Big Technology Podcast - The Cage Match That Wasn’t, Trouble At Goldman Sachs, Social Algorithms Reality Check

Episode Date: August 18, 2023

Ranjan Roy from Margins is back for our weekly discussion of the latest tech news. We cover: 1) How the Zuck v. Musk cage match fell apart. 2) Whether Musk's antics are actually a problem for his business. 3) Why Walter Isaacson writes so positively about his subjects 4) Why Goldman Sachs is running into trouble 5) The issues Goldman is finding with its Apple partnership 6) Ranjan's observations from his trip to Taiwan 7) A bunch of new studies cast new light on social media algorithms 8) Cruise car stuck in the concrete 9) Why you should be able to pick your own 'flavor' of algorithm on social media. --- 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]

All that cage match buildup and nothing to show for it. Goldman Sachs is in a rut just as its partnership with Apple is taking off. And have we been overplaying the impact of social media algorithms all this time? All that and more coming up right after this. Welcome to Big Technology Podcast Friday edition, where we break down the news in our traditional cool-headed and nuanced format. We have a number of very interesting stories that we plan to go deep on this week. And we're so glad you're here with us.

Speaking of which, returning from his vacation, here with us today, is Ron John Roy. Ron John, welcome back. It is great to be back. I'm excited to talk. Let's get to the cage match soon because I have been waiting probably three weeks to talk about this. So fresh off the plane from Taiwan, he wants to talk about the cage match. We're going to talk about your reflections on Taiwan at the very end of this show. But first, let's talk about the cage match. So it turns out that this thing is now likely not going to happen at all. Elon Musk has been playing some games. Zuck basically said he's not serious and is now saying I'm going to move on. Ranjan, you said you've been wanting to speak about this for a while.

I think most people are talked out on the cage match. Why are you still eager to discuss it? I am eager to discuss it because if you remember and if listeners remember over the last few months every time we do bring it up, I definitely have to shake my head and say, I don't want to talk about it. We shouldn't be talking about it. The reason I'm now ready to talk about it is we are all getting to see another beautiful cycle of

Elon Musk. Everyone is a part of it now. Mark Zuckerberg is a part of it. Walter Isaacson, which we'll get to and his new book is a part of it. This whole idea of, and we've talked about it a lot, you know, is Elon Musk just trying to test out different messaging and then run with the ones that he knows will stick? And clearly everyone got hyped up around this cage. But I think what we're starting to see is him releasing private message, text messages with Mark Zuckerberg, Walter Isaacson sharing them, then Elon Musk tweeting about, you know, a self-driving, leading a self-driving hoard of cars to Mark Zuckerberg's front door. I mean, we are definitely, we've escalated and moved past the point of fun to discomfort,

I think, for everyone. And that's actually my favorite part to watch of this whole cycle, because this is always where it ends. This is always where it ends. Well, not always because, and this is kind of what I always think about with these Musk cycles we've gone through over the past couple of years, is that, you know, yes, like he's outlandish and has these wild ideas and doesn't fall through in a lot of things, but he's still running SpaceX and Tesla and doing a pretty good job with those companies. And maybe he has some others on the way, NeurLink. And, you know, there was this article in the New York Times about how, like, oh, it's such a big problem that Elon Musk runs Starlink because now the Ukrainians can only

rely on him. It's like if he didn't build Starlink, the Ukrainians wouldn't have this service. So what are we complaining about here? So I always wonder with these type of situations, is it, is it, is this part of this, this whole personality part of what enabled Elon to sort of press the limits and think about things that he wouldn't, that most entrepreneurs are, and governments for that matter, wouldn't otherwise? And B, like the second side of this is, is some of the things that we're seeing with him and Twitter, the same stuff that got him to where he is. or is it sort of that that inflection point of like oh god now Elon might be in trouble what do you think I think it is exactly the same type of thing that got him to where it is because this this cage match saga

to me has always essentially been capital raising arbitrage for Elon Musk it's he has been able to build yeah okay he has been able to build these businesses think about Tesla its growth trajectory it becoming at one point, you know, a trillion-dollar company, him becoming at times the world's richest man, are all like able to be done because of the narrative he has created around himself and the attention he commands. And I think that was his biggest insight, is understanding that the more attention he's able to bring to himself and the more he can kind of just command the entire state of conversation in the world, that's what allows him to raise the money that he needs or run Tesla in the way he wants to run it or build a new factory and make heads of

state want to work with him and give him all the incentives and subsidies possible. Again, every head of state fawning over bringing Tesla to their country and bragging about when it does appear. That's all because it's called the personality. And how is this cage match going to pay off for him then? Oh, I think, okay, where this all ends up, I'm not trying to predict just yet. But I think in terms of, other than there won't be a cage match. Right. I think, but he's had so many of these moments.

I think this is just, you know, his profile only continues to grow. But this is the way he's been acting ever since. Again, for me, and I've written about this many times, I was a big Elon Musk fanboy in the early days of, or call it the middle days of Tesla in the early 2010s. It was really the 420, tweet back it was at 2018 when he said he was going to take Tesla private and starting to see just how reckless a lot of the behavior was and it was and again think about that again like

tweeting that he's going to take the company private getting a slap on the hand from the SEC and then bringing more attention to self and then turning Tesla into a trillion dollar company based on just an insane stock valuations like he has been able to do all of that over and over again So the cage match, it's a bet for him, I'm sure, that maybe I'll get away with it again. Okay, but here's the question then. If this is the same behavior that's enabled him to build, which I think, what I think most people would agree are pretty impressive companies, then what's the problem? He's just doing it again.

Oh, because it's going to run out at some point. At some point, this runs out. Come on. This is five years running since the 420 tweet, and Tesla's building more cars than ever before. SpaceX has been able to, like, basically, own low earth orbit and get those Starlink satellites in? So with this, I'm just kind of talking it out with you, right? I want to understand it. But with all this attention, he's actually been able to use that for good. So it's sort of like, is this, is this really a problem? No, I think we're going

to see, again, the idea of like the narrative, SpaceX Tesla, shooting rockets to Mars and and you know electrifying the entire motor vehicle industry that shine already you're starting to see cracks i remember i was reading i think it was felix salmon had a piece recently around a lot of the new data and narratives that are coming out around was Tesla or has it been overall a net positive for electrification of the automotive industry we take that as an unadulterated truth right like everyone's like yeah, Tesla without it, nothing happens. But could hybrids have been a better way to approach this? Could smaller vehicles and making range the central part of the entire discussion has distracted at us and potentially made us build batteries that aren't the optimal way and build

transportation infrastructure that isn't the optimal one? So I think there's going to be a lot more questioning of that narrative because it's that narrative and that unquestioning acceptance of it that has allowed him to build these companies in that way. And I think, I mean, I don't want to call the turning point ever with Elon Musk because you never know. But again, the cage match, I think, is exposing that kind of behavior to more and more people in more and more ways. Well, I think we'll just have to wait and see on this one.

I mean, I think that Elon, this entire chapter has not been, let's say, impressive. But if it's going to take the same path that it's taken with Tesla and SpaceX, and he's just going to command more capital to build more companies. Actually, you know, he's figured out the system well. Oh, he has. Over the last four to five years, he figured out the system better than anyone else. I definitely agree with that. And the person who's going to, speaking to figure out the system, right, the person who's going to go and write a biography of him is, none other than Walter Isaacson, he of the Steve Jobs biography. And it has been interesting watching Walter Isaacson, who's this, like, luminary author, go out and speak about Elon during this

entire process because he's almost become, he has become Elon's de facto PR person. Elon doesn't, you know, have a lot of, or any public relations officials pretty much. I mean, there is one guy at Twitter who keeps emailing out the stuff from Linda Yakorino. So I'm thinking like, okay, maybe PR in function, if not in name. But Elon doesn't really use PR people. Sir Isaacson has effectively been functioning as that person. And he did tweet out the private messages between Musk and Zuckerberg about the fight and in a way that served Musk's interests.

There was some debate about that, right? Where people were like, well, he should not have, you know, tweeted those or shared those texts. And I'm like, come on, you're not, you're a reporter. You share the text with like the appropriate context. But just the total tone of Isaacson towards Musk has been that of, as publicist, And this book that he has, that's going to come out about Elon, which is coming out in about a month, it might put his, I mean, it might put his credibility on the line.

Yeah, I think I really am curious how his, how this plays out for Walter Isaacson's legacy as a venerated biographer. Like, I mean, the idea that, again, 30 days must feel like an eternity for Walter Isaacson right now, because what will Elon Musk do within those 30 days and what could that mean for when that book comes out and it's glowing and it's praising and it's saying that this is and again if anyone who's read the biographies of Steve Jobs or Leonardo da Vinci which are excellent they again they paint a very very clear picture of people who are changing the world for good and might be a little complex but overall as you said it's not quite fawning but it's certainly complimentary, let's say. And what Elon Musk does before that, I'm very curious to see. But then also, as you said, again, for listeners, Walter Isaacson tweeted the text messages between Elon Musk and Mark Zuckerberg where he's talking about, you know, let's have a cage match practice at your house or something or I don't know exactly which ones they were. But he has put it mixing himself in this, whether he wants to or not. So to me, I don't think there's any kind of like journalistic duty.

to tweet the text messages. I think he's doing that is, as you said, more on the publicist side. I don't know. Like, would you prefer reporters who had texts between Zuckerberg and Musk or powerful people in the tech industry, keep those close to the vest as opposed to share them to the public? I mean, I know if I got a hold of those text messages, I'm tweeting those immediately.

Wait, but that's any source, right? That's someone feeds you some bit of information. Why are they doing it? And should I share it or should I not? So it's the context around it. Yeah, it's the context. And clearly, Elon Musk is doing that to jab Mark Zuckerberg and using Walter Isaacson as his vessel to jab Mark Zuckerberg.

So I think he has to be more cognizant of that. He spent however many hours and days and months with Elon Musk, he's got to know him a little better than that. I don't know. I would definitely be sharing those messages. And maybe with the context, like, all right, this is what is going on here. But it is interesting when we talk a little bit about, like, you know, is Isaacson going to write this book that makes people, you know, that's effusive about

Musk? And it's like, well, what do people want to read in some ways, right? Like is a book that's balanced or a book that's like a total hegeography of Elon Musk going to sell better and going to be appreciated by the public more? And it almost seems as if the public would rather read a book that's almost entirely positive about a business hero. Like, you know, however much criticism we have of the media, like actually readers, they kind of want to read the book that like, ah, this person, you know, face tough circumstances and look at what all the good they did in the world. You know, it's one of the categories of books that you want to write is, you know, you want to have something that's aspirational to the reader that's going to make them part with

the 30 bucks. Yeah. I'm curious what you think about that. That's exactly. And is Walter Isaacson functioning as a journalist here or a biographer who's trying to sell books? And clearly, it'll be the latter. And yeah, I think that's, but, you know, exactly, exactly. You could be both and I think a lot of people are, but to write the bestsellers that are remembered, I mean, maybe that is the way, that is, I agree, that's what people want to read. And it's kind of interesting to be discussing this in the same week that Michael Lewis's great book called, or great, in retrospect, who knows, book called The Blindside, which is about, you know, a boy who was adopted and went on to play football and the adopted family, like, raised him. And it was this very sentimental, beautiful

story. And he went on to play for the Baltimore Ravens. And now he's come out and said, like, you know, they took him out of tough circumstances. And the family now has tried to claim undue control over his finances and awards from the story due to a conservatorship versus adoption. And it's like this Michael Lewis story, this beautiful thread that he's, he's, he's put together, starting to unravel. And it just goes to show you. It's like, it's one of those things where I like, I do wonder if Michael Lewis actually,

and many authors, just, you know, did he actually want to find the real story? Or was he content telling the story that was, you know, almost I think they call it in the business too good to check. It's very interesting. Yeah, I think it's tough because that's where kind of like, the things that border between fiction and non-fictional narrative, it's tough because like the blinds,

and I say this, I'm a huge fan of Michael Lewis and I really hope more of this does not come to light. And it was a troubling one because again, the football player Michael O'Hur, I believe. Michael O'Hour, yeah.

Or yeah, he, I mean, and it's kind of sad too. Again, he came out and has said the family tried to control his finances, but also that the movie and his portrayal while he was in the NFL actually negatively impacted him because it, you know, portrayed him to not to be, it exaggerated his like mental capacities. And of course on the football field, that'll be something that's held against you. And that it's, it's kind of like, like, it's sad that and I loved the movie, I loved the book, but remembering that it was happening while he is alive

and while he's playing. And, yeah, and it's a beautiful. a full story, but a lot of the times the story, yeah, it's, yeah, go ahead. It's too good to check. He came into the NFL and there were players that were wondering whether he could read the playbook because of the way that this movie portrayed him as this, like, you know, guy who had been just sort of, I mean, he's like, remember, like, I was an All-American before I came into the NFL, but because of this, the way that this story was told, and again, I think that there's a commercial aspect to it, you know, that's how it impacted his real life. However, the one thing I can say again, Liars Poker, having worked on a trading floor for eight years, not during that time in the 80s with Solomon Brothers, is feels and is as real as it can get about capturing an industry and an environment.

Yeah, look, we're not going to come on here and say that Michael Lewis and Walter Isaacson are, you know, amateurs. like they obviously have skill and talent but it is kind of interesting in terms of the commercialization and the way that these things are shaped you know the directions that the work go and part of that's writer part of that story but part of that is also audience which doesn't get talked about very often speaking yeah but yeah go sorry one thing on that though I think is interesting is it's also a reminder and again the positive side of whether it's social media whether it's just more people have a voice right now is in the past, it's very likely that, you know, the, that book is written and then Michael Ower's narrative never really makes it out into the world. Obviously, his was not from like a viral tweet

or anything like that, but you do feel there is more accountability in general around these kind of things versus in the past. And I think that's a good thing. Yeah, I agree. And a lot of it happens on podcasts. I mean, I was watching or on a podcast. So we're doing good for the world, Ron John is what I'm trying to say. We're doing good for the world. Speaking of doing good for the world, Goldman Sachs. No, I'm just kidding. But, you know, they're an interesting institution.

And in the run-up to this week's show, they have a very interesting partnership with Apple. They've really been trying to make ways into the consumer world. And in the run-up to this show, you dropped, like, a few links in our... We have this collaborative doc that we, like, trying to drop stories in through the week to talk about them on this show. And you had dropped, like, a couple Goldman links.

And I was like, I don't know, it's a little far afields. They do have that Apple partnership. But as I got deeper into the story, I was like, oh, yeah, this is definitely, you know, something that we need to talk about on the podcast. So not only is their partnership with Apple starting to struggle. But their CEO, David Solomon, has really come under fire inside the company. And it is kind of interesting as to, like, why the folks at Goldman don't like him. It's not necessarily performance, but it's more just like his work on their reputation.

I'm just going to tee you up here, Ranjan. What about the Goldman News and, you know, do you find interesting? And how do you think we should view its push into the consumer world, given that its program with Apple is so important, yet they've lost a lot of money there? Yeah, so, okay, so to step back, remembering why and when Goldman Sachs got into consumer banking, I think is important here because in 2016, they launched Marcus, which is named after the founder, Marcus Goldman. And this was like the first really consumer facing product. This is the idea that Goldman Sachs before only for the ultra wealthy and exclusive and only for, you know, Wall Street

firms and banking and trading, suddenly is going to try to appeal to at least some larger portion of the entire like consumer industry. It was at a time again, remember, fintech is probably like the promise of fintech mid-2010s is it's going to change everything. It's going to be like in a revolutionary business banking will change. So consumer banking will change. It's a wide open market, so they should get into it. It even from like a standpoint of recruiting engineering talent to have these kind of like really digital first offerings, it was part of it. This is when they were losing lots and lots of talent to investment, sorry, to big tech companies

and wanting to make themselves appear more, to be more technology forward. So there's so many different elements. Then you throw in the Apple card, which I'm assuming the discussions would have started around that time as well. You know, like having such a public-facing partnership, having your logo imprinted on a credit card that's going to be in the wallet of probably a good consumer profile for you, again, still tech forward, like probably good credit or reasonable credit. So that's like, and it started under Lloyd Blankvine, then David Solomon comes in and makes it really one of his kind of marquee strategic efforts. And he's like, we are going to, consumer is going to be an area of growth. And sorry, and then another area I'd forgotten is this

is also when because of post-financial crisis regulatory reasons, banking especially trading within an investment bank starts to feel like it might become a little more restrained in terms of profit potential. So where do you find growth? It's going to be in consumer and kind of digital forward consumer offerings. So all this is happening and basically like a lot I think it's interesting how it reflects the lost promise of a lot of other fintech offerings and companies and unicorns. It's similar. They, they, the same growing pains, the same inability to actually realize whatever potential was sold in the mid-2010s. Then you have, from like a pure loan book standing, they've been losing a ton of

money on the loans that they actually underwrote on the consumer side and the credit that they issued. So all of this is happening. But why this story gets even better is you have David Solomon, you know, as the face of this push that he is the one. And for those unfamiliar, David Solomon, has a DJ name, D. Soul. He flies around. He DJs, I think, at the chain smokers concert during COVID was one of the, one of the big and most controversial ones. But he has, he's created this persona for him in front of everyone, totally publicly. And it's been okay. But it's one of those that when it's working, and that's good for you, the moment any kind of hiccup comes around, imagine everyone is going to be coming for you. And that's what we started to see. There was an

insane profile in New York Magazine. I recommend everyone reads. It's like it's a long one, but it's so good. And you can see it happening that all these kind of intersecting trends are coming together right now. Again, like the lost promise of fintech. People who are executives who over the last few years might have kind of gone a little too far on the personal branding and promotions and being the cool guy side, and now it needing to be just getting back to business. So I think this is one definitely to watch. Right.

So just going over the story, so they basically needed to get into consumer stuff because profits on investment banking side might not have been what they would have been pre-regulation. And they also saw an opportunity with fintech, like thinking about maybe like a so-fi as a competition. So that's why they decided to expand into consumer. Yeah, exactly.

I think SOFi, betterment, wealth front. That's one entire area. So imagine. But why did they need that, though? That's the thing. Like they are like this prestigious investment bank. They have all the big clients. They probably could still make a ton of money.

Like even the stories talk about how like Goldman can make money when it needs to make money. No. So what is the purpose of extended? Why does a luxury fashion house ever have like a more massive? market sub-brain. Right, that's true. But it's not working out for them, though. So what do you think, what do you think has been the cause for them? I mean, they've lost a billion dollars on the Apple card alone. Yeah, no, no. Again, I think it's not working out. But if you go back to 2016, or probably 2014, when you can imagine they would have been pitching this strategically

internally, oh, this would have been the greatest pitch deck in the world for a senior executive who wants to kind of move their way up and impress people and then David, even Lloyd Blank find at the time and then David Solomon, like this, it's a dream pitch, right? It just doesn't quite work out. And then you throw in the personal side of jet setting around and DJing with the chain smokers. It's not only the DJing. He's just a jerk internally, according to this profile. I mean, there was this one line that I pulled out where he didn't like what was happening with, you know, some of his employees. And he goes, I can't wait for the. the markets to turn so I can start firing you. And it's like, yeah, I guess that's the personality

of finance in some ways, not all finance houses, but Goldman in particular seems like one where that's tolerated. And yeah, I guess there's blowback. So do you think that the things that have caused the blowback have been that like fintech is harder than they expected and then the market did turn? Yeah, I think it's exactly those two things. FinTech is harder than expected and the market turned. And I think, and actually on the subject of he's just kind of a jerk, I kind of, I kind of smiled when I was reading a lot of the kind of over the top comments made by him or things that are being attributed to him about being a bit abrasive, let's say, is because, I mean, this is investment banking. This is Wall Street. This is like, that stuff. That stuff feels,

it's been, you know, over a decade that I have not been directed. working in it but like I mean that stuff seems pretty tame or peaceful compared to a lot of things you would see to but but it's a reminder what did you see are you able to talk about it oh no I mean just being berated in front of people and yelled at or that happened to you oh yeah yeah that's easy yeah front of the whole floor people your boss screaming at you you're then those are the bad ones there's good ones too side I one of my bosses really loved them and still talk to them regularly now. But that stuff, it's pretty, it was, it was honestly very normal and in a weird way like to

talk about. And again, 20, 23 trading floor culture. I imagine it's a bit difficult, different now. But, but I think on that side, but, but again, and David Solomon is kind of like falling into the trap of being allowed to be an asshole for a bit. You're allowed to until you stop performing. Right. And then the knives come out and you can see it.

But it's not like being a nice guy would, you know, would have saved him on this one. Obviously just the numbers. But the interesting thing is, I mean, I think it's worth talking about this Apple card in particular. So I'm curious why you think they've lost so much money on it. I mean, more than a billion dollars. And then there was another like really interesting part of the story where they talk about like who their customers are now.

So they went from like the highest end type customers. and this is, you know, what's happened recently talking about what went wrong. This is straight from the New York MagS story. Rising interest rates caused defaults on Apple Cards to spike. More than a quarter of its credit card borrowers had FICO scores under 660. Most of its personal loan customers were using the money to pay down other debt. Goldman Sachs suddenly had millions of customers who not only weren't as rich as the bank's long-time clients, but we're struggling to make ends meet.

And I think that's sort of the crux of it, right? It just talks exactly about how tough it is for a long-time bank to come in and start to take on some of like the down-the-line risk that fintech companies are willing to take on to grow. Yeah, so as you said, it's actually estimated $1 to $3 billion over the life of the partnership. It's just, it's bad issuance of credit, essentially. it's like it's not it's not and i could also i could almost imagine because remember in the mid 2010s like there was that promise that you should be able to using data evaluation like understand a credit

score and a credit worthiness of an individual consumer at a far more granular level than a phico score like you know using there's even stuff i remember where it was like using social media we will be able to issue credit based on, uh, unlike who someone is and what they're talking about. And, you know, like, imagine you're like posting about your vacation somewhere and that makes you see more wealthy. So that's going to give you more credit access to credit. So, so there, there is a lot of promise around being able to issue credit more rapidly to a wider group of customers, but they did not execute well. I think that was the actual quote. I read in one of the articles where it was we did not execute well. I think they're they're paying for it now.

And now they're thinking about passing that partnership onto American Express. So quite interesting. All right. Let's take a break. Come back and talk a little bit about these new studies about social media. Ron John Roy is here with us back from Taiwan off of vacation. And now it's time for us to get back into the swing of things. So thanks everybody who's been listening here. And we'll be back after this with a discussion of those two topics. 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 two 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 Hustled Daily Show and your favorite podcast app like the one you're using right now. And we're back here on Big Technology podcast. Ronan Roy is back from vacation. We're going to talk a little bit in this section about what he saw in Taiwan. Actually, maybe we can just start with that. Ranjan, do you have any like reflections of like the Taiwanese tech culture, anything that you saw just by osmosis there? And then we can move on to these interesting studies about social media algorithms.

Yeah, the first one, I got two that like really stuck out. First one, a lot of places did not take credit cards as in Visa or Amex, Visa MasterCard or Amex. But it wasn't cash. It was all line pay. Not WeChat pay, but line for those unfamiliar, another messaging app slash super app that Elon Musk wants to create. And for me, it was pretty fascinating to watch because.

everything, even like, like roadside vendors and stuff, everyone took line pay, you know, like everyone, the call to action is connect with us online. So seeing the behavior of the super app in, you know, in person. Did it make you have more faith in Elon's plan? No. Okay. I tried. Yeah. The other one, this was one of my favorite. So in terms of delivery, they had something called Lala Move, which apparently is in the Philippines and throughout Southeast Asia, East Asia. And so we were out at dinner and with one of my wife's friends and his wife was at home. So they literally order food to go. And then you can order it's essentially a courier service, but it's very popular. So rather than having direct relationships with

the restaurant even necessarily or the restaurant isn't even on the platform, but just calls couriers. So people because, I believe, I mean, it was explained to me again, because there is an abundance of lower cost labor and people, and you can even order like on a moped, on a car, on a truck. So yeah, so the whole delivery infrastructure, it's like, and it's something that in the U.S. I never think about. I know, I mean, Uber has, has or had Uber courier like? moving stuff around outside of the confines of a food delivery app or a car service, but actually being able to just have someone move around something for you instantly.

It was something I saw over and over again that everyone was using this Lala move. Wow, that's interesting. Could that ever work in the U.S.? I think, or in Europe? I don't know. I mean, again, Uber, I know they had the courier service. Curriers, I've always still thought of more for work when someone had like some document that has to move around

or some box that has to go from one place to another immediately. But it could make sense. Again, you're the restaurant, rather than necessarily contracting to a food delivery startup, but just that same startup that brought them their, like, you know, from a vendor or supplier stuff in the morning, could also be delivering stuff to customers when it works out. Yeah, I was desperately looking for one of those services in New York recently where I had like left my car in a at a mechanic in Long Island.

It was old folks, but it died. And I was, uh, I sold it to like one of those like parts for hire people. And, um, the repair people because I didn't have any more repairs, just stopped picking up the phone. And I had to leave the title in the car before the night before the repair people came came in. So I ended up going on my own, you know, going out there on my own. taking the plates off, leaving the title in the, um, in the driver's seat. And it was like 10 p.m. It was like probably the night before I flew to San Francisco. And because they were not ready for me because they stopped answering my, answering my calls. Um, and I needed to get that done that

night. I'm, I'm in the parking lot doing the thing. And they called the cops. Like they were monitoring it like remotely. I'm like trying to get this car off my hands. And next thing, I know there's like some speaker saying, you are trespassing, the police have been called. I'm like, oh, this is my car. So, hold on. So just to confirm, you would like to pass that off to... No. Only for the first half of the story.

To a courier, yeah. But you know what I think? Because I could only get out there at night. But if I were to be able to send a courier during the day, there wouldn't have been a problem. Okay. No, no, that's fair. And actually, yeah, that exactly. Here is the title to the car.

and just, please put it in the car. Yeah. I would have paid a lot of money for that also because, like, you know, I mean, it just had to be done in the moment and it would have saved me a drive out to Long Island to do it. I guess, yeah. I mean, I guess. Instead, I had to drive out to Long Island almost got arrested for taking the plates off my own car. For trespassing.

This would have been really awful. So social media algorithms. Social media algorithms. Social media algorithms are having their moment in the sun recently. there have been four academic institutions that studied the role of social media algorithms and features of the feed. And they published their findings in late July. And they've continued to be discussed because they're actually like fairly large studies. And they're covered in places like the New York Times. I don't know. I didn't make too much about them because they came off of like,

there wasn't like universal access to Facebook. It was just like Facebook handed over the data. But some of their conclusions have been quite interesting, including that when you were to use a plain reverse chronological feed versus an algorithm, it doesn't increase polarization, among many other things. And I'm curious, like, it seemed overwhelmingly positive for Facebook and companies that use algorithms to figure, to filter news. But I was also just like, kind of caveat here, right? Because look at the source. What was your perspective on these? studies. What did you learn? Two things. One, definitely caveat here, because the studies were funded by Facebook in 2019, they'd committed $20 million to work with the NORC at the University of Chicago,

nonpartisan research organization. But they did not pay the researchers directly, but they did fund the overall research. And they also had control to exactly what access, what data the researchers had access to. So again, yeah, this is still essentially a Facebook study that ends up, at least from a PR standpoint, they leaned heavily into the idea that our algorithms do not affect polarization at all, and this proves everything. I disagree with that. And I dug into this a lot because actually one of the things I strongly believe in, I remember a couple of years ago in, like 2019 one of the earliest margins post was my five point plan to fix social media and one of them and it was number one musk has to just buy twitter is that on the that was it that was what i said from the

begin and mark zuckerberg needs to launch threads it needs to launch threads very prescient we're there nailed it fixed um so so to me the idea of a reverse chronological feed instead of an algorithm, I think is one of the most important things that needs to be available. It needs to be very potentially, like my, I had half joked, but you, the default should be reverse chronological. And if you want to opt into algorithms, you should have like a warning label, like a pack of cigarettes, is what I've said, is that the idea is like, you just have to be made aware that what is being fed to you in an algorithm is going to be biased towards the more extreme, because

that's how algorithms work. This study, and we can definitely get more into that, and I think TikTok became this kind of like logical endpoint of what a pure algorithm looks, algorithmic content looks like when there's no social graph, no anything else. So the study found that when you actually go into a reverse chronological feed, that supposedly it does not add to polarization. In fact, it shows you less political content is what the study found. The thing that was interesting to me, but it also found that it shows you less extreme content, which is obvious.

We all know the more viral something is, the more an algorithm will select and show it. It's not like, the thing for me around a lot of this is it's not rocket science. It's, of course, things that are viral or pushed by an algorithm them are going to be more extreme. So to me, Facebook clearly, and like Nick Clegg was everywhere saying this shows that we did not actually, you know, increase polarization during the election. But it took a, it took like a very small portion of time right before one month before the November 2020 election when feeds are very heavily political anyways and then still found that

a reverse chronological feed will show you less extreme content. It's just worse, though. Like, even I think about threads like, you know, I'm on the for you and there's also, they just released the following tab a few weeks ago and I never want the following stuff. Oh, it's terrible. It's terrible. And here's why that's interesting. So your plan is to just break social media.

I mean, there's got to be some algorithmic filtering. No, no. It has to be a record. So two things. I still believe, but no, and don't get me wrong. I say this not necessarily tongue in cheek. It would definitely hamper or not maybe destroy a lot of businesses, as TikTok would definitely be the most vulnerable.

And actually, in Europe, TikTok is now going to have to show, as part of the European Digital Services Act, a non-alorithmic option. So they've already announced what they're going to do is instead of, but remember, it doesn't have to just be follower-based, which is threads the problem is they're, reverse chronological feed is only followers, right? It's, or sorry, the, and call it not reverse chronological, but the non-alorithmic feed is followers.

I will say, I went on there the other day. No one I know has threaded in days. I think I, then I saw, when was your last thread? I can't recall, but not, I, I, definitely, no, come on. Are you doing it just so you can come on this podcast and tell me that, you're still threading that is the number one reason but i have a very i well i think i used to have an active community on thread no my thread it five days ago oh my god yeah i really fell off the wagon fell off the wagon on threats start threading again man no i think that it seems like that network

is going to go through a very long struggle um and may never actually get back to what it was that first that first week it feels dead right now i'm just going to say it i'm admitting it thank you Thank you. Another thing I got to admit, by the way, I'm going to get back to this algorithm thing is this week, a self-driving cruise drove directly into wet concrete in San Francisco. This is from the New York Times. On Tuesday in San Francisco, a driverless car somehow drove into a city paving project and got stuck in wet concrete.

The mishap involved the cruise vehicle. According to city officials, he said it was not clear how this car ended up in the concrete. I know I've been very effusive on self-driving cars. I'm not going to be one-sided about it, like Wilder Isaacson will be about Elon Musk. I admit it ain't perfect yet. Okay, I've just got to say that. I feel like just for, for, you know, full disclosure reasons. Yes, these cars do sometimes drive into the concrete.

But back to our story about wet concrete. Wet concrete. It was wet concrete. They said they had like recovered the car and it wasn't clear. Like what do they leave the wheels in there? They have to pay anyway to figure that out. But going back to our discussion of algorithms, I think the thing that's been most interesting about this that's really picked up speed, whether it's Facebook itself, whether it's Musk inside

Twitter or even advocates like Julia Agwin, who wrote about it this week, is that there's budding momentum for people to be able to sort of choose their own algorithm, as opposed to just go reverse Kron or algorithm. You should be able to choose a flavor of your algorithm. You could choose like heavily filtered, lightly filtered, outrage algorithm, chill algorithm, and funny algorithm and just allow that to filter your feed based off of your preferences. I think we're eventually going to get there. It seems like that is definitely like the next stage of social media is just like sort of pick your flavor and then run with it.

And I'm curious if you think that, you know, you pointed out that article to me, the Julia one, is that like the ideal and most pragmatic outcome in one? Yeah, I really think and I hope that's where we move to. Because again, when I'm saying reverse chronological should be the default, I'm not saying that should be the only option. I'm saying that the least extreme and outrageous one should be where everyone starts. And then you should be able to go where you want to. Rather than passively being fed and told what to look at, you should have to define and do a little bit of work for yourself. And the problem is that friction will obviously change the user growth and, like, engagement for any platform, right?

So obviously, and I'm not saying from a business standpoint, it's the best way to approach this, but from an actual informational health standpoint, like having to just say, this is what I want to do. So if you want to get that shit outrageous content, you should have that right. You should have to click, this is what I want. That's my threads. That's why I die. It was just too crazy for me. give me the absolute craziest stuff out there i want only lies only lies and then uh i should be able to choose that but i should have to choose that and not just be fed it because of what i've been

profiled that or what i'm clicking on love that all right ron john feels good to be back feels good to be back we got a lot to talk about next week we're going to have a whole segment on whether generative ai is a dud and speaking of which colin murdock the chief business officer of DeepMine who does not believe it's a dud is going to be on the podcast on Wednesday to talk a little bit about Google's efforts in this area. So we managed to do a whole show without any Gen AI this week. I think that's great. And we'll get back to it next week, really interrogating, you know, how far it's come and what the opportunity is and where it lacks because there have been, you know, a couple months or almost a year in now, some areas that

have definitely emerged and some concerns that have definitely emerged amid the hype. So we'll talk about that then. Ron John, welcome back. It's really fun to have you here. Generative AI. Yeah, and more. And maybe another Long Island trespassing story? Well, I'm in Seattle now, so Okay, so that's where the trespassing will take place. I'm planning to do zero crimes

for the next week or so as I make my way back to San Francisco and then eventually to New York. But no promises. So if I end up taking the plates off another car, it ain't going to be for good reasons, folks. That I promise. miss you, but I will not be doing that. I left my screwdriver back in the apartment. Thank you, Ron John. Thanks, everybody for listening. Pleasure to have you back, Ron, John.

We'll be doing this again every week with our Friday news recap show, and then tune in on Wednesdays for the flagship interview show. Again, Colin Murdoch from DeepMind, our first DeepMind interview yet is going to be on Wednesday. Don't miss it. Thanks everybody for listening. We will see you next time on Big Technology Podcasts. Thank you.