Sharp Tech with Ben Thompson - Facebook Bowed to White House Pressure, The US Department of Technology, Fusion and Starlink and Swiftie Spotify

Episode Date: July 31, 2023

The Wall Street Journal's report that Facebook removed content related to Covid-19 in response to pressure from the Biden administration, both the principled and pragmatic cases for not repeating that pattern in the future, and a listener wonders whether CTO should be an official member of the Presidential cabinet. At the end: Mailbag questions on Fusion and Starlink technology, a Taylor Swift streaming service, and raising phonk awareness.

Hello and welcome back to another episode of Sharp Tech. I'm Andrew Sharp and on the other line, Ben Thompson. Ben, how you doing? I'm doing okay. I did a little travel over the last week had, you know, my plans interrupted by thunderstorms, which has happened to a whole lot of people this year. What I think has happened to fewer people is to have your podcast interrupted by the same thing. Yeah, you know, I don't know what we did.

This is now take four for the Sharp Tech podcast here. on Sunday night. Your power is back, so it's all good. Yeah, maybe we offended the podcast God somehow, but my power, have you ever heard of a Direcho storm, Ben? No, I have not. Okay, well, I hadn't heard of it before this weekend. D.C., I don't know whether we technically got a Direcho storm, but there were 80-mile-an-hour

winds over the weekend, and there are massive trees down all throughout my neighborhood right now. my house was mercifully spared losing power until about 15 minutes of recording with you and which we've been in and out ever since. But now, hopefully the power will hold up and we'll just get some takes off for the next 60 minutes. Does that sound good? That's right. We promised our listeners that our summer schedule will be a bit sporadic. We thought that was going to be our fault, not Mother Nature, but let's get going. We're just paying homage to the airlines here, you know? The schedules are going to keep you. guessing, but we'll start today with a report that came in late last week from the Wall Street

Journal. The headline here was Facebook bowed to White House pressure, comma, removed COVID posts. And the journal writes, Facebook removed content related to COVID-19 in response to pressure from the Biden administration, including posts claiming the virus was man-made, according to internal company communications viewed by the Wall Street Journal. The emails show Facebook executives discussing how they managed users' posts about the origins of a pandemic that the administration was seeking to control. Quote, can someone quickly remind me why we were removing rather than demoting or labeling claims that COVID is manmade? As Nick Clegg, the company's president of global affairs in a July 2021 email to colleagues. Quote, we were under pressure from the administration and others to do more, response.

a Facebook vice president in charge of content policy, speaking of the Biden administration. Quote, we shouldn't have done it, end quote. And then later, the journal notes that the email and a number of other such internal company communications were obtained by the Republican-led House Judiciary Committee, which has been investigating what GOP lawmakers say is the Biden administration's improper efforts to censor American speech on social media about COVID and other topics. The White House says its discussions were aimed at promoting the adoption of vaccines and other public health goals. So, Ben, we've been down this road before talking about censorship and the push to censor discussion of COVID and the vaccine and everything else. If you were to try

to spin this story forward, what are the most important takeaways? Like, what needs to change from here. Well, I mean, that's a, that's a pretty large sort of question. You know what? I apologize. I said we're going to be talking for 60 minutes. We're actually going to be here for the next six weeks of, with this. This is going to be like a committee of sorts.

It's going to be great. I mean, well, it spins interesting, right? Because there's spin in this segment that you chose right here. Like I look at that last line. The White House says its discussions were aimed at promoting the adoption of vaccines and other public health goals. And I think one takeaway. that is useful to have from this story, from COVID, from everything is a reminder that people

generally are acting with good intentions. Like, like, I don't think that, I don't think it's particularly useful in this case. I mean, sometimes there are nefarious actors, but I don't think, you know, there's a, there's a story I always tell. And I've told this before. I might have told this on this podcast. I've told it on podcast for sure in the past, which is, you know, this tech interview question we'd always have in business school where you talk about a company and what is a

product that this company has made that you don't like or point out a problem with it, XYZ. And the go-to one back then was like the Microsoft Zoom. Like, why is Microsoft making the Zoom, right? But the interesting question is the follow-on question, which is why did they do that? Why did they do this thing that you think is dumb? And what's funny about that is for most people, they had been practicing their answers. They kind of knew a question like this was coming.

And then they're kind of stuck. And their answer devolves into a fancy form of because they're stupid, right? Which is like, the off to malign Zoom team. Yeah, they take it on the chin all over again. No, but like, you do about any sort of product. Why do they do X, Y, Z? And the reality is, no, they're not stupid. They're very, very smart.

And the way I usually use this story is to talk about how I think about doing analysis on Shretaquery, where those are actually the most interesting questions because you get into things like, what are they? their incentives. What's the organizational structure? Like what are the things that, what are the misunderstandings? What are the patterns that lead to egregiously bad decisions? Right, right. Like, what are the misunderstandings

about their business that led them down this road? Right? For Microsoft, they were never a consumer company. They never a consumer business. Windows was an accident of history and the network effect that grew out of their dominance in the enterprise that had no bearing on whether or not they could successfully build a music player,

right? Like, that's sort of like the big picture thing. There you go. You have a Shrek article right there. that stems from actually asking that second question. How did smart people do something that seems so dumb, right? And the analogy here is you often get much further an analysis by assuming intelligence on the part of people doing dumb things, right? In this case, assume good intentions. Yes, by all means good intentions.

You think about people in government, they're highly qualified doing jobs for which they're very underpaid, right? Like they could make more money in the private sector. I think it's fair and just to assume good intentions on their part. And by extension, it's why this spin from the White House is not very helpful or not very convincing. Oh, we were trying to promote the adoption of vaccines public health goods. Okay. But if you actually study history, there's so many mistakes that were made with good intentions.

If anything, it's the good intentions and the righteousness that gets attached to them that actually leads to some of the sort of the worst abuses. And the funny thing, I mean, great selection by you of this paragraph, but there actually is a perfect example in this paragraph, which is COVID manmade. Is COVID manmade? Well, what do you mean by manmade? One of the leading contenders from where COVID came from is not that they were creating something on purpose to infect the world, but that there was gain of function research going on and that was altering these sort of viruses. Then they got out and spread from there. And what is the point of gain of function research? It's to better understand.

It's to prevent future pandemics. It's undergirded by good intentions. And what happened? A whole lot of bad stuff happened, right? Or may have happened. And we spent three years acting like it was verboten to discuss whether or not it did. And I think now it's clear we'll A, probably never know exactly what happened. And B, it's also clear that it's objectively reasonable to ask the question.

and lobby for further investigation into what actually happened. And we weren't doing that for two years. No, we were not quite the contrary. We were deleting social media posts that raised this possibility. And yes, to your point, it's an important point to raise, which is we will probably never know. The folks that will only ever know are in China and are, they might be dead or they might, there is very clear that the news is going to never get out.

And we've seen lots of evidence being withdrawn. and removed. We actually saw this back in 2020. I think in private conversations, you know, I was pretty suspicious of, of how, where this came from, sort of from the beginning. But the fact that we couldn't even talk about it, I think it's one of those things where in retrospect,

what reasonable person could not realize this was a grievous error, just sort of objectively speaking. And from an American perspective, and what we're supposed to stand for for a country, it seems like a huge mistake. And this is even before we get into the particulars of the White House and social media companies and the legality of that and all those sorts of things. I think just big picture, I would hope at this point in 2023,

we can agree that, number one, we'll probably never know the answer to this. And number two, given that, why were we wasting energy and time and the values that supposedly undergird our country to erase this, to try to censor this stuff off the internet. Yeah, you know, it's tough. I almost didn't want to discuss this story because it's so politically charged and exhausting after the last three and a half years.

It's like the end of summer. We're trying to keep things light around here. This topic was your idea for the record. I don't know. I don't know what I get back of you. Really? You want to do this? You know why?

I think it's important to highlight. Like I read the Wall Street. journal story last week. And I think it's important to highlight in large part because I really believe if you had every American read that Wall Street Journal story and then ask them whether they think the government should be telling private companies what social media posts they need to censor, the vast majority of Americans would say that's inappropriate for the U.S. government to be doing.

Like that's something that happens in India under Modi or China under Xi or whatever. not here. We have the First Amendment here. And as much as we want to talk about the First Amendment more generally in the way it's eroded over the last couple of years, I actually don't think the average American has moved that much on what free speech is supposed to mean and look like. But I think that stories like this, where you've got administration officials yelling at Facebook executives about what they need to remove, stories like this get buried entirely in the mainstream media. So what happens is you have lots and lots of people who are entering into this argument without realizing the full extent of what's actually being done behind the scenes

and what's actually changed. And part of that is the Twitter files were released in the most ham-fisted way imaginable, but this is consistent with a lot of what was in there. And so I just think it's important to highlight. And spelled them out on bright letters on top of Twitter headquarters. And then they would have got more attention. Oh, my God, that sign. It's so obnoxious. Don't make me sign with the San Francisco Code inspectors, but I can't even imagine. So, yes, that's why I wanted to discuss it. I think it's important that people are aware that this went on and that we all collectively acknowledge that it wasn't a good thing and isn't what we want to be doing with social media going forward,

whether it's Twitter, Facebook, or whoever, the government overstepped here. And it feels like there hasn't really been that collective acknowledgement that, yep, we screwed up. Like if the goal was to reduce vaccine hesitancy, didn't do that. In fact, probably did the opposite over the last couple of years. And at the same time, certainly undermine the spirit of the First Amendment, whether or not they actually violated the letter is a separate question. but still just one of those things that I think we should all be willing to talk about more freely going forward. I love it. It's on here because Andrew had takes and they're good takes.

And I agree with you. And it's interesting because there's so many levels to it. And that's why I did want to mention the good intentions bit up top. Because that in some respects, that's always the first defense, in part because it is the best defense. Right. It's like, look, no one was trying to violate the first event or whatever I'd be. And again, we'll get into the question whether it was an actual violation in a second. But that's why you have rights in a constitution that are that are spelled out because people do stuff thinking they're doing the right thing, thinking they're doing good things.

And that's why it's important to hold on to them in the moments when it's toughest to do so. It's cliche, but it's cliche because it's true, right? like the First Amendment only matters when it's speech that you don't sort of value or care about. But one thing that you sort of hinted at that I think is worth teasing apart here is there's a broader First Amendment question here, right? Is this actually a violation of the First Amendment? And we can get into those specific details. But I do know one thing that you and I agree with. Can you just sort of articulated it there is there is a debate to be had about the legalistic interpretation of what is the First Amendment,

what is government sort of interference what isn't private companies acting you know government official is yelling with the phone x y z whatever it might be there is though a sort of the idea of it like the spirit of it and that's definitely where i come down you know i people get mad at me about it and i'm pretty like we're pretty unflinching about it i think that defaulting towards free expression is not only a good thing i think it what this country is founded on. I think it's our competitive advantage relative to China, sort of in the long run.

And whether this was legal or not, I don't think there's any question. It was a violation of the spirit of things. Yeah. Well, and so Facebook was receiving all of this feedback from the White House. And then the Wall Street Journal, they write, at the same time, Facebook officials appeared to feel pressure to address the White House's concerns.

As Clegg prepared to meet the U.S. Surgeon General, about vaccine misinformation in late July 2021, he emailed colleagues, my sense is that our current course, in effect explaining ourselves more fully, but not shifting on where we draw the lines, is a recipe for protracted and increasing acrimony. Given the bigger fish we have to fry with the administration, data flows, etc., that doesn't seem a great place for us to be. So grateful for any further creative thinking on how we can be responsive to their concerns. So as far as the letter of the law is concerned, I'm curious to see how this question evolves over the next 10 to 20 years.

I think it's another area where the laws have not adapted to grapple with the reality of what big tech is and what the government can do with tech. It's kind of a simple question, though, right? You go back to July 2021, just to set the context here. I think the timing is important. So a judge had ruled that. that the lawsuit that was filed by the Trump administration against Facebook was thrown out because it was a ridiculous lawsuit. And it was still in the FTC's hands whether to refile that lawsuit. That's number one.

Number two, Facebook had this issue with Europe where this question about data flow between the EU and the U.S. had been thrown up by European court. It was like a sort of democracy is hanging over Facebook because that's how their company operated. Not just them, but all tech companies, to be clear, this is what. wasn't just a Facebook thing. They needed a new deal done. That's what Clegg is referring to in this case. And let's fast forward now to today what's happened on these issues.

Well, a month later, a month after these emails, the FTC refiled the lawsuit, which is still in court, who knows how long that's going to take. I still think it's a ridiculous lawsuit, but it's a major lawsuit that Facebook is facing when the FTC wants to break them up. The FTC filed another lawsuit about their acquisition of that VR exercise app, which the FTC then proceeded to lose. Yeah. The Facebook got fined billions of dollars by the EU for this data flow issue.

And they're like, yeah, it might be fixed by an agreement, but sorry, you're, you're liable. And so there's a bit where it's, you can't draw a clear sort of, what's the word I'm looking for? Where A causes B, sort of quid pro quo sort of thing here. But you do have to, it is fair to sort of observe that. The reality is for a company of Facebook size and the issues that they face, it is very much in their favor to be on the right side of whatever administration is in power, whether it be Republican or Democrat. It's not a partisan issue. It's a sort of very large company that operates globally sort of issue. And everything for Facebook has got wrong with the administration since this time.

Now, I actually don't think there's a quid pro quo. I think all those pieces were in movement and in action before them. It sound like Facebook and their internal leadership was also connecting the dots on their own without any explicit threat or prodig from the government. Who knows? And I trust is the number one thing. These companies fear the most. And there's also the question of section 230, which undergirds the very like Facebook is not possible without section 230. and so any threats to withdraw that are of existential threat to the company.

And, you know, it just happens to be that you have these two things going on at the same time. Now, again, not to say anything's explicit. The current case law, as I understand it, is that there needs to be an explicit sort of tying. And maybe there won't be that sort of smoking gun. But we're moving down the path from, okay, maybe it's not legally problematic, but it's a violation of the spirit of the First Amendment. to, well, okay, there's not a specific smoking gun, but there were sort of like a few pieces here, right? And like, it's just, to your point, like, again,

you have to separate yourself from the good intentions. Like, I would imagine most of our listeners are, got the, got the vaccine or relatively pro vaccine, just if you go on like sort of education levels and work in tech and things on those lines, that you have to look at that completely in, you have to separate that from this issue. Do we want the government doing this with private companies that have so much power over what we can say and do? Yeah. Well, and I'm really glad that you separated the intent from the effects at the top because that was my attitude reading the Wall Street

Journal story. It's like I'm willing to give the benefit of a doubt to all the administration officials who I'm sure at the time sincerely believed that these were necessary steps for public safety and they were trying to do the right thing. And again, I'll go further and say that all of this is consistent with themes that we've hit over and over again on this podcast, which is like the government is still understanding the power of big tech and figuring out what the best approaches are to working with these companies and making some mistakes along the way is inevitably going to be part of that process. But if I'm going to give the benefit of the doubt to the people who got it wrong in the

first instance, the one thing that will drive me insane is to then talk around stories like this and fail to even acknowledge that there were mistakes made. Like the Lab League possibility is a great example because the point of being rigorous there and trying to learn what happened and acknowledge that mistakes were made, it's not to blame any bad actors, but we need to better understand the costs and benefits of certain decisions. And where there were mistakes, avoid making similar mistakes of the future. And it just seems like we as a government screwed that up over and over again. And again, I just, I think it's important to at least highlight and then solving it with new laws is a totally separate question. But

Well, I mean, it goes back to a principal thing, though, right? If you go to the very bottom of this article, it's a classic example of the citing good intentions where I'm going to read it, quote, and this is a quote within a quote. It's a quote of the story within a quote, whatever I'd be. You're much better at this than I am. But it says in 2021, in the darkest days of the pandemic, of course the Biden administration was working every possible angle to keep people alive, a spokesman for a spokesman for Democrats on the House Judiciary Community Senate and the statesman. it's like that that's not a good excuse right if it didn't really change anything in the right then what the hell are we talking about here we can argue it's a good excuse if it actually like stopped the pandemic right we held everyone down getting the vaccine the pandemic then

failed to proceed that's it did happen like that's we're bastardizing the side of the moment I mean the only way where these mandates made sense is if the vaccine stopped transmission which it was quickly apparent it didn't right but I mean this is another point And you sort of refer to this about the average American knowing about this story. What about the average American knowing that the vaccine didn't stop transmission, right? People have to, this is, I think, such a fundamental driver of why people get politics wrong is particularly super high band with high information people. They take in a lot of information very quickly. They assimilate it very quickly.

And then they sort of change their view and adjust going forward. Everyone thinks they do that. And the number of people that do that is actually infinitesimal, right? Like there's so much information out there. No one even knows what's going on half the time, right? To the extent, say, I'm able to do that with stuff in tech, it's because I purposely don't super closely follow a bunch of other stuff, right? I don't read that much about politics.

It's too much. I don't have sufficient bandwidth to handle all that, right? And like there was my rant last week about proceeding with doubt. There's a bit about we overestimate the extent to which people take in and assimilate information and this cuts in multiple directions. Number one, like, it's hard to move public opinion and just jerk it back and forth, right? That's why fundamental shared principles are essential for a country operating, one of which ought to be valuing free expression above everything else. That's number one.

But number two, there's this, there's this bit about there's such a sense that if we just tell people the right thing, then they'll get on board, right? There was that other Facebook study last week. They're like, well, turns out the algorithm may not have actually made people polarized. They were already polarized to start. And that's where they read stuff. No, duh. Of course that's the way it works, right? Like, there's this sense that if we just tell people the right thing, if we just show them the right stuff,

if we just cut off the bad speakers, they will suddenly do the right thing like a bunch of sheep. And it's such a distasteful way to think of people and to treat people. And all of this is tied up together. Yeah. Well, and it's funny because the discussion can become bifurcated at a certain point, because on one hand, there's the principled argument, which is we either live in a society that values free speech and find stuff like this reprehensible or we don't. If you value free speech, that means valuing all the lies and misinformation and disinformation that comes with it. You don't get to just get the good stuff. Right.

And then from a practical standpoint, I'll read this quote from the journal story. there may be risk of pushing them further toward hesitancy by suppressing their speech and making them feel marginalized by large institutions, said one draft memo to Facebook leadership included in an April 2021 email. Removing such posts could also fuel conspiracy theories about a cover-up related to the safety of vaccines. The draft memo said, Hello. We have a conspiracy theorist running for president right now. All this is directly downstream from trying to. to censor stuff that that should that like that's the whole thing i absolutely believe there's no rfk if they hadn't screwed up covid messaging as badly as they did like there's no way his campaign is getting off the ground and so yeah it's just it's important that everyone reckon with exactly what happened here it's so much easier and a large chunk of people in my life choose this path it's easier to act like vaccine hesitancy was all Facebook's fault and just yell about misinformation than it is to confront some

inconvenient stories like this where you have to step back, acknowledge that the narrative is actually a lot more complicated and weigh the costs and benefits of these approaches. And it just seems like that analysis four years later still hasn't happened. No, and acknowledge the fact that your side was just as wrong about lots of stuff too. That's why the origin story is. useful. Again, we don't know for sure where the, where COVID started. That's absolutely true. But the number of the degree and the zealotry with which it was enforced that no, it was not a lab leak. It was absolutely zodotic. Like, how can you not look back on that? Number one, with embarrassment,

if that was sort of the argument you were enforcing. But number two, a shred of humility. Right. And that's the problem. One of the fundamental. challenges these platforms have presented to our society and to those of us that hold on to these beliefs about things like free expression is it was a lot easier to believe in free expression when number one you didn't really encounter stuff that really bothered you and number two was easy to avoid it if you did right yeah there was the crank down on the corner with a sign right number one that was definitely annoying you'd probably wish the police would do something about it but number two you could cross the road and walk on the other side the problem with that is the problem with

the internet is you're exposed to all the stuff you don't like and you can't escape it. And that's number one. So there's the drive to censor is way higher than it used to be. But then number two, we actually have the means to do so. To remove the guy on the sidewalk, you had to get the police involved or you were going to face charges yourself, right? Once you invoke the government and tap into that government power, well, now you're explicitly into First Amendment territory.

And that's not going to happen, right? Now, now there's like, it's like, ooh, look, go to the back end. That's right. That's right. And we can get them to do it. And it's not just that they can do it to the individual on the corner. They can do it at scale, right? We talk about scale all the time.

Now we have the ability to see misinformation at scale, to interact with it at scale, and to censor it at scale. And it's great. You want to trust your good intentions. We're only going to do that to the bad stuff. But we just saw, we had a wonderful example. I was talking about this stuff five, six years ago, and it was harder to talk about because you're talking about theoreticals. The beautiful thing about COVID, the silver lining of COVID is it gave us all the real-life examples that we need of suppressing stuff that turned out to be true and all the bad stuff that happens.

Again, we will never know where COVID came from. That's not the issue. The issue is we've engendered deep and abiding mistrust in a, authority, which is going to play out in lots of places otherwise. You talk about RFK. This guy got started, was a big part of the whole anti-vax movement before the COVID vaccine. The vaccines that we know work that have been used for decades that actually stop things like

mumps and measles. And what happens in places that start following its ideology? They get outbreaks of mumps and measles and children suffer. That's downstream from this crap. And by allowing this, by giving room, because you wet RFK or whoever else be right about one thing, then you give credence to all the stuff he's not right about. It's just better to pursue the truth regardless,

whether it's comfortable or uncomfortable, because that gives you the authority and the place to actually push back on the stuff that is absolutely not true, not by censoring it, but by proving it. Yeah, well, there you go. I feel so much better. This conversation has been cathartic. And it's exactly what I needed.

You wanted to talk about it. You triggered me into ranting about it. I'm sorry. No, but it's funny because I'm willing to believe that there weren't politically charged nefarious reasons for making some of the decisions that were made with regard to social media and policing information on there. I'm willing to also grant that there weren't threats, right? That maybe like Facebook was seeing ghosts in the closet.

I actually think that's probably true, right? But it sort of. But what's politically charged is to just bury it now and not. count for the success or failure of some massive decisions that were made government-wide. And not to step back and see, like, to argue the pedantic point of is this a First Amendment violation or not? Number one, you go back to like the Federalist papers. The reason why Alexander Hamilton opposed the bill of rights was he was like by, no, he was like by specifying rights, you're actually going to diminish rights because in the long run, people will focus on the legality of

the words as opposed to the general principle. He's like, people obviously have free expression rights. We should not lay it down because that's going to live it. That's the exact arguments we see now. That's not a First Amendment violation because it wasn't the government. It was XYZ, right? It's like exactly what he wrote would happen in like Federalist 79 or whatever it was way back when that's exactly what's happened.

We're reduced to legalistic arguments. Is this a First Amendment violation or not? Can we step back and have first principles and say what exactly are we going to to be about broadly speaking. How are we going to compete with a country like China that is obviously not in favor of free expression that does have. And let's be honest about tradeoffs. There are benefits you get from top down control.

There are benefits you get from shutting up dissent. There's no question that that's true. We spent the first half of COVID saying, wow, China sure seems to have it figured out. In the long run, you do see the costs as they accumulate over time as errors are not corrected as you don't get feedback loops. And that's what's so concerning about the thing that you're raising. If we don't admit, if we can have room to say we got this wrong, we're actually not even benefiting from whatever free expression we still have, which is to have a

feedback loop, which is to know we press the wrong button or I touch the burner and it's hot. Yeah. Well, and again, I wouldn't underestimate the intelligence and reasonableness of the American public and if people were confronted with the facts in here. I think a lot of people who would otherwise join the fray of this argument and say, well, there are a lot of anti-fax psychos on Facebook. It's like, oh, to the lab leak theory is Trump. The like, and it's like, oh, conversation over.

That's it. So remove the political valence and just present people with the facts. And I bet a vast majority would say what happened here is. inappropriate for the government to be doing with private companies. And yet it continues to happen. So hopefully we can make some changes in the future. But again, I just needed to get all this off my chest. I was Friday night reading that Wall Street Journal article being like, this is fucking bullshit. And one of these, one of these stories comes out every three months. So thank you. And be flying back getting a message from you. Let's talk about this. I'm like, are you in summer.

Are you sure you want to do that? Here we are. Well, keeping with the theme of tonight's podcast, Matthew says, why is the CTO not yet an integral member of the presidential cabinet? Should it be? Ben, what are your thoughts here? Should there be a United States Department of Technology? Well, I mean, there is like some sort of technology group or whatever. I think his question is why is it not sort of cabinet level.

I guess there is one of those things where it makes sense. like obviously we do that. My one hang up is if you look back over the last, you know, 50 years the IT revolution, which started, you know, around 1973 or the last 30 years of the internet that started in 1993, you know, or the last 15 years of smartphones or whatever it might be, I think there's a pretty unimpeachable case to be made that no country has benefited more than that than the United States. Like there's those charts floating on Twitter last week about relative GDP growth.

you know, the U.S. versus Europe and things on those lines. And it does kind of feel like things have been going pretty well, all things considered without overt, direct sort of executive branch oversight. And I'm very hesitant to mess with what works. Now, of course, a pushback would be, okay, that's finally got this far and to point to all these issues into all these problems. But in all these discussions, it's easier to highlight problems than it is to view the sort of things you don't see, which is a,

a market that has worked phenomenally well, that if anything, the biggest issue in tech and the biggest issue in media is that it generates so much value for end users that the companies can't harvest enough of that value and so they can't make money, right? Like that's the story of the internet, is this massive giveaway to sort of end users.

You talk about the relative sort of economic strength of the U.S. And people like, oh, but you know, XYZ, you write out, I was like, oh, the economy is so bad, Meanwhile, every number says the economy is doing pretty good. And certainly there's things to explore between that the mismatch between feelings and sort of reality. But there's also a question of the role of media in this, right? The media is competitive with tech in many respects.

And the media has been disrupted by tech more than anything else. Is the story we're getting about tech actually the accurate one, I think is a fair one, one that people raise? And all of this ties into just to say, I'm hesitant to me. mess with what's working. Now, maybe that's a boring answer, but it's sort of the first one that pops to mind to this sort of question. Right. I mean, it is tricky because on one hand, you and I talk back and forth about all the existing laws on the books that aren't built for what tech companies have become and this enormous fear of influence they have on American life.

On the other hand, I don't trust our current legislature to understand the issues and come up with and calibrate new rules and laws that actually will work for everybody. And so I think about like the Department of Transportation or maybe the Securities Exchange Commission where you're looking at industries that have these massive impacts. And it's actually a really good thing to have a branch of government that specializes in understanding the nuances of a given industry. now whether those other cabinet positions actually serve that old is up in the baby you need to analyze the FAA so you can have a discussion about that but maybe that's for another podcast but do you know what I mean like as as AI proliferates like I don't trust a bunch of 75 year old congressmen and

senators 75 year old sounds generous but yes I don't trust them to lead us down the right path and make changes that need to be made and we literally haven't really changed. changed like the most important law governing our internet in 30 years. And so to your point, maybe that's a good thing. And maybe that's why the industry has grown as much as it has. But I also, looking ahead at how central this is going to be to American life, I could definitely see the need to have a more qualified expert than like Kamala Harris, I believe, is in charge of AI right now for the current administration. We could do better than that. I'm guessing, at least. Yeah, it's, it's, it is a tough question. I will say this is one area where I think I've

gotten a bit humbled. You know, there is a bit where, you know, I have this speech I gave like a code conference years ago talking about Instagram being one of the biggest screwups by US regulators ever. Antitrust on it has to be reworked to focus on demand and all the, you know, all laying out all these sorts of things. And, you know, the funny thing happened along the way, which is, it turns out Facebook did have a lot of competition. And, you know, TikTok came along and when the reality of the competition is time, there's actually lots of alternatives that go in there. And then you have people who are generally anti-Facebook now cheering on threads going against Twitter and rah-rah, right? And strange bedfellows. Yeah, there is a bit where,

you know, again, my biggest antitrust, the other thing that is just a political thing, where to my mind, the biggest antitrust issue is the app store. And we have these devices that we can't actually use. And Apple makes that what I think are unrealistic. rules given the importance of it in our life, but are legally protected, according to the way I trust law as interpreted day. And why is that not a focus? And Facebook buying a VR app is, right? Like there's, I say there's two bits that been humbled on.

Number one, I feel like it, it hasn't been as monopolistic as I thought it might be. And it has been for reasons that I sort of said, which is there is no lock in here, because you're not controlling supply. You're controlling demand. So number one, I should have listened to myself more that, by that's an arrogant thing to say, but that's what I meant to say. I said the exact same thing on the greatest of all talk podcast last week. So you're in good company.

Good. Yeah, right about the big things, right? But then number two is, yeah, I've lost faith a bit in regulators and the sort of actually trying to do what's right instead of seeming to try to settle political scores. And, you know, and I think like the way, like go back to Microsoft Activision case. Like there's big picture a problem with a two trillion dollar tech company buying a $70 billion game company. And like that gets to the point of like doing to think about how our laws are. But the way in which that case was argued was so out of touch with how the games industry actually worked. Like I got, I became Mr. Microsoft defender.

Despite the fact, I'm like, there's some qualms about this case. But it's like, no, if you're going to make that argument. Well, and you know what? This is coming from a purely selfish place on my part. Because if I'm going to be doing the Sharp Tech podcast with you for the next 10 to 20 years, I can't keep running into the same roadblocks where we say the regulators have no idea what they're regulating here. And they don't understand industry X, industry Y, or industry Z. And so I, in theory, would support somebody who actually knows what they're doing or understands it a little bit better.

But maybe we'll get there in like 2040. We'll still be podcasting, though. That's like the thing. I mean, not if this is maybe, maybe I shouldn't draw this analogy. but like sure let's censor stuff as long as we censor the right things right and like well it turns out essentially the right things is pretty hard right let's regulate stuff let's let's have let's have a AI czar as long as we have the right person that does the right things right there there is a bit where the strength you know again not to sound like not to pull up my flag here and wave it on the podcast

but the strength of our system comes down to fighting it out in the market and figuring it out that way not having someone sort of figure it out sort of from on high And again, whatever you say, it has worked pretty well for the last 30 years. Yeah. I would argue that it's definitely time for some regulation in a variety of areas. But we've mined that territory in the past. And, you know, there's one other government question that has made it to a couple different rundowns here. We haven't been able to address it yet. And I'm just curious how you'd answer Jeff.

He says, earlier this summer, Ben made the comment that if it can be demonstrated in a lab today, we should assume that tech will be able to solve it in the long term. Does he feel that this is also applicable to fusion shown by the Department of Energy late last year? If so, should that significantly change some of the bets we make today? If I'm believing that within 20 to 30 years, power is a, quote, solved problem, I might change some of my planning. What's your opinion of when is the right time to factor in huge swings in potential outcomes

like this now or is it more a Taiwan invasion slash Janus knee situation where you pretend like it's all fine because to plan otherwise is too big of a change in resource allocation. So Jeff clearly knows you very, very well here, Ben. Well, what do you think? Somewhat. I would push back on my saying, if you can be demonstrated in the lab, we should assume we solve the near term. That is a specific reality of tech where the constraints are sort of,

processor, really processor capability. Okay. That's been a same bet to me. Yeah. I don't think I was clear when I said at the time. But the bet you've been able to make in tech for the last 50 years is that processors will become fast enough to do something that they're too slow to do now. That's a bet you've been able to make. And now there's questions where that will continue.

That's Moore's Law when I'm talking about there. And that is the reason that gets at why Moore's Law is so profound. because you make fundamentally different assumptions about the future because you assume that this thing is going to happen. So that's a specific thing about transistors and sort of software and the software you build and the capabilities there broadly. So I should have been clear about that. I think it was in the context of VR and there's things about like glasses and goggles. And that's getting ifier because you're starting to get into fundamental physics, you know, and like what sort of capable there. And I think the more you get into the real world outside of transistors, which by the way, again, are hitting real world physical limits.

But when you get into the real world, it does become a bare question about can or will this be solved. I mean, the fusion one is interesting. I mean, I think he's referring to we've done fusion before, but it's always been negative energy. For like a split second, we had a positive energy in which the amount of energy that was unleashed or captured was higher than the amount of energy put into the system to make it happen. And that's obviously, it has to be a case for, for fusion to happen. There was this whole, there's this whole saga going out about superconductors, which is fascinating because that would actually be an undergirding thing for fusion. I'm guessing it's not real. I'll put some of my bets on the table now, although that is sort of the safe bet.

But there are these sort of bets that can be made. And I think certainly we should be counting on that. That said, I think nuclear fission is remarkably useful, does not pollute if we had it. everywhere we'd be in much better shape and politics has gotten in the way we haven't actually been able to do that so i do think there's a bit where yeah it's probably too hard to make bets on in the long run like you can create optionality you can sort of set yourself up to be ready to seize an opportunity if it comes along but for my part i would constrain my statement to things involving transistors and again maybe it's something you just what you know what you

don't know, be a little more conservative about anything else. Yes. Well, I think that's a good approach. And your point on nuclear power existing now and being underutilized is also an important aspect of the conversation. So there are short-term things we could do while keeping an eye on the long-term. Yeah. I mean, maybe the super going to, because everything would turn out to be true.

If it does, it, it's like an, it has an astronomical impact. Maybe it won't. But it's a reminder there is the potential for breakthroughs like this to happen. And stuff can and will change very, very quickly. I'm not sure you can plan for it. If you could, you could be an all-knowing planner that could essentially plan lots of things. And we just had a discussion about that. But I personally probably be making bets on that regard.

But I'm just a podcaster. So what do I do? Well, look, if you've got that kind of foresight, get to a sports book, you know, make some real money for the next 10 or 20 years. Anthony says, Ben, after listening to your thoughts on Starlink, I had a question on the future of satellite-based internet. and what it might look like. Last week, I was lucky enough to spend some time off the grid vacationing on a Greek island, and for a period of time, my iPhone 14 Pro had zero internet signal whatsoever. Nice to unplug and touch grass, er, sand.

I did notice, however, that my iPhone had the ability to put out an SOS signal by connecting up to a satellite. So what are your thoughts on the possibility of a future miniaturization of a Starlinked type technology that would enable full satellite internet, not just SOS signals on mobile phones without the need for extra equipment. Is that theoretically possible? And if so, how far off do you think that is? While I enjoyed being totally disconnected, it might have been nice to be able to check

in on NBA trade, on NBA trade rumors from my beach chair. I don't advocate checking on NBA trade rumors from your beach chair, for one. Number two, there are satellite phones, right? they just have large antennas or they're like actually they're not that large anymore they're like nubs. I think they can most be used just for voice and maybe texting. I think like a full internet experience might not be possible. I mean, I don't know.

We're a bit out of my out of my area of expertise here to say. I know. But I think the reality is Starlink is already, I think, a pretty significant breakthrough. But it's interesting because it's in many respects an economic breakthrough is just like someone with the economic viability and capability of launch. all these satellites and with reusable rockets and the cost of them being so much lower and being able to sort of blanket coverage. And it's kind of a reminder that that's another question about all this stuff. There's often just an economic question or a business model question that is actually

when we defend the sort of like the business types. There are breakthroughs to be had in that regard as well. That's what I was wondering. Who has the incentive to bring this to market? Yeah. I mean, probably SpaceX just because again, the end of the thing. send all the satellites up there anyway. But satellite phones do exist. Are you able to like, when iPhone have satellite connectivity? Well, there's the other bit like, do you actually want that most of the time? I know.

It's actually worth it for Apple to build because then they have to spend the money on R&D and the tooling and actually manufacture it. All this stuff sort of needs scale, which means if you don't have scale, it's going to be small batch. It means it's going to be super expensive. And it's possible if you need it. But by and large, you already have a starling. that's probably going to cover most of your needs. Yeah, well, it's an opportunity to plug what you wrote about Starlink because I really enjoyed the read. You were strangely meditative about it.

It was enlightening in as much as Starlink was much better and more stable than I expected it to be. And then also there's the aspect of the discussion. I keep saying aspect a bit in my daily speech after podcasting with you for the last year. So you start saying orthogonal. I think that's on the big go. Oh, God. But I think it's true that the handful of places where you don't have service, you're happy to not have service and you're happy to be off the grid.

And so, you know, willingly sacrificing that to be connected at all times. There are real tradeoffs there. And I enjoyed the way you wrote about those tradeoffs as well. I don't remember the conversation of a, I was with someone as reminiscing about, you know, when I was in college, you would go out to meet someone and maybe they would show up and maybe they wouldn't, right? Once you left the house, it was just like, yeah, we said we'd meet at this bar at this time and we'll see who gets there and who does it. Or, you know, oh, he's talking with a buddy mind.

He's talking about he did an internship in D.C. in the 90s and he would call his parents a couple times a week. And the rest of the time, they had no idea where he was or what he was doing, right? Like, what would that be like sort of as a parent? It's, you know, the friend of mine that encouraged me to go or told me about Taiwan in the first place, when he was there, you went to 7-Eleven, you bought a calling card and there was a pay phone outside the 7-11 where he'd use your calling card to call home. And that was, that was kind of the extent of it. That wasn't that long ago. That was only a few years before I went. Look, I was calling 1-800 collect from a pay phone at my high school to go get picked up by my parents.

Like, not that long ago. And now here we are. So I mean, I broke my leg playing soccer at a high school game. And, and they're like, oh, should we like, should we call an ambush? And they're like, I don't remember. It was an insane story. I'm like, oh, no, my parents said they'd be at the game. And then something had come up.

They hadn't made the game. They could hold them. Oh, my gosh. This is such a sad story. A really rough, rough afternoon in the history of Ben. Well, while we're dating ourselves here, we can close out. Like 90s parenting techniques. but yes.

Yeah. So 1-800 collect. Andreas says both the tools and production for distribution have radically decreased, have radically decreased in cost to the point where now everybody who has access to a smartphone can make and distribute their own music without paying a cent. So there is now an abundance of music creation communities that are primarily online, spread across social media, SoundCloud,

band camp, Discord servers, and dedicated websites. There is also a very healthy culture of collaboration, which not only stimulates creativity, but also allows artists to temporarily, quote,

borrow the attention of each other's audiences. Your inability to discover new music is more a failure of the aggregators, and maybe it's just not something you are choosing to invest attention in right now. Also, there are in, genres that might not be the best fit for Spotify. You can find mashups there and they should be considered fair use, but how do you calculate royalties for a mashup? Love the show. I just felt

I needed to leap to the defense of the current state of music. It's really great out there, but it can also be pretty overwhelming once you start digging. And then there was a second note that came in from Nick. He said, Ben and Andrew, you are over indexing indeed with respect to your own experience. I just got to the 44 minute mark of last week's episode. You both showed your Gen X slash millennial roots pretty hard there. And then Nick proceeds to list three new genres of music that Zoomers are aware of that we should be aware of. The first genre he lists is called Fonk, P-H-O-N-K, and he cites Ukrainian war drone footage as an example of its an example that we should check out to listen to some Fonk.

And then the second genre is hyperpop, and the third genre is vaporized. Nick's email, to me, confirms that our takes last week were correct. if the top three new genres that come to mind are funk, hyperpop, and vaporize, I think those are pretty niche and are not, in fact, replicating the success of the grunge music scene in the 1990s with Seattle. But did you have any thoughts on the feedback? Well, I just loved Drace's sentence here. Your inability to discover new music is more of the arrogators. There is no inability to discover new music.

There's a complete lack of desire to discover new music. to discover new music. Let's be clear. Which we came by honestly. I think we were honest about that. We are saying we don't understand new music, not because it is a failure of Spotify or Ukrainian drones or whatever it might be or Elon Musk or whatever you want to point to. It is because I've no desire to listen to new music. I embrace being old.

One of my core tenets is that people who continue to try to be young actually end up being the lamest of all. So you know what? I am old. I know it. I also know that music in the 90s was the best. And we're not going to explore the connection between those two statements. Yes.

Well, I'll just read explicitly from Nick's email. Ever watch a Ukraine war video, drone combat footage? Ever watch with the sound on? That's funk, not to be confused with a Memphis rap genre from the 90s that shares the same name. So the more you know, everyone out there. I mean, that's not making good arguments for their originality here. QED, Nick, apologies from the Sharp Tech T, but we were right all along.

All right. Final question here. Well, this is actually just an idea that came in from Dumbin. He says, Sharp Tech segment idea, dumb ideas. What are some ideas that seem dumb that you actually think could work? Mine is that I think Netflix should buy a theater. and add a new tier of subscription where people can go watch Netflix movies

or the finale of Netflix shows at movie theaters. Also, Apple should buy Nintendo and put all their games on the app store. Ben, do you have any thoughts about Dumbens' dumb ideas there? Yeah, I think they're dumb. Okay. You know, I don't think... The issue with theaters,

this is the issue that it faces every sort of internet company is they operate at scale. The fundamental issue with the, the theater is they don't operate at scale. You're limited by geography. You have to actually have cost of goods sold. You have to pay a staff. You have to maintain all these sorts of things. All of which are cool. And to the extent this is a good idea, it's not a good idea because they make more money from membership. It's because they make more money through marketing,

from buzz, from sort of a general sort of thing. Why? That's something that scales. That's something that they can get sort of virality and things that extend. But by and large, all the ideas of tech companies that involve doing something in the real world tip over because the entire reason these companies work is by virtue of the zero marginal cost sort of aspect that sort of I spend a lot of time talking about. As far as Apple and Nintendo, that's always been every nerds like Wet Dream for ages and ages and ages. And Nintendo's great like it is. Let's let's let's let them be. The switch is cool. I don't need to be on an iPhone. I don't need Apple's exactly control of it. Nintendo's doing great by themselves. By all accounts, they're hard.

to work with. That was their, that's why they lost the third party sort of like ecosystem in large part because they were set on their ways and they didn't do the best formats. And they sort of took their publishers for every nickel and dine that they could. And need us to say, this doesn't sound like a good Apple partner because who can partner well with themselves. Well, okay. Well said across the board there. If listeners have dumb ideas, they'd like us to review and reject as resoundingly as Ben just rejected dumb its ideas. Please, by all means, August is a perfect time for dumb ideas. Email at sharptech.fm.

We'd love to hear your submissions. My thing with Netflix, if they are, in fact, going to develop a free tier over the next four or five years and slowly take over the world, then one thing they could do in that process is to try their best to revive movie theaters and treat it like a loss leader, treat it like a marketing opportunity, laundered. your image as you're driving all these other studios out of business and driving their business models into the ground. Well, there's actually one funny thing about this, which is that until like a year ago would have been illegal. And that was because all the studios used to own the movie theaters. And so they would only show their movies in their theaters or else they would sort of

extract a ton of the other ones, which led to what was called the Paramount Decrees, which basically said that they had to spin off all the theaters. That's where we got independent theater chains. Now, the DOJ actually repealed the decrees in 2020. People got all worked up about it, but you're actually articulating why I think it made perfect sense to do it. Because, like, now. No one else is going to support this dyeing industry. When that was the only channel, like you could understand sort of breaking up that sort of vertical monopoly.

But now theaters aren't competing against theaters. Theaters are competing against your TV. They're competing against this podcast. They're competing against Facebook. They're competing against TikTok. And there's a bit where strengthening them and letting them be vertically integrated actually maybe makes it more viable, right? It's kind of like the XM serious merger back in the day, right?

For ages they tried to merge. They were not allowed because it's like, you're competitive. And then at some point it's like, wait, no, there's MP3s out there. There's Spotify. Let these poor folks trying to run a satellite service. Imagine all expense of that must be, at least have a fighting chance. And so it's just a good example, though, of how the world certainly does change. Yeah, no kidding.

Well, we shall see what the future holds for Netflix. We also got this question from Zach, Andrew and Ben, since you've been talking about streaming a lot recently. And because Taylor Swift is now in California and Ben is going in L.A. I was wondering. I think you said it on the podcast in the past. I was wondering, what do you think about the potential of a Taylor? Swift streaming service. $13 per month.

Obviously, parentheses, that's Taylor's favorite number. All our listeners should know that Taylor's from you. Look, it's not. And it should go without saying, I hope that everyone who's listening to Sharp Tech right now knows that 13 has some mystical power for Taylor Swift and her zombie army of psycho fans. So my question to you, Ben, could she pull this off? Would you subscribe at $13 a month?

for a Taylor Swift exclusive streaming network. Well, it is interesting because there are artists driven streaming service. Are they streaming services or like MP3 services, right? Like Fish, I think, is the most famous example where, you know, for years and years, audiences would tape the shows and like trade them online. And then Fish is like, look, we'll record it straight from the soundboard. And then you can buy it. I think you can subscribe and then you just get MP3s at different shows.

Ah, interesting. An important distinction is that Fish is a jam band. not a pop star, which means it's actually useful and valuable to listen to different shows because they could all be different, right? Every song could be different every single time and different variations of it. And just like my, like the only music I listened to to is like this, like two hour like hip or electronic podcast. It's kind of the same, but it's also kind of different, which is great for me working.

It's sort of like that's like when I hear that. Yeah, like trance. Yeah. I have a good for people, Marco Arment, he talks about he buys fish shows and that's what he uses to work. And it's a little bit different every time. It's not the same thing every time, but it's also kind of the same thing and also a little bit different, right? I think that works well for jam bands. It's super cool that it's a service. I'm not sure it works for a pop star where I think the ideas of the songs are mostly the same every single time.

So I'm a little skeptical, but to your point, there is this sort of like, you know, crazy fan aspect where I don't know, maybe they can hear different mystical numbers every single time. That will make a difference. Yeah, I mean, she seems to have already cracked the code for revenue maximization with the whole, like, I'm going to record separate albums and own my masters and people are just going to buy those albums also. So I don't know that she needs the extra bump in cash. And I would be curious how much money she would then be forsaking from like a Spotify now if she went her own direction. Oh, yeah. I think that, yeah, that doesn't seem like a good idea. I mean, there's, this is always the tension to with like doing your own thing is you do get reach and, and you do, there's an aspect of convenience, right? Like everyone has Spotify or Apple Music or something different. I mean, not you, but by and large, everyone else does. And that's important and valuable. And it's easy to forget how sort of important and valuable that is. Aggregators are there because they are useful and they're useful not just to listeners. They're useful to supply as well.

There's a reason why not all supply doesn't go independent, right? To go independent, you need a cost structure. You need sort of a setup that has to accept the reality. You're going to get a smaller audience, right? By all accounts, terrorist cost structure is very large and it is suited towards being on YouTube and Spotify and everywhere else. Yes, a good note to creators out there. If you happen to be the biggest pop star on the planet and the entire world is already listening to you on streaming services and you're getting a cut of every listen, no need to worry about going

subscription and gating off your content for the small percentage of your audience that's crazy enough to pay. Not a cut of every listen, a proportional cut of all revenue based on your share of listen. Oh, that's right. I'm sorry. We went over that last week. I screwed it up. But you know what, Ben, we made it through this podcast.

Finally, after four attempts, we finally made it through. My power didn't go off. and I feel great. It's a perfect way to start the week. Yeah, and I think it's unfair. You got me too amped up by maybe my fourth go and I got a little too fired up in the middle there. But we'll see how it goes. Yes.

We will be back later in the week. Send us your dumb ideas. Email at sharp tech.com. I thought we were going to rip off Bill Simmons parent corner. We had like some name ideas or something like that. What happened to that? Maybe we will. Maybe some parent advice from Ben is coming later this week.

You're the coach. I'm the player. Here we go. Until then, Ben, I will talk to you soon. Talk to you later.