Pivot - Republicans vs. Big Tech hearing, Apple is getting into search, and California votes on the future of gig work

Episode Date: October 30, 2020

Kara and Scott talk about Republican Senators on the Commerce Committee grilling the big tech CEOs. Then they discuss Apple reportedly developing their own search tool. In listener mail, we get a question about a ballot proposition in California that would change the gig economy. Learn more about your ad choices. Visit podcastchoices.com/adchoices

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Get started at HubSpot.com slash marketers. Hi, everyone. This is Pivot from New York Magazine and the Vox Media Podcast Network. I'm Cara Swisher. And I'm hungover, Cara. Ugh, you are. Speaking of hungover, you have to watch The Queen's Gambit. That was an interesting segue.

Well, she's quite a drinker. She's a chess player and drinker. Literally the best Netflix series I've ever watched. Really? Yes. Really? Say more. It's about a chess grandmaster, mistress.

I don't know, grandmaster lady. Yeah. And it's just, she's amazing. And it's wonderful and life-affirming and funny. And every time you think something bad's going to happen, it doesn't. But it's just wonderful. It's a wonderful, wonderful, wonderful series. Oh, that's nice.

I need a new show. It'll make you feel good about life, I'll tell you. And it's all about chess. Let's not put that much pressure on a Netflix series. It's all about chess. I love The Queen's Gambit. I was so sad it was over. I was up late last night watching it.

So speaking of chess, a wonderful movie. Did you ever see, especially with You Have Boys, and I'm saving it. I have a series of films I'm saving for different points with my kids but have you ever seen Searching for Bobby Fischer? A long time ago. It's a wonderful film.

Yeah. This one I'm just telling you can you do yourself a favor with your kids? I watched it with my son. Oh it's for kids too. My boys are 10 and 13.

My kid was riveted to it. It's six or seven episodes. It's a limited series. I wish there was season two supposedly they're thinking about it. It was written by a guy named Scott Frank who did a whole bunch of great, and it was based on a book by the guy who

did The Color of Money and The Hustler, I think. The Color of Money with Tom Cruise? Well, the guy who wrote the book that it's based on. If Paul Newman got the Oscar, he should have received for The Verdict. Yes. Well, in any case, it's wonderful. That's great. Thank you. It's so unexpected. Well, in any case, it's wonderful. Like, I just, I don't often,

it's so unexpected. It goes in directions. The costume design is amazing. The set, everything about it is, and the actress, and I can't,

she has these giant eyes and I'm blanking on her name, but she's amazing. The whole thing. Every single actor in it is amazing. That's great. this is what I say.

You must watch this. So my recommendation is Tom Petty Radio on Spotify after Seven's a Cop on Coke. I say. You must watch this. So my recommendation is Tom Petty Radio on Spotify after seven Zacapa and Cokes. That's my big media recommendation. I came here. I'm isolating. I'm trying to be a good citizen.

But you know who stopped by? What? Zacapa. Hello, my friend. Oh, my God. And he wouldn't leave. He wouldn't leave. You know who needed some of that were the people that were stranded at the Trump rally.

Good God. Can you get over that? Can you get over that? Yes, it's exactly. And you know the thing? Can you get over that? You know what? Yes. It's exactly. And you know the thing is, they're going to vote for him anyway. Yeah. It's amazing. They're like gluttons for punishment. Like leaving old people. Whatever. Whatever.

Knock yourselves out, people. Let yourselves be mistreated. Let's talk tech, Cara. Let's talk tech. We're going to get to the big story because there's a lot of big stories this week. Obviously, yesterday the CEOs of Twitter, Facebook and Google got grilled by senators on the Commerce Committee in a hearing about content moderation, which quickly degenerated. Republican senators strayed from questions about the election interference and antitrust issues, particularly Senator Cruz and Senator Marsha Blackburn, who is literally the dumbest senator I've ever seen. But we'll talk about that in a second. Zuckerberg, Pichai and Dorsey endorsed appeared in video and got the hearing got heated.

The Republicans accused Dorsey and Zuckerberg of censorship. Senator Cruz said this idiotic thing to Jack Dorsey. Mr. Dorsey, who the hell elected you and put you in charge of what the media are allowed to report and what the American people are allowed to hear? And why do you persist in behaving as a Democratic super PAC, silencing views to the contrary of your political beliefs? It was just ridiculous. First of all, nobody elected him.

He's the CEO of a company of an invention he made. But beyond that, it was just, it was ridiculous. Essentially, they were arguing that if we break the rules, why do we have to suffer for breaking the rules when other people don't break the rules? It was just, it went on and on and on. It was such a shameful display when you really do have to quiz these companies about their power, which is critically important. And something I did talk about with Lena Kahn today on Sway, who's an intelligent person. So what do you think?

What do you think of this, Scott? Well, a couple of things. Probably the most important thing to come out, especially because of the Zoom portion of the hearing where you had Senator Cruz and Jack Dorsey. Beards have officially jumped the shark. When you see Senator Cruz and Jack Dorsey with their beards, you're like, okay, whatever that was is over. And all the credibility that our elected representatives gained with the hearing overseen by Representative Cicilline, they lost yesterday. It was, the way I would describe it historically, or the metaphor is Carter's failed kind of October surprise,

the tragic and failed attempt to rescue the hostages in Iran. This was an attempt by somebody to have an October surprise. Yeah. You know, it's just ridiculous, right? I mean, literally, what, seven days, seven days before the election, they decide they're getting serious about this or pretending to be. And to your point, I mean, it's just, and Senator Cruz, I think he is a bright guy. So who the hell do you think you are putting you in charge, who puts you in charge of the media? Well, first off, Senator Cruz, they are media.

Yeah. They are media. Yeah. Which means that they inherently, there's no way of getting around it. They are going to have a bias. And it also didn't have anything to do with the media. It had to do with Donald Trump broke the rules. At one point, Senator Blackburn, who is literally,

so like really not all there, I have to say, she was going on about how Trump was censored 62 times and Biden not once. I was like, he broke the rules 62 times, which should be the issue here. Yeah, well, first off, they don't seem to understand the whole point. These firms are media companies, which means they're inherently going to have a bias. Even algorithms have a bias based on who programs them initially. But in addition, if there is a bias, okay, so first off, you're right, there's a bias based on who programs them initially. But in addition, if there is a bias, okay, so first off, you're right, there's a bias. We're a media company, the same way the folks that interview you at Fox have a bias versus the people at MSNBC have a bias. So the notion that Republicans have a beef

is just not only ridiculous, but it's ridiculous that the Democrats aren't able to swat it away like a fly. Again, there's Sheldon Adelson, number three. There's the Koch brothers, number two. And then tied for one is Jack Dorsey and Mark Zuckerberg in terms of non-economic contribution to the GOP. The premise that these aren't media firms is dumb. The notion that somehow Republicans have been hurt by these algorithms or these media companies or these platforms is dumber. So we have dumb and dumber here. And we have a House or, excuse me, a Senate panel that eroded some of the credibility they were starting to gather back from the House subcommittee hearing on antitrust. This was, two words here, shit and show. This was just stupid

and made our government look sophomoric and as if they lacked all domain expertise. Anyways. I could not agree with you more. Actually, Senator Brian Schatz refused to ask questions because it was such a sham. It was a sham. And this is the time when you have to be asking really important questions of these guys. And they got away scot-free because it was so ridiculous. It did not put a glove on them. The other part that I think I was indignant about, and I don't love defending tech companies, trust me, is mispronouncing the name of Sindhu Pichai, calling him pecan. Now, the last hearing, if you remember, what was it, over immigration, the only person they asked about immigration was a person of color.

Like, calling him pecan, like, not being, it's like the kamalalala, kamalalala, whatever. They're idiots. They are just literally dotards to do this. These are serious issues. We've got to ask serious questions. And this is just to score points. And again, Ted Cruz was appalling because he knows better.

And the other day he was on John Swan's show on Axios, where he did the same thing, which is like, I'm against deficits, except for President Trump's deficits, and I'll be against deficits again. Just literally tossing away any kind of credibility they have, and that you only get one shot at these companies, that you get one shot at them. 100%. I grew up in LA, and we used to go to Disneyland every six months or every year. And it was a big deal. It was a lot of fun when you were a kid. And you got these ridiculous books that had A, B, C, D, and E tickets. And the E tickets were for all the great rides. And you only had a certain amount. So you had to go through this. You start learning about economics and scarcity and decisions and opportunity costs. and you really plan it out. And you occasionally, someone in your group would make the rookie move of using an e-ticket to go on a small world, and you would be so irate. How could you commit the crime of trade-off economics and opportunity costs by using an e-ticket to go on a small world? This was them wasting an e-ticket on a small

world. They can only call the heads of the three of the most powerful firms in the world so many times. And they absolutely wasted it. Your term was the exact one. Not a single senator landed a single glove on any of them. And what's interesting, there's another hearing, I think, for mid-November when, if the Republicans lose the Senate, they'll be yammering away with no reason to do this. And maybe then they will ask actual questions about how these systems are in place. These systems are so porous and so badly built, they need to be discussed by a cogent group of people. And I hate to sound like Biden in a bipartisan panel of people with experts and also, and citizens and everyone else. And this is just, just literally,

I don't know what is the madness of this, of this group of people is hard to understand on every level. We joke about the people at the rally, but it's mad. It's madness. And, and again, these are, we're all concerned about the tech companies being, having guardrails on them, being brought to bear for the impact they've had to really address the serious issues around things like content moderation or privacy or power or concentration of power. And this ain't it.

And I don't know who they're playing to. And of course, it went right on Fox News. I have an idea to solve this all. I have an idea. What? Governor Newsom appoints the jungle cat to the vacant Senate seat. You bring the intellect and courage of Senator Harris, and you bring the height of Senator Boxer.

Boom. Boom and boom. Wouldn't I say if they asked me? Yes. I would totally say yes. We love this. You love real funny, powerful person. You love that.

No, but seriously, would you say yes if someone asked you that? Yes, right? Totally. Right? Completely. If someone said, I want you to be the person. You love that. No, but seriously, would you say yes if someone asked you that? Yes, right? Totally, right? Completely. If someone said, I want you to be the senator from California? Yeah. I pretend to be thoughtful about it, thinking, how can I quickly as possible say yes? Oh, my God.

I totally say yes. I'm a total narcissist. They're going to ask like Katie Porter, who I'm good with. Katie Porter will be fantastic. Oh, she'd be fantastic. Do you really think Representative Porter is going to get the nod? Yeah, she's in the top list of the people. That would be a fantastic move for the country and California.

She's great. She'll bring out a whiteboard, et cetera. I just bought a whiteboard, by the way. I'm very excited. I was inspired by her and Sheldon Whitehouse. I bought a whiteboard. I don't know what I'm going to do with it. We need you rolling around with a whiteboard.

And you'll be like, turn around and it'll be like, L-I-S-T-E-N to me. You'll be riding it over and over. Listen to me. Listen to me. Oh, come on. Listen to me. Let me listen to me, everybody. Senator Ted Cruz is a dotard. And this was a waste of his intellect. They kept calling him cruise missile, like Sean Hannity, another dotard. Just literally called him cruise missile, which was ridiculous. Whatever, cruise. Let's think of an insult with cruise, but it's not a cruise missile. It's a defective cruise missile, if that's the case. Terry Crews. I love Terry Crews.

Yeah, Terry Crews is great. Okay, listen. We'll see what happens with the investigation and stuff like that. But we really do need better people asking better questions. And anyway. We do need better people running the country. We do need better people overseeing questions. And anyway. We do need better people running the country. We do need better people overseeing the most impressive deliberative body. You know something? We have an election on the 2nd.

I voted, by the way. Did you vote? Yeah, I did. My most popular and controversial tweet ever in terms of, you know, I'm desperate for other people's affirmation. Sure. My most liked tweet ever yesterday, I had a picture of my ballot that I dropped off yesterday. Don't put a picture of your ballot. Why? No, I didn't.

No, no, not who I voted for. Just the mail-in ballot, which I dropped off. By the way, when I went to vote, two people said, I love you and Scott at the polling place. Oh, my God. They said, I love you. And then what did they say? Then Scott. And Scott.

But then they love Sway, too. It was like they couldn't believe it. And then someone who was running for office who was outside, you know, the area you're allowed to be, tweeted about, oh, my God, I just handed a brochure to Kara Swisher, who I love on, you know. My creative director, Catherine Dillon, who's kind of the secret sauce in any amount of success I've registered, was talking about yesterday. And Catherine never gets emotional. She was talking about voting at the West Harlem polling station. And she said somehow they know when there's a first-time voter. And they would announce a first-time voter or something, and the whole place would erupt in applause.

The poll workers were great. And there were a bunch of kids in Halloween costumes going up and down the line handing out candy. Yeah. It was really nice. I have to say the poll workers, especially in the middle of a coronavirus, they had great things in place here in D.C. They did it really well. It was beautifully done. I have nothing but positivity to say about the way they handled it.

And anyway, let's go to a quick break. When we come back, we're going to talk about Apple developing its own search. God, you were right again. And a listener mail question. When you picture an online scammer, what do you see? For the longest time, we have these images of somebody sitting crouched over their computer with a hoodie on, just kind of typing away in the middle of the night. And honestly, that's not what it is anymore. That's Ian Mitchell, a banker turned fraud fighter. These days, online scams look more like crime syndicates than individual con artists. And they're making bank. Last year, scammers made off with more than $10 billion. It's mind-blowing to see the kind of infrastructure

that's been built to facilitate scamming at scale. There are hundreds, if not thousands, of scam centers all around the world. These are very savvy business people. These are organized criminal rings. And so once we understand the magnitude of this problem, we can protect people better. One challenge that fraud fighters like Ian face is that scam victims sometimes feel too ashamed to discuss what happened to them. But Ian says one of our best defenses is simple. We need to talk to each other. We need to have those awkward conversations around what do you do if you have text messages you don't recognize?

What do you do if you start getting asked to send information that's more sensitive? Even my own father fell victim to a, thank goodness, a smaller dollar scam, but he fell victim and we have these conversations all the time. So we are all at risk and we all need to work together to protect each other. Learn more about how to protect yourself at vox.com slash Zelle. And when using digital payment platforms, remember to only send money to people you know and trust. Support for this podcast comes from Anthropic. You already know that AI is transforming the world around us,

but lost in all the enthusiasm and excitement is a really important question. How can AI actually work for you? And where should you even start? Claude from Anthropic may be the answer. Claude is a next-generation AI assistant, built to help you work more efficiently without sacrificing safety or reliability. Anthropic's latest model, Cloud 3.5 Sonnet, can help you organize thoughts, solve tricky problems, analyze data, and more. Whether you're brainstorming alone or working on a team with thousands of people, all at a price that works for just about any use case.

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Actually, they've zeroed in on that deal where Google is the default search engine on iPhones, which means they have both systems, Android and Apple. People don't know it. Google is the search engine you come with. You can actually pick some others, but it's hard to figure out. Google has been the default search engine for over a decade. The DOJ claims that Google has paid Apple up to $12 billion a year for the arrangement, a lot of money, a deal that's central to its antitrust case. So Apple might need a new search tool and forego

this $12 billion a year. This is a deal done a long time ago by Eric Schmidt and I think Steve Jobs. And what do we think? Tell them, how big a deal is this? Talk about this, the opportunity and giving up $12 billion. Well, let's just dwell on the fact that we called this before everyone else was calling it. You did. You called it. It seems obvious now, but it wasn't obvious back then. And there's a lot. First off, there's two separate issues here. The antitrust action against Google because of their bundling, that's a totally separate issue. This was going to happen distinct of that. And that is Apple, I mean, there's a lot here. First off, search, if you think of it as a technology, over time, as technology is mature, it is very hard to maintain the kind of

differentiation in IP that you had in the early years. And so, I don't want to say search has been commoditized, but for the first time, it's reasonable to think that Apple could hire the head of search, which they did two and a half years ago under the auspices that he was going to work on AI. Yeah, right. And they've been recruiting Yeah. But here's where I think it's going and why I think it's important. If you think about the best brand move of the last 20 years was Apple's decision to go into stores,

recognizing that the contact, the touch with the consumer base is an important part of the brand evolution of the brand clock. And in computer tech and hardware, the distribution was abysmal. And they could transfer money out of pre-purchase broadcast advertising, which was dying, lease 500 stores, spend $7 billion and create these temples and absolutely

just rejuvenate the brand with this unbelievable church-like experience. The second best brand move of the last 20 years was Tim Cook and the strategist at Apple saying, the thing we are going to emphasize about Apple is not our design, it's not our humanity, it's not connecting people, it's not the expressive self-benefit, it's not the creativity, it's privacy. And the whole team probably said, what? And he said, yeah, because if we, the thing about positioning or where you lead, the thing you dimension you decide to highlight, you're immediately highlighting that dimension across your competitors and you're depositioning them because privacy is the open weeping wound at Facebook and Google. And this is where they're headed, I believe. I believe that Apple's headed to a recurring revenue bundle. And part of that bundle will be part of iOS, which iOS 14 has already had some search features.

It'll be a search engine. The search engine will be only 80% as good as Google, and it couldn't have been 80% as good. A year ago, it would have been 60% as good. Two years ago, it would have been 40% as good, but now I think they can get to 80%. All right, there's a few questions I have, but go ahead. And they will not have advertising, and they will highlight, they will highlight that this is the node of privacy violation, and we are taking that node out. And even if they get $10 billion a year from Google on their billion users, that means they lose $10 per user. But if they can create a bundle, and one of the key attributes is privacy, they'll get more than $10 per user.

So, two things. How do they, one, replace the $12 billion? Don't yet, yet. And secondly, transferring power from one giant company to another giant company, they could be like controlling search on their phone. They could get into a lot of trouble. Same thing with the App Store. The third thing is they did try to compete in Maps

and have not done very well. So Google has sort of cleaned their clock in the Map area. So talk about those things. How do they replace the $12 billion? Do they have to? Secondly, can they keep up the quality? Can they avoid a Google and Apple Maps experience? And then again, they're big. Like, I guess it's transferring from a less big company to just the same situation? Well, there's several issues there. So the first is, the question that most CEOs ask, and they should be, the question they ask is, how do I replace that revenue? And the question they should ask, or the better CEOs ask, is,

how do I replace that stakeholder value? Apple hasn't increased its top-line revenues in 18 months, and it's doubled its shareholder price. Yes. And the reason why is because the world likes them moving to a recurring revenue bundle. So Tim Cook and whoever is running strategy at Apple, who I'm convinced is like the deepest thinker in technology right now, or the most cogent thinker, has said, all right, we're going to take Apple One, our recurring revenue, bundled. It's now 24% of our revenue. We're going to bundle in AirPods and the iPhone, which is what everyone wants for 50, 75, 100 bucks a month, you get all of these kind of leftover B-League apps, but you also get the best phone in the world, the best AirPods in the world, an iPad in the world, 30, 60 days before anybody else, plus all this stuff

preloaded on it and a search engine that doesn't molest your privacy. And we're going to take ads off and we don't pull as many points from it. And if they can do that, if they can move to 50 or 100 bucks a month, they have a billion, the billion users of Apple are the wealthiest people in the world, the most influential people in the world. Yeah, I'd pay for it. You're right. They still haven't had a bundle I'd pay for. Their recent bundle, I'm like, eh. You know what I mean? It's sort of eh. It's not enough. Yeah, it's not. No, no, no. Their bundle is the B team right now. You know what I mean? It's sort of eh.

It's not enough. No, no, no. Their bundle is the B team right now. I mean, Amazon bundle I pay for. It's worth it. I watch stuff on it. That's the best bundle in the world. And I get delivery. The second best bundle in the world is Microsoft.

Yeah. Yeah. 100%. But they will replace. They will replace in more. And they have the credibility and the cash flow. I mean, they have $80 billion in cash. They can give up that $10 billion like, you know, water off a duck or whatever it is.

They'd like to stick it to Google. I'm sure they would. But if they have the opportunity to come up with the ultimate bundle that includes the ultimate core product, and that is the iPhone, and further cements their dimension that's growing in relevance to consumers, and that is privacy because their search engine doesn't use it as a means of harvesting your organs and then reselling it on the black market. And you wake up on a beach in Brazil with a bunch of stitches in your back. You're like, what the fuck happened? What's that happen to you? I had nine caparinhas and then I woke up on the beach with a bad stitching around my kidney. What will Sundar Pekan do?

What would that Mr. Pekan do? Or is it Pekan? Pekan do. Is it Pekan or Pekan? I can name people's names wrong all the time. What does the CEO. Pecan do? Or is it Pecan? Pecan do. Is it Pecan or Pecan? I get people's names wrong all the time. What does the CEO of Alphabet do? It's Pichai. I don't know.

That's an interesting question. What may end up helping them in a weird way, and this is the last part of your question, is that if they say, look, we have competitors everywhere, look at what's happening at Apple. Apple is now squarely competing against us. So I think it'll end up being a point of defense for the law firm. everywhere. Look at what's happening at Apple. Apple is now squarely competing against us. So I think it'll end up being a point of defense for the law firm defending Google and the antitrust case. So if this happens, when it happens, I want timing now. I want you to even drill down more on your predictive elements. And is this a way for Apple to sort of, it's not really throwing Google under the bus, it's pulling it out from under the bus if there is a competitive pressure, even if it's a giant company. It's not like suddenly DuckDuckGo wins here. Well, one of the keys to building a trillion-dollar company is going vertical.

So the fact that Apple was outsourcing search just didn't make any sense. Yeah, but it's been a long time. Google's going to be fine. They'll save the $12 billion. They won't have as much dominance. They'll have another talking point to defend against antitrust. But, you know, you asked where do they go. It's where they're all going or where Google and Microsoft at least are going.

And to a lesser extent, Amazon that still has core businesses that are thriving. Cloud. Did you see Microsoft's numbers yesterday? Yeah, I was going to bring that up. Azure was up 48% year on year. And Teams, everything. Well, I'm not surprised about Teams because of the pandemic, but because of businesses moving this.

This idea of like offering trusted people that you would buy more things from. So what else would you buy from Apple? What could they put in that rundle? Because, again, I didn't buy Apple one because I was like, I got Apple TV and that's all I want. This strategy is easy. The key to any recurring revenue bundle

is that it's A, first off, an IQ test because it's such incredible value. But B, what it does is it supplants the core offering. So Amazon Prime, the gangster offering was 48-hour free delivery, which gave me permission to just order shit without friction or going, all right, what do I have to pay? What do I have to pay on?

Easy returns, too. Easy returns, easy shipping. And then they started layering stuff in. Apple's come at it kind of bass-ackward and said, all right, first we'll start with the B-League stuff, the photo storage, which you have on Amazon, which is kind of a B thing, right? They've come in with all their B-Le league. It all goes to the same place. And that is, of the billion iOS users, there's 100 million, maybe more, that will say, I'll pay 50, 70, 100 bucks a month, and you just handle it all. And I know I'm part of the elite of the elite. I'm part of the 10% of the 10%, and that is I get the iPhone

and all the cool shit before anybody else. And the moment they do that, I think the stock, I think this could be, anyways, I think it's this, they are definitely headed towards a recurring revenue bundle and the value proposition will be ease,

no choice, and more than anything, this positioning, which depositions their two biggest threats, privacy, privacy. Privacy. Yep. Yep. I mean, what's interesting is what else could they put in there? What else would you want to have from them? Because I just got rid of Apple Music, actually, because I like Spotify better. But if it had more stuff in it, I certainly would pay for it. Well, here's where I think they're all going to try and go. And this is the most underreported story in tech this week. Do you see what Shopify is doing? Do you see

who Shopify is partnering with? Tell me. Tell me. They're partnering with TikTok. They're going to have their small and medium-sized businesses do commerce-related videos, or as we like to call it, Kara, A-commerce, algorithmic commerce. I thought it was going to be Walmart as a function of their investment in TikTok. It's not at Shopify. Shopify is going to start working with TikTok to come up with 15 and 30-second videos that highlight and talk about the features in a fun, algorithmic way. They're small and medium-sized businesses on their platform. Shopify and Ant Financial are two most impressive innovative companies in the last decade. All right.

Okay. Well, that's interesting. So we'll have to see what happens with all this, but it's a really interesting, it really is a fascinating time for this stuff. And the problem is you're going to have all these companies that are big companies you're doing these rundles with, whether it's Disney or Apple or Amazon or whoever. But I'd be interested to know what Google could give you. I guess Docs and stuff like that. But they all have to sort of have a value proposition for people, especially the wealthy people they're aiming at, because nothing like a rich person who wants value. But I think loosely speaking, the whole world

is bifurcating into iOS and Android. And what basically the value proposition of iOS is we give you a premium self-expressive benefit branded experience at a rich premium price. We're going to charge you the household income in Turkey for a phone. We're going to charge you premium. We're going to give you a series of B plus, A minus features, except for the iPhone, which is an A plus, and you're going to pay a Mercedes-like price. And then the rest of the world gets great technology for free, for free economically with some non-economic costs where you become, as Shoshana Zuboff said, the raw material for the product,

which is their ability to influence people. And the whole world's going that way. And a lot of people, the reality is the vast majority of the product, which is their ability to influence people. Yep. And the whole world's going that way. And a lot of people, the reality is the vast majority of the world, 70%, 80% of the world is willing to make that trade. If you give me essentially the processing power of a space shuttle for free, which is kind of what Android does, the phones are basically free now. It's a great deal. And people take that.

And then everybody else, the whole world, the whole world is buy for it. There will be no JCPenney's or Sears of technology or of anything else. Everything in the middle is getting cleared out. So if you had to, we've got to get to Lister Mall, but if you had to stack rank them right now, for example, I think Amazon's still the top in that in terms of value, getting that rundle kind of thing. And I don't know how quickly anybody can catch them. I would possibly buy healthcare from Amazon. I mean, I would buy a lot of things from Amazon, which is terrible to say.

I mean, oddly enough, I just bought their new Halo, their hand device, because they offered it to me for such a low price, because they want everyone to start using them. And they've not been great on devices, by the way. Amazon hasn't, as well as Apple has sold devices. I'm very happy to buy Apple. I'm happy to go to stores, Apple stores.

They made a mess on my AirPods, and I went back three times, and I didn't mind the experience at all. It was quite a good experience. So, which stack rank them in terms of two years out, which one will be of the rundles? Name five rundles you think people will be big businesses. I'd say Amazon is number one. Yeah, Amazon that'll roll in healthcare unless Walmart gets the purse. Walmart actually has clinics. Yeah, they have a lot of points of contact with people.

Smart, visionary, a board that supports the kind of capital investment you need. I think if Netflix were to acquire Spotify, that would be a very interesting bundle. I think the most underappreciated bundle that could add the most shareholder value across the S&P 500 right now would be kind of what I'll call Disney Plus Plus, that if they rolled in, if they said, all right, Black Widow in the next Star Wars trilogy is on Disney Plus just for Disney members, as is the private tour of Star Wars Galaxy's Edge, as is

the Star Wars theme cruise, as is on and on and on. Anyone who made over $50,000 a year, any household income with kids that made over $50,000 a year in Western Europe and the United States would have to be a part of that bundle. I would agree. You know, many years ago, I went into an Apple store and I, you know, there was lots of people because it was this sort of wonderful place that people hung out and socialized in San Francisco. It was a very popular store. And I had to wait to look at the new whatever, whatever it was, an iPhone or a watch or whatever it was. I wanted to see it in person. And I was sitting there, I had to wait because all these people are just not buying, but looking, right? So that was great. And I turned to one of the

geniuses, I said, listen to me, that kid over there is sexting. Why don't you know when I walk into here that I have spent this much money on Apple? Like I've spent a hundred thousand. I mean, whatever I've spent on Apple with business stuff, it should, I should allow you to ping me and know who I am. And then you run up to me and sell me other sins instead of that kid is in my way because he's sexting. And, and she was like, how do you know that kid's sexting?

I said, let's not focus on the sexting kid. Let's focus on the fact that you don't know me and you don't know to hand me a glass of champagne and say, what would you like today? Like I'm in Tiffany or whatever, which by the way is an excellent consumer experience. Tiffany is having just bought a wedding ring. You got a wedding ring at Tiffany? Yeah, I did. I liked it. I don't know why I find that so surprising. Because I wanted a simple one. I wanted a simple one. Tiffany, yes, very simple, very down-home.

You're such a down-home gal going into Tiffany for your wedding ring. the nicest simple rings. Okay, I don't want to go to like Zare or whatever the heck. You little seductress showing up with

the little aquamarine Zuba. I bought a beautiful antique one for one of the rings but the other one was just a plain thing. In any case, it was a great

consumer experience. They gave us a cake. It was great. The whole thing was great. They gave us the most beautiful cake. It was a little white cake that they sent to our house after we bought these things. And they weren't that expensive. And it was wonderful.

It was a cake. And then when you cut into it, there were sprinkles the color of Tiffany. Tiffany-colored sprinkles. I loved. I will now shop there. I was so delighted by their care. Okay, so you're talking about Rundles. and I'm going to do serious name dropping here. I know the CEO of Lululemon well.

Yeah, love those pants. My son loves those pants. Breakfast, I know the CEO of Tiffany. This is where they both should go, and I think they will go there. There'll be a lot of other interesting bundles or Rundles. Equinox bought Mirror. or Rundles. Equinox bought Mirror. What if Equinox started saying to, you know, I don't even want to try and label that cohort, but what if they said to them, all right, we're going to handle all your athleisure at different levels, and we're also going to handle your workout at home with Mirror,

and it's a certain amount per month, and they started testing it. Do you realize, right now, in specialty retail, Lululemon trades at an Apple-like multiple. Lululemon is arguably, from a shareholder standpoint, the most successful specialty retailer of the last 10 years. I would agree. They have excellent products, too, by the way. Well, they've gone vertical. They have amazing engineering in their products. They have a nice brand.

Everything about that should just work. My son buys Lululemon. That is fascinating because the pants are so good. $50,000 a year. You can have any six products across the entire LVMH portfolio, whether it's Vuitton or Bulgari or Tiffany or Dior, and you get any of them, including $50,000 earrings, and you get them all for either three or anywhere from four to 12 weeks. They could have become the ultimate bundle around rental. And I think- Rundle. They're think. Rundle. They're not going to use the term rundle at Tiffany, though.

Well, no, it's a terrible name. But I think there's going to be a bunch of smaller ones. I think Nike's in a position to do a great rundle. Yeah. All right. So there's a lot of them. We love the rundle. Apple, keep adding stuff.

You have to add more because you don't have enough in your rundle that is very attractive. Your basket of goods is not good enough for care. So I literally got rid of a whole bunch of Apple apps today. Really? Yeah, because I was like not using it, not using it. But if they were bundled in a certain way, I certainly would. Okay, Scott, let's go to a listener mail question. We're going to shift topics over and let's play that. You've got, you've got, I can't believe I'm going to be a mailman. You've got mail. Hey, Karen, Scott, this is Tim Selman from Los Angeles. As California voters send in their ballots and head to the polls, I'd love your thoughts on Proposition 22.

Uber, Lyft, DoorDash, and other companies have spent almost $200 million on this initiative that aims to counteract Assembly Bill 5, which, as of January 1st, required companies in California to reclassify contract workers as employees and thereby extend standard wage benefit and legal protections that employees enjoy. Proposition 22 exempts gig companies from the law while providing some concessions on wages and benefits. In addition to spending heavily and fighting AB5 in court, the companies have used their platforms to aggressively lobby customers to support Prop 22. court, the companies have used their platforms to aggressively lobby customers to support Prop 22. My perspective is that while AB5 has its flaws, it's a necessary step to change how gig worker companies operate. And passing Prop 22 sets a really dangerous precedent about corporate

influence on the process of direct democracy. I really love your thoughts on the matter. Thanks in advance, guys. Well, thank you so much, Tim, from Los Angeles. I think you are correct. I think this is a ridiculous proposition. And I think it will lose, obviously, Joe Biden and the Democratic Party. What are the polls saying? I haven't watched. Is it going to win or lose? We should know by now.

It's losing. I'm not a California voter anymore, which is why I can't be senator. But I would vote against it. It's ridiculous. It's an end run around something that was already passed, which is AB5. And again, it was not perfect, but it certainly is. Look, get on this train, people. This is the direction it's going. We're going to have to figure out a way to give some benefits to gig workers. And if anything this pandemic has proven is that we need to do it. It's a critical existential threat to lots

of people's lives. And it's just going to, this is not going to be good. And then they're going to have to refigure their business. They might as well get on this train now and figure out how their businesses are impacted. Scott? Yeah, well, look, the earth is hitting back. The earth is sick of us arbitraging, you know, weather and minerals to the earth's kind of detriment. And the earth is hitting back. the earth's kind of detriment, and the earth is hitting back. And I feel like when we continue to arbitrage an underclass of America that we've created through really poor, a lack of empathy,

which is one of the critical components of a successful democratic capitalist society, they're hitting back. And the government comes in and says, all right, we pass AB5. AB5 is not good legislation. We do need a reclassification. We need a new classification of employer. So let me just acknowledge we need something like this. The problem is none of us want Uber or Lyft creating that classification. And the classification they are trying to shove down California voters' throats with a quarter of a billion dollars in support from these companies says you can't unionize.

Yeah. I mean, part of the First Amendment is the right of free assembly, unionization. I'm a member of a union. And basically, they're trying to slip that in to say, I think it's like you need, basically, they're trying to outlaw unions, which, too, they're saying you make, you can't, they're pretending it's a concession. And the language is very elegant and insidious here. But it says, you make at least X dollars per hour, hey, great, while you're working. And that's one of the most cancerous things

about this cancer. The cancer on cancer here is that everybody was outraged by the software that fast-serve restaurants tried to implement a decade ago where you got clocked out automatically when it wasn't busy in the restaurant. And like, look, these people. But Uber's figured this out.

All right. If you're sitting in your car, you're away from your family, you're working, but you don't have a ride, we're not going to pay you. And this is this pretended to say we're going to take your wages up a certain amount. So I hope this gets hit hard. It's a heavy handed. I will tell you where it is. With only eight days until the election, Proposition 22, the megabucks ballot measure from Uber, Lyft, and other gig companies to keep their workers independent contractors, is running shy of the 50-plus margin it needs to pass, according to an independent poll released Monday.

46% of likely voters supported it, which is interesting. That's advertising works. While 42% oppose and 12% are undecided. That information came from the San Francisco Chronicle. It needs 50%. And so, therefore, it's a problem. It's tight. It's a tight race, but it's certainly, it's not, it needs 50%.

And so what they should have done is dealt with the bill as it was in terms of figuring out what's the best way to do this. And they're threatening to pull business out. That's just not the way to go anymore. They've got to work together, just as with Section 230, content moderation. Enough with this fighting. We've got to figure out a way that works for the companies and works for workers.

And if I was senator from the great state of California, that's what I would work on. So what is the outcome? Give me the outcome, and then I want to get to predictions. What do you think the outcome will be if they lose? I think that while Uber has claimed that they'll be out of business, no, they won't be out of business. It'll be a smaller business, and they'll have to rethink their business model, and they will figure it out. However, again, the most underreported story, you know, that prop gets all the headlines and all the oxygen. But the most, probably the most important proposition is Prop 15.

That would undo limits on commercial property taxes where basically commercial real estate owners, this asset class that has been wildly favored. What other asset class can you depreciate 3% a year, even if it's increasing in value? Or you can sell it and not register a capital gain, but transfer it into another, roll it into another asset. California voters are likely going to say, you know what? We recognize that the tension between government and private sector is out of whack. Feng is kicking the shit out of Shui. Ying is pummeled Yang. And things are out of balance.

And we need to restore our institutions. And if our government institutions need in any way to hold, you know, to have the metal to push back on private power, which they need to at this point, we need to begin funding them. So for California taxpayers, who, by the way, already pay a shit ton of taxes to say, you know what, taxes are going to go up on commercial property owners, who, by the way, have seen their taxes not go up in a long, long time, it signals something for the rest of the country and a healthy thing, and that is our government

and our institutions are noble and they need to be funded. Well, here's the thing, though. It's sort of a struggle. It's still not, it's still, it's one of those things they don't know what's going to happen here. But definitely, definitely more taxes in California is not something that would be welcoming to citizens of California. At the same time, Prop 13 really gutted a lot of things, and it would bring billions into the state, especially when they need it right now. Because California was doing pretty well, but we'll see what happens. It's. It would be the biggest change in revising Prop 13 by Prop 15. But the tax, just to be clear, the tax would be on commercial property owners who, by the way, make up 9% of the Forbes 400. It's an asset class that for some reason has lobbied and been very effective at securing what I would call disproportionate advantage relative to other asset classes. Just so, you know, it would focus on commercial properties and undo those limits. Right. And by the way, you know, I was just talking to a commercial property person here in D.C., and they said the business has just gotten killed through the pandemic.

Oh, I can't. Killed. Think about this. Killed. He doesn't know what's going to happen. Oh, my gosh. There are, think about the novel coronavirus is a tectonic or a shift in the tectonic plates off the coast, and there are massive tsunamis forming. One of those tsunamis, no doubt about it, no doubt about it, is the transfer in stakeholder value from commercial to residential real estate.

Do you realize in a six-month period, the vacancy on San Francisco office space? Yep. It went up like crazy. Like it was tight. This is how crazy it is. It went from the lowest it's ever been in history to the highest it's ever been in history in six months. Think about that swing. Yep.

Think about the change in stakeholder value. Think about all the debt holders on those buildings. Well, there was a moment back when Web 1.0, 2.0, or one of the webs fell apart. That happened. You know what I mean? Like whenever all the business, I guess the stock market went crazy. And remember all those startups were closing. There was a point in that, but nothing like this. There's been nothing like this. And not with a secular shift in how people go to work and especially these tech companies doing remote things. It's dramatic. It's dramatic. It's dramatic. And it's not cyclical, it's structural. Structural. Exactly. All right. We'll see what happens with all those props in California, but I think 22 is going to not pass.

Anyway, Scott. The new junior senator from the great state of California. I'd be so good. I'd wear outfits, you know, like that senator from Arizona. I'd wear outfits. That's your sales pitch? I'd wear outfits. Governor Newsom, you should know I'd wear outfits.

I have a really great scene in my upcoming book memoir with me and Governor Newsom not wearing diapers. Let me just say that's all I'll have to say. What? You're going to have to wait. Not wearing diapers at a tech party. Okay? What's the name of your book? That's the key.

51% is the name of your book. Scott? No. My life was Scott Galloway. There you go. Listen to me, Scott. That's what it's called. Listen to me. All right, Scott. Actually, that would be a bad title. Listen to me. That wouldn't be a bad title. There you go. Listen to me, Scott. That's what it's called. Listen to me.

All right, Scott. Actually, that wouldn't be a bad title. Listen to me. That wouldn't be a bad title. Listen to me. Listen to me. All right, Scott. One more quick break. Okay. We'll be back for predictions. The Capital Ideas Podcast now features a series hosted by Capital Group CEO, Mike Gitlin.

Through the words and experiences of investment professionals, you'll discover what differentiates their investment approach, what learnings have shifted their career trajectories, and how do they find their next great idea? Invest 30 minutes in an episode today. Subscribe wherever you get your podcasts. Published by Capital Client Group, Inc. Support for this show comes from Constant Contact. You know what's not easy?

Marketing. And when you're starting your small business, while you're so focused on the day-to-day, the personnel, and the finances, marketing is the last thing on your mind. But if customers don't know about you, the is the last thing on your mind. But if customers don't know about you, the rest of it doesn't really matter. Luckily, there's Constant Contact. Constant Contact's award-winning marketing platform can help your businesses stand out,

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Pandemic rising. Some predictions. Scott? First off, the stock market's quote-unquote crash yesterday. Every media outlet is trying to create the quote-unquote situation room and pretend things are more dramatic than they are. Yeah, the stock market plummeted to September levels yesterday. I mean, people, I've had two media outlets call me and say, what does this crash mean? I'm like, this wasn't a crash.

I'm talking about the headlines meaning. Like, I get that. Go ahead. Go ahead. Okay, look, it's time. I have held my tongue on this. The stock market was off when it needed to be on. I have held my tongue on this. Stock market was off when it needed to be on. I have held my tongue on this.

Everybody is worried that Donald Trump, A, will either leverage the Supreme Court or all this doubt he's instilled in America about election legitimacy, that we might not have a president until January, that he could hold on to power. This election is over Tuesday night. He is a keyboard coward. He's going to lose all his support. No one in the military supports this guy. Republicans are going to drop him like second period French when they see how badly he's going to get his orange ass handed to him. Second period French?

Could you come up with a better metaphor? Drop him like what? I don't know. Drop him like, I don't know, the slow fade. Okay. No, he's going don't know, the slow fade. Okay. No, he's going to go fast. You're right. I think we have, and we're all nervous to say this.

I think on Tuesday night, on Tuesday night, and a lot of the media outlets will be scared to call it because they don't want to. They're so worried about doing anything, you know, ahead of the curve here. He is out. There's not going to be any need. He will be scared. This is over. It's over Tuesday night. The immunities are kicking in. America again. Everyone had their moment. Everyone who's in the middle, and I'm a proud raging moderate, has had their moment when they said, that is it. My moment was when he mocked the disabled. Everyone and everyone in America has dozens of points of light around the stupidity, around the misogyny, around the bigotry, around the lack of appreciation for our brothers and sisters who have built the strongest alliances in the world.

Everyone has had their moment. And the sum of all those moments happens by midnight Tuesday. We will have a change in power, and these fears around moving to an autocratic society where we don't know what's going to happen, he may not leave, bullshit. He's a keyboard coward. He's going to get his ass handed to him, and he's going to leave. What is a keyboard coward? Well, someone who's really tough when it comes to 140 characters. Oh, a coward. I don't think he's going to. I love that.

I don't think he's going to. I just don't think he has the nads to try and say, to try and. I think he's going to get beat so badly Tuesday, so badly, that there's no way he's going to try and pull any of the shit that everyone thinks he's going to pull. I don't think. I just don't. Not that that was good. I think Stephen Miller's got executive orders out the yin-yang.

Of course, they'll be undone, which will be, they'll be done and then undone, which is- Anyways, Tuesday night, Tuesday night, the immunities kick in, Cara. We got one more show before that. Okay, that's your prediction. Okay. Well, what do you think?

You respond to that. You know politics better than I do. And by the way, I get this wrong. I get more than my fair share right on business. I get them wrong all the time. That's why it worries me because you get it wrong. I think you're right. I think you're right. But I think that I just, there's no, the only thing that I look towards is how incompetent they were on the Hunter Biden thing. Like this was their, they're somewhat incompetent in their execution, even though it's sort of like they, as I always say, they throw a hammer at a piano to make music. Like that's their go-to. And sometimes they hit, like these stupid executive orders sometimes work and they have, what they've done down at the

border is criminal. And all kinds of stuff like that has worked, even though it's been clottish in the way they've done it. But when you look at sort of what happened around this Hunter Biden stuff, and that was their effort, how incompetent they are, like how they tried to get it into mainstream media. And I'm like, they're just idiots. Like they didn't, like they had this, that one story that I think Ben Smith wrote about how this smart group of people went to the Wall Street Journal. And then Rudy was freelancing over here going rogue. And it just was like, you're incompetent. And then them trying to resave it. Giuliani was on Fox News and even the Fox News lady was like, uh-huh, no.

Yeah, even Fox is turning on them. What's with the pants thing? It doesn't seem right to me. It looked like you were getting some. It was interesting. And then Tucker Carlson yesterday going, you know, I have the documents, but I sent them and they got lost in the mail. And I'm like, what? Like you know, I have the documents, but I sent them and they got lost in the mail. And I'm like, what? Like, why didn't you make a copy? This is

ridiculous. It's now to the dog ate my homework period of time. So that makes me wonder how incompetent they are that they can really actually steal the election. They certainly made all kinds of voter suppression efforts all over the place, a hundred percent. But I do think people are like, I'm voting. Like, no, no thank you. I don't think that, I think they, people, that is one thing that people don't like being pushed around on. But we'll see. We'll see. I don't know. We'll see if they can pull something off. I think the Supreme Court is sort of like, well, come down on your side if you're not completely incompetent. But so far, the decisions have been mixed. So, we'll see. They're not going

to go out of their way to give him the seat by cheating. They certainly aren't. Anyway, we'll see what happens. We'll see what happens. I'm going to be like a we'll see. I'm not going to watch any of it. I'm going to get on my Peloton and stay there all night. That's what I'm doing.

Speaking of rundles, I think I would buy, I just bought clothes from Peloton. Interesting. Did you really? Yes, I did. That is really interesting. It was an Allie Love thing and I bought it. It was really good. It looked good. And you really? Yes, I did. That is really interesting. It was an Allie Love thing and I bought it. It was really good. It looked good. And so I would buy more from them, a hundred percent. The gangster, I mean, I'm regressing a bit, but the gangster feature for the Peloton, Rundle? Yeah. Dating. Dating. Their NPS scores are higher

than Apple. It's a like-minded community of fitness people, which means they're all hot. They could all be on, they could turn their Facebook page into a dating site that would put Tinder out of business and every other dating site. Oh, I like that idea. Peloton, are you listening to me? We should have the CEO on the show. Anyway, that's the show. Email us with questions about companies and trends. That was a great question today in tech and business at pivot at voxmedia.com. We love your questions. I'm very excited for this election to be over. I'll tell you that. And then we can get on to like re-engineering the country

and economics and things like that and media and everything else. And not in the version that the Republican senators did this, which was shameful. Shameful, shameful. Anyway, Scott, read us out. Today's show was produced by Rebecca Sinanis. Fernanda Finite engineered this episode. Erica Anderson is Pivot's executive producer.

Thanks also to Hannah Rosen and Drew Burrows. Make sure you're subscribed to the show on Apple Podcasts, or if you're an Android user, check us out on Spotify, or frankly, wherever you listen to podcasts. If you like the show, please recommend it to a friend. Thanks for listening to Pivot from New York Magazine and Vox Media. We'll be back next week for a breakdown of all things tech and business. Well, that's why we built HubSpot. It's an AI-powered customer platform that builds campaigns for you,

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