like, that's how cell carriers get you. You're on the family plan, it's like, oh man, I'm kind of mad at AT&T. Now I have to tell my parents to switch to, I guess we're sticking with AT&T. And like, that's this.

• 51:41Speaker 06

  I was thinking that this week with the Rogan stuff where I was like, what if I did want to cancel Spotify? I am on a family plan. And I was like, damn it, then I have to have a convo with my dad about like Joe Rogan and it's just opening up a whole another can of worms, you know, where I'm like, I, I guess I'm stuck. Yeah.

• 52:00Nilay Patel?

  Well, I just think it's, we've always thought about this as Spotify versus Apple Music and that they're, you know, they're the two dominant music subscription services here. But Spotify is just kind of dominant. Like they've, they own a spot in the culture that Apple Music does not. Even though Apple Music is popular, like I am an Apple Music subscriber. But Spotify owns this place in the culture. And I, I think with their podcasting efforts, they're trying to own an even bigger spot in the culture with the live audio stuff, right? They're just trying to make it so that if you're listening to something, you're probably doing it through Spotify. I mean, their earnings are great. Like they, they're executing that strategy.

• 52:35Speaker 06

  Mm hmm. Yeah. And I mean, they also, not for nothing, are trying to usurp the radio as well with their car thing.

• 52:42Nilay Patel?

  I mean, we talked about car thing last time that you were on the show. Do you still have that thing going?

• 52:47Speaker 06

  Oh, hell no. I'm worried about microphones. I'm like, I really don't want Spotify in my car. And I like the radio. It's my one time that I get to listen to the radio. It's like nostalgic for me.

• 52:56Nilay Patel?

  Yeah. I mean, we are, we are, we are, we live in the middle of nowhere. So we have Sirius XM. And I'm like, oh yeah, these are my bros. These are like radio DJs. Like,

• 53:04Speaker 06

  Yeah.

• 53:05Nilay Patel?

  You, you were in 1980s MTV BJ. Now you somehow have a Sirius show like, Yeah. That's a true pipeline that exists. And I'm like, yeah, I do want to listen to Tom Morello's hour of radio. What an odd, what an odd situation to find yourself in. But their earnings, you know, they, we should talk about Rogan. Rogan is driving subscriptions for them, even that some world and controversy after controversy. That's their big hit. Do they have other big hits coming?

• 53:29Speaker 06

  They mentioned that Obama and Bruce Springsteen's show was doing well as well internationally. But that was kind of the two shout outs, which is like, okay, yeah, Barack Obama and Joe Rogan.

• 53:40Nilay Patel?

  Yeah.

• 53:41Speaker 06

  Like, yes, okay.

• 53:43Nilay Patel?

  The, the spread, the, the total spread of all content in the world.

• 53:46Speaker 06

  It, it, it really is sort of though, like this deal with the devil with Rogan because

• 53:50Nilay Patel?

  Yeah.

• 53:50Speaker 06

  the stories don't stop. I mean, the dude is controversial. They knew that going in. He's also happens to be the biggest podcaster in the world. So they were like, this is it. This is what we need to make it work. And yet again, this week, there was a story with Rogan saying some kind of anti-vaxi opinion-y things.

• 54:09Nilay Patel?

  Yeah. He said, if you're 21 years old, by the way, if you're wondering why Ashley's been hesitant, it's because our science team always tells us not to repeat the claims. But I'm just, it's, I think Verchass listeners know, you should get vaccinated, no matter how old you are. Rogan said if he, if he would not advise 21 year olds to get vaccinated, that is just bad advice. Like just flatly bad advice. The shape of the pandemic now is that younger people are actually getting infected at higher rates. So it's just bad advice. He didn't really say why.

• 54:36Speaker 06

  No. And that's the funny part is it's like, okay, if, if he kept going with that thought, you know, it would have led somewhere. That would probably cross Spotify's terms and they would have to take down the episode, but Spotify left up the episode. And so, and then it just got them into a whole new bucket of shit. And Dr. Fauci came out and was like, Joe Rogan is wrong about this. Like now the White House is having to denounce Spotify's biggest podcaster, which is like personally a space. I don't want to be it if it was me.

• 55:06Nilay Patel?

  And I think this is one of those tech companies, it being media companies, being news providers.

• 55:15Nilay Patel?

  We live in a space like we are a news organization. People criticize us all the time. That's like, our business is to write things that other people do not want us to write. Okay, that's fine. And like, we have strong ideas and strong opinions about the First Amendment and its limits. And like, quite frankly, people send their lawyers at us when they're very angry at us and we like, fight them off. It's a thing we do. But that is our business, right? And it's like, inside of our company, we all know it's our business and that's our team. And like, even at big, big companies, you're like, news division is kind of isolated because their business is to get into that kind of trouble. Spotify is like, a tech company that wants to serve everyone all the time. And then they've got basically just like, one guy. Like, I don't think anyone's, I don't

• 56:00Nilay Patel?

  know what Bruce Springsteen said on that show with Barack Obama, but I'm guessing it was mostly platitudes about America. But like, Rogan's job is to stir up controversy. He's very good at it. People love him. I'm not discounting anything. But Spotify as a company is not organized to have a media division, a news division, that gets into that kind of trouble. Apple is a company that makes Apple TV shows. I think Ted Lasso is amazing. I think it's one of the best shows ever made. It is like, the nicest show in the world. It's like, so, it's very safe for Apple. As all these companies start to do more and more content, they end up in what either looks like, like the YouTube and Twitter set of controversies, the Facebook set of controversies, what are users doing with your platform? Or they end up with the what are you paying for controversy?

• 56:42Nilay Patel?

  And I think Spotify does not want to be in the what are we paying for controversy? And yet, here they are.

• 56:48Speaker 06

  Yeah, but to work it out for stockholders.

• 56:50Nilay Patel?

  Yeah, I mean, he's a good podcaster. I don't want to discount the fact that like, he is popular for reasons.

• 56:56Speaker 06

  No, I know. I'm just saying, like, I guess if you were them weighing out, okay, we can either have the biggest podcaster in the world, we have to pay him possibly $100 million to get him over here. But we could get him. Or do we want to avoid this entire situation and like, all together? You're like, well, look at Facebook. They have seemingly caused an insurrection in the United States and a genocide in Myanmar, but people still use them. And I'm invested in it. So I guess if I was Spotify, I'd be like, okay, we'll take it.

• 57:24Nilay Patel?

  Yeah, it's it's worth the controversy. Like, we'll make the comparison to Facebook directly. Facebook knows the controversy is coming. They have like built it into their time. And they like, after a lot of controversies, they've developed like a certain amount of resilience or response to it. And often it just looks like they don't do anything and we continue to be frustrated. Nothing seems to be able to knock Facebook off its course or get them to like meaningfully change how it thinks about the software. At the same time, they just stay the course. Spotify seems to get really rattled.

• 57:57Speaker 06

  Yes. And I think part of that is like Instagram is kind of Facebook's like cool cultural thing. And for the most part, Instagram's been pretty like sectioned away. Like you don't really associate Instagram with all the bad Facebook things. Facebook is just like, yeah, we're copying Clubhouse. It's like, okay. Another day, like who they know what's coming, they leave it at that. Instagram is still trying to be kind of good. Whereas Spotify has this all as one place and they want it all to be like culturally cool. And I think that's where they run into the like, oh snap, how do we, how do we make this right? In the culturally cool way while still being like potentially a huge platform that like dominates audio? Where do we land? You can't be cool and a monopoly.

• 58:38Speaker 06

  Like you just can't. So you have to pick one.

• 58:40Nilay Patel?

  One thing that I have thought about a lot, and we've talked about this before, giving everybody in the world the ability to like publish text has caused a wide variety of problems. At least with text, right? Like it is already in a format that can computers understand and can parse. Not well, right? You miss tone, you miss context. Like, we all know the problems with moderating text. Now we're letting everybody in the world just like talking to a microphone live potentially. And that moderation challenge is going to get even crazier.

• 59:11Speaker 06

  Yeah.

• 59:12Nilay Patel?

  And I don't think any of these platforms are there for it. I'm not like, if you're a Veritas listener, you know, I have just deeply angsty thoughts about content moderation, especially at scale. I'm not saying like, we should turn it all off. I'm saying, I'm not hearing a lot of thinking ahead.

• 59:27Speaker 06

  No. And you know, Liz Lapato brought up a good point. We were talking about the Rogan story where it's like, okay, fine. You don't, you want to leave up maybe this Rogan comment. Well, all the other tech platforms have put up these little labels like Twitter, Instagram, where even if they just detect that you're talking about COVID, they put a little disclaimer like, check out the CDC's website. So what? Yeah. Why don't we have that for audio yet? Things like that where it's like, okay, maybe you're not at the place to fully police this type of speech, but maybe there's ways to like, offer reputable information as well. It just seems like that's sort of that not forward thinking.

• 1:00:03Nilay Patel?

  Yeah. I mean, the way, again, deeply angsty thoughts about content moderation. I am the sort of person who thinks maybe answers like we'll never get it right.

• 1:00:13Nilay Patel?

  And like, when you use the words police and speech, like, you know, it's just like the hairs on the back of my head prick up. But if you really think the solution to bad speech is more speech, then the labels are like literally more speech. You're just putting the information next to the other information. I just think Spotify can do that with their, their highly paid famous podcaster. Like, I don't think they can exert that kind of editorial control. And I think they're gonna, they're just gonna run into it over and over again until they come out with a point of view.

• 1:00:38Speaker 06

  Yes.

• 1:00:39Nilay Patel?

  I say that about Rogan. Again, I know white people like Rogan. I think he's very entertaining. My wife listens to Rogan.

• 1:00:43Speaker 06

  Huge admission.

• 1:00:44Nilay Patel?

  She loves comedy podcasts. It's like a real thing. Um, it's great. It like keeps me like in the culture, like you're saying. But I just don't think you can be a big tech company trying to do tech business and be a culture company without those things frequently running into each other. And as all of these companies try to get big into podcasts, they're gonna find themselves in that position in a way that they weren't even in with text. And so I think that's fascinating. All right. War between the elephants. We are all just the ants in the grass. That's what this feels like. Ash, it was great talking to you as always. I'm confident as these next couple of months, as all these things roll out, we'll be talking to you on the show again soon.

• 1:01:19Speaker 06

  Thanks for having me.

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• 1:02:47Nilay Patel?

  We're back. Thanks to Ashley. I always love talking about Sherega on our podcast. It's always smooth sailing with no controversy at all whatsoever. All right, Haim and Dan are back. Welcome back, gentlemen. There was a Samsung event this week, Dan.

• 1:03:01Speaker 03

  Yeah, there was. It was kind of out of the blue. It was like, why is Samsung having another event in April? And the way they teased this event was like the most powerful Galaxy ever. So I think a lot of people were really hyped to see new phones. And then Samsung was like, here's a bunch of laptops.

• 1:03:19Speaker 03

  Yeah, so they, I don't even know the full count off the top of my head, but they released at least four new laptops. We got a hands-on look at the Galaxy Book Pro and the Book Pro 360, which are their new OLED screen laptops. They start at a thousand bucks. They are really sleek. They're really light. If you read Monica's article and go check out her video, her main takeaway was that the screen looks great and this thing is surprisingly light. I think the 13 inches, under two pounds. So these, these laptops are getting like, you cannot beat this weight with an iPad and a keyboard case. Like you are, you are heavier when you add that keyboard case than this laptop, which is, which is kind of like a wild thing to be at. But they're not the first ones at that point, but they are definitely.

• 1:03:58Nilay Patel?

  This is like a trend, right? Ultra lightweight Windows laptops?

• 1:04:01Speaker 03

  Yeah, we're definitely seeing much more of it. And the thing that we're seeing with these is they are not compromising in the way that ultra light laptops used to be. So like, you know, the old 12 inch MacBook was extremely light. It was right around that two point pound mark. And obviously it was very compromised in power. These are running 11th gen core processors. They've got, you know, XE graphic options. They've got designs with convertible flexibility. They've got the OLED screens like we mentioned. So like, these are like actual laptops. They're not like secondary computers. So they're, they're really slick. They're really nice. I like that they come in blue. I think more laptops should come in navy blue. I really like them. In addition, Samsung also announced some entry level models that don't have the OLED screen.

• 1:04:46Speaker 03

  Very similar design, similar feature set. They just trade the OLED for QLED or LCD panels. And then they have a new gaming laptop called the Galaxy Book Odyssey, which is probably coming later this year. They were kind of nebulous on availability about it. But they also announced the RTX 3050 Ti graphics card in it. And we went to Nvidia and be like, hey, what's up with this graphics card? And they're like, oh yeah, Samsung wasn't supposed to announce that.

• 1:05:11Nilay Patel?

  Really?

• 1:05:12Speaker 03

  Your partners will get you.

• 1:05:13Nilay Patel?

  Wait, Heim, can, can Nvidia make enough of those chips? We'll find out. I mean, you're talking about like chip shortage. GPU market is like out of control.

• 1:05:20Speaker 03

  Yeah, exactly. It's a, it's a great question. I mean, like really, the only way you can get a modern GPU now is if you buy it in a laptop.

• 1:05:26Nilay Patel?

  Or if you buy it with Bitcoin.

• 1:05:28Speaker 03

  Yeah, buy it with Bitcoin in your laptop.

• 1:05:30Nilay Patel?

  That's not true. I just.

• 1:05:31Speaker 03

  So it's a, it's kind of like an interesting gaming laptop in that it is not the most powerful on the market by far. However, it is really light. It's sleek. It's thin. It is seems to be targeting the person that maybe wants to game sometimes, but really just kind of needs a laptop for, for work or school or whatever. They don't want to advertise to the world that they're gamers. They don't want to listen to fans all day long. But it should be nice. The thing that, that gets me with all of these Samsung things is they make really like interesting and nice looking hardware. Obviously they have a lot of display expertise and things like that. And I've never seen anyone use a Samsung laptop that wasn't a Chromebook. Like, who is buying these things? And I just don't know. Maybe this, maybe this wave will change that.

• 1:06:11Nilay Patel?

  Well, if you are the prospective Samsung laptop buyer, Dan is at DCSeefert on Twitter. Send him a photo of your laptop. Please tweet at him.

• 1:06:20Speaker 03

  Yeah. So, so they're, they're coming out soon. We'll have reviews up in the near future on those. And they should be interesting, even if no one buys them.

• 1:06:28Nilay Patel?

  I'm fascinated by this trend. Didn't Lenovo just did a ThinkPad that was like super lightweight? No compromises.

• 1:06:34Speaker 03

  Yeah. Lenovo's got Acer, I think, or Asus. I constantly confuse the two of them, but one of them is in the game. Vio has had these really lightweight computers. The thing with the Vios though, is they always like compromise the battery life. So they're like three hours of battery life on your 1.9 pound computer, uh, which is always a silly thing to me. If you're going to make a super portable computer, you'd think you're away from a laptop or even that.

• 1:06:58Nilay Patel?

  What's driving this trend though? I mean, like even battery life aside, like the Lenovo one has reasonable battery life. We're expecting the Samsung one.

• 1:07:05Speaker 02

  It's the new processors, like.

• 1:07:07Speaker 03

  I think it's processors. That's a point. Yes.

• 1:07:10Speaker 02

  Intel, Intel was sitting on its hands for, for this next generation of, of chips for like five years. And they finally got them out the doors and then all the laptops have good battery life and performance and small factors again, like.

• 1:07:22Speaker 03

  Yeah. I mean, there's, there's that, but like the processor is not the heavy part of computer. The heavy part is the battery cell. It's the chassis. It's the cooling systems. So like where the processor comes into play is it's way more efficient. It needs less beefy cooling. That cooling system can be lighter. That battery maybe doesn't need to be as huge of a capacity to get that runtime. So they can shrink that. And we're also seeing a lot more materials being used. We're seeing more magnesium and we're seeing other things that are not necessarily aluminum. And it's, and it's kind of funny is that we're seeing these manufacturers play in this space that make an iPad or a MacBook Air feel heavy in comparison. Like my MacBook Air is like portly at 2.75 pounds. It's like such a silly concept.

• 1:08:06Speaker 03

  But if you hold it next to one of these, you're like, wow, this MacBook Air is a lot heavier. And it's because it's made entirely out of aluminum, which is now not the lightest material to be using. So it's kind of an interesting trend. I, I am eager to see where it goes. I think there is maybe a part of this that is they want to compete with the folks who are using iPads with keyboards or tablets with keyboards. Uh, because once you add that, that the tablet starts out really light, those might be one and a half pounds or even less, depending on the size. But once you add that keyboard, you're back up to three pounds. So, uh, it's, it's kind of an interesting trend. I think it's cool. I think it's great. All laptops should be as portable as possible. So, uh, that's the whole point of them. So I'm excited to see more of that.

• 1:08:42Nilay Patel?

  Heim, what is the process of this specific process? Is this just a new Intel core chip and we're off to the races?

• 1:08:47Speaker 02

  These are the 11th gen Tiger Lake processors that they released last fall. They're great. They have great integrated graphics. And they're just by standard, like by the sheer definition of of technical advancements, they are dramatically better at power efficiency than, you know, the 14 nanometer generation that came before it. They have more transistors and smaller transistors. So they get, you know, more bang for your buck, literally. So you need less battery and you need smaller batteries to get similar returns as you did with those computers, you know, two, three years ago. And that, like Dan said, trickles down to everything. If the processor is more efficient, you can have smaller batteries. You can have less batteries. You can take up less space. You can have less cooling systems, which is all great.

• 1:09:29Speaker 03

  Yeah. The one thing that all of these have, though, is they still have fans. And like, they still have that cooling system, that traditional one. And, you know, the M1 MacBook Air doesn't have a fan and it's great. It's so quiet. So there's still ways for them to go, but.

• 1:09:44Nilay Patel?

  Noted M1 stan, Dan Seifert on the Vergecast, everybody. I'm going to give three Elon Musk updates, then we've gone way over. So we got to get out of here. One, we've got a big story on Tesla's solar roofs, solar roofs on the site from Andy Hawkins. This is just classic Elon. Like, he made a big show of what the solar roof could look like several years ago. They've been stumbling towards development. And a bunch of people who preordered saw their preorder prices rise, like their estimates went way up. People are very unhappy about this. Andy has a full story of that on the site. Elon said on Tesla's last hearing calls that they, quote, "made significant mistakes with the solar roof project." So check that out. They also launched 60 Starlink. Well, not they.

• 1:10:28Nilay Patel?

  Tesla and SpaceX are different companies. They're run by the same guy. SpaceX launched 60 more Starlink satellites this week. As some Vergecast listeners know, I have a Starlink. Actually, because I'm in Wisconsin this week, I gave it to Monica, who lives just a little bit east of me. We'll see if it works at her house. Starlink is really fun if you can get it over the trees at your house. So we're going to have a review of Starlink. If you have questions about it, let me know, but it's, it has been a fascinating process using this internet access system. It's at times extraordinarily fast, but even but a single tree brings your speeds to virtually nothing. It's great. I'm really interested in reviewing it. Like, I'm, the reason I'm bringing it up is I want to answer people's questions.

• 1:11:13Nilay Patel?

  Otherwise, that review is like, yep, it's a plastic dish. You pointed at the sky. Why is it at your house? Like, there's not a lot to talk about. So let me know your questions. So we can build out that review well. That's it. We've gone over, as always, I want to call it a few things. One, there was a big hearing in Congress about algorithmic amplification of content. McKenna wrote that up in her new newsletter, The Hill Report. You can subscribe to it. It's theverge.com/hillreport. It's also on the site. Every time there's a hearing, she's got some big plans for that project. Check that out. I interviewed Senator Amy Klobuchar about antitrust on Decoder this week. If you haven't heard that interview yet, go check that out on the Decoder feed. We'll be back next week with more Vergecast and Decoder. You can tweet at us, I'm at

• 1:11:54Nilay Patel?

  Reckless. Ashley's at Ashley Carmen. Heim is C. Gartenberg. Dan is D.C. Seifert. I think that's all the things I have to say. That's it. That's the Vergecast. We'll be back next week with Dieter. See you soon. Rock and roll. Later, y'all. Bye.

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