Big Technology Podcast - Do We Need The Metaverse? — With Nick Clegg

Episode Date: May 24, 2022

Nick Clegg is the president for global affairs at Meta and former deputy prime minister of the UK. He joins Big Technology Podcast to discuss his company's vision for the Metaverse, how it should be governed, and whether we actually need it. Stick around for the second half where we speak about Meta's app store fees, whether the company should instead focus on winning over younger users, and the ethics of its lobbying effort. This podcast was recorded live from Davos during the World Economic Forum's annual meeting.

LinkedIn Presents. of the tech world and beyond. We are here at Davos in association with Unfinished and the Web3 Foundation. We're going to start big, and I'm about to introduce our guest in a moment. But just to let you know that we have four conversations coming up after this one, Gavin Wood, the co-founder of Ethereum, Vivian Schiller, the executive director at the Aspen Institute here in the audience today, which is awesome. Nick Thompson, CEO of Atlantic and Professor Eric Bernioffson, who's the author of the second

machine agent does great work at Stanford. and now for our guest today. Joining us today is Nick Clegg, the president of global affairs at Meta and the former deputy prime minister at the UK. Nick, how are you? I'm right, how are you? I'm doing well.

I'm excited to speak with you about all things Meta, but first I've got to start with this. You must be thrilled that Elon Musk is trying to buy Twitter. I mean, for all of the scrutiny that Facebook gets, and I'm trying to build this delicately, it must be like a really nice distraction. Well, I'm not sure that was his plan, or certainly not ours,

but I see. I suppose you're right in saying that it does reinforce, given that he is very deliberately sought to kind of open a debate around free expression versus content moderation, it does reinforce something which, sort of, I live and breathe every day, which is, it's difficult. It's really difficult to draw these lines in a way that, you know, enjoys consensus. And in a sense, it just kind of reinforces the kind of push-you-pull-mey quality. of the debate around free expression versus content moderation, particularly in the United States,

where you know better than I do, like half the country thinks that Silicon Valley companies take down too much content, and the other half thinks they don't take it down enough. So to that extent, I think it's kind of sort of, yeah, it's shown a spotlight, not even so much on us or on Twitter or even on Elon Musk, just on, this is a kind of difficult living and breathing debate about human speech and where are the limits and where the limits should be and who should set them.

That's right. And luckily for you guys, I don't think there's going to be any Musk figure coming in to try to take over. So I doubt it. So let's talk about the Metaverse. You've been at it blogging on Medium, so welcome to the club. And you had a long piece that you published about the Metaverse. Now, I think with conversations like this, conversation about the Metaverse, conversations about Web3, NFTs, Dow's, whatever it is, all the hot topics in tech today. One of the consistent things is that no one really knows what we're talking about when we say these words.

you know, I had a selection of comments from your competitors that I got to read through about, you know, their perspective on what the Metaverse means. But here's one for Dave Limp, who runs hardware at Amazon. He said, if I asked a few hundred people what they thought the Metaverse was, we'd get 205 different answers. What's your answer? So, the first thing to say is it's not one thing. It's a whole new computing.

See, here we go. We're already... No, no, but the reason you will get different answers is because, like, if you ask someone, what is the internet? I mean, you'll have lots of quite sort of elastic definitions. A lot of things happen in and on the internet. It's a similar, it's a new computing platform. It is, in effect, you're trying

to kind of build a sort of new version of the internet, almost, from the foundations upwards. I think what it did, I think that, I think it's perhaps, therefore, easy to describe how it is a relatively I mean, it's both revolutionary in one sense

and sounds quite sort of sci-fi when people describe it. But it's also quite a compelling and almost logical evolution of where we've come from. If you think about the way we've leapt from desktops to laptops and laptops to phones, there's no law of nature that says we're going to carry on holding phones in our clammy hands forever. The idea that in hardware terms we might move to something which we put on the perch on the bridge of our nose, maybe with some computing power around our wrist or in our pockets is not, you know, I think when you sort of escape this idea that the phone is the last.

iteration by which we enter into the online world. And equally, if you look at the content that we have tended to rely upon, we started with text, then we moved to photos, and now it's kind of very much videos. I mean, Facebook, about 50% of Facebook now is video. Look at the amazing success of TikTok using these short form video forms. And all of them are moving to inextrably in one direction, which is making the way we communicate more and more lifelike,

more and more embodied. You and I, I'm looking, I'm picking up thousands of signals from you. You're picking up thousands of signals. You're looking at me. You're looking at my gesticulations, my body language. You know, the metaverse offers this tantalizing prospect of a means of communication where it's not just what we say or what we film, but it's also how we are as embodied, you know, beings that also becomes, you know, the way

in which we communicate. And I think that, I guess, terrifically exciting, that sense of presence, which in a sense has increased with each of those iterations and could really manifest itself more fully in the metaverse. And I don't find that, I don't find that imprecise or vague. It's sometimes difficult to visualize, but the more that the technology matures, I've been holding my weekly. team meetings, not least because people are distributed around the world for close to a year now in Horizon workrooms, and okay, we're all sort of cartoon avatars of ourselves. I'm curiously look significantly lighter and about 20 years younger than I really, really am. So we all choose rather flattering avatars of ourselves. But it's an amazing sense of presence being in that

virtual space. I notice, for instance, my voice relaxes so much more when I am speaking to people in the Metaverse in those formats than when I'm slightly straining my voice to speak to people on those passport photograph rows on a flat screen on Zoom or whatever. So anyway, that's a thumbnail sketch, not a very brief one, but one which I hope nonetheless

gets a flavor of the way we at Meta think about it. Okay, I hear you. So technology that allows for presence between human being something like virtual reality, augmented reality. Where eventually the technology melts away. I think that's the aspiration. Brain implants? We could go that way. But your example is really telling because, of course, if you're working at a multinational company like META, you're going to have colleagues in different countries and an experience like being in the Metaverse with them is awesome. I wonder about the rest of the population, though, especially people who are like, yeah, who aren't working in, you know, white-collar jobs are born into affluence.

So I've read this really interesting Atlantic story that said roughly three and four American, and it's about Americans. I know we're, you know, we're outside of the U.S. right now. but I think it's probably instructive for what goes on in most of the world. Roughly three and four American adults live within 30 miles of their nearest parent or an adult child. And only 7% have their nearest relative 500 or more miles away. So do you think that there could be a bit of a solving the wrong problem situation here? Because most people do want to spend their time. Like the idea of presence, they get that with the people that are close to them

and the people that are close to them are physically close to them. You know, it's only when we get into places like we're working in multinational corporations where the Zoom meeting or, you know, let's face time with my mom, becomes important. I'm not sure if I agree with that. If you just think, I mean, think, just imagine what it could do in the classroom. You could take a class of 12-year-olds to walk in the Metaverse in ancient Rome, as you're teaching by ancient Rome, medical students. A surgeon could teach medical students how to perform surgery in a much, much more direct and lifelike and embodied way than we do at the moment.

I think the applications are much more diverse than, I mean, think about the creative possibilities. And we see, by the way, in the early use by the early adopters of our technologies, how particularly younger people are using it, even though many of them will use it primarily for gaming purposes, that quite quickly they're using it for social purposes, almost autonomously, we're not sort of prompting them to do so. So I think there are lots of different ways in which people might use these technologies which don't just rely on whether you are physically distant from your kith and kin. I mean, think what the effect it could have on that wasteful, draining, ecologically,

damaging mass habit of commuting to offices. Why do so many billions of human beings commute and waste one, two, three hours a day commuting into offices to sit in serried rows on desk when I kind of think in future quite a lot, not everybody, and certainly for those who choose to rather than compelled to, would be able to work just as comfortably and just as effectively and with just as much sense of presence one to the other through this technology. Having said all of that one... Can you just do that through Zoom though?

Yeah. But you're saying this is better than you. Our assertion is that what people will always seek is a form of communication, which is more embodied, where the presence is greater, where the sense of really being there with someone else, even if not, even if you're not there physically, will always be more rich, more enjoyable, more fulfilling, and so forth. But in terms of the barriers, one thing, you didn't mention this, but one thing which I do accept is, sort of built-in barrier. And remember, we're a company that is sort of moving from being a social media app company to being a company that now will produce hardware. We've really been a hardware company before. And also being a social media company to being a company that will also design its own operating system. You know, the internet basically is dominated by two operating

systems, iOS and Android. We're going to be developing our own operating systems, as I guess the other major players will as well. But whenever you have hardware, that of course is in some sense kind of barrier because you've got to buy it. Now we don't, our business model is not, we're not aiming to, we're not aiming to spin a great markup on, on, on the hardware. We want to keep the cost of the hardware as low as possible. We can't give them away. We're not, you know, we're not a charity either, so we have to, we have to make sure that we can cover the costs of manufacturing them. But I do accept that getting the hardware into sufficient numbers of people's hands, particularly those on lower incomes, is always a, always a challenge. But, you know,

It was the same with a whole mobile telephone revolution and that hardware has become pretty prevalent. But that is one additional barrier, which we as a company have ever had before. Right, and you're working on that now. But it's interesting because, okay, so you talk about getting into rooms with your coworkers. You talked about schools.

I know you guys are talking about medical issues. Facebook's, or we can call it meta now? Still Facebook. Facebook is the social network. and you've built these social experiences. Is it possible that what you're really building is an enterprise product and not a consumer product? And that's exactly what happened with Google Glass.

And of course it was early for its time, but people realized that this experience was actually much better if we used it in factories, for instance. I know you have differences from Google Glass, but it's interesting to see this shift. Yeah, it's not our intention. It's not to say there won't be enterprise applications. I was in Munich just a few weeks ago at BMW's research center.

Actually, as it happens, they weren't using our hardware or stuff. But it was very interesting to see how much they use AR and VR technologies already in the design processes for their cars. It was very impressive to see. So clearly there are enterprise applications for this technology generically. It's not where we think our expertise lies. I mean, we think what we're good at is precisely based on finding new and enriching. and inspiring and enjoyable ways for people to connect with each other. You may have heard Mark Zuckerberg talk himself

when he talked about, when he founded Facebook, that you could go on the internet to find a book, you could go on the internet to find an idea, you'd go on the internet to find a holiday. The one thing you couldn't go on the internet to do is find the most important thing of all, which is other human beings. And that's very much the spirit that we bring to this,

and it's very much the skills that we will bring to this as well. And if you look at the experience we've built Horizon Worlds, It is all rooted in the idea of social interaction. So I don't think the enterprise application is the primary motive. It's certainly one, though, that I think will occur, of course, and others might excel in that in a way that appeals more to their interests or their skills. So you're building an operating system with Oculus and Horizon. You talked a little bit about Apple,

and META has some clear perspectives on what Apple's doing. with its App Store. Are you going to follow the same pattern? I'm talking about being restrictive in terms of, like, I guess, governing your App Store with the heavy hand, charging big fees. We will charge fees. They won't be the same, but so to that extent

will be new for us to run a sort of app store-style operation. I think here's the thing. And I'm wrongly saying, I don't want to be facetious when talking about Apple or other companies. But if you look at the way in which Apple has devastatingly successful company, the way they've sort of vertically integrated their stack, they've got the operating system,

they've got the hardware, they're increasingly got the services, the kind of centrifugal temptation or incentive for people just to remain in that kind of Apple funnel is so overwhelming now. And I do think that there is a slight danger that competitive animal spirits being what they are, if we allow the governance of the metaverse purely up to the kind of private sector to slug it out,

I do think there is a bit of a risk that much in the way that we talk about the splinterverse, sorry, the splinternet in the terms of the fragmentation of the internet as we know it today, I think there is a bit of a risk that you'll get a splinterverse and you'll get a sort of vertically integrated Microsoft Metavers. and a vertically integrated Apple meta and a Google one and then a meta metaverse and that from a user point of view the ability to move seamlessly from one to the other will be inhibited and I think that would be a great, great shame and so we all need to work on the whole web of standards

and interoperable arrangements and licensing arrangements and all the rest of it which have grown up in a slightly hegelty-piggledy way in the current internet to allow the user not to feel they're locked into these kind of silos. I do think that is a, it's probably in governance terms, the bit that I think is most deserving of real thought. Of course, interoperability, you know, that's something that you've talked about. But I want to get a firm answer from you on the Apple thing, because the big discussion about Apple has been the 30% fees in the app store. You mentioned you're going to charge fees.

I always thought after hearing, you know, from people inside Facebook about the way that Apple was charging, that those fees would inevitably be less. But there was a report that came out a few months ago that said that Meta's going to take, has been taking 47.5% on some transactions when it comes to NFTs. So it's like a hardware platform fee of 30% of sales through the Meta Quest store. And then Horizon Worlds will charge a 17.5% fee. You know, people have been talking about that for NFTs. And one person I saw a comment on it was like someone ought to tell Meta that after the IRS is done, I'm not going to have that amount of money to pay.

them. Why, 47.5%? I mean, how could that possibly be? Well, firstly, as I said earlier, we're not looking to make money off the hardware, off the device. So it's quite a different approach than Apple has taken, where they clearly, you know, extract a significant margin on the device. Yes, we're charging fees. But remember, Horizon Worlds will be available through lots of other routes. So the, I think it's the 17% that Horizon Worlds will will charge on Horizon Worlds is not, I mean in a sense I get it, you're adding together the App Store

charge on Oculus with Horizon Worlds but of course we envisage Horizon Worlds being available through so many different other routes and so the same won't apply so I'm not sure if it's comparing apples with apples and pairs with pairs. I think it's mixing these things but yeah we're quite open about the fact

that we don't want to, we don't, we're not trying to extract great margins off the hardware. We do want to be transparent about if you, if you're, you know, generating value and creating presence on Horizon World. We want to be very open of what the charges are. And they aren't just charges on top of Oculus, because as I say, they'll be available through 2D means as well. So, yeah, look, we're not, you know, we have to be open about that. We're not hiding those rates, those fees, but I don't think there are remotely similar to the Apple approach, which is a very successful business model. It's not the one we're following. Yeah, I mean, it's not similar because it costs more money.

I mean, wouldn't it make sense just to commit to charge, like, let's say, a flat 15%, no matter whenever you go through anything that meta builds? Well, we've chosen not to, and as I say, we could slice and dice this in different ways. we could try and put more margin on the hardware the moment we decide not to do that for the reasons I described earlier because we think we've got a huge incentive to get hardware into the hands of people at the lowest possible cost

then you have a knock on effect and look we're pouring I mean I'd love to I mean people might think that we're like you know we're a charity which can just give away this stuff we can't we have to try and work out a business model that's sustainable

we're pouring billions of dollars into this technology and we'll continue to do so for years before it makes a meaningful return for us. So we kind of have to develop a balance between where we think value is created for developers and creators on our platform and what would be a reasonable feed to ask of them and be very open about that from the outset. That's what we've done. Okay. So speaking of the investment that you're making in Oculus, does the, so I think last summer, Facebook was valued at a trillion dollars. That's about, it's about half right now, given the market

turned down. Do you make different decisions investing in products like Oculus when you're worth $500 billion, which isn't bad, versus a trillion? I mean, there are hiring freezes, from my understanding, in multiple departments throughout Facebook. I don't think that exists in Oculus. Can people expect to see the same investment, given the state of the economy right now? I think one of the advantages of having a founder-led company is that you can plan for the long term and you can sort of write out these wild gyrations in the markets a bit more strategically than a company that has to be driven by sort of quarter by quarter

performance. So we're cutting our cloth as you'd expect prudently in response to market conditions we're operating possibly in the most competitive environment that we ever have as a company. So I kind of think that's what it would be very odd we didn't. And that, of course, has an effect on, I mean, we're not, you know, headcount is growing, just not growing as fast as it might do otherwise. So we're still going to be employing more people at the end of this year than we did at the end of last year. So it's still

growing. It's just, it's just we're being sensible about trying to kind of slow the rate of increase where we think that that is consistent with our product roadmap. And in answer to your question, will that materially affect the momentum towards our investment in these metaverse technologies? No. Our aim is still to square the circle and still maintain the same momentum. We've got this very exciting new headset. It's a sort of higher-end headset that we're releasing later this year, which will be a significant, sort of advanced step in displaying our mixed and augmented reality capacities, which we've invested in a lot. So, no, we want to keep that up, but, you know, we're doing what any business does when

when market conditions change. You cut your cloth accordingly. That's what we've done. Nick Legge is with us. He's the president of global affairs at Meta. Former UK Deputy Prime Minister will be back right after this on Big Technology Podcast. Hey, everyone. Let me tell you about The Hustle Daily Show, a podcast filled with business, tech news, and original

stories to keep you in the loop on what's trending. More than 2 million professionals read The Hustle's daily email for its reverent and informative takes on business and tech news. Now, they have a daily podcast called The Hustle Daily Show, where their team of writers break down the biggest business headlines in 15 minutes or less, and explain why you should care about them. So, search for the Hustle Daily show and your favorite podcast app, like the one you're using right now. Now we're back here on Big Technology Podcast with Nick Clegg, former UK Deputy Prime Minister, and current president for global affairs at Facebook. Nick, great having you here.

Actually, we're here at Davos. We kind of spoke on the way up here about power. And, you know, it's kind of interesting hearing your perspective on what it's like coming here as a representative of Facebook, right? We're here get where some of like the world's top officials are gathered, some of the world top business leaders. So you've obviously come, you know, from the government perspective in the UK and now you're here from a corporate perspective with meta, how is it different? It's very different. It's, I mean, the world of, sort of Harry Potter world of Westminster of sort of, you know, people calling each other up, you know, no, you know, I couldn't even be called Nick Clegg in the House of Commons. I had to be referred to as the right honourable member

for Sheffield Hallam. I mean, it's just like a language which is like stuck in the 19th century. the building is about to collapse under the weight of its own contradictions. It's such a sort of antiquated arrangement. Of course, that compared to the sort of gleaming steel and glass constructions at empires and Silicon Valley is very different. The one similarity, I guess, is just given the sheer scale of meta and our apps, used by, you know, three billion odd people, given all the controversies which, of course, always erupt around you're dealing with human speech in all its different manifestations,

you know, good, bad, beautiful and ugly, the sort of velocity and variety of issues that certainly cross my desk feel a little analogous to the velocity and variety of issues that I encountered when I was in government. But I often hear people say, oh, you know, these big tech companies, they're as powerful as governments, that's not true at all. I think it's a totally overused sort of analogy, which really doesn't bear any scrutiny. They're not like governments at all. Governments have much more direct. They don't, governments decide whether you go to war or not. They decide whether your taxes go up or down. They decide whether your local hospital gets more money or less. They decide what your curriculum, your kid is taught. You know, they decide how

your elderly parents looked after in a social care home. It's much, much, much more direct influence over people's lives than even the most powerful social media companies. I do think this sort of well-worn, off-repeated analogy between these big social media companies in government is, it's a great kind of throwaway thing to say in a newspaper column, but it doesn't, in my experience, bear much relation to the reality. Well, you don't have an army, but you do have influence. You have influence, but, you know, at the end of the day, people will use Facebook, Instagram, messenger, WhatsApp in the way they want, when they want, how they want, or not.

They're not, you know, if you're in government, you've got a pretty solemn set of responsibilities to defend the nation, to keep people safe, to educate children, to protect public health. It's a much, much more diverse. I just, just because 3 billion people use a product doesn't mean that you're administering sort of government decisions and how they lead their everyday lives in a way that governments do. So, I mean, maybe because I'm in the unusual position of, I suppose, I'm, yeah, I suppose, think. about. I'm probably the more senior ex-politician have gone into an executive position in a big Silicon Valley company. I just think it's a nice glib kind of comparison, which just doesn't really tell you much in practice at all. It's my view. So when you speak to the people that used to work with on the government side, you're here talking about the metaverse. I mean, we've seen some of these discussions. Do you think that they know what, I mean, I guess a lot of us don't know what the metaverse means. But how are these conversations going? And do you think they are, you know, tackling these issues and prepared? I mean, it probably is too early for regulation, but are they wrapping their head around the way that this stuff can change?

Well, it's interesting you say that. One of the reasons, and forgive me, it was so long, and thank you for reading it. And for those who've waded through it, thank you very much for doing so. But I hope you thought it was worth it. One of the reasons I wrote that, and one of the reasons I'm talking to a lot of people here about it,

is I think one of the things that clearly with hindsight, not when wrong is too strong a way of putting it, because I don't think it was deliberate. it. But we clearly, as a sort of society, I'm talking very grand terms now, you had this technology erupt 10, 15 years ago, more, particularly in social media, and in a sense we've been retrofitting societal norms and standards and guardrails and limits on them ever since. You know, the EU has just passed the DMA and the DSA. Logically, the DMA and the DSA should have been in place 12 years ago, not not now. And I think oddly, given that we've got, we've got a lot of

of time, you know, these Metaverse technologies, it's still very, very early days. It's going to take 10, 15 years for this technology to, you know, to come to fruition. So I hope that this time round, we actually have the opportunity, if we can have a kind of grown-up conversation about some of the fundamental, foundational concepts of what is the Metaverse, what is it not? Who's responsible for what? At what level of the kind of stack? Where do the responsibilities of the companies lie? Or the individuals, or the users, of governments, regulations, and so on. Who sets the rules on interoperability? If you can have those discussions now in parallel with the kind of flywheel of engineering and technological investment,

hopefully we can look back in 20 years' time and say, oh, well, this time around, we avoided this sort of violent mood swing from tech euphoria and sort of tech utopianism to sort of tech pessimism, which we've seen occur over the last decade, where, you know, companies like Facebook were held 10 years ago to be responsible for everything that was good and great and shiny and Bright, and people like Mark Zuckerberg were held aloft, and they could do no wrong, they walked on water, and now literally anything that goes wrong from an election outcome that you

don't like to, you know, youngsters are unhappy, it's all got to be because of some mysterious and nefarious algorithm. It's kind of swung, and of course neither are true. Neither extreme optimism or extreme pessimism or true. It's always, the truth has always lies somewhere in between. My hope, and this is where I hope

to play a modest role, is if you can sort of goad and encourage the policy makers and the regulator staff early thinking about this. Maybe we can talk about governance and rules and so on at the same time as the technology develops rather than, rather than, in a sense, sort of add them as sort of seatbelts later

after the technology is already taken root. Yeah, it's interesting, though, because I'm listening to, reading your post and the names I see coming together to try to get regulation on this path. certain companies like META and Apple and Microsoft, Google. At what point do the most powerful companies coming together to push regulation actually end up entrenching them more than it does opening up room for other competition?

That's always the risk. You've always got to be very skeptical and big companies. So, oh, you know, we like, we want new rules of the games. Facebook doesn't really play, you know, you guys take some swings when you get regulated against them talking about like the Australia situation when they wanted to charge Facebook for news and the company shut news down. Well, quite the characterization I'd accept. We were just on that one.

Not just news, yeah. Well, just on that one. We were being asked to pay, in the original conception of those rules, potentially uncapped amounts of money, literally limitless amounts of money, to publishers who were posting their content on our platforms to reach their users, where all the value goes from us,

in a sense to them, and we were, and so we quite, we just, we have no, of course, it's not something I voluntarily like to do. You don't like to have a great big argument like that, but it was just, I don't think any business would have put up with a proposition where we're just basically being asked to provide an uncapped subsidy to another industry, particularly an industry, in this case, the publishing industry, who derive all the value from us. But anyway, that's, I put that aside. No, no, no, look, I think your initial instinct to be skeptical when big companies say that, absolutely, because, of course, regulatory interventions is going to become a barrier to market entry and so on.

And look, I'd be clear, I'm not here saying, straining at the bit, saying, oh, gosh, Parliament should rush to make laws and rules about the Metaverse. I think it's too early for that. I just think that the more you can have a grown-up conversation with academics, with researchers, with other parts of the industry, large and small, with online harms experts and others, get everybody in the same room with regulators and say, look, this is new technology, it's going to happen one way or

another. We don't exactly know how it's going to play out, but here are some of the early foundational design questions we need to think about. I kind of just intuitively think that has to help us navigate all of this better than the kind of wild mood swings that seem to meet, at least, have seemed to somewhat disfigured the societal debate around technology over the last 10 years or so. So let's talk about the way that Facebook does go about. I keep saying Facebook. This name change, man. Okay. So let's talk about the ways that meta goes about this regulation. There's an article in the Washington Post last week about a group called American Edge that got all of its seed money from Facebook was millions of dollars. And they go out and they have local business people do op-eds or make statements, run ads that seem to be supporting Facebook's positions, but never any disclosure that that's where the source of the money is.

coming from. And this has happened like all throughout this big tech debate. And I think that like it's actually good. There are arguments to have D to C companies or smaller businesses talk about how these products are helpful. However, they should, if they're being funded, if the ad campaigns are being funded by organizations that get all their money for meta, there should be some disclosure, don't you think? Yeah. I'm surprised to hear you say that. I think there's full disclosure. I think we've never hidden the fact that I mean, by the way, I mean, I need to, I don't know which story you're referring to, But I mean, we've been totally open about the fact that American Edge, which is a constellation of experts and people saying, basically making the fundamental case that American technological success needs, you know, you shouldn't just take it for granted. And lawmakers need to think very hard about the effects of their decisions on American technological prowess, particularly compared to the strategic competitive threat from China.

We've been very open about the fact that we supported that, financially supported it. They have as well. By the way, ask any of the numerous, numerous organizations whose sole purpose in life is to criticize Big Tech. Ask them where their funding comes from. Everybody is funded by some. Yeah, exactly. And everyone just needs to be open about it.

I don't think just because, I don't know, which, there are lots and lots of these organizations and they're funded by so and so and so and so and so. They're perfectly entitled to get that funding and still make their case. And I think the American Edge Project is entitled to do exactly the same. I don't doubt that META has made its connections to American Edge clear. I think the question becomes what happens when these small business owners come out and they're doing an ad on behalf of American Edge and it says, you know, this ad has been funded by American Edge,

but no one knows what American Edge is outside of us, like the people in this room, people listening. I'm sure people listening to the podcast don't even know and the broader population don't know. So don't you think META should commit to when small business owners go out to make your case through organizations that receive funding from you that they also disclose that there's funding coming from META. Well, I don't, I mean, the answer is I don't know, I can't micromanage for you the relationship between American Edge,

which is an organization funded by us, but it runs its own operations. I mean, I'm assuming, of course, they disclose where their funding gets to when they're dealing with a lot of these local voices who are raising their own support for the American technology sector as a whole. But as I say, I kind of think it works all ways. I mean, you have local campaigns against big tech. I'm assuming those organizations will say that they've got money from this foundation or that foundation. Yeah, look, on the whole, I agree with you.

I think there should be – we've certainly got no incentive at all to be secretive about this. Why should we be? I think we're actually very pleased with the fact that people want to raise their voice, and we want to support that, want to raise their voice about American technology and its role in society. Right, but again, speaking of the power, if the money's going, I mean, I know you don't want to micromanage each one of these organizations, but if the money is coming to American Edge from a place like META, you probably have more influence over that organization. Yeah, we wouldn't fund it if we didn't think what they did was something which we agree with. So could just be like, hey, guys, I mean, I will check, but I really don't think we have ever remotely brushed this under the carpet. Why would we?

And actually, I strongly suspect and hope that we couldn't and shouldn't that, you know, it's part of our arrangements that you have to be open about this. Right. And I like the fact that you're saying that. And it would be good if we had this because when I first started big technology, I went and looked at a bunch of these op-eds that were being written. And the money didn't just come from that. It came from places like Alphabet as well.

But oftentimes there's like local op-eds in places like the KC Star that are trying to influence certain, you know, politicians. And then only after you dig through like four or five levels do you get to the funder. but I won't harangue you about that anymore. So I also wanted to talk to you about, let's talk about teens. I wrote this book, Always Day 1, actually spoke to Mark Ford. It was really interesting to hear about his perspective, and it's all about corporate reinvention. Companies coming in as if it's their first day

and building without regard for what the legacy product is. Now, obviously, meta's in the middle of that. You've got the name change, you have this big investment going into virtual reality. and at the same time it seems like teens aren't seeing the same appeal and young people aren't seeing the same appeal for products like Facebook and Instagram as they did in the past. I'm curious

if you think this is the right re-invention and then as a business, what does meta need to do in order to get the energy going from young people in the way that it had been in the past? I'm not sure if I entirely agree with that sort of thumbnail sketch.

But dare I say, it's a somewhat American-centric view of how people use. Well, no, no, but it's important this. Over 90% of the people who use our products are outside the US. And yet, I find myself often ask questions as if the whole of social media is US. It's not. It's like, you know, less than 10% of our users, our US users. So if you look across the world, I don't actually think your characterization is entirely right. We've got a lot of young people using WhatsApp in increasing numbers.

a lot of young people use Instagram of course we constantly strive to be appealing to young adults in particular in Facebook and face fierce competition with that

but I so we're not giving up if that's what your implication No no I'm saying yeah I don't think you're giving up at all but I want to know what's going on because actually there have been you know I think either reports or Facebook

itself has said that this is a big priority No no no we'd be very open about that Particularly when it comes to Facebook, we understand that, you know, it's a mature social media app now. There are other really attractive alternatives. TikTok is an astonishingly effective competitor for people's time and attention. It's the fastest growing social media app ever far. It's grown far faster than... And people spend more time each day on TikTok. All that. So, you know, look, I mean, I'm kind of old-fashioned in the way. I kind of think competition's a good thing. It kind of keeps you on your toes. It means you have to constantly iterate.

We have to constantly ask ourselves, why, you know, what are the attractions of these other apps? What can we do to make sure that we constantly iterate and innovate? And, you know, look at the way in which we have really now leaned into short form video, which is clearly an extremely popular form of, you know, sharing content these days. And Reels is doing exceptionally well. We're not monetizing Reels as, you know, that'll take some time. So, you know, I think it never stays still.

It never stays still, both geographically and demographically and across the generations. We need to continue to offer improvements to our apps where we need to make sure they're appealing to younger people and not just to more mature users. We do that across the piece. I think the other thing we're seeing, interestingly, is it's not exactly emerging, I'm putting it too strongly, but it is interesting to see the way in which messaging apps and social media apps they're kind of blurring on the edges almost it is interesting to see how messaging apps generally are being used for, it's going well beyond just

the just sending a typed messaging message to another person. It's been used for payments it's been used increasingly by businesses, it's being used by larger numbers of people, look at the way, you know, Telegram is used by very large numbers of people, that's why we recently announced the expansion of WhatsApp communities, so church groups and youth groups And school groups can do that. So I think that's a really important evolution.

We're spending a lot of time thinking about that. How can you retain the privacy and intimacy of messaging apps, but also make them more sort of versatile for larger groups of people and for more business uses and not just personal communication uses? I think all of that are areas where I think we are continued to be highly innovative. And what do you think about Discord? Well, it's just another app which is incredibly popular, as you know. And I even see this with my kids, you know, kids who will, you know, be gaming.

And they use Discord to message at the same time. You know, it's a very, very popular, very popular app. As is, look, as is this app, as is TikTok, as is, you know, there's a lot of competition in this space. And, you know, we've been around for some time, longer than some of these other apps. All of them have their own virtues. All of them bring their own innovation. I think the key thing, and I think this is my, my. own view is it's one of the things that Mark Zuckerberg excels in is to keep that sort of

hunger, that appetite for trying something new, never to rest on your laurels. And I think it's a difficult balance. If you look at big companies, there's always this risk that big companies start resting on their laurels. They don't move as fast. And I think one of the interesting things about being a founder-led company is that hunger to continue to compete, to continue to innovate, to continue to be worried that you're going to be outflanked by new competitors is very, it's It's very alive in, certainly in my experience over the last three and a half years in meta, and I think that's a good thing. Right, and he's the last of the bunch in big tech.

In a way, well, Elon Musk is out of Amazon. Yeah, well, Elon Musk is, I mean, we'll see what happens to Tesla stock. Okay, we'll see, but I mean, yeah, no, he's certainly, certainly, you know, if you think about jobs and Bezos and so on, you know, but one of the things I admire about Mark Zuckerberg is, is, is, I mean, you could have, he could be forgiven to say, gosh, I've been doing this for quite a while now, and it's a, you know, it's a pretty full-on job. I'm going to kind of slow down a bit. He remains as, as kind of adamant and sort of interested and intense about the job at hand as I think he was even, you know, several years ago. Yeah. Okay, I want to end

on this. Have you heard of the mappiness project? No. It's like a project that maps happiness. And there's a stat that they found of 27 leisure activities. Social media rings dead last and how much happiness it brings. Why is that? Why do you think they found that? Um, well, without knowing any of the study, I can't really give you a very, um, look, our research, I mean, firstly, I doubt very much that, what is it, three billion odd people keep using our products because they want to be unhappy. I just kind of, I just, sorry, just defies, I keep hearing these narratives about how ghastly it must be to use social media. Well, let's can't, someone hasn't told those three billion people who, because you need to find great value and happiness and enjoyment

out of it. I tell you what our research has shown, however, is that passive scrolling can be a, you know, can be a more negative experience for people than using social media in a way that actually involves connecting with others. I think the act of connection, the act of communication, does seem to have a dramatic effect on people's sense of well-being. And so I do think it is incumbent upon us to find ways which people are encouraged to connect with other human beings and not just sort of passively scroll and kind of

watch what other people are sort of doing. So that's certainly what our research has shown and that's why we do spend as much time as we do to constantly find ways which people find it enriching and useful to connect to other people. But look, look, it's like everything else in life. use it in moderation.

Don't, don't, you know, don't over-rely on it. Don't make your life dependent on it. You know, it's like everything else in life. I think social media is a incredibly, when well-use, and is an incredibly enriching, enjoyable. And look, one of the things I find in my job is I speak to a lot of people who think that Facebook is all politics and news. And which, by the way, is true.

I mean, Twitter is a lot of politics and news, because it's an elite app. It's used by, what? 230 million people. It's tiny. Less than that. It's less. Snap is twice as big as Twitter.

So Twitter is very, very small because it's used basically by politicians and journalists, and they have this sort of flywheel speaking about it. Facebook is completely different. The amount of politics on Facebook at the moment in terms of the total content on news fee, it's about 3%. Because the vast majority of people go on Facebook

is, I often say, for babies, barbecues, and bimitsfers. But that's also an intentional decision by Facebook to limit the amount of political content. Yes. But for a very good reason, because we know, because that's what people tell us, that they find that more meaningful, more fulfilling, more inspiring. And dare I say it, it makes them feel better about themselves. It makes them feel happier. So we don't want our apps to be flooded with angry, political, polemic. It isn't. It isn't. The vast, vast, vast majority of it. And our job, of course, is to safeguard and to nurture that, the vast majority of that content, which is fulfilling, fun, innocent, inspiring and so useful. And, of course, deal with a market. minority of stuff that is nefarious, that is bad, that is detrimental to people. That's our constant fight. But so much of the debate, certainly the debate that I'm exposed to with regulators and politicians, assumes that that minority is the majority. It really, really isn't.

I mean, the prevalence of hate speech. And by the way, when I say these statistics, it's not just me saying these, these are now independently audited statistics that we publish. EY now independently audits them is 0.03%. That means for every 10,000 bits of content you do, if you keep scrolling, there'd be three bits which are hate speech. I wish it was zero. It's never going to be zero. But I kind of, for me, it just defies logic, the idea that a platform which is used by so many people every day.

It's so useful to so many millions of people and so many millions of small businesses that only has 3% or so of political content, where it was 0.03% of hate speech is a sort of primary source of societal unhappiness. It doesn't, that really just doesn't help for me, I must say. Nickleg, thank you so much. for joining. Great having you and I hope to have you

again sometime soon. Yeah, there'll be a pleasure. Thank you. Okay. Thank you. All right, that'll do it for us here on the show. We'll be back tomorrow with another show with Gavin Wood, so stay tuned for that.