Big Technology Podcast - New Release at Big Technology, AI Bubble Looms, Apple's Next Event — With Brian McCullough

Episode Date: October 25, 2023

Brian McCullough is the host of Techmeme Ride Home and general partner of the Ride Home Fund. He joins Big Technology Podcast for a deep dive into the week's news and a fresh announcement from Big Technology. We cover: 1) Big Technology Premium 2) The state of Big Tech at the end of a year-end that started with layoffs 3) Is self-driving tech's biggest story this year? 4) Who is winning the AI battle among the incumbents? 5) What happened to crypto 6) Apple's new Super Scary event on 10/30 You can subscribe to Big Technology Premium for 25% off at https://bit.ly/bigtechnology or at bigtechnology.com -- Enjoying Big Technology Podcast? Please rate us five stars ⭐⭐⭐⭐⭐ in your podcast app of choice. For weekly updates on the show, sign up for the pod newsletter on LinkedIn: https://www.linkedin.com/newsletters/6901970121829801984/ Questions? Feedback? Write to: [e-mail]

Big Technology is launching a new premium edition with a new monthly podcast. We also take a look at the state of tech as the year draws to a close, and then we sort fact and fiction from AI and crypto. And maybe we throw in a little bit of Apple's big news coming up right after this. Welcome to Big Technology podcast, a show for cool-ended, nuanced conversation of the tech world and beyond. We have a special double-feature episode today because we're running this both on the big technology feed and on the TechMeme Right Home feed, which means that none other than Brian McCullough is joining us live.

Welcome, Brian. Hey, Alex. Welcome TechMeme Right Home listeners to another weekend bonus episode with our buddy Alex. I think you've been on like five or six times at this point. That sounds right. It's always pleasure to talk, Brian. Yeah, no intros needed on my side. But given that this is news for your audience and for mine too,

what is this new big technology premium thing, Alex? Okay, thanks for team me up perfectly there. So this is great. This is an opportunity for me to introduce it both to our listeners on big technology podcast and to tech meme right home listeners. So big technology has been free for three years and the free edition will remain after this. But I'm introducing this new premium edition that's just going to give more of what we've

been doing in new forms and new formats with new features. and even a new podcast. So I'll start with the podcast first because I feel like it's, you know, pretty exciting for podcast listeners. It's called Big Tech War Stories. It's going to run once a month for big technology premium subscribers. And it's going to be a conversation with people who are, who have been in the weeds inside big tech companies and have either built a product that people love or one that was

never released. And we're going to speak with them about what exactly happened. I think I have a clip from it that I can play here. This is with, so our first episode, which is going to be running next week, is with Garv Mehmeda, who's the first product manager on Google's Lambda chatbot. What are some lessons learned for Google? Looking in the rearview mirror. Like, how should Google change?

They need to go back to the experimental route, like over the years. Google has become more and more conservative about doing things. they care a lot about PR, the public relations. They care a lot about how their image is shown in the media. And I feel that, at least in my experience, that plagued so many projects inside of Google. It was like the PR was always top of mind for leaders. And on the other side, like, open AI,

they don't give a shit about PR or, like, for the most part, they don't. So that's a bit of a clip of the new show. show. I'm stoked about it. Again, coming next Monday. And then in addition to that with this premium edition, we have this new thing called the panel, which you're on, which is we already have about 20 tech experts. We're talking about analysts, VCs, journalists, and technologists that are going to weigh in on news as it's happening. So let's say the Silicon Valley Bank is in the middle of collapsing. I'm going to email the panel. The panel will all, well, when it's relevant, email one to two sentence replies about how to think about the news and we'll be

able to contextualize it for readers. And then finally we have a new Amazon column coming from Christy Coulter, who's a recent guest of the show. She spent 11 years at Amazon and has like a really good insight into how the company works. So that's it basically. Big technology premium. You can find it on big technology.com. And the launch special will still be going on. So that's 30% off the annual price, which is already a good amount off of the monthly price. they can get an annual subscription for $90, and that's it. Two comments on this. First of all, thank you, Alex, for asking me to be involved in this panel thing.

I actually saw Alex in person this weekend, and I was like, oh, you should have this person on the panel. You should have this person on the panel on it. Everyone I said, he was like, they're on. So believe me when I say this is a blue ribbon panel, because everyone that I was suggesting to him, they have already agreed to be on the panel. so that's great. And then number two, I have a suggestion for the podcast. Years ago, I did an interview with one of the people on the team at Dig.

If you know the history that like Dig was the big thing before Reddit and they did a site redesign that destroyed Dig and Reddit came to the four. So that would be a sort of behind the scenes story. If I can, I'll have to dig into my archives and see that person. Oh, that would be great. Yes, yes, please. Yes, okay. That would be great. see if we can make that happen. Yeah. Yeah, so it just got it off the ground. We're recording

on Tuesday. This show's going live on my feed Wednesday and then yours on the weekend, but this is this thing is fresh and hot off the presses. And I've been like thinking about the right formula for many years. I want to be able to keep the free product for those who want, but also offer more for people who are interested in a premium subscription, something that can help them do their jobs better, you know, give themselves an edge in their career, give their companies an edge against the competition. I think that this sort of insight insight in terms of being able to read tech events

as they happen and learn about how the best do it is the best possible offering. And I'm really excited to roll it out today. Well, everyone go check it out because, as you know, big technology is one of the best sources out there for really in-depth sort of stuff in terms of analyzing the tech landscape

deeper than I can do in my 15-minute show. However, and I'm going to grab the reins slightly because one of the reasons why I wanted to talk to you this week is because you are the big technology guy. And it's sort of that time of year when a young man's fancy turns to thoughts of year-end recaps. And so this is me teeing into our first topic, which is I wanted to ask you, seeing as how you follow closer than I do, all of the big tech platforms, this year started out with tech in turmoil, with layoffs, with, you know, some people questioning, you know, the business models of something, like was meta in trouble and stock down, whatever percent it was

or whatever. I feel like it's not that much in turmoil. So if you'll allow me to pose the question to you, but then we can go back and forth on this. What happened to big tech this year, I feel like they've recovered. Is that the correct sense or what happened? I mean, they've definitely recovered. And you know, you just have to look at meta stock price, right? Right. 150% over the year to know that all that doom saying towards the end of last year was misplaced and that these companies were always already, sorry, they were always going to respond to the demands of the market and boy, did they do it. So what you had is Mark Zuckerberg basically he came in flat-footed, but then immediately realized that it was going to have to be a year of

efficiency, as he put it, right? Big cuts and a focus more on inventing versus maintaining. And I think you've seen that meta has done the cost cutting. It's very tough for them, right? They had to cut a large percentage of their staff. But it also changed the culture internally where they started, you know, started acting less like a big company and more like a company with some urgency. And you've seen that manifested with big moments where they've shipped, you know, their open source AI model, Lama, they've opened, they've shipped chatbots, this whole new slew of purpose-built chatbots that you can now get in WhatsApp and Messenger.

Honestly, like, you know, been among the biggest skeptics of what this Metaverse thing was going to be for consumers, but I just got a chance to try the Oculus 3, Quest 3. And I thought it was very impressive. It has great pass-throughs. So you basically can wear it, walk around, and see everything going on in the room with you. And it's not quite where it needs to be. Obviously, it needs to be much thinner than what it looks like now as opposed to these big goggles. But I mean, is it getting there?

Absolutely. Especially because Apple's bringing it forward. And so I think that meta is emblematic of the type of movement you've seen through the entire big tech echelon, where there's been, you know, cuts that they had to make and they've made them, however painful they were. And then innovation. And, I mean, AI, which we're going to talk about later, has underpinned a lot of that. So I attended a meta event sometime in the summer, June or July.

And they were talking about all the AI stuff they were going to bring into their ads products and things like that. But they constantly made the point that, like, we're still committed to the metaverse. Is it just a Maybe it's They still are committed And they're still spending money on it But is it also a thing where it's like

If we just don't shout it from the rooftops That keeps Wall Street happy Like It's not like they're walking away from it Or doing a Mayacalpa saying Well that was a that was a cul-de-sac They're just not talking about The Metaverse as

You know forthrightly as they were say a year ago Absolutely I mean don't you think that when they said year of efficiency. I mean, how much of Wall Street thought that meant not investing, you know, billions of dollars into the Metaverse every year, not losing billions of dollars. That's actually not what happened. They didn't cut spend at all. They, in fact, increased spend on the Metaverse. I mean, they are not taking their foot off the gas pedal there. And they've just tried to trim elsewhere within the company. And not only that, their ad product has recovered nicely from

Apple's anti-tracking moves. So you put it all together. And it is sort of, it's almost just business as usual in a way that the strategy hasn't changed maybe they've added more AI into it but they're just trying to do it in a way that's again a way you know a method of building with more urgency and a slightly although not dramatically less people well so that I was going to ask again like you go on the like compound and friends like you're closer to like the stock market end of this or whatever was it ever a case that like in the early part of the year, was EPS down for any of these companies, were like, were profits significantly hit and they've come back? Or was it more that they were being cautious in terms

of like forecasting? And also, so then when they do cuts to especially personnel, that looks better to the bottom line to Wall Street, what I'm asking is, were their businesses is significantly hit. You just mentioned Meta's ad business recovering from the ATT thing, where they hit and they've recovered, or is it just the vibe, which all of Wall Street is to a certain extent where Wall Street likes the narrative better now? Part of both. I mean, there was a real hit, especially with Apple's anti-tracking moves. We're talking about a $10 billion loss coming in, or a contraction of revenue coming in, in particular because Apple didn't let them track what was going on. And so for meta specifically, that has come back in the sense that like, are we back to

where we were before ATT? Not 100%, but there's two things that have happened. One is that people have taken their money and they've brought it to Snapchat and they've brought it to Twitter and they brought it elsewhere. And then, you know, even though they weren't getting the same returns that they were on Facebook, they've just been like, oh, shucks, you know, the best place we have to put our money is Facebook. So they've actually like come back from that worldwide tour and be like, all right, Facebook, you know, take it. Then Facebook has built a lot of technical tools that have enabled these advertisers to start to get maybe not back to where they were, but to a point where they're pretty comfortable now spending money with this company. So you're at a point

where you also had some pretty hard comps against COVID because people all, you know, every company that we're talking about in big tech just had massive increases in revenue during COVID because they were basically the economy. So that tails off a little bit. But now, I mean, it's definitely evened out at this point, and everything is pointing up for these companies. So if we have time, can I ask you for two other specific companies? We'll save Google slash alphabet for the AI conversation later, but you're talking about COVID times and cutting back the workforce. That's Amazon, right? Amazon was also dealing with the sort of the transition to a new regime, you know, Andy Jassy taking over. So what's your take on Amazon's year

this year. I mean, in some ways good. They really were slow on the AI front, but they positioned themselves a lot better with their big investment in Anthropic, right? Already 1.25 billion in Anthropic, potentially up to 4 billion investment in Anthropic, which is like this counterweight to open AI. So now they have a research house similar to the way that Microsoft has a research house. And while doing this, they've sort of, and Matt Wood was, this VP from AWS was on the show,

a few months back talking about this where they've kind of created AWS as this clearinghouse for AI models. So no matter what model you want to build, they're not going to favor necessarily the ones that are developed within Amazon or the ones that are developed within Anthropic. They have access to the builders. And they're like, all right, builders like come use our tools and build. So I think they're in good shape there. The one, you know, concern for Amazon is that AWS growth has really been slowing in a way that you know you see google google google i mean google cloud right there's not anywhere close but it's starting to at least put put up some formidable competition and there's still a shine around azure microsoft's cloud offering and so you put it all together and at amazon you know

you're you're you're still dealing with the fall out of the pandemic right because you overbuilt your infrastructure you kind of recought flat footed on uh i but you're starting to make up for that and you came into this year and it was probably like an oh my god what are we going to do scenario people talking about jeff bezos coming back and now the ship seems to be riding there as well and they're up about 40% on the year so um one thing that i have been hearing which might be related to the awes thing i don't know if you've been hearing this too but the the idea that um there are these new startups that have access to the invidia chips that are creating sort of um sort of new cloud offerings, I've been hearing from a lot of people that, like, this could

provide the opening for people to get a wedge against the traditional, because essentially running a sort of a cloud instance or a, you know, a set of racks for doing AI stuff is different. You have to design it differently than how a traditional cloud service does. And so I think maybe that's some of the concerns around AWS as I've been hearing people say, a bunch of these startups that now are getting multi-billion dollar valuations just because they have access to A100 chips. If people get like sort of acclimated to using these people to do their AI stuff, well, then it's easy to be like, well, here we'll add on this cloud thing or whatever. Anyway, the point being, this might be an opportunity for people to create alternatives to

AWS and the traditional cloud providers. Right. And don't you think it's a huge opportunity for? for NVIDIA? I mean, they are starting to license them of their computing in the same way that Amazon is. Today they were talking about also getting to the GPUs, which is different. But NVIDIA is investing in all those,

like cohere and what's the one in Jersey or whatever? Right. Or maybe that's the one in Jersey. Anyway, the point being is that, yes, all those ones that are having these multi-billion dollar valuations, you're seeing that the lead investor is NVIDIA. So, yeah, and NVIDIA. They're covering their basis.

NVIDIA has an interest in powering cloud stuff. so yeah exactly don't you love the fact that like one of the more important companies in this space is in jersey it's like such a jersey thing it's like yo you need some chips yeah no i love that company because i you know i think i did it the story a couple months ago they just had a bunch of um GPUs left over because they were uh uh experimenting with crypto and then all the sudden it's like well we're not doing crypto anymore but we still have these and everyone's like Please, please, give me, give me. There's plenty of startups right now that are plowing that field, FYI.

Right. Maybe that's what Web 3 was all along, where Web 1 was read, Web 2 was right, and Web 3 was stockpile Nvidia chips and sell them for the AI boom. Hey, I always say that the whole reason Web 2 happened was because it was all of the infrastructure left over from Web 1, like all of the blow up of, you know, global crossing and all those that left all the dark fiber in the ground. Real quick, last one that I want to do here. Apple's story this year is essentially just a global macro story that global growth slowed

and they couldn't sell as many phones and that's it or is there any other larger story to the Apple story? Yeah, there's like a few angles. So like, yes, growth slowed. The number two thing is that people, by and large, upgraded everything they needed during the pandemic. Right. So you had a two-year super, super, super cycle.

And then, like, people just don't need to replace. So, and by the way, like, this is obvious at this point, but an Apple, you know, an iPhone 12 or 13 is fine for five years, really. If you had the 10, you needed the 15, but if you have something 12, 13, you can probably, I mean, there's not a massive difference. So the compelling event to upgrade is no longer there in the same way that it was. And then, I mean, honestly, like, there is some worry from China where you've, and this is something that has been overlooked, but I think is really important. We've talked about it in the show in the past where the Chinese government said if you're in public service in China, no iPhones. And not only is that a decent sized amount of the market there, but it's also a signal to people in China that says, hey, if you have national pride, don't use the iPhone. We make great phones here.

You know, okay, we might be reading your data on them. But if you love China, use a Huawei. And now Huawei is the number one phone in China. So there's a lot of different currents writing against Apple. The comps to COVID definitely don't help. But we have like four straight quarters of revenue growth decline. And we're going to talk about their new laptops and, you know, towards the end of the show. But, but geez, you know, not only they have revenue decline, but they have serious geopolitical risk.

That's a rough spot to be in if you're Apple. Indeed. And in terms of like we said, you know, maybe everyone recognizes that they don't need a new phone as often as every two years. You had Google acknowledging that with the pixel. What is there? They're supporting out to eight years or something crazy like that now. But yeah, it's a very long time. Yeah. Yeah. Which you would imagine that some people will have to match at some point. But we'll see. Okay. That's my that's my trip around. Let me tell you, Brian. Yeah. Yeah. I mean, to me the thing, the real big. story. So first of all, like I think we know that these tech companies are, they're in good shape. And you mentioned the compound and friends. I think one of the things that Josh Brown, who is the co-host of that show, has talked about is that AI save the market in

23. I really think that's true. We're going to get into that in the next segment. But one thing that I think is super important to touch on is to me the underrated, unheralded story of the year. And listeners of a big technology podcast probably know how I feel about this, because we've talked so much about it is that self-driving cars took a huge leap, a tremendous leap. And they're finally at the point where the driving is good enough that they are, you know, able to operate functionally in large, large portions of cities, 24-7. We're going to have Waymo CEO to Kijra, Ma Wakana, next week on Big Technology podcast. And one of the things listeners are going to hear in that conversation is that,

Waymo since 2021, has gone from 50 square miles of operation within Phoenix, which is already a decent amount of size to more than 200 square miles in Phoenix, not only that operating in San Francisco, testing in L.A. And we have crews testing on the freeways. So the speed and success at which this wave is coming is truly fascinating. And, you know, while it's kind of interesting, like while we all talked about crypto, AI was quietly the biggest story in tech. And now as maybe while we're all talking about AI, the rise of self-driving is quietly the biggest story in tech. To the degree, I mean, I know that obviously there's different ways to answer this, but I agree that it's a big story in terms of a technology that we were promised, promise, promise, and it kept not coming. And I had the famous, well, we get self-driving by 2020, as everyone promised that it never came true.

But is that a big tech story in the sense that, I mean, Waymo and Cruz could become big companies, but is that going to be, that's almost ancillary to tech in the same way that Uber, in a sense, is ancillary? Like, do you see what I'm saying? Like, is this, when we tend to think of big tech in terms of like the platforms, it's like, well, Google can do X, Y, and Z, or why can't you also do a music service? why can't you also do movies and is is I know that Waymo comes out of Alphabet but is this if it's a success 10 years from now is it a story of like well yes I don't own a car anymore because I have a Waymo or a cruise subscription but that's sort of walled off from the larger tech story I think it's a great tech story and I think that like we sometimes can judge the the impact of tech in terms of the way that it rearranges our world, right? And for better or worse, I think this is

mostly a better situation. And, you know, despite the fact that everybody tags me when a cruise falls into a puddle of cement in San Francisco, which is like, not great, but come on. You know, anyway, we're going to talk about it more on Wednesday about all these, these headlines about the cruise hating a purse or someone being critically injured under a cruise. It turns out it was a human driver that slammed into them and they just landed under the cruise. But I think that this could really reorient the way and not to get too deep into this because it's going to take a while and these promises have been made and delayed. But it will reorient the way that our city's work. It will change, you know, if you don't, if nobody owns these cars and you're just hailing them,

then you don't really need space for parking. I think it will create a much better world and and will probably be, I mean, I put it up there with iPhone, chat GPT, and Waymo cars, the three most amazing experiences I've had with tech in my lifetime. You know, the other, I don't know if you've been aware of this, but simultaneously to all of a sudden six months ago, oh, wait, there are way more self-driving cars out there than I anticipated. Are you aware that like the drone delivery thing is actually becoming a reality too? And it's not necessarily Amazon, though.

Apparently they've made some more moves recently. But like the FAA has officially like given the okay for like real actual drone delivery for stuff in the U.S. And so like I feel like that's another one where it was a promise for the last decade that has never come true. But while everyone is looking elsewhere, I feel like drones are suddenly becoming closer to being a reality, sort of like self-driving cars are. That's pretty exciting. I'm pro-drone. I like the idea. I mean, as long as you're not like flying your drone and looking at,

into my window with the camera like uh i think that we really benefit from the ability for drones to deliver things i mean it's also good i'd imagine better for the environment than having a car drive around to do that i think that drone uh photography and footage is exceptional to watch i've been uh when i was at buzzfeed i flew the drones and captured uh some wild footage inside uh some of the wildfire impacted areas in california so um i didn't realize it was that close to being approved in terms of delivery, but are we that far away from seeing this stuff hit? Yeah, no, this is what I'm saying is that the two stories rhyme to me in the same way that like the promise was self-driving and that it never came, never came, and now all of a sudden

like a switch has been flipped and that has been true. I think Walmart is, whoever's doing it with Walmart, I don't have any of my notes in front of me, is the furthest along. But even this week, I saw movement from Amazon Air or whatever they call it for them doing more. more than they had been doing too. So what if we look back on 2023 as the year that self-driving and drone delivery passed a threshold and started to get real? Yeah, definitely. And it's interesting, right? Because in the middle of this AI moment, the thing that everybody looks at is that attention is all you need paper outside of Google, which is the transformer model. And that was in 2017. And, you know, I mean, it comes to a moment where there are these breakthroughs. They're quiet.

and then people build on them. And the fact that these drivers have become generalizable and are able to apply the same stuff they know, city to city, road to road is extremely underrated and I think extremely cool. So I know we're both in New York. It's going to take a while for this stuff to hit the streets in New York. Like, man, get a robot to drive on ice.

It's not as easy. I mean, humans can't do it either. But who knows? I'm now hopeful that we'll see the day. Yeah. I'm more hopeful than I'm. I was in 2020 when I declared my bet Nolen Void because I couldn't take a self-driving car into work or whatever. Soon enough.

Can we take a quick break and then come back here and talk about AI, crypto, and Apple on the other side of this? Please. All right. We're here on Big Technology Podcast with Brian McCullough of the Ride Home podcast. We're also on the Ride Home podcast. That's pretty cool. TechMeme Ride Home podcast, which is awesome and great daily update on what's going on. in the tech world and also talking about premium addition to big technology. I'll throw out

the URL one more time. It's big technology.com. If you go to the launch post, which is going to be the second, or first or second from the top, Bay Technology is going paid with deeper coverage and new features. You can get a $90 for the year subscription as opposed to our typical $15 a month or $120 for the year deal. All right. We'll be back right after this. 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 irreverent 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. And we're back here on Big Technology Podcasts with Brian McCullough. host of the tech meme ride home podcast CEO of ride home media uh brian let's talk about and actually you know now we're going through your titles you're also partner in the ride

home fund that's right which is focused all about uh wait is it the ride home fund well there's there is a ride home fund that you came there is a ride home AI fund right so there's two flavors original flavor and AI flavor so AI flavors so yeah let me just read so I You know, obviously we've been in a year of exceptional promise and lots of questions now about AI, right? I think that people have, we'll talk about crypto in the next segment, but people have a little bit of maybe PTSD from the crypto movement where a lot of people said this could change it all and it didn't change it all. And, or at least yet. And they were like, okay, well, now we're hearing the same thing about artificial intelligence. And yeah, I can chat with chat GPT, but is that really going to amount to a new web?

Let me read to you something from Tanya Dewa's newsletter on LinkedIn. And it's talking about whether AI has been overhyped. This is a quote that she puts in from Matt Turk from First Mark. You've started to see the cracks in the whole generative AI hype train in the past few months. It's a clear case of Amara's law where people have overestimated what a specific technology can do in the short term. and underestimated what it can do in the long term. Brian, where do you stand on that? That we're overest, we're underestimating what it can do in the long term.

Listen, any, any technology wave, there's, you know, the curve, you know, trough of delusion, you know, anything that gets hyped at first, the first couple years, there's a lot of things that will not work. By the way, chat GPT is not even a year old yet, right? Right? So, like, we're so, we've thought of this year as like the big AI year, but it's the equivalent of if I, if you and I were having a conversation about e-commerce on the World Wide Web at the end of 1994, right? So this before Google or Amazon or anything, like, the reason that I say that in the long term, we're underestimating it, I'm not even one of these people necessarily that believes true artificial intelligence. like self-aware computers are you know maybe might not even be here in our lifetime but the thing that I think that this represents is the true promise of computing and that's why I say that this is underestimated what I believe and the reason why I raised the fun to go after this stuff is I believe

that what the simplest way to put it is what I think is being promised right now is the computer from Star Trek the next generation, where all of computing has been about sort of abstracting away the complexity of making a computer work. There once was the command line, and you basically had to know how to code to make a computer work. Then came the GUI, and so now it's easier you click on icons or whatever, but you still have file menus and pull down menus. On Star Trek, the next generation, Picard just says, you know, computer do X, Y, or Z, computer enhanced, computer, you know, assess the makeup of that star or whatever. And you don't have to know all of the things that go behind it to get the computer to work for you. When computers first came out after

World War II, they called them electronic brains. Because again, we've always thought of robots and computing primally as humans in the same way. Well, this is a tool that will do my work for me. I think that that the fact that we have spent at least the last 50 years bringing computers into our lives but they were still difficult tools that you had to master

if we can abstract away all of the things that are complex about computing and just say computer book me the flight computer respond to Alex and tell him I can record the show at two today instead of four

like then essentially this is a different paradigm where we don't necessarily have to look at screens. I'm not saying it's all going to be voice commanded or whatever, but I think that we're underestimating the ability of the true promise of computing to be manifest within our lives, normal people's lives within less than five years. This doesn't even get into how it could transform medicine, you know, change how different professions work and things like that. I think that we're underestimating the fact that the true promise of computing as a tool that normal people use and rely on in their everyday lives to make it better is it's here. It's now.

It's a paradigm shift that I've been waiting for my whole life. And so let's talk about, I mean, he talks about how it's overestimated in the short term. Are we going to go through a year or two where people are going to be like, where's the cream filling on this stuff? Yeah, 100%. which is scary to be investing in a space like that. I'm going to ask about that, yeah. But also, at the same time,

if you gave me the choice of investing in a sort of greenfield, wide open, new, this is a new paradigm, I would take that all day long. Like there are other, you know, investing in SaaS companies for the last decade at least has almost been a spreadsheet-like thing. Like you see how much users grow

and like sort of how the revenue grows. You can plot it on a graph and see like, okay, here's the valuation of this thing. It's more interesting to me to invest in a space where it's like, think of how crazy it was that the mobile phone came around and the things that got disrupted were taxis and hotel rentals, right? Like, there's no way that you can plot for that. It's more interesting to me to invest in a space that it's Greenfield. Having said that, Chris and I started the fund,

just at the beginning of the summer. By the way, it's still open if anyone is interested in investing in the fund. You can find out at right home fund.com. Our thesis has been to go after the productization of stuff. So, like, what is the Airbnb or the Uber of this paradigm shift? I would say, by our definition, we've only made one of those types of investments. And all of the other investments right now have sort of been infrastructure plays, by which I mean, who is creating the scaffolding around what this new level of

compute is. We've kicked the tires on dozens and dozens of these products, you know, AI for architecture, AI for law or whatever, and they don't seem defensible. And so I will tell you, if I'm being quite honest, we haven't found the Airbnb of this moment yet. What we are investing in is, hey, if you're Ford or American Airlines and you want to deploy a chatbot or a large language model, you've got to be able to do it safely. Or if you're on Wall Street, you've got to make sure that your proprietary data is here. So that's what I mean by infrastructure. There's a lot of plays right now around allowing this moment to flourish. And so, again, that's kind of like investing in 1994. Like, if you invested in every website at the

time, you might not have done well. But if you invested in the underlying tech, you might have You did great. Okay, so I have a question for you about that. What do you think about, and I'm writing about this this week. So for listeners, if you're a journalist, don't take this idea. But what do you think about this emerging fight between Facebook and open AI? I mean, you have open AI, super open. No, sorry, not, no, open in the name, pretty closed in the technology. You have meta pumping out these open source algorithms. By the way, like not signing on to any. any of these, we need to stop AI progress while Open AI seems to want to shut others out of it. Yes. And then you have Open AI with this big, impressive, generalizable bot chat GPT, and you have meta in this moment with all these personal, more specific use case style bots that they're releasing. Talk me through this fight. And is it like, it's kind of like an underrated conflict point between the time, what you think?

So, Alex, if it's almost like you and I are more professional and more organized. And we had thought about, because I thought of this as a topic, but we never, we didn't coordinate on this. But I'm glad you brought it up because I have some serious thoughts on this. Here's what you got to understand. In a sense, open AI is already the incumbent, okay? Because if you think of these large language models as a new sort of, as I'm saying, computing paradigm, the key behind them is the secret sauce of what the data is trained on with the large language models are trained on. But also, the key is, is what they call, like, temperature. And basically, imagine you have to, you train a large language model,

and you're like, well, it doesn't work that well. So turn this knob three points and slide that dial 70% or whatever. It's fine tuning, okay? That's the secret sauce for making things work. And you can, it's not just for accuracy, but it's also for making it cheaper and stuff like that. Okay. So Open AI in previous models, they released what the models were trained on and how the inputs worked and how, like I'm saying, they fiddled with the knobs and the dials to get the secret sauce. They're not doing that anymore.

And so the reason is, is essentially, because they had the first big win on this, right? And so if you're a meta or someone coming from behind, Open AI or ChatGBTGPT is the fastest product to become successful of all time. 100 million users until threads. Until threads. Yeah, I can't count out threads. But who knows, maybe they're both lost users. But sorry, go ahead. So what you have to understand is that anyone else now is like, well, there's a scenario where the biggest model will always win.

Because it's the got the most data behind it, it's the best train. And so either everyone can just follow in Open AI's wake and be like, ours is just as good. It's sort of like a Google versus Bing thing. Or they have to differentiate and not just in the market, but in terms of developers. So meta does what Google always used to do, which was open source, anything that they did. And the reason that they're doing that is there's a scenario where, If you can let a thousand flowers bloom and a thousand different, Chris and I think talked about

this on your show, like the AI varietals thing. Like if you have a thousand different models and this one is trained slightly differently than that one, it gets different outputs. Like that's the sort of way that you can differentiate. Meta has obviously an incentive to do that because OpenAI got ahead of them. You could argue that Google will have similar incentives. But I was at an AI conference two weeks ago. and it was all discussion about open source.

And let me give you the negatives about open source first is people are concerned about, well, you know, you throw a large language model out there that anyone can get off of GitHub or a hugging face or whatever, and then, you know, terrorists can use it to do bad things. People can use it to create misinformation or X, Y, and Z. But the sense is that the open source stuff is we're never going to be able to innovate

and create the Airbnb of this moment if the actual models are behind this firewall of open AI and they don't tell you how it works because then all you're left with is a scenario where people can build businesses that are just thin wrappers based off of open AI APIs.

Okay? So if people are excited about this moment and they want to grab hold of the future of it, they feel like they need it to be open source so that they can own the models. Okay. And one of the things that I said to a lot of the startups that I talk to at this conference is you have to understand that not only does Meadow want this to work that way, the VC class of which, obviously, I'm a part, wants it to work this way too. Because that's, again, if you're the biggest VC firms in the world, your Sequoias or your Andreessen Horowitz's or whomever, even if they're already invested in Open AI, they need an ecosystem to grow up around the, stuff. Otherwise, again, Open AI or just the biggest model wins. And so I said to a lot of the startups that I met there is I'm glad that everybody is exploring open source for this

technology. But if you're being pushed to do it, keep in mind that the incentives by the people that are pushing you to do it are their own. Meta wants to unseat Open AI. The VC class wants to create a bunch of startups that will be the next open AI. So I think that people are excited about open source being the future of AI, but I would caution a lot of people to understand why a lot of people are shouting that right now. Well, let's, okay, so let's go then on one level deeper. Why does meta want to unseat open AI, in your opinion? I mean, everybody's going to want to in the sense that if you believe like I do that this is a new compute

paradigm in the sense of how you're going to interact with compute, that works for, what is meta do? Their social network, essentially, I mean, really their business is selling ads, but you can throw AI into that. But so meta needs to control the fact that what if five years from now social networks are really, maybe you don't talk to your friends as much as you talk to your favorite bot, that you've maybe created their personality, you've trained it on everything that you've got on your phone or your computer and so it knows you and so the bot becomes your friend or what if five years from now social networking is all of our bots interacting with each other on social media or in VR or in AR meta does not want to be in a position where the only way they

can do that with a high degree of of accuracy and efficacy is to have to ping somebody else's APIs because again they'll be in the position that they have been with like the iPhone and Android all these years is they don't own the platform that their service fundamentally sits on. That's why meta needs it. But also, one of the things that I've said on my show is that, you know, meta's looking at what Open AI is doing and is thinking, how did Open AI create these products? They trained it on the internet. They trained it on users' content.

Who has more user content than meta from their family of apps? there is a scenario where within two years meta has the best lLM because it has access to more meta will shut off open AI's ability to be trained like you're already seeing reddit shut off open AI from training on on their content like who's in a better position to be the the the throner of open AI than meta is they've they've got the PhDs they've got the science they've got the patents and they have the content that you can train this next generation of technology on. I think there's any level of envy in terms of how Zuckerberg feels about Sam Altman. Zuckerberg, to my sense of him, has envy for anybody that, I mean, Bill Gates had this too,

anybody that's successful in a field that he thinks he could be successful in, yeah, he's like, why not me? But I also think that he's in a better position. now because, you know, the phrases is that the leaders often end up with a bunch of arrows in their back. Because the two companies that are best positioned in my mind to challenge open AI are meta and Google. I mean, Google created the technology that allows the current attention-based generative AI, transformer-based AI to happen. But Facebook has been had a decade of the best AI minds under under their roof as well and then like I said they have

the content that they can they can train this stuff on so um if if someone's going to dethrone if open AI is and also ran within three years I bet it'll be meta my money would be on meta that would dethrone them and then maybe Google slash alphabet oh interesting yeah okay great so let's just do uh let's go lightning round through our next two topics crypto and Apple, Apple's new, new launch event. One of the things that you wrote to me while we were to talk and discuss about what we're going to talk is whither crypto. I mean, to me, it seems pretty obvious.

I mean, crypto is, is disgraced in many ways. Now, listen, maybe there's going to be something emerged from the rubble. I have to point out that today on October 24th, Bitcoin just surged to $35,000 a coin. No. You didn't know that? Yes, because apparently, everyone, believes that the first Bitcoin ETF is about to be announced. So yeah, for the Bitcoin hit high, the highest it's been in 18 months. Now, you can make the argument that Bitcoin is

almost a separate story than the larger crypto ecosystem. I don't know that Solana has come back to its highs of 18 months ago or whatever, or Ethereum. But so having said that, and so if we look like idiots, if you're listening to this three months from now, because crypto all a sudden is $100,000 a coin or a Bitcoin is. What we're talking about is two years ago when we were on like the Twitter spaces and the clubhouse rooms or whatever, we were all talking about crypto and NFTs and all the Web 3 goodness and stuff. And I think that you're alluding to the sense that I get as well, which is like the energy has gone out of that. There's still the same people that are in the space. I'm not saying they've evaporated.

But the overall energy... Well, some of them are in jail. That's true. Do you agree with me that you feel like that the energy or at least the chatter that was there around crypto this year sort of dimmed like it, we felt like it was starting to do at the beginning of the year? Oh, yeah. I mean, if you think about pandemic, like zero interest rate crypto versus now, like that was a fully inflated balloon. and this is a sad piece of bursted rubber. Well, let me, let me again caveat this by saying,

if you think Alex and I are just talking about price, that's not what we're talking about, because, again, two years ago, three years ago, there were new ideas. And as much as people did and still do laugh at things like NFTs or, you know, fintech around like, again, the things that blew up and people went to jail for, which is like all of these crypto,

lending things that were, you know, giving you 18% returns and turned out to be Ponzi schemes or or whatever. But there was a period of time where there was this flowering of a ton of new ideas. And I don't see like a new idea around lending or, you know, putting your mortgage on the on the blockchain and stuff like that. Like there was a time when that was every day and like I don't hear that. Now, maybe I'm not listening in the right spaces. That's because people like their houses and they don't want to lose them. Sorry. I don't know. I feel, I guess I'm just getting out of these SBF trial hearings, and I'm feeling salty. Yes.

Well, all right. I get it. And one of the things is, is that the people that used to yell at me on my show when I would do two stories or three stories of crypto in a day, and they're like, what is this the crypto right home? And I was like, listen, it was for a time the biggest story in tech. No doubt. Absolutely. And I mean, I can go entire weeks without mentioning a crypto story now. So to the degree that Alex or I are a barometer of this sort of stuff for the broader tech thing, I think that, yeah, right now it's another lull.

I mean, maybe it'll come back for all we know. I don't just count the idea that blockchain technology might end up being, I mean, it is being used in many different places and there's going to be some innovation that comes out of it. But whether it reinvents the web or reinvents the way that we do things, it seems questionable at best. Okay, last story, Apple just announced, or if you're listening on Saturday, earlier this week announced, they have a new event happening Halloween Eve called Scary Fast. And the idea is that they're going to announce new Macs. And Mac has been one of those products that have been troubled for them. I'm curious, do you, speaking of things that used to be exciting and now are seemingly not,

do you think there's going to be any buzz at all? I mean, it's interesting that they're even announcing it's like seven days before, before this event happens. Also, it's interesting. They've, we, I, you know, work with the editors at TechMeme and we were trying to look. They've never done, the events at 5 p.m. on Monday. They usually do Tuesday events. They never do events in the evening that we can, we couldn't find, at least in the history of tech meme when they had done a 5 p.m. Eastern Time at night event. And then you're saying Max, what we've been speculating in the Slack is, is scary fast means that we think that it's going to be about the M3 chip. Because if you think about it, even if they were just going to upgrade,

even if they were going to upgrade the Mac Pro line or whatever, and the rumors initially were, oh, they're going to upgrade the IMac line because the IMA line, as it exists right now, is two and a half years old, I think. They could do that just by doing a press release and like, you know, updating the store. The fact that they're doing a special event at a special time and it's called Scary Fast says to me that they are excited to tell us about the M3 and they must have something that they think is significant to tell us about how those chips perform. Now, they'll probably also announce putting them into new Macs as well. But I think that what we're going to see, and this is Claim Chowder for, you know, if you listen to this after Monday,

I think it's all about the M3. Well, I would be stoked for that. I mean, even though that the juice has come out of these events a little bit, I'm on like a five-year-old desktop at this point. And having that compared to the Apple, the MacBook Pro with the M2 chip, it just feels so slow. Like, I have a great setup with the desktop, and I just find myself wanting to work on the laptop all the time.

So I don't know, man, if this is what's coming. coming down, then I guess sign me up for these new machines. M3, here we go, baby. I'm going to quote from our resident Mac expert inside the TechMeme Slack. I won't name him, however. I don't think they'd have a weird event time like this if there were just big chassis form factor changes. It also feels weird if it's just M3 refreshes across the board. So I really don't know what to expect, but something tells me either it's something bigger

than those two things or those two things combined will be bigger than what we're all expecting. Scare me, Tim Cook. Scare me. I'm ready for it. All right, Brian, thank you so much for the time. This was great. Always great to speak with you.

Thank you, Alex. And congratulations on Big Technology Premium. Everyone, go check it out. If you want to see my immediate takes on the big news in the roundtable, you got to subscribe to Big Technology Premium. Yeah, thanks again for being a part of the panel. Again, it's big technology.com. You can get it there, 30% off, no, 25% off for our launch special. It's a great deal. I hope you go check it out. And if you're not on the free list, then try the free list and see if you want to upgrade. Again, we'll have a story about this meta-open AI fight up there on Friday. So also, one last thing to our listeners, if you don't subscribe to TechMe right home now, I recommend it. It's a great list and gets you up to date on. everything going on in the tech world every day hosted by none

other than Brian. So I highly recommend. Thank you, Alex. All right, everybody. Thanks so much for listening. Thank you, big technology listeners. Thank you TechMeme right home listeners. Thank you, LinkedIn, for having me as part of your podcast network. Thanks to everybody who's willing to go give this big technology premium a try.

And again, it's a pleasure bringing you this show. Stay tuned. Friday. Ron John Roy will be on. We're going to talk about the latest in tech, especially tech earnings this week, big week of earnings. I'm preparing to go on CNBC to talk about Amazon and others on Thursday, so we'll break that down. And then next Wednesday, an interview with Takedra Ma Wakana, the co-CEO of Waymo, more self-driving car talk,

plenty of new details, really fun conversation. I hope you stay tuned for that. And we will see you next time on Big Technology Podcast. You know what I'm going to be.