Offline with Jon Favreau - The Enshittification of the Internet (with Cory Doctorow)

Episode Date: January 17, 2026

Journalist, blogger, and science fiction writer Cory Doctorow stops by the studio to talk to Jon about “enshittification,” his theory that explains how, sometime over the last decade, everything online became substantially worse. The two discuss how tech companies lure in, trap, and then extract as much capital as possible from users; how that process played out at Facebook and Amazon; and what it would take — from a Democratic-led FTC and Congress — to reverse the trend before it’s supercharged by AI.For a closed-captioned version of this episode, click here. For a transcript of this episode, please email [e-mail] and include the name of the podcast.  Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

Offline is brought to you by Sundays. Out with the old and with the new. It's that time of year, right? Question for you. How old is that giant bag of kibble you bought for your dog that you're still serving to them? I don't ask me that. I bet you don't even. And that's a problem. The solution? Sundays. Sundays was founded by a veterinarian and mom, Dr. Tori Waxman, who got tired of seeing so-called premium dog food full of fillers and synthetics. So she designed Sundays, air-dried, real food made in a human-grade kitchen, using the same ingredients in care you'd use to cook for yourself and your family. Every bite of Sundays is clean and made from 100,000. percent meat and superfoods with no kibble. That means no weird ingredients you can't pronounce and no fillers. Compared to kibble or other brands out there, Sundays invests 50 times more in its ingredients to ensure premium quality because your dog deserves food made with care, not in the

interest of cost cutting. And the best part, you just scoop and serve. No freezer. Scoop it. Serve it. No thong. No prep. No mess. Just nutrient rich, clean food that fuels their happiest, healthiest days. So you get more of them to share together. We love Sundays. Leo loves Sundays. As soon as he hears that Sunday's food going into the bowl, poof, runs right over. Can't wait to eat it. And it's easy to store.

Make the switch to Sundays. Go right now to Sundays for Dogs.com slash offline 30 and get 30% off your first three orders. Or you can use code offline 30 at checkout. That's 30% off your first three orders at Sundays for Dogs.com slash offline 30. Sundays for Dogs.com slash offline 30 or use code offline 30 at checkout. One day, Mark Zuckerberg arises from his sarcophagus. And he says, harken unto me, brothers and sisters, for I have had a vision. I know that I told you that your future would consist of arguing with your most racist uncle,

using the primitive text interface I created my Harvard dorm room to non-consensually rate the fuckability of undergraduates. However, the real truth is that I'm going to convert you and everyone you love into a legless, sexless, low polygon, heavily surreal cartoon character so that I can imprison you in a virtual world I stole from a 25-year-old satirical cyberpunk novel that I call the Metaverse. And that's the final stage, right? the giant pile of shit. I'm John Favreau, and you just heard from today's guest, journalist, blogger, and science fiction writer, Corey Doctro.

Corey sat down with me to talk about inshittification, a term he coined to describe a process that we're all unfortunately too familiar with. The idea that everything online, sometime over the last decade, has become substantially worse. Nazis on Twitter, AI slop on Facebook, shopping on Amazon, influencer-sponsored, supplement on Instagram, et cetera, et cetera, et cetera. Corey put together a phenomenal book where he lays out his theory of inshittification.

The platforms attract users and businesses with unsustainable incentives, trap them, and then extract as much capital from them as possible, making the experience on those platforms shittier and shittier and shittier. You should absolutely check out the book. Corey lays out how this process has happened to Twitter, Facebook, Amazon, even the iPhone,

and lays out a theory of what we can do about it. We had a great conversation about all of this when he stopped by the studio this week that I think you're going to really enjoy. Here's Corey Doctor. Corey, welcome to offline. Thank you very much. A pleasure. So you've written thousands of words, a dozen plus books, countless blog posts. 30 plus books.

Do you ever think that out of all those words, all of that long-form writing, that you'd become known for a single word that you coined? I like to hope that I'm known for more than you. just a single word that I've coined. I certainly, you know, I come out of science fiction. And so, you know, my friend William Gibson coined the term cyberspace. It's got legs. You know, my friend Bruce Sterling popularized the term, cyberpunk. People still use that word a lot.

So I'm familiar with people whose legacy is semantic. But, you know, I hope that like those two worthies that people appreciate my work for more than just a word I came up with. Yeah, well, you have a lot of fans here at Cricket as well, so people are excited you're in the office. And it's not just because of insuredification. So I would love to talk about the definition and coinage of inshittification. Before I read your book, I took it to mean that all of our technology products and platforms just keep getting worse. Well, that seems directionally right. There's a lot more to it than that. So how do you define it for people who ask? Yeah, I'm completely fine with people using it generically. And the beauty of speaking a manga language like English is that. words can mean lots of things. We have words like cleave that mean the actual opposite of what they mean, both to stick together and to chop apart. It's great. I love ambiguity and language. However, I do have a very precise technical definition of machification. It's a kind of a theory in three

parts. There's an observational component about what happens to platforms. So first, they're good to their end users. They find a way to lock them in. When it's hard for them to leave, they make things worse for them in order to make things better for business customers, who they also lock in. And once those business customers are locked in, they drain the value off of them. to harvest it all for the shareholders and executives turn into a pile of shit. That's the observational part. But I think the more important parts of the theory about why this is happening now and also the remedy, what we do about it.

Maybe that's what we can talk about. For sure. Before we get to that, in the book, you lay out a series of case studies to explain the inshittification trend. But was there a single moment or a thing that sort of broke the proverbial glass and made you see this trend in a bunch of different places? So I have to say yes and no, not in the sense that there was like a product decision where I went, oh, you know, I thought Zuck really had it going on until that one day that he turned on the beacon,

and then I realized he wasn't our friend or whatever. It was actually in the realm of policy. And, you know, I'm a policy person. I've worked for the Electronic Frontier Foundation, which is the foremost digital rights nonprofit in the world. I'm going into my 25th year with them. And these policy questions, they're kind of dry and abstract and technical until they're not, right? Until everything's on fire and then it's very real, you know, until someone's like taking your 12-year-old and making deep fake nudes of them on a popular social media site, then it becomes very, very real and in the moment.

But there was this fight in the mid-2010s about whether or not the premier standards body for the web, something called the Worldwide Web Consortium, W3C. was going to cave to pressure from the movie studios and the big browser vendors and put something called digital rights management and browsers. There's a lot of stuff about that subject in the book. But the most important thing to understand is that if you use this technology called digital rights management, scrambling technology, then under U.S. federal statute, Section 12 of the Digital Millennium Copyright Act, you go to prison for five years and pay a $500,000 fine if you tamper with it,

which means that if you design a product, that has even the kind of thinnest wrapper of digital rights management around it, you can send people to prison for changing how that product works, even if that's to defend their privacy or to stop themselves from being ripped off or to retrieve their own data. And historically, the World Wide Web Consortium had been such a force for good. And in part, that was because the people who worked there really cared about the health of the web.

But it was also because their constituency was kind of a rabble. You know, sure, Microsoft and Intel, these big tech companies, but mostly through the history of the web, you had like just hundreds of small and medium-sized companies that couldn't agree on anything, much less how they wanted to fuck all of us over. And so even if some of them had plans to do something bad, other ones would counter it.

And what I saw was at this moment in the, really around 2017, was that there had been so much concentration in the tech sector that even people who wanted to be honest brokers, like the World Wide Web Consortium, could not stand up to their might, let alone regulators, let alone retailers, let alone important partners of theirs, like content creators, that really they had become too big to fail and too big to jail, but also too big to care.

And that we were no longer at the point where you could just show up and say, no, you're wrong and protect the web, that we needed to structurally change really the order of the world before we could have a better future. So I think the best way for folks to understand and shittification is you go through a bunch of case studies in book and you do Facebook, Amazon, Twitter, and the iPhone. I would love you to walk us through one or two of those case studies. Yeah, we talk about Facebook maybe?

Yeah, I was going to say. Sure, it's a good kind of err example here. So 2006 was a critical moment for Facebook. before 2006, you needed a .edu address. You need to be an American college kid to sign up. But then Mark Zuckerberg wants to open up to everyone in the world. So he makes this pitch. He says, come over to my platform.

I know you're all using MySpace, right? But I don't know if you realize this. MySpace is owned by this evil, craculence, an Australian immortal vampire billionaire named Rupert Murdoch, who spies on you with every hour that God sends. Facebook is not owned by an evil billionaire, and we will never spy on you. And that was a pretty good offer.

so we piled into Facebook, and we locked ourselves in. So with other platforms, they have to do exotic things to lock you in. Like Uber, they went to this venture capitalist called SoftBank. It's, you know, principal, this guy, Masayoshi's son, had $31 billion from the Saudi royal family. They gave it to Uber. Uber lost 41 cents on every dollar they brought in for 13 years, drove all the other cab companies out of business, drove all the other ride share companies out of business, became the dominant player, double the price of rides, have the compensation they gave to drivers.

That's a big complicated bet, right? You don't have to do that with social media. With social media, we lock ourselves in through something economists called the collective action problem, right? Which is that, like, you love your friends, but like even the six people in your group chat can't agree on where you're going to go for a beer on Friday or what board game you're going to play. So when you want to leave Facebook, and some of you are there because, like, you have a rare disease, and that's where everyone else is hanging out. Some of you are there because that's where your customers or your audiences are. And some of you are there because that's how you plan the carpool for your kids' little league. And some of you are there because you emigrated and that's where everyone from back home is hanging out.

It's really hard to convince those people to leave. Right? Because they have to convince all those other people to leave. We have to convince everyone else. So this collective action problem glues us that we take each other hostage. And so that's stage one, right? Lure people into the platform, offer them a good deal. Lock them in.

Once we're locked in, Mark Zuckerberg can start turning the screws. So he goes to different groups of business customers like advertisers. It's like, I know I told these rubs that we weren't going to spy on them, but of course, we spy on them from asshole to appetite. Give us like a small amount of money. We will target ads to them with exquisite fidelity. And we are such kind of conscientious craftspeople that will pay for a whole building full of engineers that will just police ad fraud. So when you give us a dollar to show an ad to a specific user, we'll find that user and shove that ad right in their face, right? Publishers, similar kind of thing.

You know, I know we told you that we told these rubs that we were only going to show. them the things they ask to see, actually put excerpts from your own website here. We'll like cram it non-consensually into the eyeballs of people who never asked to see it. We'll put a link back to our own website. They'll click the link and then you're going to get free traffic. It's like a gift from us to you. So everyone piles in. They become very dependent. And I think that unless you've done econ, we were telling jokes about doing econ classes before or unless you're running a small business, it's hard to grasp how dependent a supplier can be on a customer.

We all understand Monopoly, right? We played the board game on rainy days of the cottage until we wanted to kill our family and ourselves, right? But no one's ever played a board game called Monopsony. Monopsy is the kind of twin brother of Monopoly. If Monopoly is when you have powerful sellers,

monopsony is when you have powerful buyers. And, you know, if you think about it as by analogy, like imagine, you know, there's a block with like five coffee shops on it. And you go and you pick your first, favorite one every day and you go there for coffee. Now, that coffee shop has an office building next door like this one, and 20% of their gross receipts come from the people in the office building. One day, that business goes under, and those people never come back to the coffee shop.

The coffee shop loses 20% of its gross receipts overnight. The coffee shop is probably out of business. Right. In fact, happened during the pandemic. Yeah, yeah, yeah. Although, some of the, some of the coffee shops and places around this office when we weren't here for a couple of years. Exactly. Right. So, you know, this is how a business that represents only 20% of your sales can be as important as though they had 100%, right? This is how they can put you over the barrel. Whereas you, like the customer,

yeah, you're sad that your favorite coffee shop went under, but there's still four other coffee shops in the block. You'll just get your coffee somewhere else. So a 20% share as a monopsonist is basically dispositive. It gives you total control. 20% share as a monopolist is just an inconvenience for your customers. Right. So they get this monopsony over the,

advertisers or the publishers, they turn the screws on them too. And, you know, I think there's like a kind of naive version of this that stops before we get to the advertisers and publishers. It says, oh, you know, you went and used Facebook. You didn't understand if you're not paying for the product, you're the product. You, the almighty consumer from whom all decisions about market structure stems, shopped with insufficient care and created this bad world we live in. And it's just not you're not going to shop your way out of a monopoly, right? That's like saying you're going to going to recycle your way out of the wildfires. I don't care how well people in the palisades sorted their plastic waste, right? That wasn't going to stop their houses from burning down.

So these people, they're victimized by this, too. You know, advertising prices go way up. AdFidelity goes through the floor. AdFraising ad fraud explodes, right? So Procter & Gamble in 2017, they zeroed out their annual $200 million spend on programmatic average. surveillance advertising. They saw a zero dollar drop in sales. That is such a wild stat. It's like to a first approximation, no one saw the ads. It just disappeared down the fraud hole. It is too, like having in another life worked with some of these places, you realize that like the bigger, the company, like the ad budget, the stuff they spend on it, it's just a small line item. Yeah, it just disappears. No one is, no one is paying attention to her and it's just thrown away money. Former Chief Justice Brandeis, he called this the curse of bigness.

You get these dis-economies of scale. So they lost $200 million a year on these ads. They weren't the only ones. Publishers, meanwhile, they found that they had to put more and more of their content on Facebook. Just have it show up for the people who'd actually subscribe to their feeds. To get recommended, you couldn't even have a link back to your own website because maybe that's a dangerous link, a deceptive link. Eventually, it's got to be the whole substitutive content. No link back to your website.

This is what destroyed the media industry. Absolutely. We've talked about this before. This is why journalism is in the one of the big reasons that journalism is in the situation. Well, that and like being stripped mined by private equity companies and all these other things. But yeah, no. And the pivot to video, which is another example of this kind of fraud. And so they're also being drained, right? All the extractable value is now landing in the pockets of shareholders and executives at Facebook, right, at Meta. And, you know, this feels like a great place to be, but it's a very brittle equilibrium. Because the difference between, God, I hate Facebook, but I can't seem to stop logging into it. God, I hate Facebook. I'm never going back again. It's very thin.

And you get one like live stream mass shooting or, you know, a whistleblower complaint. People bolt for the exits. And the shareholders worry, maybe this is the end of the growth run for Facebook. They sell the stock. January 2020, Mark Zuckerberg announced that he had slightly fewer than expected new users in the U.S. and there was a quarter billion dollar 24-hour sell-off of Facebook stock. And guess which stock Mark Zuckerberg personally has the most of in his portfolio, right? So this is really kicking him where it hurts.

So they have to really worry about this. And when these stock sell-offs happen, they panic. And of course, being technical people, they have a euphemism for panicking, a technical term. They call it pivoting. And so, you know, one day Mark Zuckerberg arises for, as sarcophagus. And he says, hearken unto me, brothers and sisters, for I have had a vision. I know that I told you that your future would consist of arguing with your most racist

uncle using the primitive text interface I created my Harvard dorm room to non-consensually rate the fuckability of undergraduates. However, the real truth is that I'm going to convert you and everyone you love into a legless, sexless, low polygon, heavily surreal cartoon character so that I can imprison you in a virtual world I stole from a 25-year-old satirical cyberpunk novel that I call the metaverse. Right? And that's the final stage, right?

The giant pile of shit. And that's gone well. But that was like two pivots ago now. All it had to do was convince the market that there was still some growth until they could come up with cryptocurrency and Web3 and then AI and now superintelligence. So that just no one ever says, wait, wait. How does your company with a 90% market share continue to grow again? Yeah. You know?

The case study for Amazon really spoke to me because from a consumer standpoint, everyone can, I mean, everyone's like Facebook is shitty, Mark Zuckerberg. But you kind of see the changes in Amazon over time that like you search for something now and the shit you get at the top of the Amazon search results is like, well, I didn't ask for this. This isn't the brand I wanted. This isn't even, this doesn't make sense. You mentioned at one point, I think, that they fool around with like how many in a package to try to make sure that you can't even filter. You can't do like for like comparisons. Yeah. And Amazon has both the sellers and the customers. customers trapped. That's characteristic of all these companies. That's what makes them platforms,

right? They have end users and they have business customers and they mediate between them. There's nothing wrong with having a mediator between an end user and a business customer. Like, you want to have a podcast, but you don't want to have to roll your own web server. Right. Right. So it's nice to have like platforms in between that do stuff. But, you know, what happens is they get too big for their britches. They get monopsonies. They get monopolies. They squeeze everyone. In the case of Amazon, there's a lot of ways that works. one is something called most favored nation, which says that if you sell on Amazon,

you have to give your best price to Amazon's customers, and you can't sell for less anywhere else. That sounds like Amazon looking up for you and me, but almost all the affluent households in America have Amazon Prime, and almost all the consumption in America comes from the 10% of richest households. So that's what it means to live through three consecutive K-shaped recover where the rich get richer and everyone else gets poorer, is now all the consumption comes from the,

small coterie people who all have prime. If you have prime, you start and end your online searches on Amazon. So you have to sell on Amazon or you won't sell at all. So they have lots of ways of screwing these merchants. One is, as you alluded to, the search scam. So they call it an advertising program. It's not advertising. It's what if you follow radio for a long time, you know as payola, pay for play, pay for search results. So the top result on an Amazon search results page is there because they paid more than everyone else. It's not because it's the best match for your search. So that top result, now, they have to either lower quality or raise prices or both in order to win the bidding war. So that top result on average is 29% more expensive than

the best result for your search on Amazon. The top row is 25% more expensive. And to get the best deal, you go about 17 places down on the second screen to get to the best result. Now, when I wrote the book, it was $30-something billion. a year industry. Last year was a 50-something billion-dollar industry. Just paying for the top results. That's right. This year, they're on track for $80 billion. That is three times the combined gross revenue of all the newspapers in the world. And as my friend Tim Wu points out in his new book, The Age of Extraction, this is a loss for everyone. The merchants lose, the customers lose, the only people who win are Amazon. And because of that most favored nation deal,

because everyone has to raise their prices to pay the junk fees on Amazon, It was 45 to 51% of every dollar that a merchant brought in on Amazon was kept by Jeff Bezos. Now it's 50 to 60%. To make that up, they have to raise prices. But because of most favored nation, they have to raise prices at Target, at Walmart, at the factory store, and at your local convenience store. So this is an economy-wide tax that's making everything worse except for the yacht that Jeff Bezos had to tear down a special bridge for and the penis-shaped rocket. Those get better. Those get better, of course.

Offline is brought you by Delete Me. Delete Me makes it easy, quick and safe to remove your personal data online at a time when surveillance and data breaches are common enough to make everyone vulnerable. It's easier than ever to find personal information about people online. Having your address, phone number, and family members' names hanging out on the internet

can have actual consequences in the real world and makes everyone vulnerable. More and more, online partisans and nefarious actors will find this data and use it to target political rivals, civil servants, and even outspoken citizens posting their opinions online. With Delete Me, you can protect your personal privacy or the privacy of your business from doxing attacks

before sensitive information can be exploited. The New York Times Wirecutter has named Delete Me their top pick for data removal services. Someone who definitely posts a lot of his opinions online, not going to stop doing that. Where it can have more privacy is really important, and that is why Delete Me is so important to use. Have you ever been a victim of identity theft, harassment, or doxing?

haven't, you probably know someone who has. Delete Me can help. Take control of your data and keep your private life private by signing up for Delete Me. Now at a special discount for our listeners get 20% off your DeleteMe plan when you go to join DeleteMe.com slash offline and use promo code offline at checkout. The only way to get 20% off off off is to go to join deleteme.com slash offline and enter code offline. That's Join DeleteMe.com slash offline code offline. Offline is brought to by Mint Mobile. Now that the holidays are over, you might be feeling like you've got a big spending hangover, the drinks, the holiday food, the gifts. It all. adds up. Luckily, Mint Mobile is here to help you cut back on overspending on wireless this January

with 50% off unlimited premium wireless. Mint Mobile's end of year sale is still going on, but only until the end of the month. Cut out big wireless's bloated plans and unnecessary monthly charges with 50% off, three, six or 12 months of unlimited. All plans come with high speed data and unlimited talk and text delivered on the nation's largest 5G network. Use your own phone with any Mint mobile plan and bring your phone number along with all your existing contacts. As you all know by now, Crooked Media's own Nina switched to Mint Mobile last year. We had it right here in studio. She told us all about it when she was here right before the holidays.

She's saving a ton of money from her previous wireless plans and she's enjoying the reliable service and high-speed data with Mint Mobile. That's right. She sure is, John. This January, quit overspending on wireless with 50% off unlimited premium wireless. plans start at $15 a month at mintmobile.com slash offline. That's mintmobile.com slash offline. Limited time offer, upfront payments of $45 for three months, $90 for six months,

or $180 for 12 months, plan required, which is $15 a month, equivalent. Taxes and fees extra. Initial plan term only over 50 gigabytes may slow when network is busy. Capable device required, availability, speed, and coverage varies. See mintmobile.com. So one argument I'm sure you've heard is that, so you got these tech companies, and after taking on a bunch of investors, and zero interest debt for a long time.

They had to first focus on growth and getting as many people as possible to use their product, but at some point they have to figure out a way to bring in revenue and become profitable, which requires either charging people more or putting ads in front of them, both of which will make customers more unhappy. So isn't the insidification of these digital services

inevitable in some way so long as they have to figure out a way to then bring in revenue and become profitable after being in debt and getting all the customers first. So if you remember the history of Google, it's a good example to work from, so Google didn't know how they were going to make money at first. Actually, if you look at the research paper that they released when they released the first version of Google, there's a section in it that says, we're never going to do ads because ads make search engines crappy. It's great. It's called the page rank papers, a very famous research paper that that's just a footnote. It mostly describes this cool Google methodology for finding the best search results, which was, an amazing moment. And then, you know, we had the crash of 2000 and they had to figure out how to make money.

And they came up with this ad sales technique AdWords that actually did make a ton of money for them. They were in the black and doing super well, but they wanted more money. Now, of course, every firm wants more money, right? The ideal firm, if you're like just sort of constructing it as like a physicist going, you know, well, I'm going to imagine a spherical cow of uniform density on a frictionless surface for the purpose of this thought experiment, the ideal company is. is one that charges infinity for its product and pays nothing for the inputs that make that product. And admittedly, this is the academic publishing industry I've just described, but most other industries have to accept that they can neither charge infinity nor pay nothing because people won't sit still for it. So Google went from this original advertising system,

which was a content-based advertising system, where they were targeting ads based on what you were searching for, to a surveillance-based advertising system. Now, surveillance-based advertising systems did not come down off a mountain on two stone tablets, right? The reason companies are able to conduct mass surveillance and use our data without any limit to speak of is because the last time Congress updated our privacy law was in 1988 when Ronald Reagan signed a law that banned video store clerks from disclosing your VHS rentals, right?

Now, like, that's not a fact of nature, right? Like, we have payment processors on the internet. Not the best companies in the world. Right. But payment processors would make a lot more money if they just kept your money when you gave it to them. Instead of giving it to the person you were hoping to get it to. Right. They don't do that, right?

The reason they don't do that is it's felony fraud and they go to prison, right? Why does Google spy on us? The same reason your dog licks its balls because they can, right? Because we never told them they couldn't. And so they do. right? So this is not a fact of nature. It's not an iron law of economics. It's not the great forces of history that said Congress wouldn't update our privacy law after the Reagan era. It's just corporate concentration and regulatory capture, which, you know, themselves have a proximate cause.

It was the decision in the Reagan years to stop enforcing antitrust laws. Like it turns out that when you stop enforcing the laws that prevent monopolies, you get monopolies. And this shouldn't surprise anyone. And yet we have all these economists who are like, how can you blame me for this? You know, maybe like it's just the time of the monopoly, right? It's like we used to not have a rat problem because we were using rat poison and these guys were like, stop using rat poison. Now rats are eating our faces off and they're like, why is this our fault?

Like maybe it's just the time of the rat, right? Have you considered that like sunspots might have made rats more facun than in any time in history? And yeah, I'll admit the rats did buy all the rat poison factories and shut them down. But look, we're not using rat poison anymore. That's just economically rational, right? So these are not mysteries. They're not forces. They're not inevitable, right?

These are like the foreseeable and foreseen outcomes of specific policy choices made in living memory by named individuals who were warned at the time that this would happen, who created the inshittogenic policy environment where everything turns to shit. And I think we kind of let them off the hook when we say, oh, it's just capitalism. It's funny because when I first started reading the book, I was like, isn't inshittification just capital? And then I saw that that was the title of your conclusion. Yes. Yeah. And the argument is that it's not just capitalism. It's a kind of capitalism, but it's a worse kind of capitalism, materially, than the kinds of capitalism we had before.

I'm not, I'll cop to it. I'm not the world's biggest capitalism fan, right? But even I understand that the dynamic of capitalism, the means by which it is supposed to produce a kind of bounty for all of us, as opposed to just making rich people richer, it's laid out by Adam's. Smith, right? It's not through the generosity of the baker that we get our bread. It's through their self-regard. They're worried that a competitor will come and poach their customers, and so they bake the best loaf they can at the lowest price they can offer, and everyone is doing this, and this is driving down prices and driving up quality, and we all benefit from it. When we stopped enforcing competition law, we not only ended that dynamic, but we also set up the circumstances

where it was inevitable that our regulators would get captured. Regulatory capture. Regulatory capture. is not inevitable. Regulatory capture is what happens when a company is more powerful than the regulator that's supposed to be regulating it. Right. I say this to my libertarian friends all the time. You know, like even if you think the only job the government should have is making sure companies live up to their contracts, the government has to be more powerful than those companies, right? The smallest government you can have is determined by the largest corporation you're willing to tolerate. So obviously with under Lena Kahn's FTC, we probably had, you know, someone who did more or attempted to do more to enforce regulatory.

Did more, I think. Laws on the books right now. Racked up a lot of victories. Than anyone in decades. Yeah. Racked up a lot of victories. It does seem like the victories that she racked up tended to be towards like the traditional monopolies that we're used to, you know, when it was like grocery stores and

fashion and stuff like that. And that especially when it came to some of the plazons. platforms, the cases that she did there, you know, she ran into courts being like, well, that's just not the law, right? Because courts are still, like, when they see monopoly law as like, it's about prices and consumer and stuff, you know, the old. That's not quite true. So the two big platform cases were the Google cases that were the DOJ. So that was Jonathan Cantor, not Lena Conn. It's a different agency. And they won both of those cases. It's just, well, we've only had a remedy phase in one of them, but the judge basically said, yeah, you're guilty

as hell, but I'm not going to punish you in any way, which is a little different. There was the Facebook case that actually started under Trump. They picked up and refiled, and then Trump's FTC fumbled it. And then there was an Amazon case that, again, was kind of in flux when they left office. I don't know. The meta case was, you know. Yeah, the Facebook case. Yeah, right. I think that it would be very weird if after 40 years of bad jurisprudence, all you had to do is just file some good cases and you'd start winning them. Right. Right. Well, I guess the course, question I'm getting to is, does the insidification you're talking about ultimately have to get solved with Congress passing new laws? Maybe. So that's what I would have said back when Congress did

stuff. Yeah. This is my challenge. So here's what I'm, you know, I'm actually working on a new book about this right now. I work out all my anxieties on the page. I wrote nine books during lockdown. So I am working on this book now called the Post-American Internet. That starts from the observation that the reason that every country in the world has a law that makes it illegal to disinshittify American products, right, to modify an iPhone to take a third-party app store, protect your privacy while you use it, or modify a games console, or modify a tractor so that anyone can fix it. The reason these laws are on the books in every country in the world is that the U.S. trade representative over the last 25 years has said, you pass a law like this or we will hit you with

tariffs. So like, happy liberation day, right? If someone says, you've got to do it, as I say, I'm going to burn your house down. And then they burn your house down? You don't have to do what they say. Can we talk a little bit about that just to explain it to people on the digital. Because this is a law that was passed in what, 1998? 1998, October 28.

And this was originally about piracy, right? So supposedly. That was the rubric for it. Sure, that was the cause of spell eye. And this was the idea that this was like IP, right? And that you wanted to make sure that people, creative people who had their IP and businesses, like people didn't steal it, right? And then it got into, or what, you tell me, you tell me. Right.

So let me say what the law says. The law says that if you have a product or service and it has what's called an access control, so anything that stops you from modifying it without doing some special step, like entering a manufacturer's password or, you know, sort of moving something around that wasn't meant to be moved, right? If it's glued shut, digitally speaking, then opening it up is a crime no matter whether you infringe anyone's copyright. Right. So what it does is it creates a new felony punishable by a five-year prison sentence and a $500,000 fine for just opening the box that the manufacturer doesn't want you to open. So the people who proposed this, and originally it was a lot of this was about DVDs. Right. And it was about preventing unauthorized DVD duplication, but also preventing out-of-region disc playback. I remember that. Right. So they all said, look, we understand that our technical countermeasure here. isn't going to stop criminals from copying disks.

We understand that this is just a speed bump. But what it'll do is keep the honest people honest, which Ed Felton who later worked at the FTC said, that's like keeping tall people tall. What they said was like, you won't slip and accidentally copy a DVD and give it to your friend, right? So what they were really interested in, though,

was controlling uses that weren't copyright infringements. And the big one was region coding. So before the DVD, before digital television, we had two different competing standards in the world for TV. There was NTSC in America, never twice the same color. And there was PAL in Europe and most of the rest of the world. And what that meant is you could release a DVD or VHS cassette in different markets. And even if you flew to, say, India and bought a licensed official VHS cassette, not a pirate one,

but it costs $2 instead of $20. If you brought it home to America, it wouldn't play on your VCR. Right? So they like that. Now, again, like, the fact that they were making money from that and that they can't anymore once we standardize on something new, that's a them problem, not a you problem, right? Going to another country and buying a thing that the manufacturer licensed for sale and then using it when you get home, that's not a copyright infringement. Right. They just wanted to be able to do this market segmentation that was like it's not part of copyright law.

There's no market segmentation in 17 U.S. see. It's just a business model. Jay Freeman calls this whole idea of felony contempt of business model. So the other big proponents for this were companies like Sega, which had just switched to CD-based games consoles. And the thing about a CD-based games console is it's much easier to duplicate a CD than a games cartridge. And they wanted to continue to charge games manufacturers, companies that made games. They wanted to charge them giant royalties for access to the platform. And if you could just press CDs and sell them to Sega customers, then they could skip the 30% Vig that Sega was scraping out of their bottom line.

Right. And so Sega was like, okay, we're going to have a gimmicked CD that has an access control, and it won't play back on your Sega Dreamcast unless it comes from our factory. And because we have this access control, this law, Section 121 of the DMCA, makes it a felony to make a DVD that plays in a Sega player. Now, like, let's think about this for a minute. This is a copyright law. So I'm a games publisher.

I make a video game, you're my customer, you want to play the video game. In no way does it violate copyright law for me to sell you my copyrighted work to enjoy. Right. Right. It's never been about piracy. Piracy was the thing they said it was about. This was always about what you can think of as a private system of law, right? The ability to conjure new felonies out of thin air, playing a game without giving us 30% of the sell price.

Right. That's not a law Congress ever passed. It would be a very weird law for. Congress to pass, but because Congress made a law that said, changing the access control, opening the box is a felony, then anything you have to open the box to do becomes a felony. Is changing this part of the, this right to repair movement that you see? And it's like, it's interesting because you get sort of strange bedfellows there where like Democrats, some Democrats, especially rural Democrats are for it. And then Republicans randomly

in different places are forward as well. A lot of more Republicans too, because John Deere screws people with this stuff. So in 1998, chips were expensive, right? And so implementing an access control, it was still a rarity, and a computerized device was kind of a rarity. But anyone who had been paying attention could see the chips were going to get cheaper. And particularly a special kind of chip called a system on a chip or an SOC, it's like a full-fledged computer on just one little microchip. And it's got video drivers and it's got printer drivers and it's running a copy of Linux. And it's just the cheapest ones are like 25 cents. The most expensive ones are like 80. or $10. And they're tiny. And they're so tiny and so cheap that now you have manufacturers who put them on their parts to do something called parts pairing. So what's a good example here?

Medtronic, the largest medical technology company in the world. They bought all their competitors, did a reverse takeover with an Irish company so they wouldn't have to pay tax. Now they make all the world's medical equipment, including all of our ventilators. Now, every part in the ventilator has got a system on a chip on it. The ventilator's got a central computer. And when you fix a ventilator and put a new part in it, the central computer says to the chip, prove to me that you were installed by a technician by giving me the code that the technician would have entered when he initialized or she initialized the part. Oh, so all the parts have to be.

All the parts have to be theirs, and they have to be installed by them. So this is what John Deere does. John Deere, if you're a farmer and your tractor breaks, you fix it, right? You've either got the part or they send you the part. but it doesn't start working until the technician comes out, charges you $200 in types of unlock code. And during lockdown, this was really bad when it came to ventilators because every hospital needed, every ventilator could lay hands on.

Medtronic could not send technicians to the hospitals because the planes weren't flying. And so you had technicians who were like scavenging a donor screen from a dead ventilator and putting it in a working ventilator with a dead screen, but because they didn't have the unlock code, it wouldn't start working. Wow. So this is all up and down the chain. You see it anywhere there's an opportunity to extract rent. All you need to do is add a couple of bucks worth of silicon and the minimum viable access control. And the U.S. government will step into felonize competitors who unrig the system you've just rigged. So if you got rid of this, right, if Congress repealed the section of the law, how would that help with insidification? Well, let's take some foreign examples. I don't think Congress is going to change this, but I think another legislature might. So like all the best Americans, I am Canadian.

And Canada has had a bunch of very unsuccessful bids to get big tech to behave. This is a case where the referee isn't as powerful as the players. The referee makes a call. The players say, I don't think so. Right. So they had this law. I didn't think much of the law, but they had this idea that they wanted Facebook and Google to pay for links to the news. They thought that what Facebook was stealing was the news.

I think what Facebook steals is the money, right? 51 cents out of every ad dollar. Like, that's what they're actually stealing. But they wanted to charge them a tax on these links. So Facebook was like, great, we just won't carry news. There's just no news in Canada. So Facebook is where, like, a large plurality, if not the majority of Canadians, get their news. And the only news is influencer content from far-right conspiratorialists.

Right? So this is not good. It sort of explains the Canadian political environment. It sure does. Yeah, it sure does. Although there's a kind of cycle there where, you know, know, Canada, like, we are a country of genocide. Apologists, you know, founded on stolen land who've always worshipped oligarchs.

Well, certainly didn't help. Like Canada was founded by like furriers and stuff and people who couldn't get along with their neighbors in England. But its biggest surge of new Canadians came when all the people who loved the king left America after the revolution. It's a pretty Tory place, right? So, you know, we have our own problems. It's not just right-wing influencers. But imagine that it was legal to jailbreak devices. right? Well, you could just have an alternative Facebook client, maybe one that also showed you what was waiting for you on Twitter and on TikTok and Massadone, blue sky, wherever you are, that just put the news back in. Like, why is Facebook in charge of what you see when you look at Facebook? You know, when Facebook kicked off, they had this problem that everyone who would have used social media was on MySpace, as we discussed. And they solved that problem, not by saying, well, why don't you come to Facebook and admire our beautiful privacy policy and our excellent design,

smug solitude while your dumb friends finally wise up and come and join you. Instead, they gave all those MySpace users who'd come over to Facebook a bot, and you gave it your login and password for MySpace. And it would go to MySpace several times a day and grab everything waiting for you in your feed there and put it in your Facebook feed, and you could reply to it, right? You could eat your cake and have it too. So this is like if you could do this with Blue Sky, for example, and be like, well, I don't want to leave Twitter because there's a lot of stuff going on there and I still have to go. And so you could then bring it all over there.

You could do it all on device. You could have the Twitter client on your device. And if you can jailbreak your device, you don't even have to jailbreak the app. If you could jailbreak iOS, then you could look inside the packets that are being slurped down from Twitter and you could put the ones that were relevant to the user.

It's not the far right influencer crap, but whatever it matters to you in that feed. In fact, this happened. So in 2024, a couple of teenagers made an app called OG app. And what OG app did was it took your Instagram login and password, impersonated you to the service, grabbed everything that Instagram wanted to feed you, threw away all the suggestions, threw away all the ads,

threw away all the boosted content, threw away everything that the algorithm had surfaced from three months ago because it was clicky, and just showed you the things from the people that you followed in reverse chronological order. In one day, it hit the top 10 of both app stores. That night, Meta sent a take down notice to both app stores the next morning was gone forever because there was honor among thieves, right? So someone like Meta, a company like meta, say this, you could do this, they would say, well, this is our whole business. How are we going to make any money anymore at all? Sounds like a you problem. Right? Sounds like a you problem, right? Like at last night, look, they're not a charity. Right. If we say to them, if you run a business and you

rely on meta to reach your customers and meta nukes your account or nerfs your reach and you go to them, they're like, that sounds like a you problem. Yeah. Right. So sauce for the goose is sauce for the gander. The point of industrial policy cannot be that the people who did something that was successful before never have to worry about someone doing to unto them as they did unto their forebears. Right. I mean... And is the culture of disruption, isn't it? We can move fast and break kings, right? Like, it's fine to move fast and break things if they belong to Mark Zuckerberg. Right. Right. I'm totally down with that. Not like some starving taxi driver, but, you know, Mark Zuckerberg, he can afford it. Right. Yeah, he can sell off maybe some of the

bunker in Hawaii. Where you hunt humans. Yeah, exactly. Offline is brought you by OneSkin. I'm over the whole New Year, New Me thing. You remember what hole? The whole. Sorry, just catching up.

I'm over the whole New Year, New Me thing. Oh. New Year old me. Short-term fads don't deliver long-term results. Science does, especially when it comes to skin care. That's why I use not just soap and water anymore, but one skin. It's not just soap and water anymore, people. Nope.

Their formulas are powered by the OS1 peptide, a peptic. patented peptide built on longevity science proven to target aging at the cellular level. It's not about adding extra steps to your routine because before I just had one. It's about swapping in smarter ones. I really like the eye cream. I've been using that. I really like the lip balm. That's really great.

They do good work over there. Lip balm is good. You get those chap lips in the winter. I also love knowing I'm supporting the cellular repair that keeps my skin looking and feeling better as I get older. So happy to be a supporter of cellular repair. known for cult's favorite formulas like OS1 body, OS1 face, and OS1I. One Skin stands out for their science-first approach to aging validated in five separate clinical trials. That's five. That's not three. That's not four. That's five clinical trials.

Four is delivering hydration, barrier strengthening, and visible improvements to the skin with every product. All of One Skin's products are designed to layer effortlessly and even replace multiple steps in your routine, making long-term skin health simpler and smarter at any age. Every formula is certified safe for sensitive skin. Dermatologists tested free from over 1,500 irritating ingredients and awarded the National Exema Association seal of acceptance. They got the itchy. Got the itchy.

You get powerful results without irritation or harsh side effects. Born from over 10 years of longevity research, One Skin's OS1 peptide is proven to target the cells that cause the visible signs of aging, helping you unlock your healthiest skin now and as you age. And for a limited time, one skin is making. it even easier to stay consistent with up to 30% off your first three subscription orders when you use code offline at Onskin.co.co. That's up to 30% off with code offline. After you purchase, they'll ask where you heard about them. Please support our show and tell them we sent you.

Offline is brought you by Cook Unity. Cook Unity brings restaurant level flavor to your fresh start with chef designed dishes that balance nourishment, creativity, and everyday luxury. Choose your own path with new meal collections like fiber maxing, mood boosting, better for sleep, and protein forward. Cook Unity is also launching chefs table lunar feast drop, a limited two-week collaboration where chefs celebrate Lunar New Year with symbolic fortune-filled dishes and behind-the-scenes storytelling, explore how chefs are redefining wellness and infusing their creativity and cultural roots into each meal. Got a Cook Unity veteran here. Oh, yeah. Been a Cook Unity subscriber since long before they were ever a sponsor of this podcast. And I love them. You love them.

Every night I have a Cook Unity meal. Probably like five out of seven nights a week. Wow. I have a cook unit email. First of all, there's like 350-something meals to choose from every week. And they always have like a what's new section. So you've got some new ones. And you know, you got all the nutritional info there.

You get different varieties. You got different kinds of meals. It's great. And there's no cooking, shopping, or thinking about how to get the nutrition and comfort meals. You need every week. Cooking quality meals takes time. it doesn't have to be your time. There's no cleanup or meal planning.

You can choose from a rotating seasonal menu of over 300 meals, like I said, or let Cook Unity's platform provide personalized recommendations. New celebrity chefs are always joining, like restaurateur Marcus Samuelson or Michelin-Stard Rick Baylis. Commitment-free subscriptions start as low as $11 a meal. Skip deliveries, pause or cancel any time, taste comfort and craftsmanship in every bite from the award-winning chefs behind CookUnity. Go to cookunity.com slash offline or enter code offline before checkout to get 50% off your first order. That's 50% off your first order by using code offline or going to cookunity.com slash offline. What's at the top of your list for like the next FTC commissioner and the next hopefully Democratic

Congress and Democratic president if you could like wave a magic wand? Well, a lot of it is just about enforcing the laws that are in the books. The laws are pretty good. You know, one of the cases that just got dropped by Trump's FTC was an incredible case. It was the first Robinson Patman Act. that had been brought in like 40 years. Robinson Patman Act was passed back when 18, not AT&T, A&P was blowing up. And small town grocers were all going under because A&P was going to their, it's funny, there's so many companies that sound like A&P, there's AP, the Associated Press, there's AT&T. A&P went to all the suppliers and they said, you have to charge us less than you charge

everyone else, and you have to charge them more. And if they discount below what we're selling at, you have to cut off their supply. lie. So the Robertson Patman Act says you cannot offer preferential discounting. You can do quantity breaks. 10,000 costs this, 100,000 cost that, one cost this. But you cannot say 100,000 costs less for Walmart than it does for everyone else. The sidelining of the Robertson Patman Act gave us Walmart. You wouldn't have Walmart without it. And this case that was brought was about how Pepsi and Walmart had rigged the game so that Walmart would give Pepsi preferential treatment, all the end caps, the big stacks of soda and other snacks. They own everything, not just soft drinks, free to lay and whatever.

And that in exchange, Pepsi would charge everyone else more than Walmart, no matter what quantity they were buying in. And if they ever caught them discounting below Walmart's retail price, they would cut them off. They would punish them. And this is just an economy-wide tax. You know, we think of Walmart as bringing us low prices. What Walmart has done is raised prices everywhere, including at Walmart, but not as much as everyone else has raised it. Walmart's imposed one of those economy-wide taxes, just like, Amazon has. So, like, we have so many laws like this, the Clayton Act, the FTC Act, all of these laws, they're very forceful and they do a lot of good. Now, the Supreme Court narrowed the

FTC's ability to do a lot of enforcement in the last session by sidelining something called Chevron difference, you know, but I think that's a little overstated. So first of all, the Supreme Court did not say, and just to lay this out, Congress says, we're going to create an agency called the EPA and we're going to ask it to make sure that our environment isn't poison. What they don't say is we're going to create an agency called the APA, and we're going to make sure that there aren't more than eight parts per million of dioxin in your water. Because Congress doesn't have the expertise. The federal government is supposed to, the executive branch is supposed to be able to do that.

It'd be a very long-ass law, right, if you had to do all of that stuff. Now, the Supremes did not say that everything qualifies as a major question that Congress has to include. So there may be some things that they can do. But the other thing is that Chevron deference does not touch what's called a conduct remedy, which is like a penalty for a specific company. So it's about rules, not penalties. So the FTC can't say no one is allowed to do surveillance pricing, where we spy on you, we figure out how desperate you are,

and then we offer you a wage or a price based on your desperation. This is everywhere right now. In fact, Google's CEOs, Sundar Pinchai, just made an announcement saying, this is the future of AI. We're going to spy on you. We're going to figure out how much you're willing to pay. We're going to change every price you see based on. on your ability to pay.

Cool. It's like caud Marxism, right? From each to their ability to each according to their ability to pay, right? It's a very weird turn of affairs, but it's especially bad in labor markets. So nurses, if they're contract nurses, which is like the way hospitals preferentially hire them so they can do union avoidance, they sign on for their shifts using one of four national apps, all of which kind of advertises itself as Uber for nurses. Before the nurses offered a shift because we don't have any new privacy laws since 1988.

The app can look up the nurses. credit card history, and depending on how much credit card debt that nurse is carrying, they're offered a lower wage. So the FTC can't say maybe under the major questions doctrine, they can't say this is illegal. What they can say is if we catch you doing it, then we will find you so fucking much money that your grandkids are going to be sad, right? And, you know, like they say, sometimes you have to execute an admiral to encourage the others. The way that deterrence works is that the FTC goes in there and just kneecaps some company for doing this.

Just takes Delta, because Delta just announced they were going to do this, right? Goes and investigates because after Delta announced they were going to do it, everyone got angry at them, and they said, oh, we're just kidding, you misunderstood. Why are you mad at me? Right. But go and use your investigatory powers.

Just open up all of Delta's books. Read every goddamn memo. Put it in the public record, and if you catch them doing it, turn Delta into a smoking ruin so that we can clear up a bunch of roots that are currently being dominated by a big, dumb monopolist and we can have new market entry by other airlines and so that all the other

airlines are like, Jesus Christ, we better not do that again, right? That's a thing they could absolutely do. You mentioned AI. I know you could ask about this all the time. Is there a way to develop AI so that it's not in shitified? What would people do? So the big problem with AI is that it's just not real, right? No one's ever lost as much money as they have on AI. AI is the money-losingest proposition in business in the history of the world, right? And it doesn't make any money. So, you know, the companies have already done like, okay, yet. But let's talk about this. Let's talk about what we mean when we say yet. Six to 700 billion dollars in capital expenditure to date, right? Two trillion to three trillion committed in capital expenditure between now 2020.

Right. Gross revenues from the industry buy its own account globally, $60 billion. Right. $600 billion in CapEx, $60 billion gross revenues. $60 billion is incredibly inflated. Because in that, just to give you one line item, is the $10 billion that Microsoft gives to Open AI, and opening I gives back to Microsoft. Right. This is like you walk past the Starbucks, and a kid in a green apron gives you a voucher for a $7 latte.

You go and you redeem it, and they book that as $7 revenue. They're poorer than they were when you redeemed it. They're not richer than they were. They're out, all the materials needed to make the latte and the wages of the barista who mixed it. Right. So, like, this is, to call this accounting fraud is to do violence to the noble accounting fraud, right? So, so you have this giant money losing enterprise.

They're like seven companies that are like 33% of the stock market, 33% of the S&P 500. They're just passing around the same $100 billion IOU and pretending it's in everyone's bank account at once. They're insolvent for the most part. When they implode, right, the market's going to just because you can't vaporize a third of the market overnight. Well, aren't they in the, to take in certifications? theory, aren't they in the stage where they are trying to get so many people hooked on the LLMs at this point? And there'll probably be other products, I'm guessing, as well. But like for now, the LLMs, and then especially you get like businesses hooked on it. And then suddenly they're paying a lot more money and then they're turning the screws.

Sure. Yeah, yeah. No, that's the theory, right? But the values involved, the dollar prices involved are so high. Right. Right. You have to go from $20 a month to $2,000 a month. And for everyone who's noaps out of that, The $2,000 figure goes up because their fixed costs are so high. Right. So, like, I mean, the thing here, I sometimes feel like I'm on crazy pills, right? Because, like, the people who've lost the least money on GPUs are the ones who forgot that they needed electricity for them. And so they're just sitting in a warehouse. The minute you plug in the GPU, you start losing money.

The more you use the GPU, the more customers you have and the more they use your product, the more money you lose. And it's a lot of money, like a shocking amount of money. They say in finance, Stein's Law, anything that can't go on for, forever eventually stops, right? Eventually, you run out of suckers who are going to bankroll this adventure. There are useful things AI can do. If AI was a normal technology, which I think it is modular the hype, we would just call the stuff that it does a plugin, right? Like, I would be really surprised if when you're editing this, someone wasn't running Whisper, which is Open AIs, open source transcription model to help you build the EDL so that you can search for specific phrases and also

maybe do closed captioning and so on. I use it all the time. I had to find a quote for an article I was writing and I didn't remember which podcast I heard it in. It runs on my laptop whisper. It's like, it's not in the cloud. I just downloaded a copy of whisper. I threw 30 hours of podcasts at it. Yeah. And then it transcribed all of them. And then I just searched the text and I found the podcast I was thinking of. It was great. Yeah. Right. That's a plugin. Right. If you're like, what do you mean plug in like for people who don't? It's just an add on to your product. Right. Right. Like if you're sitting there at your avid suite down the road at Warners or whatever and the director comes in and says, God, I wish I'd had those 300 extras look over there instead of over here

when we were shooting that. And you say, oh, yeah, no, I got this new feature for my edit suite. I can just move their eyes, right? Well, yes, that is deep faking AI, blah, blah, blah. But it's just a plug-in. The director's going to be like, that's super cool. He's not going to be like, well, I guess we don't need editors anymore, right? Or maybe like, maybe the word guessing program's going to wake up and turn us into paper clips, right? Certainly, we should bet the future of the human race and all of our money on it. Right? Like, it's just a normal technology.

So when this stuff implodes, and it's going to implode, and I don't know when it's going to happen before you ask me, and I don't know what you should invest in, except for maybe, like, poles to dig through rubble for canned goods. But when this all, like goes away. A bunker like Mark Zuckerberg has on the island. Yeah, yeah, a luxury bunker. And bomb callers from the mercenaries who protect you from people. Right.

Because otherwise, they're just going to, they're just going to cap you and take all your stuff. But, you know, it's. When this happens, when the bubble burst, we will have some productive residue. So bubbles often leave behind productive residue. They're still not good, right? Bubbles are still a way to transfer money from normie investors to scumbag rich people, right? But when the bubble bursts, we're going to have productive residue.

Like when WorldCom, when they're bubble burst, there's still fiber in the ground. I look down the road from here, AT&T just lit up some old WorldCom fiber in my neighborhood. I got two gigabit symmetrical fiber now, right? I would still rather that some like, you know, nice retired couple didn't end up eating dog food for the rest of their life because all their money was stolen by WorldCom. But at least there's something left behind. At least we salvaged something. And we're on by contrast, nothing. Right. Right.

So when cryptocurrency goes away, all we're going to have is bad Austrian economics and worse JPEGs. Right. When AI goes away, we will have GPUs at 10 cents on the dollar. We'll have your pick of skilled applied statisticians looking for work. And you're going to have all these open source models. whisper that the AI companies, they threw them over the wall as a kind of calling card as an advertisement, they didn't put any energy at all into optimizing them, making them run more efficiently on cheaper hardware and better, because the suckers that they're roping in for the AI con,

they don't understand AI. And so their proxy for understanding the investment opportunity is they think of it as a function of the investment value. So if they want a billion dollars, it's because they're chasing $10 billion. If they want $10 billion, it's because they're chasing $100 billion. Right? If the pile of shit is big enough, there's a pony under it somewhere. Right? And so they've had no incentive to make these things run better.

So give it a couple of years. Cheapu's GPUs, lots of applies sad decisions looking for work and open source models that have barely been touched and have lots of room for improvement. Like, you go on Reddit forums, and there's these weirdos just going like, oh, yeah, I like spent 15 minutes tuning this last night. Now it runs five times better.

Right? that Chinese hedge fund had this like skunk works that they gave $20 million to to try and improve one of these open source models from meta. They produced a thing called DeepMind or Deepseek rather that worked so well that Nvidia lost a trillion dollars off its market cap in one day because people are like, oh, you don't need the giant energy sucking GPUs to run this. You can just do this with like cheap old commodity hardware. Right? So that's the inshittification resist an AI because all it'll be is like stuff that runs locally or runs like among a bunch of different companies. There's not a lot of big capital modes. And it's just a normal technology. It does some useful utility functions. Last question. Sure. You mentioned the Electronic Frontier Foundation. Yeah. You started working there back in, I think, 2002. Yeah. What's that work like today and are you as hopeful about it as you were when you started? Hope is the right word. I'm on the record is thinking optimism is for suckers.

Optimism is fatalism. It's the sunny twin brother of pessimism. The idea that things are going to get worse or better, no matter what we do, that the future is arriving on rails, you can't steer it. And I think hope is the right thing. And hope is the idea that if you materially improve your circumstances, even though you don't know how to get from here to the peak you want to be at, that if you can ascend the gradient just by one step, you can attain a new vantage point. And from there, you can see terrain that was occulted when you were down here at this lower elevation and new ways up the hill. And the fact that you can't see from here how you get to there doesn't mean there's no path. In fact, there almost always is.

It's just going to require a lot of back and forth and stepwise motion. So I have all the hope in the world. I'm not happy, but I have all the hope in the world. And when I started at EFF, I think a lot of our mission was about preserving all the good things on the Internet. and preventing people from undertaking these in shittificatory gambits, right? Like, I started at EFF just like two or three years after the Digital Millennium Copyright Act was passed. No one knew how far it would go, how far this anti-circumvention would go. And a lot of our work back then was like warning people about how bad this was,

and trying to get Congress to rein it in, and trying to get the Copyright Office who often adjudicate questions related to it to rule in a narrow and conservative way rather than the expansive way industry wanted. and so on. And so it was about preserving what we had. And we lost a lot of those fights. I mean, not all of them, but we were overmatched. We won critical ones, but we lost so many of them. And now, I think that our mission is more about like, what does a new good Internet look like? And there were lots of problems with the old good Internet. It was hard for normal people to use. A lot of my friends are normal people. I like hanging out with them on the Internet.

Yeah, right? But the part that wasn't bad about the old good internet was that users got to decide how it worked. And if someone tried to screw you, you didn't have to put up with it. Either you or someone who understood the technology better than you could take that 10-foot pile of shit that someone had parachuted into your path and make an 11-foot ladder out of code that would let you just go straight over it. That's what we've lost. And I think that's what we're trying to get back now. That's a good place to stop. Corey, Doctor, thank you so much for joining off. My pleasure. Thank you, John. quick housekeeping notes. Crooked Media's newest book, Hated by All the Right People, Tucker Carlson,

and The Unravelling of the Conservative Mind, is releasing on January 27th. It's by one of our favorite political journalists, New York Times magazine writer Jason Zengarly. In hated by all the right people, Jason gives a fascinating, informative look at Tucker's political evolution and how his rise traces the rise of the MAGA movement. Tommy's going to interview Jason on Tuesday's Pod Save America episode, so make sure to check that out. The book comes out January 27th, but you can get discount right now when you pre-order a copy of hated by all the right people. Head to Kroket.com slash books to get that discount and check out Jason's book signing tour dates. It's a fantastic book. Go check it out. Also, Pod Save America is going down under for the hopefully just visiting

tour 2026. We're headed to Auckland, New Zealand on February 11th, and then three cities in Australia after that, Melbourne on February 13th, Brisbane on February 14th, and Sydney on February 16th. Tickets are on Until right now for more details and to grab tickets, head to crooked.com slash events. As always, if you have comments, questions, or guest ideas, email us at offline atcrucid.com, and if you're as opinionated as we are, please rate and review the show on your favorite podcast platform. For ad-free episodes of offline and Podsave America, exclusive content and more, go to cricket.com slash friends to subscribe on Supercast, substack, YouTube, or Apple Podcasts. If you like watching your podcast, subscribe to the offline with John Favreau

YouTube channel. Don't forget to follow Cricket Media on Instagram, TikTok, and the other ones for original content, community events, and more. Offline is a Cricket Media production. It's written and hosted by me, John Favreau. It's produced by Emma Ilich Frank. Austin Fisher is our senior producer. Adrian Hill is our head of news and politics. Jerich Centeno is our sound editor and engineer. Audio support from Kyle Seiglin. Jordan Katz and Kenny Siegel take care of our music. Thanks to Dilan Villanueva and our digital team who film and share our episode. as videos every week. Our production staff is proudly unionized

with the Writers Guild of America East.