The Vergecast - Elon Musk meets with Tim Cook, Neuralink's show and tell, and FTX's collapse

Episode Date: December 2, 2022

The Verge's Nilay Patel, Alex Cranz, and Alex Heath discuss this week in Elon Musk, everything that went wrong with FTX, and the latest gadget news. Further reading: Why some tech CEOs are rooting for Elon Musk  A Twitter executive got a court injunction to prevent Elon Musk from firing her Another major ad agency recommends pausing Twitter ad campaigns  Elon Musk is delaying Twitter’s paid verification to avoid Apple’s 30 percent cut Elon Musk says Apple has ‘threatened to withhold Twitter’ from the App Store Elon Musk says Tim Cook told him Apple ‘never considered’ removing Twitter  Elon Musk is dragging Apple into the culture wars  Elon Musk claims Neuralink is about ‘six months’ away from first human trial   Here’s everything that went wrong with FTX Sam Bankman-Fried Interview: Read the Transcript - The New York Times  Kensington made a new wireless version of its SlimBlade trackball mouse  The Genki Covert Dock Mini lets me put an entire gaming system in my purse  Now the Apple Watch Ultra can actually be your diving computer  Anker’s Eufy lied to us about the security of its security cameras   Canoo repurposed its bubbly electric pickup truck for the US Army Learn more about your ad choices. Visit podcastchoices.com/adchoices

Today on the Vergecast, the fake war between Twitter and Apple. Then Sam Bankman-Fried of FDX just can't stop admitting to fraud. And of course, all the gadget news from this week. That's coming up right after this. Support for the show comes from Retool. Too many companies run critical operations on duct-taped spreadsheets, Slack workflows, and whatever else they could cobble together. Not because they want to, but because building internal tools

means weeks of waiting on someone else's backlog. That's where Retool comes in. Build custom internal tools just by describing what you need. Prompt something like, build me a revenue dashboard on our Salesforce data. And Retool actually builds it on your company's data in your cloud with enterprise security built in. Go to retool.com slash Verchcast. We all need to retool how we build software. What's up, y'all.

I'm Skyler Diggins, seven-time WMBA All-Star, Olympic gold medalist, and mom. And I'm Cassidy Hubbard, host and reporter for me. nearly 20 years covering the biggest names and stories in sports and mom. And this is Am Mom, a community for athletes, game changers, and moms of all kinds. Dropping May 14th. Tap in with us. Hello, welcome to the Rochcast, the flagship podcast of talking to the New York Times, even though your lawyer says, don't do that. I'm your friend, Eli.

Alex Kranz is here. I'm your friend who thinks you should always do that. Do whatever the lawyer says, do the opposite. I have to encourage the audience to stop listening to this podcast immediately. I don't know what else to tell you. Just if it's like, if it's of journalistic value to me personally, do the opposite. Yeah. Alex Heath is here.

Hey, I'm, you know, I'm actually coming around to hating free speech in America. It's really quite tiresome. Yeah, it's becoming annoying, honestly. Yeah, you know, I think we should just shut it down. Let's go back to what the founders intended, which was... Quite honestly, not the free speech that you expect today. That's a different podcast. We can get into it later.

I will note for the listener, it's two Alexes today. No David Pierce. David and his family produced a child. Congratulations, David. He won't tell me what said child is named. I can only assume that he's named the baby Bluetooth 2.1 plus EDR Pierce. That's just my guess. He's holding up different cables going, this is USB2.

This is three. USBA Pierce. But David will not be here for the next few weeks. Congrats to David. We're going to have a bunch of people filling in. It's going to be a good time for everyone except David who's not going to get any sleep. But he got a baby out of it. You get a baby out of it.

Don't say that. Childbirth I've heard is amazing. Well, David didn't have to do anything. He just had to like, anyhow. But congrats to David, tweet at him. I'm sure he'll like to hear from you. Okay. So why are we talking about the tiresome of this free speech from America?

It's because Elon and Twitter and Apple went at it again this week. We got to talk about that. Sam Bankman-Fried won't stop talking to reporters about FTX. That will not be free speech for him. Yes, this is the speech that will put him in jail. It will lead him directly to not being free. And I was at the deal about conference for that big interview with Andrew Sorkin. Well, by the way, speaking of free speech from America, Mike Pence said first, I revere the Constitution and then was asked about content moderation.

was like, well, you can't shout fire in a crowded theater. Can I just say for the record, for the virtuous audience, the fire in a crowded theater line, I'm sure you've heard me or Addie say this before in the show. That line is just a throwaway line in a Supreme Court case called Shank, in which the Supreme Court held, the government could arrest you for telling people not to go into the military. We are, what, less than five minutes in? I'm just like, you know, I was already talking about fire in a crowded theater. It's gone.

It's just like driving me crazy. Episodes over. That case was overturned. in another case called Brandenburg. So it's like this like throwaway line in a case I got overturned. And everyone keeps saying it. Tries me bonkers.

Yesterday, Mike Pence, the former vice president of the United States was, you know, he was doing Mike Pence. He's like, well, you know, you can't say fire. And I out loud was like, oh, in like a row of reporters

you all looked at me. So Mike, if you're listening, I can walk you through it. The best part of this was SBF and Mike Pence were on stage together, right? At the same time. Yeah.

No, they were not on stage together. Same time. They were nearly back to back. impressive conference, incredible lineup of seekers. Again, I believe that Mike Pence is a listener of this show. Absolutely. Very strong feelings for H-GMI-C. Pence and SBF really two excellent figures,

two excellent public figures that we should all aspire to be one day. Yeah. Baby. You know, I keep telling this, I told the stroke, maybe 100 times history. It's like, I know my limit as a reporter is like a tech reporter. Like, I can't cross over into politics or general news because I just can't figure out how to pretend that I care about what Mike Pence has to say. Like, I just can't,

I can't turn it on. I'm like, yep, there's a guy. Well, he has a really great book about his time in office, Nealai. Don't read it. Andrew Ross Sorkin actually did it. It's free speech. You should read it. So the book is called So Help Me God. And yesterday, Sorkin was saying goodbye to Pence. He looked at him and said, So Help Me God. Thank you, which was deeply funny. Wow. Okay. Wow. We'll get to SPF on that stage and all the interviews and what's going on at FTX in a bit. Let's start with Twitter, Apple, Tim Cook giving Elon a tour of the Apple campus, which is a weird outcome of this whole thing. It was just a weird week of like the culture war and Elon wanting to launch Twitter

blue and the Apple tax all just colliding. Ron DeSantis. Ron DeSantis. It's just like the most crazy that you could get. Heath, what's going on? Oh, what is going on? It looks like Musk and Cook squash the beef. Musk started the week saying Apple, you know, do they hate free speech in America? No, spoiler alert, they hated in China, not America.

Yeah. But saying this and then, you know, complaining about the 30 percent, this was a few days after Phil Schiller had mysteriously, you know, the head of the app store deleted his Twitter account after Trump had been reinstated. The vibes were starting to shift between Apple and Twitter. Why is this important? Our listeners are smart, but I should just say Twitter will probably cease to exist if Apple ever decide. to kick it off of its app store. So Apple is its most critical source of distribution. Also, taxing blue, the subscription product that Elon is essentially betting the future of the company on. And so there was some speculation as to, is he critiquing Apple because he's mad about the 30%? Or has Apple done this thing that it does sometimes quietly behind the scenes with apps and say, hey, we don't like what we're seeing on here. There's too much, you know, X. I think you all Roth, Twitter's former head of trust and safety had said in a New York Times op-ed that, you know, there were people at Apple who had raised concerns about there being too much nudity on the platform before, for example.

So, you know, Musk comes in. He fires a lot of the, you know, moderators, talks about letting pretty much anything go, amnesty for all the banned accounts. I could imagine Apple got concerned. Twitter is wanting to push an update for the new to relaunch Blue, which got delayed again this week. But Apple's tied up and all that. And they have the power to actually keep. the Twitter app from being updated until Twitter meets whatever their specific slash vague demands are that they don't publicly articulate because they're Apple. Somehow, this all led to Elon Musk and Tim Cook walking Apple Park together around. Have you been there to that specific body of water, Nilai or a crayons? Yes, it's beautiful.

So I imagine, like, if you're an Apple engineer and you're out there taking lunch, taking a call, and maybe that's like a normal thing to see, I doubt it, but I would have loved to it. have seen the entourage or laughing. So it was definitely Tim Cook, because I saw the photo and I saw the shadow, but we confirmed this? Yeah, there was some shadow analysis done and it looked like him.

What if he had like a cardboard stand in? It could not even be, given the state of Twitter, you know, that could have been a fake account that tweeted that. We don't actually know that that was Musk. I will say that we were told Apple employees had seen the two of them walk around together.

Like, very specifically, like that, like they did it. it that way so that it would get out. Like they made a show of the two of them walking around such that other people would see them walking around so that they wouldn't have to confirm it officially, which is. And we assume it was because he wanted to talk about the 30%, which Twitter wouldn't actually have to pay because it's less for these kind of subscriptions. Well, it's 30% the first year.

So this is like, it drops, right? It drops to 15 in the second year. This is what I say, like, this whole story is actually. of control. We've done this before. I've been here. I live here. I have a vacation home in the app store. Tim Sweeney, you know, he sails a ship here once a year to yell about it. Like, we spend a lot of time talking about these policies. They're not great. I don't think that the vast majority of the tech industry loves the duopoly power of Apple and Google when it comes to their stores, and especially these fees are in-app purchases.

Right. And I know that that's true because there were trials about it because Epic sued these companies over those policies. The trial took a month. Apple won. The Google one is like ongoing. The Apple one is all the way up at the court of appeals. They've already had arguments. Like that's where we were all the way there. And now it's because of Elon. We're like starting at the beginning. And he's literally tweeting, did you know Apple charges a fee? And it's, To me, it's, there's an element of bad faith embedded in that. You don't say. That's like the most gentle way of thing. I have a question, though. Was the 30%? The 30% is the first year you're on the app store, right? Like the first year you have the subscription product.

Yes. Didn't Twitter already launch this subscription product? So the Twitter blue, which is, I believe is $4 a month. I paid for that version of blue because that was the one that on our site and many others got, like, blocked the ad. If you clicked on a link to our site from Twitter and you were paying for Twitter Blue, we wouldn't show you the ads. And we would get a sense. We would collect pennies from you as part of your Twitter Blue subscription.

Thank you. The business model that Spotify has used to make so many artists rich that finally come to publishing by your $4 a month Twitter Blue subscription. But I was paying for that one because I thought it was nice to pay the publishers that I visit most often directly. Was I mostly paying the company that I work for? Yes. But I was paying for that one, and that one was indeed an in-app purchase. And I had talked to Kvon Bakepour, who was two heads of product ago, Alex. Yeah, actually.

Yeah. Yeah. I know how to describe it. Kvon was the head of product of Twitter. He was reasonably successful for a Twitter head of product under Dorsey, and he was on Decoder. And I spent a lot of time asking him about the 30% 15% fee. Yeah. because everything Twitter wanted to do at that time ran into the fee.

This is Twitter blue expanding it. They were going to do a competitor to a substack. You know, the swirl of NFT nonsense. It was raging. It was like, NFT summer. And I was like, what are you going to do about these fees? And he was very clear in that interview, we are not in the business of skirting the platform rules.

We're going to pay the money and try to build our businesses the right way. And maybe if we get enough leverage, we can go talk to. Apple. So that's where Twitter was. This new version of Blue $8, he needs every one of those pennies to make up for the lost advertising revenue. Right. But my question is, did Apple restart the clock? Was Apple like, oh, new owner? All right, we're back to 30%. You got to wait a whole year. No, no, no, because it's a new product. It doesn't matter. Oh, it doesn't matter. Okay. Right. It's the consumer. It's not the company. So I sign up the first year that I

subscribe to you, Alex Cranz, and then that purchase, Apple will take 30%. The second year of my subscription to you is 15%. Okay. But that's per product per customer. Okay. Yeah, I actually think we're maybe overplaying the importance of the 30%. Elon has even talked internally since he took over about how they're intentionally only doing blue through iOS because they want to use Apple's payments layer and security because they don't

have it in house. They don't have the ability to do it. So I don't actually think Musk has a problem with the 30%. If anything, he was probably sending out grenades because a conversation had started to happen where Apple was going. And this is exposing the reality of Silicon Valley, which is that Apple is Silicon Valley's strongest speech regulator. They just don't call themselves that. And that's because they routinely will go to a social network if they don't like what they're seeing or they don't like the direction, something is going. I mean, they booted parlor.

This is the most famous example of them actually. Whoa, whoa, that's not the most famous example. What is the most famous example? Booby Gate at Tumblr. Yeah. Okay. I know it all comes back to Tumblr. It always comes back to Tumblr.

Always. I would say parlor in the moment it was in was a bigger deal. But Apple is Silicon Valley's de facto speeches are because of the way they leveraged the store. What probably happened around the time Schiller deleted his account was Twitter got a message saying, hey, we're noticing the direction that the site's going. All the reports we saw early on about the spike. racist tweets, hateful tweets, you fired all your moderators. We have concerns here.

And guess what? Twitter's trying to cue in the revamp of Blue, which they need to push an update for, which Apple can hold. And they do this all the time, where they don't say, we're going to remove you. They say, ah, this update,

you know, it would be a shame if it never, you know, came out. And that's probably what was going on. And, you know, Elon actually responded to our own Jake Castronachis earlier in the week when Jake asked, directly, is Apple threatening you all or making moderation demands? And he said yes. And so that conversation with Cook was probably Elon saying, no, look, like, I care about this stuff. You know, I don't want the bad stuff. And Cook going, okay, okay, now give me my 30 percent. And Musk left.

So definitely, just real quick, it definitely, definitely wasn't him going and begging Tim Cook to do what Tim Cook is repeatedly refused to do and buy Twitter. I don't, well, it's kind of amazing that this is what got Elon a meeting with Tim Cook, because if we all remember, there was some reporting, I don't remember if this was two years ago, three years ago about how there were conversations where Elon maybe wanted Apple to look at buying Tesla many years ago when it was struggling. And Tim Cook, like, did it answer his call? Yeah. And Cook was like, we've never spoken.

And it only took buying, you know, Twitter for $44 billion to get a meeting with Cook. Well, no, we can unpack that further. So I think, Alex, the general sweep of what you've laid out is correct, right? What we also know is that for Facebook or Instagram or any of the big companies, it's not just an irregular series of conversations with Apple, right? If you run an app like Twitter or Instagram or whatever it is, your relationship with app review, you're in each other's pockets because those companies are pushing updates constantly. that's why their release notes are so bad in their apps.

Like it's just like bugfigs and other improvements. It's because they're just like hundreds of updates that go into these apps constantly. And they want to push them out really fast to support whatever they're doing. At the other companies, there's basically an entire staff of people that just manages Apple. Right? Like you're in charge of these app reviewers. You're going to Phil Schiller and Eddie Q are your best friends. Take them out to dinner.

Take them out to, like, get it done. Yeah. Elon fired all those people. So there's a, there's, I would say like, yes, maybe Apple's a little worried, yes, whatever. At the same time, the way to express those concerns and the very true implicit threat of, if you don't meet our demands, we can kick you off the store. Elon just doesn't have the people who can translate the Apple weirdness for him. Yeah.

To manage that relationship. Yeah. And I think this just quickly spiraled out of control where Apple is probably saying stuff it almost always says. That's my vague understanding of it that from Apple's perspective, this was just the normal course of business. And like if you're not used to the mafia, the sort of implicit threat is like very threatening. Yeah, you got to go make your pilgrimage.

Yeah. So Elon was like, they threatened me. And Apple's like, no, no, this is just the basic. No. This is just like the foundational threat. We didn't even take the bat out of the car. We left it. We're just knocking.

We're just saying hi. What's the problem? Can I tell you about a thing called app tracking transparency? Exactly. So here's what we did. We destroyed Meta's business overnight and made it seem like we're the good guys. That's what we're able to do. This is such a strange dynamic because as we also found out this week, and it makes

perfect sense to where I wish I would have just thought of this earlier, Apple is Twitter's largest advertiser. Yeah. So not only is Twitter. totally relying on Apple to survive from a distribution perspective, they also need their money to just, like, pay the bills.

This is a question mark. I don't know why Apple is Twitter's biggest advertiser. I don't know what they get out of it. Because they hate Facebook. Where else are they going to advertise on social? So, I mean, like, Apple famously will not even put Facebook in, like, an app store list of, like, apps you need for the holidays. Like,

Apple will not touch Facebook or any of their properties. They also don't really care about targeting, as we see what it's, So if you're them, like Twitter is actually the perfect platform. It's like just a brandy advertising thing for events and live stuff, which they do all the time, that promoted hashtags. It makes perfect sense that Apple would actually be Twitter's largest advertiser. I'm just kicking myself that I didn't think of it sooner. And that spend is going down.

Right. There's some reporting that it has gone up. Well, you can't just Twitter is not plug and play like Facebook is where it's a lot of direct response advertisers that are running like hyper. measurable campaigns that can be turned on or off at a dime. Twitter is much more brand-centric. We've talked about this on past shows. And you can't just claw back everything immediately. Although it seems very real that Apple has significantly clawed back at spend, though,

not all of it. So that's one piece, right, which is the overreacting to the threat of app store control, which is very funny. Like, I think app store control is bad. I think if you have listened to this show for more than five minutes, you know that I think Apple's control of innovation on its phone is maybe a little bit more than it should be. Yeah. And that's like me being nice.

But it's still there. And it's also just everyone knows it. Like we've done 15 rounds of this story. It was kind of like when like your parent calls you after an Apple event and says, well, did you hear they had of a new iPhone? And you're like, yeah. Yeah. Yeah. Definitely.

Like it's the same thing. Actually, my mom lately is, I'm like, what does the new one do? And I have to be like, uh, dynamic island. Dynamic. Parents are not impressed by the dynamic island. It's not a talk point for that. It's a black box on the top now. You can't move. I will say that my mom, first of all, my mom cried when Steve Jobs died. That's a real fact. She was very sad about it.

And now lately, she will never, she's unhappy with their phone. She's like, Steve Jobs would have never been signed a film like this. It's like perfect. Can you imagine Steve Jobs negotiating with Elon this week? He wouldn't have. can imagine. I would spend the rest of the show just writing out that negotiation. He would have destroyed because he wouldn't put up with any of it. This is actually, I think, the important thing. This is why Elon ended up on the Apple campus because Tim Cook is an underrated savvy political operator.

Right. If you think about Tim Cook and what he accomplished over the past five years, yet we can name a lot of things. Actually, at the top of the list is managing Donald Trump, Foxconn, and China through a trade war and coming out having manufactured and shipped war iPhones than ever before. Because that was not a guaranteed situation at all. Well, it's not great for him with Foxcond right now, but. It's not, it's going very badly with him for Foxxon right now. But in terms of his understanding of how to manage that kind of personality, he has more practice than maybe any business owner in America.

Right. And Alex, he, well, and the two Alexes. And he keeps reminding me a lot of what we're seeing from you on right now tracks with Trump. Like it's very reminiscent of Trump. Yeah. Yeah. So I don't know this for sure. But I have spent over a decade paying a lot of attention to Apple and knowing a lot of people in and around there.

Like, you know, sometimes I'll just be in my house, like pouring coffee and my wife will walk into the room and be like, why are you tense? And I haven't said a word to her and we haven't been in the same room for more than 10 seconds and she knows. And the vibes coming off Apple. we're that, right? Like, you just pay a lot of attention to this company. You see it. You're like, I'm charging my mouse right now and it's upside down. And I'm just pissed.

And my sense is he started doing these tweets about Apple on Free Speech and the store and the 30% and they wanted to come out storming. And basically being like, yeah, it's our store 30%, like our way or the highway. We just beat Epic, screw you. And then the weird GOP tweets started. head crews lit up and ronda santis lit up and mike lee who co-sponsored the antitrust bills lit up tucker carlson did a segment and the culture war started adie mckenna wrote a great piece about this apple like elon drove apple into the most unpredictable ideologically incoherent part of america which is the gop culture war and they realized oh this somehow this is going to end with a bill that

allows side loading on the app so yeah and they decided to that instead of going on offense, Tim Cook would be a politician, and he would charm Elon with a walker in a circle around the campus. And I'm pretty sure that that is just the, the flow of that decision that occurred. Because unlike Epic and Fortnite, when they went fully on offense, they see this other thing, this other thing that Elon has a handle into, which is just the wildness of the culture war. Like, Fortnite did not get a Tucker Carlson segment about free speech. No, no. I mean, what did Ron DeSantis say, it was basically like, if Twitter is banned by Apple, you know, we need to regulate Apple.

Yeah. I mean, that was the directs. Yeah, he's like, Congress should respond to this like raw demonstration of monopoly power. And it's like, first of all, it's not that I have not sympathetic to it. Yeah. Right. We've had like David Cicillini and Amy Klobuchar, like, have been on the show talking about their antitrust bills.

Yeah, I get it. But the solution is like market competition. it's not we should punish Apple because they pissed off Elon. And when you're, I just think that level of unhingedness actually made Apple change its tactic away from what they did with Epic, which is we'll see you in court. Like, what's going to happen, though, because we also have Ireland, who is saying you suck to Twitter and it seems ready to like find it into oblivion? So we have like, we have. So, wait, actually, it's organized this conversation. So like, I think Keith was saying, let's.

put a bow on Apple. We should talk with the rest of Twitter. And to put a bow on this, you know, with how smooth Tim is, Elon tweets after the media and goes, look, we resolved this misunderstanding was the word he used where, like, two days before, maybe even a day before, he was tweeting at Jake and other people being like, Apple hates free speech in America. He meets with Tim Cook for 30 minutes. And it was like, it was a misunderstanding. Tim was clear that Apple never considered banning us.

Everything's chill. And then he follows Tim Cook on Twitter. And then it's like. And he deletes is, I'm going to go to war with you tweets. Right, right. So, like, if you're going to come at the king, you best not miss. I mean, that was the lesson, I think, for Elon and Apple this week. Wait, who's the king in this scenario?

Tim Cook. It's Tim Cook. Is it because... Tim Cook, absolutely. No, because Elon threw a giant tantrum and got what he couldn't get for years, which was a meeting with Tim Cook. That's not... He's the richest fan of the world. If he really wants a meeting with Tim Cook, he can get a meeting with Tim Cook.

Also, like, Tim Cook didn't come to Twitter. Apple, you know, like Elon came to... Apple. Like there's this. Tim Cook's not going to like go meet. Yeah. Tim Cook is not wandering the, the desolate empty halls.

Which is what works. He's like, we're not even getting in the building. We're going to walk around outside. Kitchen sink sitting over there. Yeah. I mean, that's the,

I mean, we have no idea what was said in this conversation. But Microsoft has tried for years to get out of a 30% cut. Microsoft has tried for years to evade apps for rules around game streaming and give Apple. they can't get there. And so I think you, there's no way that Elon got anything out of this deal.

And I have no idea what Tim traded ahead to make him tweet what he tweeted, right? There, there has to be, they're both savvy business people. Yeah. They're not bad at this. They had to have come. He didn't just tell him he like, like, oh, I forgive you. Like, he was, they exchanged something. We have no idea what that exchange was. The most logical explanation was Apple was threatening to keep Twitter's app update and purgatory because of concerns about content moderation. Elon assured Tim that he had a handle on it, which, uh, debatable, but he obviously assured Tim and they left the meeting, Tim going, okay, we won't, we won't keep you in purgatory. That's the most likely explanation of what happened. I actually think

30% was maybe not raised at all. I would be shocked if it actually was because like that's not, that's a non-negotiable thing, right? That's, well, it is negotiable, depending on who you are. It's, yeah, it's negotiable. If you get a bunch of right-wing members. members of Congress to sign on Clovichard's App Store bill. It's right there. And it's,

it was on an unlikely outcome. Yeah. Right. Right. Like that's, and I think Apple recognize that and that's why they played it this way instead of the way that they haven't played it.

By the way, Apple's position, this whole time has been clear since the epic trial. Yeah, you can do side loading on a store. Yeah, you can, whatever, the stuff were forced to do in South Korea in other countries, developers still have to pay us the money.

Right. It's not just you can get around us. It's what we actually care about is the money. And the decision, at least in this country, the judge basically said, yeah, Apple is entitled to being paid for its intellectual property and its effort developing iOS. So even if the bill is passed, Apple is, they've been pretty clear and consistent this whole time. And they have rolled out this system in other countries that require, you know, other kinds of in-app purchasing systems to be present on iOS. The Apple still wants a cut. They don't really care. Yeah, you might not use their credit card processor,

or what Apple's getting its money. And I think that's actually the non-negotiable part, whether it's in-at purchases or whatever else. And I think Elon is smart. I think we can agree on that. But coming late to the game and pointing right at Tim Cook's services revenue line, and being like, what if less is like,

you got to try harder than that? That's the reality of life. The sun will rise and Apple will get its money. Yeah, exactly. All right. Let's talk about Twitter itself. Keith, you've been reporting on it. Yes.

What's a vibe in there right now? Oh, well, I think, Monday was like the perfect like just microcosm of life inside Twitter. So Elon sends this email at like 3 a.m. as he's prone to do saying we're going to do code reviews again. Bring your lines of code, which any engineer will tell you is an absurd exercise. And reminded again that he expects managers to be coding as well, engineering managers. I think his direct quote was being unable to do so as like a Calvary captain who can't ride a horse. Does he like?

And does he know? how like anything works outside of like the Elon Muskcrafted world. Does he just understand? He's the richest man in the world, Kranz. He knows all. He knows everything. He knows everything. We respect capitalism in America and free speech in that order.

So anyway, he sends this email. Everyone's like frantically trying to figure out what this means. Does this mean more people are about to get fired? The code review doesn't happen. So everyone shows up to Twitter, San Francisco offices for the Elon Code Review Monday evening. He's not, no one can find Elon. There's no code reviews that happen. The fire alarm does get pulled, and a bunch of engineers end up spending about an hour standing

outside of Twitter's office as they figure out what goes on with the fire alarm. So that was like just Monday. And then progressively fire alarm got pulled? Yes. That's really good. So that's just like, and then you have this remarkable thing where you have, and I think Cranes, you were wanting to mention this earlier, Twitter's VP of Public Policy who's based in Ireland, sued the company to keep them from firing her

over the hardcore ultimatum that she didn't say check the yes to from a couple weeks ago. And she won. Like, this is the first example of a VP that I've ever seen suing to stay employed. Have we heard of this? Is this a thing that's happened? I mean, it's very common in, like, Europe,

because they have much stronger labor laws there. So I think we've seen this repeatedly with Twitter in Europe, is that he has no grasp of labor laws there. And he doesn't understand that, like, he can't just fire people. But I'm saying a high-ranking executive suing a company to stay employed. Right. Again, I think this is like a very European.

In America, we solve our problems with cash. Yeah. That's true. Right. So you're mad at your company in America. You sue them. You're like, pay me however much money it would have made the next year of employment. And then I'm done with you.

Other countries, other legal systems, other remedies are available. Like, no, you have to hire me back. Yeah. Yeah, you're going to hire me back. I still work here. So it's just, it's just, I think it's an, and like she was, she was technically like employed still under European law, but like had been locked out of her systems and she's just like twilling her thumbs. This is a VP of public policy being like, and now she's apparently back in the slack. It's like amazing.

I think it's also in Germany. There's either Germany or France. There's a number of Twitter engineers who are also suing because they also got fired and you can't fire them. Can't just do that. Yeah. You have to give like a ton of notice. pay them out and all of this. And they're like, no, you, you broke the law. We're not America. Yeah. So he's, but he's also struggling like, he's struggling with the labor law there,

but didn't the EU commissioner this week, one of the EU commissioners say, we're going to like, what was it? Yeah. They've got to have the data controllers that they, I mean, the EU is a very regulated environment, especially as it pertains to privacy issues. And they're like who all the people are gone. So get back on your game. He told Mr. Britain, so this is from the Irish Times, Mr. Breton told Mr. Musk he must adhere to a checklist of rules including ditching an arbitrary approach to reinstating band users,

pursuing disinformation just aggressively, and agreeing to an extensive independent audit of the platform by next year. None of that's going to happen. So, I mean, you say that, but the EU has a pretty good record of, like, bodying tech companies. Yeah, with fines, which, I mean,

and that's... With fines for a company that needs to make how much money? Yeah, that has no money. Yeah, I know. I think Ireland's a dark horse in this race for Elon. He keeps ignoring the world exists. Whether the FTC decides, finds any evidence that they have actually violated their compliance requirements in the EU. If either one of those regulators decides to act on Twitter, that could legitimately put it out of business. Right.

Yeah. And instead he's like, I'm going to pick a fight with Tim. Yeah. Well, he did wear a suit for the meeting with the EU. So maybe he is taking that seriously. Elon is not bad at getting government money. In fact, it might be his greatest skill. It is Tesla is the way Tesla makes money.

And SpaceX. Carbon credits and grants. And SpaceX is a government contractor. So it's, I don't think that I think we might, I might be saying that Tim Cook is an underrated political operator. That's the main thing he does. It's true. Elon is a pretty good political operator too.

The differences, Elon's businesses are monopolies. Right. Like, where are you going to go, NASA? right like the SLS is like not doing it for you like you got one choice where are you going to get like who are you going to buy your carbon credits from it's Tesla so there's just like an element uh and if you're like a state governor and you want to prove that you're green but you you say you'd have a supercharger put in right like I just I think there's like there's just a difference in complexity that both of them face and I think fundamentally this EU stuff he's he's about to learn

what it takes to run a business there and there's a reason And a lot of these, like, when we talk about regulation in this country, like, the VCs jump out of the ward work to be like, there's a reason there's no innovative companies in your heart, which is not true. But that's the argument is the regulatory environment is so insane that you can't do it. And I think Elon is trying to run this thing like a scrappy startup, but it is actually like a world historically important communications platform. And the Europeans are they care about it a lot. Yeah. What else is going on inside of Twitter, Alex? Is it is it settled down? I would say it's become very very. Very siloed. So like inside Twitter, you used to be able to browse any Slack channels, see basically what any team is working on. That is stopped. So channels have all been set private. He's doing these like inserting different language and different emails to try to find leakers. Edicts are still being mysteriously passed down from Tesla people inside the company about what Elon wants. The internal directory is not online. So there's no, nobody really has any understanding of like who reports to who, how orgs are set up. It's been communicated like in a team siloed environment, but not broadly. And, you know, he said that like this transitional period, he may get a lot of things wrong. But, you know, the idea is that in the near future, all this will become more visible. It'll make more sense. And then he'll step back and appoint a CEO, I guess, which, you know, I can't wait to see who that is. But yeah, I would say right now

it's still people just going, if you're not working on an Elon project, right, which is like encrypting DMs competing with YouTube by adding video to Twitter and doing monetization, blue, the revamp of blue and verification. If you're not working on something like that or cost cutting, you're kind of twiddling your thumbs and trying to understand who your manager may or may not be tomorrow. There was a lot of noise in, you know, wave five of layoffs that Twitter wouldn't survive the World Cup. Things were going to start breaking. Is that starting happening? Yeah, I'm glad you brought this up because like literally as we were talking. I got another notification from a, from a musk boy, like, referencing one of my tweets where I said,

you know, Twitter employees were telling me they expect the site to stop breaking and everyone's dunking, you know, still waiting on this, like yada yada. I just also, like, if you're a musk boy and you're listening to this, like, your experience with Twitter is not indicative of everyone else's experience with Twitter. So, like, just because you're not experiencing something breaking doesn't mean stuff isn't breaking. We've seen, like, my timeline's gone bonkers a couple times. I don't know about you guys. We're like all of a sudden. Notifications have been breaking. There was a moment where SMS verification wasn't working.

There's been little glitches all over. And I do think we as the media, the week of the first purge where half of the employees were fired, we did maybe buy a little bit into the hysteria of like, because we all have this weird relationship with Twitter too, where we're all just like, oh, what happens? I was part of a Twitter space that went on for hours where it was like, what is Twitter meant to you? What's going to mean when it's gone? Yada yada.

And I can understand people trying to latch on to that and say the media like wants this thing to fail and wants Elon to fail. And I would just like, I can only speak for how I report, but I think for all the people who are reporting on like what's happening inside Twitter, Casey, Zoe, et cetera, we're just relaying what employees are telling us. And there were a lot of current and former Twitter employees with direct knowledge who were very, very concerned based on the cuts Musk made that it would lead to a catastrophic outage. very quickly. That's not like a reporter saying, oh, I'm like pontificating or just like assuming this is going to happen. I'm just like, I'm saying what employees are telling me.

So you can trust that or you cannot. That's fine. Like you don't have to, whatever media is fake. But that was the real concern. And it's actually amazing that hasn't happened. I think it's a testament to the people who already were maintaining Twitter, the fail safes that were in place

when you have a service this large and you have any level of competency in how it's run, which, you know, Twitter didn't have as much competency as it should have, but it did have a lot. There are a lot of fail safes in just ways that, you know, the service can stay operational even on, you know, a skeleton crew. But that said, there are, you know, glitches, and this isn't going to mean that, like, Twitter won't break at some point.

It very well could. Musk has, like, been pretty open about that. So I just wanted to address that because, like, I'm still getting at messages about that. Also, the World Cup just started, right? Like, we're not even to the ones where people, like, line up and pack in the bars. I mean, I guess some of them are. We've seen some of that.

But, like, we're just in the beginnings of the real crunch period for the World Cup traffic for them. Yeah. And it may go off great. And that will be great if Twitter doesn't break. I don't want it to break. But there's, you know, there's a lot of institutional knowledge that's gone. Like, we were just talking about with the App Store stuff. You know, there's a lot of people that, like, there was a moment where the Wi-Fi went out.

FTC regulation. Yeah, compliance. Like, there was a moment where Elon was in the New York office and the Wi-Fi went out because, like, the server room where the Wi-Fi was overheated and no one knew how to get in there and fix it because, like, you fired the person who knew how. So there's going to be stuff like that that just happens. And that's what Elon bought and that's what he did. Yeah.

I think that will it break right away. That particular day was bonkers. Like, it's software. Like, I think we've all experienced software that just sort of putters along. Yeah. There was definitely a hysteria. there was a hysteria. And I think people were acknowledging it at the time. I think everybody was even being like, I'm hysterical and I don't know what's happening. But like, so I think people were pretty candid about it. And it is just part of that conversation where where there's both sidesism to this whole thing. Everybody has to have like a team. They have to be team Elon or team Twitter or something. It's like, no. Team Twitter. You don't. Well, so Elon keeps tweeting the numbers are up, right? Engage time is up, that users have gone up.

using the metric that he said was totally fake. Very confusing. I've experienced the flip, and I know a lot of people who are kind of on the flip side of things, where I took it off my phone. Yeah. Because my experience of Twitter, in addition to just stuff breaking,

like when my notifications break, they break in the most deeply hilarious way. They just recommend tweets from Elon. I hate, ooh. Like that's, and I don't follow Elon. It's just like, here's another tweet you might like. And it's like, no, you got this wrong. I don't need more of this.

This is why I took it off my phone. But I know a lot of people in the past week or so who are like, my experience of Twitter is becoming more negative because he hasn't even let everybody back on yet. But the people who remain are like more inclined to yell at one another. And they're more inclined to test the limits of what is and isn't allowed anymore. And it's just noisier. And more people are on Twitter talking about Twitter, which is just the worst. And that to me is the real danger.

Yeah. Yeah. Right? Is that the people you need to make it vibrant will get driven off or they'll quit or they'll find something new or I think maybe what might be the healthiest outcome will all just stop being addicted to social media feeds in this specific way and like something else will emerge, which is really unusual. If you just think about the number of times that that kind of shift has even been possible over the last decade or so, it's maybe three. like at best three. I'm thinking it's like Friendster to MySpace,

MySpace to Facebook, and then the emergence of Twitter, and then maybe most recently the emergence of TikTok. Right? And like I said three and I, the Friendsster to MySpace to Facebook, that's just this one. That all happened in like 24 months.

I think snaps in there. There's some other shifts in there. But we've seen a lot of shifts though, right? Like I think one of the earliest ones wasn't even Friendster. it was Live Journal. Live Journal was a social media platform. It was really big.

It was a different kind of social media platform. And then everybody was like, oh, Russia's bought it. We got to kill it. We got to leave this place. We can't have the Russians own us. This was, what, 2009 or something? And it didn't die rapidly. I think that, like, I would honestly say live journal is the most similar analogy to this,

where suddenly got a new owner. Everybody started to really question what they were doing on the service, why they were doing it, and whether they were, like, being good people by using the service owned by people who were potentially not good. It might not use their data correctly. And then what happened was it's a long, slow death. There were a ton of clones. Everybody said, dream with.

This is the new future. Dream with. I mean, I'm sure people use it. And then a bunch of people migrated to Tumblr, but it took, what, three or four, five years for that to happen? It just happens like this long, slow thing. We saw the same thing with Tumblr. Like, we've seen this happen with these smaller social media platforms, not just the big ones. And in those smaller platforms where you do see these big changes that upset the majority of the users,

it's not a big sudden shift because people don't operate that way. Like Tumblr died and everybody said, Pillow Fort's the new thing. And the same thing that's happening now with High Social has happened with Pillow Fork where it couldn't handle. What are you? What are you even talking? Yeah. Alex is just making up service names. You're just saying words to me.

It's still a exist. She's like Cluckaduck. That was huge for a minute. But the same thing that happened, though, where they just said, where everybody's like, yeah, we're going to go to this. It broke it. And it's slowly coming back. But, like, we've seen a time, time again with these smaller platforms that it isn't a sudden migration. It is always a very slow thing.

Yeah. People will experiment. You know, I noticed that tapbots, the maker of one of the best original Twitter clients, tweet bot. They're building a Macedon client now. I actually just got on the beta. Thank you, Paul. And, like, there is interesting activity happening on Macedon. I don't think Macedon's going to necessarily, like, take the world by storm.

I think people don't want to organize or understand servers. Like, that's just an inherent human nature thing to, like, not give a shit about servers. But Massadon's trying. There will be other stuff. But I think, like, Twitter is really Elon's to mess up. Like, either it will get fined out of existence. or he will not have anyone left who can actually make it better and he's not able to hire for some reason,

which I think he actually will. I think he actually, I've actually gotten random people emailing me being like, do you know how I can apply to work at Twitter? Wow. Yeah, like people, engineers. You print out the last 50 page. Yeah, you print out your code.

Just go over there. Just hold them up above your head, like saying anything. Or you just show up to one of his show intel events. Like we had the neuralink event this week where almost nothing happened. He showed a bunch of old videos. and then he was like, maybe I'll stick a chip in my head one year, and you could watch him. I was watching. Wait, hold on.

Let's take a break. We come back. We'll talk about it. Seamously transition from monkeys, wirelessly charging their brains to Sandbank. We're going to take a break. I'm going to figure out that transition. We'll be right back. Support for this show comes from Shopify.

Every thriving, successful business has to start somewhere. A good place to start is a relatively simple question. What if, given the right tools, I've really put my all into this. One tool that can help grow your sprouting business to new heights is Shopify. Millions of businesses around the world rely on Shopify for e-commerce. They offer a host of helpful tools you can take advantage of, from payment processing to analytics to website design.

Their design studio includes hundreds of templates to help you create the exact website you've been envisioning for your business. If you're wondering, what if I need help? Then no worries, because you're never left to fend for your business. yourself. Shopify's award-winning customer support is available 24-7. It's time to turn those what-ifs into a thriving business with Shopify today. Sign up for your $1 per month trial today at Shopify.com slash vergecast. Go to Shopify.com slash vergecast. That's Shopify.com slash vergecast. Support for the show comes from Grammarly. You don't need reminding that the world

moves fast. But work today requires clear communication, and when every message counts, sounding rushed or generic can be getting lost in the shuffle. Grammally gives you one place to think, write, and finish your work where you already write, while giving you access to agents that help you sound natural and engaging. No matter what kind of writing you're doing, Gramerly helps you get ideas done faster and move from draft to done with less friction. You can use Gramerley's AI chat to brainstorm ideas, outline a solid draft, then refine it with context-aware suggestions that fit what you're working on. See why 90% of professionals say Grammarly has saved them time writing and editing their work. In a world of generic AI, you don't have to sound like everyone else.

With Gramerly, you never will. Download Grammarly for free at Grammarly.com. That's Grammarly.com. Okay, we're back. Let's talk about Neerlink briefly. We're just all musk all the time. So he had the event. He did announce some things.

But the most improbable is that he will start implanting brain implants in people within six months. He originally promised in 2020 to do the brain implants. So they were like, they were like, I think it was 2018, 2019. He said, 2020, we're going to be implanting these in humans. And then 2020 came. And then they're like, actually, it's going to be 2022. And then just, what, November 30th, 2022, they were like, no, no, no. It's six months from now.

But the majority of the time for the Neurilink conversation was spent on, like, saying we really don't do the monkeys enjoy being tested on. We're totally fine because Neurrelink has been getting a lot of flack for the fact that it does a lot of animal testing. And it's like, sometimes the monkeys die. Don't worry about it. We're going to put chips in people's brains. Thousands of monkeys have died is what writers reported today, or USA today. So many. Also, you can control the mouse with your brain slower than you could with your hands.

All I'm going to tell you is a single most important part of this entire demo, which was all for recruiting and they were very open about it. Come work, go work it. And you're like if you want to be the cutting edge of monkeys typing with their brains. They like got deep into chargers. And like, here's the problem. We need to, it needs to be convenient. It needs to deliver a lot of power and go fast. We also can't heat your brain up more than two degrees or we'll kill you.

That's fair. I was like, this is raw. Like I wish more tech companies where there's raw and stating the problem. You know, thermals are a huge issue and a lot of technology. And when you put that in the brain and you heat the brain, you got to be careful. They're like, so here's our solution. And they show this like, you got to watch this video. Like this was this was the president is, there's not Elon.

It was like a Neurrilink engineering manager. And this is his life. He was dead serious about this. Like it, I got to charge you up in more than 15 minutes. The battery has to last all day. And I can't, I can't boil your brain in your skull. Very challenging problem. And he's like, so here's what we've done.

There's a lever that delivers banana smoothie. And the monkeys have learned to charge their own brains by standing under this wireless charger. And they're like, here's this monkey. And he goes, and he's just like drinking a smoothie. And there's a graph. And the graph goes up. He's like, see, it's charging.

Watching this one, this rules. Like, I honestly wish more Apple events featured this exact situation. Monkeys drinking smoothies, wirelessly. charging. Yeah, like Samsung used to be close to this. They've really toned it down. There was a time when any Samsung event would veer right into. Also, in addition to washers, dryers, nuclear submarines, a fleet of charging monkeys. Like, it was always right there. Little smoothies. They've really toned it down since. I'm just saying this was like that part of this event the whole time. I was like all events should be like this. Yeah.

Just do we think the, do we think the monkeys could learn how to code and then they could be at No, he addressed this. He addressed it. He was like, the monkeys, because he's doing the demo where the monkeys drink in the smoothie and it's moving the mouse and typing. And he's like, I just want you to understand they're typing gibberish. We do plan to one day maybe make them type. That'll be huge.

Yeah. Like he definitely, but it was very clearly a joke, sadly. The monkeys get pissed when the code review gets canceled. Yeah. Lose their minds in the office. I've worked. I filed it. Saving my job.

Speaking of illegal things with my job. monkeys. Oh, there it is. There's a segue. Yes. That's a good one. So, Neely, Nilai, you, you were in Are there monkeys in the Bahamas? That's what I was like, I was like, there's got to be monkeys in the Bahamas. Speaking of tropical animals, Bahamas. Yeah, so Neely, you were in beautiful New York City this week to watch Andrew Ross Sorkin of the New York Times do his annual deal book conference, and he had none other than the illustrious Sam Bakeman-Fried there virtually. He was the closer. A pretty remarkable interview, we watched it, you were in the room. Can you just describe what it was like being in the room for this truly bizarre moment? And we should note that like, people were mad that Sorkin

was even doing this interview, right? Because SBF is, I think we can all say here, like, probably a criminal, allegedly. And yeah, so there was like a debate about whether this interview should even happen. And then it does happen. And what was that like? It was strange. I will candidly admit that I feel a sense of smugness about all of crypto because we have been so skeptical of it this whole time. And so the way we have covered it, I think, is a little more detached than people want us to be. Like, we're just not as mad about it. And I recognize that people have had their lives destroyed. And I am mad for those people on their behalf. And that's actually how Andrew opened the interview with Sam. He's like, here's some letters I got from people whose lives

have been destroyed. His life savings are taken away. But just from the verge of consumer site, it's not a financial services site, it's not a business site. We're a consumer technology site. And so we just covered it sort of a remove. Like it's a caper to us, I think. So it was interesting to go into that audience,

in the deal book audience. It's the code conference. Like, it's the closest parallel to it. Bill Ackman's in the room asking questions. All these big investors are in there, major businessmen are in there, major politicians are in there.

Pretty cool to be in that room. Like, that was neat. And for most of the day, like you're in a large theater with a lot of important people. There's just like a layer of background noise in the room, no matter who's being interviewed. Reed Hastings is on stage, talking about the future of Netflix. There's sort of like a layer of background noise. People are getting up, like I got up in the middle and took a phone call.

People are typing. There's some like murmurs. There's reactions to the interview. You know, it's very polite and respectful and people are focused. But there's sort of like this layer of background activity happening in the room, right? Yeah. It's a big theater. You get to Sam and it's just pin drop silent.

Like no one's even moving. Like no one knows what to do. And it's remote. And Sam can't perceive the room. Like this is the, here's the hard limit of a Zoom conversation. Right? Like he's looking into his webcam and he can see Andrew Ross Sorkin and he can probably

hear the room. And Sorkin is on stage and I was sitting off to the side so I could see what Sorkin was looking at. He didn't have a lot. a monitor that he could not see Sam. Sam was behind him. So he was just looking into the camera to create the illusion of eye contact. It's exactly what I am doing right now. I'm staring down the barrel of a camera lens to make it look like I'm looking at the two Alexes, but I'm looking in my camera lens. And I was like, oh, Andrew Ross-Wirkin is a CNBC anchor. Like, he's just falling back on his cable news training to create intimacy, even though he is dead aware of what's happening

in this room. And yes, there's what happened. happen on we should talk about the interview and sam and the scam and all that stuff i just from a creation of a cultural moment using technology standpoint i was just like blown away like i i've never experienced anything like that and i've been to a million of these conferences we've done a million interviews i host an interview show remotely but that mismatch between here is this room full of bankers and executives and politicians just tensed at the on the edge of the their seat, all kind of like, you should shut up. Like, shut up.

That's the amazing thing. And he's just like video chatting. Yeah. He's just having a time. Didn't Sorkin ask at one point, like, what are your lawyers advising you? I mean, like, that was the big question we all have was like. This was like the most incredible mumbled aside of all time. He was like, are your lawyer selling you to talk to?

And he's like, they are not. And then he just kept talking. Because there were times where Sam would look off to the side of the camera. And, you know, Liz and I and others were on Slack and we're all talking and we're like, man, is he looking at his talking points? Is he looking at a lawyer who's going, no, like, what is, what is going through this guy's head? I think he was just doing, there's a thing I do it a lot, a lot of people do where you sometimes will like look away when you're talking and trying to get over whatever conversation you're supposed to have. And I think that's just a tick of his that he has. Yeah.

It was just very strange. I mean, he, from what I can tell, he continues to just admit to frauds. Like he won't stop admitting to frauds, which seems like a huge problem. Well, he said he didn't intend to do fraud, I believe. And he apologized for everybody's losing their money. He's like, I just want to do right by my customers. And I was like, well, you know where you could have done that. Yeah.

Yeah, but it was like this weird exercise of like, I don't know how the thing I made works. It was like the common refrain he would go to. He was like he was pointing to some boogeyman that wasn't him. that he couldn't name because he's obviously the culprit. Right. And so what are you going to do if you're also like enough of a psychopath to put yourself in a public interview in this moment? You're going to just like invent something to blame that you can't describe. I mean, is that a fair read?

I don't know how else to describe how he handled it. I was talking with Liz a bunch about this yesterday. We were trying to figure out why is this man coming and talking to everybody repeatedly. Wait, before we go any farther with this, let's just back up a little bit. Heath, can you tell us just the elevator version of what's going on with FTX? Sure. This is probably important. So FTX basically started as this hedge fund called Alameda Research. They did a very basic thing and made a lot of money doing it where they basically traded the difference between the price of crypto in one country versus the next.

I believe it was maybe Japan in the U.S. for a while. Sam Beckman-Fried, young dude with seems like other really young people, some of which he had extra, you know, kind of relationships with are all running this thing. It's like a classic like finance bro, like pounding red bulls like at your desk all day thing. And FTX gets created as Alameda's taking off. And, you know, I'll skip all the all intricacies with essentially how it all came down is there was an obvious, you know, massive collapse in the price of cryptocurrency. And essentially a run on the bank happened on FTX. And the problem was is that FCX didn't actually have the money that its depositors that its customers put with them because Alameda Research took that money

to back the bets that it had lost all of its money on as a hedge fund, betting on certain crypto assets that plummeted. And so Sam did the, you know, one of the worst things you could possibly do in finance and what is actually legal if you're like a fully regulated financial institution, which FTX was not. It was based in the Bahamas. All this is very relevant now because it was very clear. He was trying to skirt.

regulation, and he doesn't actually care about regulation, even though he was saying he was the one who cared about the most. And yeah, FTX ended up not having the money to be able to give people their deposits. And so the whole thing came crashing down 10 plus billion. You know, this was a guy who was the largest or one of the largest donors in the midterms. To both sides, it turned out. To both sides, he says, like, you know, he was the youngest billionaire of his stature. I think he was the richest, you know, billionaire under 30 for a minute on paper. And now he says he's got, he's broke. and, you know, but we don't actually know that. There's been a lot of reporting that money was taken out and it's unclear. A lot of homes bought, that sort of thing. So that's like the elevator story. Yeah, and Liz has been doing great work covering FTX on the site. Just for our purposes, again, it's a financial story.

At the end of the day, it's a, you started an unregulated bank and then did the shadiest things that an unregulated bank can do. And the amount of technology involved, yes, crypto has some interesting tech baked into it. but like at the end of the day, it's, it's like a bank story. So yes, we've been covering it,

but I'm watching this interview and what actually really struck me is crypto, crypto in general, I don't, if you remember what I think of as crypto summer, was hailed as like the next gigantic turn for the tech industry. And we all had to hear about Web 3 interminably.

And just an endless amount of crypto stuff occurred. And watching the scenario, it was like, oh, this is the, moment where it's dead, right? Where he, yeah, he talked to the Times yesterday. He talked to New York MAG, our sister publication. He was on Good Morning America this morning.

And he's like, I owe it to my customers to explain what happened. To explain the fraud. And every prosecutor in every state and the country is like, and you should keep talking. Yeah. Because everything you say is admissible in any discrepancy in what you say, we're going to hold up in front of a jury and used to put you in jail. And it just feels like maybe the entire industry is tainting. in an irrevocable way because of all of this now, right?

I mean, if you remember the Super Bowl with, like, all the crypto ads, like, Tom Brady was a FTX spokesman. He made an ad with Giselle. And the entire ad was basically like, you should be in her Ponzi scheme. There was no mention of utility. It was just him being like, are you in over and over again to his famous friends? Well, and we saw what that did to Tom and Giselle. And, you know, that's a metaphor for what it's doing.

He's not having a good year. Not a great year for Tom. It's not the best year. Tommy's life. Yeah. But fundamentally, like, do you think that that's the case that this moment for crypto has just come to an end in the next moment? I mean, there might be a next moment.

There has been some interesting technology developed. But I have heard more from vindicated skeptics than I've heard from people who are like, we'll come back from this. I talked to a friend who was like an executive at one of these big crypto companies and he got laid off because they was running out of money because so many of these companies were like, we're going to throw a bunch of investments at it and see what happens. And it's like, wait, there's just giant Ponzi schemes. Eventually, your money goes somewhere and it never comes back.

And I was like, is crypto kind of done with the collapse of FTX? And he's like, I don't see how it can recover. Really? Yeah, he's like, I just do not see how it happens after this. And I think even people in the crypto community always kind of knew that a big chunk of this is a Ponzi scheme. Because this money is fake money and it doesn't, there's no like, there's no, gold standard. There's no, there's nothing at the other end saying this is real. All money is fake money. Did you just advocate for the gold standard on the verge cast? Yes, I did. By that standard,

all money is fake money. But I mean, you know, there's no difference between this money and the gold that Ash and I are currently mining on World of Warcraft as we pretend to be little dragons. Like, what's the difference? Both of them can theoretically be used to buy goods and as more people invest in it. Well, one you can actually use for something in World of Warcraft. Yeah, one I can go and I buy mats to make my dragons stronger. The other one I can hopefully get some cash for if I traded in crypto. And like, I think they all kind of were aware that the bottom could drop out of this at any time.

If anybody wants to run on the bank, a totally unregulated bank will be destroyed. And so like, yeah, I think it's done. I don't think it's done. I think what we saw in this last wave was a lot of. key infrastructure tech was built, like layers of blockchains were built with no use cases on top of them. So it was a Ponzi scheme because once you buy a bunch of whatever, what are you going to do with it, right? Yeah. Except, you know, certain illicit things that I, you know, obviously I have no idea what those are. So, so if you, if that's the only use case, it is a Ponzi scheme. And so I am actually seeing interesting startups.

There was a lot of VC money deployed into crypto into these startups. that are actually trying to build use cases. And I think, you know, we saw some of that in gaming. It didn't really go anywhere. There was, it was kind of a brief moment. But where are the use cases you're seeing that, like, could go somewhere? Because we saw it with gaming and it went away. Payments.

Payments. I think we'll see some of the large social apps. Elon has talked, I know, it's like, you know. All the way back around. Yeah, all the way back around. But, like, Twitter will add crypto. Telegram is adding crypto. I think meta's apps.

They're already doing NFTs on Polygon. I think they will probably have some kind of crypto payment feature within three years. There is a payments layer where it does make sense to eliminate a middleman if you can. And like if you use one of these tokens that actually can move quickly and a chain that actually is performative, like it does make sense as a payment mechanism. You just have to have the network effects for that. And no one's done that yet. How does it make sense to go and invest, go find a crypto that I feel good about?

Find an app that I want to use to invest in it. Invest my cash, my legal tender that is regulated. Then go, like how is that faster and easier than Apple Pay or my Amex? It's not. But like that you're describing as the retail COVID Fed Stimmy bubble mania that we had that was like the perfect cocktail of people wanting to speculate in crypto. Right. And a bunch of companies being opportunistic about, you know, but I'm saying like now that crypto has been pretty poisoned in public view, right? Like most people. Definitely on a retail level, yeah.

How does it go? How does it come back from that? Like on the retail level, how am I going to get my best friend who does no idea what a crypto wallet is to go and use that? I mean, it has to move out of speculation. It has to move out of like, you're buying this thing because it may go up one day. It has to be like, oh, I actually need this to like send someone money on Twitter or on Telegram.

This is the thing that truly struck me about watching Sam in person at the dealbook and watching the other interviews. There are like two stories in tech right now, right? There's Elon and Twitter, and there's FTX. Yeah. And we are covering, we might be overcovering Elon on Twitter. And we are covering to a certain degree FTX and crypto because there's a tech element to it.

But when you peel back the layers, you have to be a finance expert to really understand what happened at FTX, to really catch him in the fraud that everyone is. the legitimacy's committing, which you probably did. I cannot find the part where it's like, and here's the thing they did technically that created the fraud. It's all just the shell game of an unregulated bank. And then people saying, I want my money. And the bank saying, sorry, we spent it on my girlfriend's hedge fund, which is an incredible

outcome, by the way. It was just, it's a wonderful life. Just the whole scene. But this is the tech. You ready for the tech element of it? Yeah. It happened online. We used to, a long time ago at the beginning of the verge, when we had like vet stories to decide whether we were going to write about them.

We had to draw a line. It's like, we can't do this just because someone tweeted about it. Yeah. Like that, that's not, that doesn't make it a text story. That's just something. How that has changed. Yeah. Now it's like all day, every day.

As people are tweeting, we have to react to it. We should actually talk about this part because I did get a bunch of questions that I said that we were talking about in the Verge asked a little bit. the notion that just by interviewing Sam Bankman-Fried, you're perpetuating this fraud. I, like, fundamentally our job is to talk to people. So it seemed, and I understand that you don't want a platform. Like, there's people you don't want a platform. But at this moment, it's like, well, he's the bad guy.

Right? He's the villain. Like, you want to know if you can get the villain to admit the villainy. And, like, him speaking is actually, like, a public service in its way. Like, if you were a good interviewer. I don't know, what do you guys think? I find it bizarre. I mean, I guess I can understand if you don't work in the media, thinking that the media is, like, aiding and embedding him if they're giving him a platform.

But, I mean, why would you not? Because you think that he doesn't deserve the attention. Or that, the attention. I think it's really down to, like, how you use that platform. How you use it. Yeah. Right? Like, if he'd gone up there with somebody who was a really soft interviewer who was just like, tell me, okay, now what's your day like now that you bankrupted your company?

What's going on? Obama's. as escaping the feds. Like, what kind of plastic fern is that that you have looming over your head for this entire interview? I haven't seen that. I have seen a lot of credulous interviews. Yeah, and that's the thing is that's why I think it's okay.

Like, I think we've gotten, we've seen a lot of interviews with bad actors like this in the past where they go and they give their sob story and there's no pushback. But Sorkin was like, to his credit, pushing back really consistently. Oh, yeah, the last, you should all watch. Actually, there is a very funny, like very verbiage. moment in this interview. He's coming to the end and he asked a question

and he's like, so you had no CFO and no board of directors did you think that was a problem? And again, this is a room full of bankers and people who have invested in FTX who all should have seen the lack of a CFO and the lack of a board of directors is a giant waving red flag. Spend the money anyway.

And Sam goes, I think we had too many boards and the call drops. And so everyone thinks that he did this on purpose. right that he's like yank the plug or like his lawyers have finally stormed into the room and like throwing the laptop out the window and I'm looking at it I'm like oh that's the

Elgado Camlink screen You stand up and yell that His camera just died I'm the tech expert I'm the tech the Elgado It's just like And everyone's like oh my God Is he coming back

And I was like no dude that's just the Elgado Computer just time down He'll be back Like this dude can't shut up And lo and behold he came back And I encourage everyone to just watch the last five minutes of this interview at the Times this site. And it's also, it's, it's all over TikTok.

Like this is, this thing has been rebuted everywhere. Sorking just like Nashville. And he ends by saying, are you lying? Which is, I think I'm going to end every decoder interview. So are you lying? We'll note that SBF did not give a quick no, which is never a good sign that you're actually not lying. I did think that the awkward clapping at the end was like,

little, I understand that that's like a conference thing that you always clap, but like, it was really funny to see people like clapping as SBF was like leaving, but I don't think they're clapping for him. They were like, good interviews. No, I know. They're clapping for Andrew. Also, you can't see this. You couldn't see this on the stream.

I'm sure. But then this all ends. And he's like, all right. So last thing, you know, here are some Broadway performers to close us out. And he was like rapping. It was like Broadway rap. It was just a very odd moment. Very surreal.

All right. Because that was the last interview of the day? That was a lot. Yeah. And there was, I would, just from what I gathered from various people there, there was a lot of skepticism that SBF would show up. Yeah, because he booked to this before. He booked all this before. He said he was going to do it.

But he's in the Bahamas. He doesn't have to do it. Yeah. That poor events planner who is working on this thing. And they're like, we're going to have this great triumphant final interview with the guy who did FTX. He's into all this album. tourism. It's going to be so lovely. Then we're going to these dancers come out and it's going to be this great moment.

Then just going, do I get rid of the dancers? Like, what do I do? How do we follow this now? Yeah. Shout out to that dude. You should go watch just at least the last 10 minutes, but just because Andrew did such a good job. And it was so weird. It was so weird. Truly one of the weirdest moments.

All right, we got to take a break. We'll come back. We'll do a tiny little gadget lightning around and we'll get out of here. We'll get out of here. This show comes from What Not. Whether you're selling online or out of a storefront, you already know the challenge. You're simply hoping for people to find your listing or waiting for them to walk in. But What Not flips that.

They say they're the live shopping marketplace where you can shop, sell, and connect around the things you love. On What Not, you go live and sell directly to people in real time. They see what you've got, ask questions, and buy. and they keep coming back. Whether it's beauty, collectibles, electronics, luxury fashion, and yes, even cookies, sellers are building real thriving businesses. And for a limited time, What Not says they'll match your first $150 sold in the first month. You can visit Whatnot.com slash sell to start selling. That's W-H-A-T-N-O-T dot com slash sell.

Whatnot.com slash sell. Support for the show comes from Anthropic. Not every question has an easy answer. And the ones that are really worth asking usually come with a healthy mix of inspiration and backpedaling. A-ha moments and quiet meditation. When you're working through one of those problems, you want a partner to be bounce ideas off of and figure out where the deeper issue lies. That's where Claude can help. Claude is the AI for minds that don't stop at good enough. It's the collaborator that actually

understands your entire workflow and thinks with you, whether you're debugging code at midnight or strategizing your next business move. Cloud extends your thinking to tackle the problems that matter. Plus, Claude's research capabilities go deeper than basic search. It can have comprehensive, reliable analysis with proper citations, turning hours of research into minutes. Ready to tackle bigger problems? Get started with Claude today at cloud.aI slash vergecast. That's cloud.aI slash vergecast and check out Claude Pro, which includes access to all the features mentioned in today's episode. Claude.aI. slash vergecast.

All right, we're back. We need like a pallet cleanser here. We got to talk about some gadgets and some buttons and knobs and bleeps and bloops. Alex, we got for us. All right. I'm not going to talk about it too much because David and I talked about it a whole bunch recently in a recorded episode before the baby came. But the Amazon Kindle Scribe came out this week. I reviewed it.

If you really, really, really, really, really want a Kindle that you can write on, go for it. Otherwise, don't. Just skip it. I was just, Alex and I are like, our. edit meeting was like I reviewed the Kindle Scribe. And like, I'm on the show with you. I know how you feel about E-ink. Yeah.

I would describe the look on your face as pure devastation. It's pretty, it's pretty big bummer. Pretty big bummer. Yeah. Why is it bad? I think it's bad because the software is bad. Amazon has gotten really complacent with its software design and is like, yeah, you'll enjoy this slop because you need it because we sell the e-books.

That's kind of the feeling I get from using it. Yeah, that's how they are. No, but it just like shoved a bunch of stuff in your face. It kept showing me like comics to buy on my black and white e-reader. It was just bad at recommending stuff. And the note-taking elements of it were like pretty unfulfilling. And the fact that the largest cloud computing company in the world still has you emailing yourself in order to sync documents. That just seems.

Hey, it's still not as bad as horrific. horizon work work. I'll tell you that. That's true. It's like, it's like three below it. But it was just, it was just a big bummer. And you'll have to stay tuned for an upcoming episode of the Wednesday show where I talk all about it. It's really great. But also there was a new trackball mouse. David's not here to like stop all of my better, like stop me. Yeah, I can really, I'm looking at this rundown and I'm like, oh, this Alex made this rundown of gadgets. This is a real. You can tell the David wasn't here this week. This is very exciting because for years the trackball space was totally undeveloped. We didn't have a lot of trackballs. They were all wired. It was horrible. Tracball space was undeveloped. Kensington said no. It's actually not crypto, you guys. It's track balls. That's the future. Like the hot VC money is going into the trackball space. Kensington and Logitech are just like, send us all your cash, invest in us. But new wireless. Who is the SBF of trackballs, friends? Steve Kensington. No, it's the guy who makes plupy. No, the plupy guys are actually lovely.

The trackball looks sick, and I kind of want one. I got to be honest with, yeah. Do they still do the thing where they make custom trackball balls with like eight balls and things? Yes. Track ball balls. Do you not know, this is like a hot, like when I was like eighth grade, like the custom trackball balls. No, because now you build your own track ball. And then you, I know a guy who takes like steel ball bearings and he polishes them.

And then he like colors them with metal. I don't know. I'm not a metal or just, but he does stuff. And so he's got his. own little fancy custom-made trackballs. But if you don't want to do that, you can get this new wireless version of the Slim Blade, which is a great name. I'm reading the actual press release for this product.

Can I just read you the headline in this press release? Yes. Kensington Slim Blade Pro takes trackballs to the next level. Yes. I believe it. They had a meeting. Like this got sent around. They're like, what's the headline of our press release?

And they're like, do it. Next level. No one stopped. I love it. I'm buying one of these. Why is the trackball encrypted? All right. I guess the Bluetooth.

Yeah, you want to have the Bluetooth encrypted. And then what else? Yeah, Allison Johnson reviewed there, checked out the new Ginky covert doc mini, which lets you like dock a lot of your different game systems very easily. And historically, those docs for like the switch are these giant device.

Like it's a big plastic block. It's like the size of an iPhone charger. Yeah. And so it's just cool. It's just nice. When the switch first came out, everybody was complaining about how they couldn't just plug a USBC cord in. And you still can't.

You still can't just plug a USBC to HTMLI cord into your TV and have a dock. That does seem like a miss, but this thing looks cool. This is a great gadget. Yeah. Just very, very cool stuff. This is like the rare Indiegogo that like really went off. Yeah, because Ginkie's been,

they've had a couple of these. This is the newest one. It's only $50. and like you can just check it in your purse, which is what she did. You guys, I guess, would put it in your cargo pants, your fanny pack. I don't, what, what is it? How did you know that's what I wear every day? Is it because I live in Southern California?

Just with flip-flops. Your board shorts. That's actually what Alex is wearing right now. You guys can't see it. But looking great. That was a probing. That was a very revealing. She was like, let me throw out cargo pants and see how they react.

That's right. Look, I appreciate an extra pocket. Yeah. I feel like we need to talk about the Ufi thing. Maybe we should have Sean come on a Wednesday show and really get into it. But Sean Holster, I would say, very annoyed with Ufi. There's a story that Ufi security cameras can just be accessed via VLC, the app VLC. Yeah.

You could basically just type a URL in the VLC and start streaming your camera. Sick. Which is not great. It's a little bit harder than that. There needs to have been an event that triggered the camera, all this stuff. but Ufi is out there being like where cameras are fully encrypted and safe end-to-end encrypted.

And so he asked him for a statement and he's like, this is impossible and then he did it and it worked. Well, okay, so I have Ufis. They're through HomeKit though. Like they're through my home app and I don't use the Ufi app. Therefore I'm safe, right?

No. Home Kipp's camera app. If it goes through Apple HomeKit, isn't it? It's real bad. Yeah, Jin's talked about this a few times but the home Kip camera situation is is not one she would recommend. I got a good, guys.

I got a problem. Everybody just start like randomizing Ufi camera links and you'll be like, hello, you'll see Alex's cargo pants. It's going to be great. So even if you had your Ufi router through HomeKit,

you're still susceptible to this. I think it is unclear at this time. HomeKit secure video is supposed to be encrypted. Right. But the VLC thing is just going to the camera. Right. So it's like maybe the connection from the camera to home kit to the cloud service to your phone. All that is encrypted. But if you can just talk to the camera directly, it'll just give you a video file. Would thread have kept this from happening? I mean, I don't, we got a bunch of cameras outside. I think cameras inside are really weird. And I have always picked the ring cameras. Not because I like love the entire ring ethos of like, what if we terrify old people and having cameras? outside their house. No, yeah, you like bad software. I love it. It's the best. But it's also that I

I know that Amazon will probably like last a long time. And they are fair. And they are going to run, they're going to make their own software and run AWS directly and like, I mean, not if the Kindle's any indication. All these other companies that are sorry. That's true. But I, can you VALC into a Kindle? Like there's just a part of these other companies where it's like they're just buying commodity bits and off the shelf and assembling them into products. And it's like that's where the security consequences come from. Whereas at least for the ring, it's like, I know they're a company that will like last a long time.

Because Ufi, I think Ufi, the appeal was it wasn't one of these other companies. It could use home kit. You could just have it attached to your local storage and not have to have any kind of cloud at all, which is as someone who loves a server. I'm a huge fan. But it just like you still have to, there's still security. You still have to think about these things. there's still ways to hack this stuff.

Yeah, by typing the address of the camera into VLC and accessing an unencrypted stream. Perfect. Beautiful. But I saw a TikTok of somebody just like talking about their Plex server the other, and I forgot to send it to you. But now this is because of our relationship here, TikTok is like, we need to start storing in Plex content.

I'm so happy for you. Kranz, do you have a Mastodon server? No, I was looking into putting one on my Synology, or like my Synology server. That's what I use. and then I like read about three lines into how to create a Mastodon server. And that was the end. So as a lover of servers, you can't even get behind Mastodon.

So I think Mastodon is doomed. It's doomed. It's doomed. It's doomed. It's doomed. It's going to be what's going to happen to Mastod is going to be incredible. Someone is going to centralize a Mastodon instance. And that's going to become the service.

And everyone else can, they're going to have like fake interoperability with other Mastod servers. but everyone's going to join Twitter clone.com. You know who it is. Which is Mastodon, and then it's going to have all the same problems as Twitter. You know who it is. Who's that? It's all full circle.

So this little company has, so small social media company, we've never talked about on this show before. I definitely have never talked about. Has announced that they're going to support Mastodon instances. So you'll be able to log in with your Tumblr account onto Mastodon. That's pretty good. It's going to be Tumblr. Just embrace it, guys.

I'm sorry. I feel like Matt Mullen, like who's the CEO of Automatic, which owns WordPress and Tumblr. Yeah. I think he sends his blood in the water. Yeah. He had the feeling he's like, oh, I went through this app store review shit with Tumblr. You can't hurt me.

She bought that for how much money did Yahoo lose when they sold it to him? It was like $80 billion. It was crazy. It was like the full amount. Yeah. So. Well, this is Yahoo loves to do this. I don't think they've ever made money on anything. So automatic is going to make some money. Yeah. 98.1. percent loss.

Yeah. They bought it. They bought it for $1.1 billion, and they sold it for $20 million. A well below $20 million. That was a Marissa Mayer special, I think. Yeah, it was. It was. Yeah.

When her strategy was buying every app to get talent in the door. In between Zamboni drives. Actually, neither of you know this story. When we first started The Verge, we shared this, like, horrible office in New York City and Fifth Avenue. It was small. I feel very fondly for it, but objectively, it was like, crap. Didn't you guys do the Vergecast in like a closet? We did for a minute there.

Yeah. It wasn't even a closet. It was just like the side of the room and everyone in the office had to be quiet. It was great. You can go back and watch them there. And there was a company next to us called stamped.com. And to this day, I still kind of know what they did. I think they made stamps.

Like I don't know what they did. And one day they were gone and we're like, what happened is stamp.com? And Marissa Meyer had shown up and bought them right under our noses. And then they were part of Yahoo. And we're like, you were next door. You could have told us? No one ever heard from stamp. com Yahoo or Marissa Meyer ever again.

Last one. I'm just going to tease the fact that we're working on this review. The Oceanic Plus app for the Apple Watch Ultra is now out for our scuba divers in the audience. I'm only bringing this up because what I've heard about our Apple Watch Ultra review video. It's going to win an Oscar. It's, I mean, this is the highest budget thing. This is a Marvel movie at this point.

A full billion dollar avatar stand back. Versa's Apple Watch Ultra review is coming. We're going to throw it out of an airplane. I was going to say, did we do any skydiving for this one? I know that there's an attempt to crash a car. I don't know if it actually happened. Oh. And now we're trying to dive with it.

So we're waiting for this, but that review is coming. And we'll see. We'll see if the dive button does everything that we ever hoped it would do. V and Becca have been working really hard on it. Sounds like it's going to be a lot of fun. Yeah. I mean, again, we've just been. Every time I hear about it, I'm like, huh, that's a new problem that we have to solve.

So, like, we need a 2003 Ford Fiat that we can just destroy. Does anyone have an oxygen tank? Who scuba certified? The company can sign this insurance waiver. And I'm like, I don't think anyone we're going to do that, actually. Like, we might have to hire a new lawyer and lie to them. Yeah, just pull an Eon and have them self-certified. That's great.

Last thing, just this is a very funny headline. Canoe has repurposed. it's electric pickup truck for the army. I encourage you to go look at the canoe pickup truck. It's adorable. And then try to imagine this thing as a weapon of war. It's very good. There's a very good idea fully.

That's it. That's a Vercast. We'll be back. We've got grand plans in David's absence. He was one who really kept this thing on the rails. And as you can tell, even with two hours notice, it's already going sideways. But tweeted him, tell him congratulations. You can tweet at us.

I met reckless. Alex is Alex H. Cranes. Heath is Alex E. Heath. Very confusing you too. You both should change your We like to use our middle names. Good job. We'll be back on Wednesday. Actually, this is like the last episode David did before he took off. David and Alex are going to talk about 15 years of the Kindle. Yeah. Russell Brandon is going to join us. He did a big project with consumer reports mapping out broadband. That's really cool. Last thing, we're working on our end of year wrapups. Call into our hotline. 866. Verge 11. 837, 4311, tell us who you think your winners and losers of 2022 are.

Here's a challenge, though. You can't pick meta for either one. Oh, that's rough. Yeah, it's tough. Can you put Elon? The people are going to call, all right? Vox Populi, Vox Day or whatever. Let the people speak.

Call the number 866, Verveach, 1-6-8-37-4-3-1-1. Winners and losers of 2022, but you can't pick meta. All right. That's tough. I would have to think about that for a while. But call the number. And we'll let you know what people say. It's SBF, both sides. Truly, the highs and lows. All right, that's it. That's Vergecast. And that's a wrap for Vergecast this week. Thanks for listening. If you enjoy the show, subscribe in the podcast app of your choice or tell a friend.

You can send us feedback at verge at theverge.com. This show is produced by me, Liam James, and our senior audio director, Andrew Marino. This episode was edited and mixed by Amanda Rose Smith. Our editorial director is Brooke Minters, and our executive producer is Eleanor Donovan. The Verge cast is a production of The Verge and Box Media Podcast Network. And that's it. We'll see you next week.