The Vergecast - Facebook's privacy pivot and the streaming wars

Episode Date: March 8, 2019

Breaking down Mark Zuckerberg’s letter on Facebook about its privacy-focused future. The Verge's Nilay Patel, Dieter Bohn,  Julia Alexander, Casey Newton, and Paul Miller discuss Facebooks new pivot to privacy, the next move for HBO after the AT&T restructure, and YouTube's bad actors.  Stories from this episode: The president just called the CEO of Apple ‘Tim Apple’Read Mark Zuckerberg's letter on Facebook's privacy-focused future …Mark Zuckerberg promises a newer, more private Facebook Facebook knows Facebook isn't the futureFacebook's pivot to privacy has huge implications — if it's realThe messy details behind Facebook’s messaging plansHBO CEO Richard Plepler is leaving the company amid AT&T …AT&T's new HBO chief criticizes Netflix, says it 'doesn't have a brand …AT&T just made its first huge changes to HBO and the rest of …Game of Thrones' final season trailer prepares us for the biggest fight …Disney is ending its vault program, giving Disney+ a huge boost in the streaming warsHow baseball’s tech team built the future of televisionDying social robot Jibo goes out with a song and a danceYouTube is demonetizing all videos about Momo YouTube's family vloggers worry about future amid comments …YouTube terminates more than 400 channels following controversy …YouTube is 'aggressively approaching' solution to child exploitation ...voxmedia.com/podsurvey Thanks to Microsoft Azure for sponsoring this episode. Get started with a free account and 12 months of popular free services at Azure.com/trial today. Learn more about your ad choices. Visit podcastchoices.com/adchoices

This week on the Vergecast, Casey Newton joins us to talk about everything that's going on with Facebook, including a weird switch to privacy. Julia Alexander comes on to talk about the streaming wars and a little bit of YouTube. Plus, Paul does this thing. This on the Vergecast. 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. custom internal tools just by describing what you need.

Prompts 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 nearly 20. 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 and welcome to the Vergecast, the flagship podcast of Vox Media, the whole thing. Ooh. I feel like we got to go bold. We're about to go to South by Southwest. I'm about to see all of the other Vox Media podcasts.

And we've got to put a plant to flag, the whole thing. If you are in Austin this weekend, I believe I are. podcast is on Sunday. Is that correct? It is on Sunday. It's on Sunday. I want to see a line around the block, so please come. Yeah, it'll be fun. I think it'll be good. Anyway, I'm Neely, I'm your friend. I've been foolishly put in charge of this operation. Dieter Bone is here. I'm the one angrily demanding you get in line. Yeah, Paul. Hi, Paul. Hello. And we're joined. Casey, I think this is your 45th week in a row. Casey Newton is here because Facebook won't stop it. And it's nice to be here. Thanks for having me back, Neelai. I love you, Casey. And Julia Alexander is here,

because YouTube has begun once again. Yeah, exactly. It's just how it goes. Hi, Julia. So a lot going on. Before we start, I've been asked by the powers that be to make you take a survey.

So please go to voxmedia.com slash pod survey and then pick whatever answers but you think benefit us the most. I have not actually looked at the survey. I've not clicked this link. Just go to boxmedia.com slash pod survey and then try to just like tilt that thing in our favor. If you could do that for me,

that would be great. Also be honest about the other shows and say you like them. But, you know, one tick by. biased in our favor would be great. Okay. Can we start with the most important news of the week? The single most important thing that happened this week. The most viral tech news that has ever occurred blew up our website, brought the industry to a halt. It is that Donald Trump just confidently

referred to Tim Cook is Tim Apple. It's so good. So the backstory here is that we have a great policy reporter named McKenna Kelly. And she, her poor job is to watch the goings on of the government. So she was just like watching a stream of the American Workforce Policy Advisory Board, which is like a bunch of CEOs and the president. Mostly the stream is like everyone complimenting each other. Like no decisions are made in this room as far as I can tell. No policy happens. No one is advised. No workforce has developed.

I mean, that's true of all meetings. Yeah, that's true. Meetings are bad. This meeting in particular is like theater. Anyway, so she's watching it because that's her job. And she notices that Trump just confidently refers to. to Tim Cook. It's Tim Apple. And then she puts it on the side.

And it blew up. It went everywhere. I'm just going to play this for you because it is so deeply, deeply funny. Put a big investment in our country. We appreciate it very much, Tim Apple. All right. I feel like as the resident Trump apologist, here's my hot. Really? That's what you're going with? Paul, if you were going to say what he meant, what he was trying to do is thank you, Tim,

comma, Apple is great. No. There's an invisible comma. Did you see the state of the union where he would like, talk about one topic and then he would start talking about the next topic and it felt like there's an audio at it. A, I don't, I just, I don't think you should call yourself a Trumpologist. Just stop doing that. He's like resident relative Trump.

Relative to me. This specific show. Right. Yeah. Okay. Fine. Still not a great self-identification. Two, let's say I go with your, your theory.

How do you explain him previously referring to the CEO of Lockheed as a Maryland Lockheed. I mean, that's a mistake anybody could make. The only person for whom this makes sense is Michael Dell. Also Donald Trump. Also Donald Trump. Yeah. He thinks all companies are named after the person in charge of them.

Anyway, Tim Cook changed his Twitter handle to Tim Apple logo, which is funny. Like, it is very funny. It's funny because Tim Cook was not previously known to have a sense of humor about himself. Like there has been no previous documented instance of Tim Cook like uttering a self-deprecating joke. That's true. My favorite part about Tim Cook changing his Twitter handle is he used, you know, whatever the code is to display the Apple logo, like the canonical, like, the canonical, like, actual Apple logo, which only works basically on like Apple devices and software. So literally everybody else just saw Apple weird symbol. maybe it was a box.

I've seen people that had like this like weird like Maori fish hook thing. That's great. It's just it's he's he's Tim box. He's Tim Unicode standards are hard. It's the best. It's Apple,

Apple Unicode lock in, put for sub-tweets of the president. It's great. All right. It was very entertaining. I encourage you to go literally whenever you need to be cheered up. Just look at Tim Cook's face when the president's like,

Thank you very much, Tim Apple. And he's just like, there's a name card in front of him. He's sitting next to the president. Also, by the way, like many years from now, like decades from now, when Tim Cook passes away, like the first line of his obituary will be like, Tim Cook, who is so closely identified with his company that the president of the United States once referred to him as Tim Apple. Hasn't every other tech CEO except for, like, I don't know, Meg Whitman or somebody, like, bailed on this panel. Why is he still showing up?

Because he has to import phones from China and cell phones to China. Which actually leads me right into Facebook because there's a lot going on here. And China is actually kind of at the heart of one of the big pieces here. So Casey, our friend Mark, the Zuckster, he emerged from his cocoon to issue a proclamation. Business Insider has a great story. He literally has like a secure enclave surrounded by plain close policeman. Yeah. Yeah.

For good reason. I mean, like, he faces actual threats. Yeah, no, no, no, please. By all means, escape the conference room. I mean, I wish our conference rooms had an escape hatch. Speaking of meetings, being fed. Anyway, Zuckerberg put out a letter. Basically, everyone in tech and media has interpreted, like, in thousands of different ways.

But he basically says Facebook is going to pivot to become a privacy-focused social network. Walk me through this letter. So this letter is a real Rorschach test. for how you feel about Facebook, like most things, Mark Zuckerberg says these days. You know, the post itself is 3,200 words, and it has a couple of major components to it. One is, he sort of confirms earlier reporting from the New York Times that they're going to unify the back end of the three big messaging services that Facebook runs. So that's Messenger and Instagram Direct and WhatsApp, but that it's going to encrypt them all end-to-end the way that WhatsApp is now. So it will

bring end-to-end encryption to services that are used collectively by billions of people. So that's really big. The second big thing is a sort of embrace of ephemeral messaging. So in the future, your messages on those services will likely self-destruct by default after a certain amount of time. You'll be able to opt out of that. But Zuckerberg has sort of seen the light around, you know, the problems with messages coming back to haunt you. The third big thing is that because they are going to do this end-to-end encryption, they know that governments are going to hate them for it. Around the world, countries are already asking big tech platforms like Facebook to store data collected about their citizens locally within the country. And Facebook is basically saying, if you have a bad record on human rights, we are going to say no to that.

And we are willing to be banned. and we're probably going to give up on getting into China anytime soon. So that was kind of the suite of announcements, and now everyone's tearing it apart, trying to decide how seriously to take Mark Zuckerberg and what it's actually going to mean for Facebook as a company. So let's kind of go in reverse order. Because I feel like the China one is sort of the easiest to grapple with.

They're not there, right? They get to just say, we're not going to do the thing we're already not doing. Aren't you proud of us? And that's great. And it's a great shot at Apple because Apple not only built iCloud data centers in China, it's turned over the encryption keys because that's the requirement of the Chinese government. So Apple has been taking shot after shot at Facebook, deservedly so in many cases. And now Facebook gets to take, I mean, this is like a huge subtweet of Apple, basically.

Whenever Tim Cook says something on privacy, well, Zuckerberg can say, well, I didn't put my user data in China because I don't trust them. And then they can stare at each other and he can be like, well, the president called me Tim Apple. What does he call you? So, I mean, that's like, that one just seems like the easiest one to contend with, right? I don't think there's that much more to say other than think about the fact that Mark Zuckerberg learned Mandarin so that he could open up Facebook in China, right? This was not a casual weekend project for him.

He's invested a lot of time there. You know, they had essentially a lobbyist in there. Facebook still sells billions of dollars of ads. ads inside China just from Chinese companies that want to reach, you know, other consumers around the world. But clearly they gave up. So that was one big change that was announced this week. So then there's the other two, which are we're, and I think the way he phrased this,

which is if you're like me and you love arguing about metaphors, it's a great metaphor. He said, we've built the town square and now we're going to build a digital living room. And we know that there's some things you want to do out in public. That's the news feed. That's share, share, share all the time. but then there's more intimate stuff you want to do with smaller groups. So you want to do in particular messaging, and then we're going to build a suite of services

on top of our new unified messaging architecture, commerce, sharing, all this other stuff, payments. That, to me, seems much bigger. Like, it's much bigger in scope. It's a new product initiative for them. They're deep in blockchain. Are they just trying to build Wii chat? Yeah, I think that's a big part of it.

WeChat, of course, the giant Chinese app that essentially doubles as the internet for most Chinese citizens. And of course, it benefits from, you know, working hand in glove with the authoritarian Chinese government, you know, which is not something that Facebook is going to be able to do in America. But it does represent a big new business opportunity for Facebook if you believe that they can figure out payments and commerce. I reported last year, Facebook is building a standalone Instagram shopping app.

I think we will probably see that, you know, sooner, rather than later. And they have a giant blockchain division that is developing a cryptocurrency that people will be able to use to conduct transactions on WhatsApp and these other apps. So, you know, so far as you believe all those things are real, and I do, then sure, there's a new business opportunity for Facebook. I think the question is, do you believe that the newsfeed and all of the other core Facebook products are going to endure and be as popular and become more popular over time? Or do you think that we've probably already hit peak news feed, for example, and all that stuff is going to slowly unwind, and then Facebook is going to have to find a second act?

Yeah. So I think by the time this podcast will be out, a piece that Heim Gartenberg is working on will be up, where he just sort of looked at every public letter statement interview Mark Zuckerberg has given about Facebook for the past five years or so? Yeah. And you just look at the list and it's like connecting people, connecting people, sharing is better, connecting people, connecting people. And then now today it's also privacy is good. Four years ago it was the news feed is going to be all video. Two years ago it was Facebook is going to build social infrastructure, which I honestly, I do not think we clarified in the two years since he published that post what social infrastructure actually was. Neither of those things really came true. That's not to say.

that this won't come true, but I do think it is important to note that Facebook's mouth runs far ahead of reality, particularly when it wants to do these 30,000-foot, you know, views of all human behavior. So this, okay, one, saying it now, it's closure, my wife works for Oculus, which is a division of Facebook. But this is the central question for me here is when people talk about huge Facebook pivots, one, is this a pivot or is this just a new thing they're doing on top of what they're currently doing, whatever.

But two, how much can we actually believe that they're going to turn this into a real thing? Because the canonical example of Facebook said they're going to do a thing and then they did a thing and they were wildly successful was when they realized they had to actually make a mobile app and pay attention to mobile and make mobile core to something everybody on their team does instead of a team off in the basement in some building somewhere. But at the same time, I think you're right that they have also made many, many, many other grand pronouncements that. didn't really go anywhere, right? And they've started many apps and like many different variations of like video sections and whatever that meh. And so like on a scale of, well, let's see what they do and watch them not be successful at this to oh wait, no, this is potentially the future of the company. I guess it this, my gut reaction is like this is more real than I think the doubters would want to give it credit for. Yeah.

But I don't know why I think that other than like, it seems obvious that they have to do something because everybody's been so mad at them for the past three years. So yesterday I talked with a former Facebooker who said that this version of Mark Zuckerberg, which is the version of Mark with his back against the wall, is the best version of him. And that this person was really excited because they felt like he had maybe grown a little fat and happy. and then after the 2016 election kind of had the holy heck moment of, okay, we've really got to fix this company, and that's going to mean going out and building an entire new set of products and services that have a different business model. So, you know, I think there is some excitement externally among ex-Facebook people

that this could be a really positive turning point for the company. What's interesting is that I'm told that a lot of people inside Facebook think that I, in particular, have overreacted to this set of a company. announcements and that in reality, it's just kind of like an unveiling of a product roadmap of kind of like, hey, we're going to build some things and here's what they're going to be like. And there's really not much more to it than that. So my read on it is, I think, more there. Casey, I don't think you're overreacting in the sense that he's laying out the next thing he's going to be focused on, which sort of necessarily

means the news feed, the targeted ads business, the stuff that just keeps getting them in trouble will sort of necessarily take less of his attention. Right. So that's a business. It's fine. You know, we know that it's kind of like peaked in terms of like the number of people in the world. Like you need more human beings in the world to use Facebook for that business to meaningfully grow. That doesn't seem like it's going to happen. So it's hit this point where they can't put more ads in the feed. That'll just bother everybody that kind of hit that point. They're not making more humans at the scale they need to like show investors. They got to grow a new business. Great. So this is one they're going to do. Where I do think the criticism is warranted is, one, this is just a

repackaging of a bunch of stuff they're already doing, right? It's most basic level. This is a bunch of products they already have. They're saying we're going to tie them together at a moment where both the United States government and the European government are seriously considering about tearing Facebook apart. So McKenna also wrote a piece today that's like, Richard Blumenthal basically put out a statement in the center. He said, Mark Zuckerberg is antagonizing every antitrust regulator in the world, right? Like the announcement about the technical infrastructure being tied together of Instagram, WhatsApp, Messenger came out in the Times and literally governments around the

world started saying, wait, don't do that because we might still pull you apart. So then you've got this like, great, we've got to do it for privacy, right? So there's this idea that this is just a naked attempt to repackage a thing they were already going to do in a way that sounds more appealing. And then I think the third sort of like overreaction thing is they haven't rolled out or proven that anybody even wants this suite of additional capabilities on top of their messaging service. Right. And Wii chat's very powerful. And I think we just went through this entire conversation around.

Why are iPhone sales in China down? Because everyone just uses Wii chat. So you can just get a cooler phone for less money. Like I think Facebook sees that ambition. They don't own any of these underlying operating systems. So of course they want everybody to use their app as the main interface to the world because then they get to abstract away Apple, right? They get to abstract away Google. We both are their rivals in many cases.

And I think in Apple's case now, like they're bitter, hated enemy. So I see it as like they've got to build a new business. They're under this big regulatory threat. They see it coming. And they're wrapping up this like existing business plan in the facade of privacy just to say, well, you're, you know, not, this is what we have to do to preserve privacy on the platform. And maybe I'm just more cynical, but I don't think Facebook is doing this out of like the purity of motivation. I think they're, they're taking a bunch of stuff they were already going to do,

like China, and saying, you know what, why don't you give us credit for all this? I think that's fair. I actually think that's exactly the right level of cynical to be. Because like, I also see takes floating through my feed. It's like, Mark Zuckerberg has never spoken a true word in his entire life and Facebook is a criminal operation. And, you know, this entire blog post was, you know, ninth dimensional wizard chest designed to distract us all from the real truth, which is that the earth is flat, right? So there's just kind of a lot of that floating around. I agree with your take, but I want to point out the risk there, right?

So, you know, one of my personal beliefs is that any company motto will only ever be used against you. And so you saw this with Don't Be Evil, with Google, you saw this with move fast and break things, with Facebook. I think the pivot to privacy is about to become the new move fast and break things. Look at how many privacy scandals Facebook had in the past year. Let's assume they have half that many in the next 12 months, right? So 5,000 privacy scandals.

Yeah. There was one today. Yes, there was literally one today. There was a vulnerability discovered in Facebook Messenger. That is a true thing. Every time that happens from now on, Twitter and the rest of the world is going to light up with, hey, remember the pivot to privacy, L-O-L. and I think that just speaks to the enormous, like, reputation risk that they're taking on by

wrapping up all of these, you know, cynical business decisions in the clothing of privacy because it's going to trigger an even bigger privacy backlash against them, right? Like, their mouth just wrote a huge check. And if they can't cash it, they've just inherited a world of problems. So the reason that I am inclined to be less cynical is because it just shocks me that they would take on that much risk. But again, maybe I'm being naive. Can I just say this is my take on Facebook as someone who doesn't use it other than to keep up with my grandmother?

I see you on that, Graham. Yeah, Instagram. Yeah, right. But I generally love that. So I read Casey's very good interface post on this to understand everything. And I generally love that Mark Zuckerberg and Facebook have recreated the letter. Like they're like, you can send this thing and no one will read it other than you to and then it will disappear when you shred it. And it's like Elon inventing a subway where he's like, I'm going to be a little bit.

the tunnel and you can go through it. And I don't understand. I read it and I was like, oh, cool. Mark has discovered that people just want to read something and then it can disappear. And I guess I was like not as floored by it. Yeah, it's him, him listing things that people do want and are good things that he and his company are very bad at. It's like, we understand ephemeral messaging because we added this feature to Instagram

where the thing disappears after 24 hours. It's like that's not, this is not your. core competency other than WhatsApp, which for its time, it was sort of the leader in like in-to-end encrypted messaging platforms. But I don't think it's viewed as like the de facto or the greatest security win anymore, especially because it's owned by Facebook. So it's, he's saying like we are about as a company all about a thing that we have never been very good at. Yeah. And I think the one of the best criticisms that I've read, I think John Herman from the Times vases of this criticism, a bunch of other people. This letter is to Julius point.

it exists like out of time. Like it exists out of historical context. Like, yes, there were letters before. Yes, there were tunnels before. But more importantly, Facebook created the conditions by which a huge set of consumers is like, I would prefer not to share everything that I do. Facebook created the conditions in which the notion that everything will be leaked or used against you or that misinformation will drive elections. Like, they're responsible.

for the moment. So then to say, by the way, we noticed these problems. We're not saying who caused him or where they came from. No,

they generated demand. So Mark Zuckerberg, he's had his hands on the steering wheel this whole time. He's like, okay, the way to own the future

is to create your own private corporate blockchain and get like transaction commissions because people will get sick of ads five years from now.

So what we should do is make them all hate Facebook so much that they will want a privacy alternative that includes our new blockchain wallet. Yeah. I mean, the blockchain thing, Casey, can you make the, is there any clarity around the blockchain activity other than Facebook wants to do payments? Yeah. So Facebook is looking for kind of a wedge into payments, right? What is something they could do that would inspire a lot of people to adopt it? And my understanding is that one area they're exploring is remittances. So, like when someone in one country wants to send money to another country, maybe because they are working in one country and they're sending money back to their family, you know, typically people will do that through something like Western Union. There are really high fees attached to that. So I think Facebook is thinking if we can come up with our own cryptocurrency that is decentralized, we can enable remittances at lower rates, which will then drive a huge wave of adoption, much in the same way that offering free text messaging, you know, led the

whole world to sign it for WhatsApp, maybe sort of lower cost transfers could be a huge new business for them. I mean, in terms of things that will run you into a regulatory buzzsaw, there's like leaking everyone's data and there's building a worldwide payment system outside of the worldwide payment system. I honestly wonder how much some of these countries are going to want that, right? Oh, yeah. I mean, just the audacity of it, right?

It's like Facebook already owning a giant chunk of all human interaction, like now one, to tax commerce as well. I mean, it's like the growth ambitions here are really staggering. Okay. I want to let Dieter yell for 10 minutes, basically. Let's all be honest about what's going to happen. So a huge piece of this actually listed as a heading in this letter is the word interoperability, which is a huge red herring.

One of the sentences under of that section literally says encryption, in innings. enables openness. It's like something insane, which is not true. But basically, Mark Zuckerberg is using the word interoperability to mean, and he calls them preferred messengers. But the only preferred messengers that exist are Facebook Messenger, Instagram, direct, and WhatsApp. And then, and then SMS. And then there's a side dose of maybe the new RCS standard. So, Deeter, as I believe the only human being in the world who understands RCS, he died. What the hell is going on here? Oh, my God.

Okay. Bark Zuckerberg said the word interoperable in like the same paragraph as SMS. And everyone's like, oh, he's going to interoperable with SMS. No, no. All he means, all he's saying is right now, if you use an Android phone. you can set a Facebook app like WhatsApp or I think Messenger as your SMS app, your SMS client. And then when you get a text message or want to send a text message, you can do it inside that app. And you can switch directly right in there from between the messenger or WhatsApp and sending a text message, it's SMS.

And it can do vague, I message like things where like if I'm going to want to send you a text and you're also on Messenger, it'll let me send you a messenger message instead of a text message because that's more convenient. And so he wants to be able to create a world where all of the Facebook messaging apps interoperate with each other. And then when I open up Messenger and you're on WhatsApp and I want to send you a text message, it'll be like, oh, well, Neli is on WhatsApp. You're on Messenger. You just send them that. And then it will be encrypted and everything will be great. That's it.

There's no like, he'll make it work with SMS. But then he also like gestured to a couple other things. He gestured to the fact that you can't do this on the iPhone, on the iPhone, the only app that's allowed. to send text messages is the messages app. And he also said he'd like to maybe work with RCS someday. That means two things. One, RCS is not end-to-end encrypted. Carrier gets to look at all that stuff,

and it may theoretically potentially be possible to build an end-to-end encrypted system on top of RCS. All does send data in the first place. It's just an IP-based messaging system like anything else. If you can send a picture, you should be able to send an encrypted chat. Who knows? But... I'm so happy this is happening.

By the way, we have EMT standing by for Dider if he explodes at the end of the last segment. Keep going, my friend. Currently, the only apps that are allowed to send an RCS message are Android messages and then like Samsung messages. You cannot set a third-party client like WhatsApp or Joe's cool texting app in the Google Play Store or whatever as an RCS, like your main app. You have to use the first party one that's given to you by the manufacturer or alternative. download Android messages if you're on Samsung. You don't want to use Samsung messages because, you know, Samsung. So when he says I'd like to work with RCS someday, what he's really saying is, A, this restriction sucks.

Maybe they should change it. B, there should be some sort of encryption, but who knows? And C, Apple, like, what the heck? So you add all of that up. And what he's actually saying so far as I can tell is Apple, let us put our message. make our message a thing more like a first party client on the iPhone. And two, let us put, integrate RCS into our messaging app and not just be the fallback for SMS. Three, maybe a tiny side of Google when you, on March 9th, when the apocalypse lands of like more apps have to explicitly declare their SMS permissions, make sure that doesn't hurt our business because that's annoying.

But really, what he's doing here, this whole thing, all these three Facebook apps interoperating. the whole thing about privacy, all of this is it's a power play to take on I message in the U.S., not WeChat in China, but Facebook already owns a ton of the messaging market share around the world. And this is about like firming that up

and establishing it using Facebook's power as the company who like knows who you really are and actually requires a real identity instead of just, you know, random schmo on Twitter. And so don't, don't read this as like, like a big nice thing. This is literally, we're going to try and take over messaging and we want to make sure that we can do it by also like getting on top of our CS and having every Android phone

works sort of like IMessage, where when you want to send a text, you'll see that this person's already on one of the Facebook messaging apps and you'll send a Facebook message instead. And then. Yep. Any of there is one more. Walt Mossberg was tweeting me like no one trusts Mark Zuckerberg. No one trusts Mark Zuckerberg. No one trusts them to actually do the privacy thing right here. So the question of trust is really complicated because if they build a proper end-to-end messaging system, in theory, they don't have any information to get off of you at all. But in practice, building a good end-to-end encrypted system is very difficult,

especially if you want people to be able to message across multiple devices. If you use WhatsApp or signal, for example, and you want a text-jury computer, you've got to scan the little QR code, you know, and then if you switch phones, you've got to, like, re-authenticate with your phone number, and you can't have it go to two phones at once and blah, blah, blah, blah, blah. It is possible to build a quote-unquote federated end-to-end system, but the easiest and most likely way for Facebook to do it and the way that when he talked to Nick Thompson-Wired said he would is, you know, Facebook would get some metadata. If you get some metadata, then you are able to, you know, send the message where you want it to go. So they can build an end-to-end encrypted system where no one can see what the messages are, but Facebook will still know who you're talking to.

And Zuckerberg has said he intends to like get rid of that information more quickly than they do now and that he'll feel. figure out how to advertise, even though he doesn't have that stuff. But like, fundamentally, this is about Facebook establishing further dominance in the messaging space, making sure that it's got a follow-up platform, you know, for WeChat and to do something, you know, with money and make it the new platform that people pay attention to. And to have a hedge against anybody else growing in the messaging space, because everyone is just going to default to a Facebook style or client app, messaging app, because you know who they are on there. And the, Like they've, they're already big, and now they're just going to get bigger.

I just want to stop it. You know who you are in there. Because that's really important. And I will do this in the spirit of counterbalance. Here's a good thing that Mark Zuckerberg said might happen. You're a regular person. You want to transact with a business you saw on Instagram. You don't have an Instagram direct account, but you can text the business on Instagram

from your Facebook account. Right. Right. That's great. That's cool. And they know who you are. so you can do all these payments. You want to sell something on Facebook Marketplace,

and you want people to send you stuff, but you don't want to give up your phone number. They can just hit up your WhatsApp. Yep. Like there's all these things where, because they know who you are, they can abstract your identity to other services, and you can have sort of like different slices of contact information available to all these other places.

Yeah, I want a source to be able to talk to me on a messaging app, but I don't want to have to give them my phone number for signal to work because then they've got my phone number and that's a pretty, like Paul has talked about, a actually important piece of information, which, by the way, Facebook has been very promiscuous about sharing because if you gave them your phone number for two-factor, they apparently just give that to anybody.

Thanks, Facebook. Anyway, so there's like some good stuff that you enable. What really occurs to me is when they say interoperability, they only mean between the three Facebook products. They do not mean with, actually with, SMS. They don't mean with RCS. They certainly don't mean with signal or AOL instant message. Does AOL and Semester still exist? I don't think it does. XMPP. Yeah, they don't mean with jabber. Right. Deer sweet Jabber. But, but, you know, they mean it in like a perverted way. It was like we all of our stuff will be

interoperable in the way that everybody thinks of interoperable. But also, uh, we want to be quote unquote interoperable with SMS and RCS insofar as it will allow us to hijack, uh, those messages and turn them into Facebook messages. Yeah. In the same way I message. Which is it, yeah, exactly the play I message ran. So this to me feels the, like the most sort of like

pernicious thing that they're proposing. But yeah. It's pernicious. But is that perniciousness? Is that perniciousness? Perfittity. Pernicity. Is that Facebook's perniciousness.

Stroking out. Do you smell toast? I do. Is Facebook's perniciousness in trying to hijack all text messaging and do its own interoperable Facebook system? Worse than everybody sending unencrypted SMS and RCS messages that the carriers control will hand over any government that sneezes at them? Is that worse? I would prefer to not have one corporation

in charge of communication. Like that's just me. Agreed. Where I'm at is like as a person. If they literally do actual end-to-in encryption and they're not lying and they, I don't know, he says explicitly that they find other ways to spy on you through. It does seem, it is an upgrade. It is an upgrade for a lot of people. But I also think it's like Facebook's not going to go to China. They've decided that China is a good business model to be, except with a little bit more encryption. It just makes it seem obvious that we have to have some sort of decentralized open source messaging protocol.

Because this is going to keep on happening, that either it will, stuff will either wither, or it will be, it will, there's no safety in picking one messaging platform for a company because the company gets to decide how secure it is. You don't get to decide. There's an amazing blog post on Signal where they talk about the possibility of a federated open, secure messaging standard. And they basically are like, yeah, no, it's never going to happen. We're just going to keep making signal because there's no way that we can fight the forces of global capitalism and make this thing real. It'll just die. We're better off making something that we can actually build and iterate on and improve directly than hoping for an open standard that everyone will agree on.

It's never going to happen. And like, that's the thing we're facing. So I'd much rather push Facebook and Google and even Apple to improve their privacy standards than cross my fingers and hope that, you know, a federated standard is going to happen. Yeah. But there's no reason we can't try for both. Yeah. I mean, maybe one day we will solve the XKCD comic about standards. Yeah. Like, maybe that will happen.

Maybe one day the most like the most difficult technology collective action problem in the world will just solve itself. Like, yeah, I would just prefer to have more competition. There's the Matrix protocol. It's not like nobody is trying to do this. The Matrix is decentralized and it is into crypto. It has been done, but I don't know what it will. take, you know, probably somebody like me should be trying to use it. Well, I think you just answered your own question. Dieter, what were you going to say? Well, just to wrap this up, a couple of months ago, I wrote a story that made everybody mad,

and I knew it would, but I wrote it anyway. It was the moral case for I message and an Android. I think that the sharpest move, the best, most hilarious thing that could happen is Facebook starts to gain just a tiny whiff of traction. with this new system that it's set up, and Tim Apple decides, you know what, screw it. IMessage on Android. It has a way to fend off Facebook. That would be amazing.

I mean, if you believe that the future of Apple is services, like put IMessage on Android and build services around it. Like, it doesn't seem like that hard of a call to me. Yeah. Right. And to be clear, this is what they have already tried to do in hilarious Apple fashion with IMessage. There is an IMessage app store because the only thing Apple is. Apple knows how to do is build app stores. They're like, we got this hammer.

We're going to go ahead and hit IMessage with it and see what happens. They've already tried to lace other activity into IMessage. There's no reason that if they're going to be a services business, they wouldn't come after the same thing. And they have better reputation. They do run a multi-point encrypted messaging system. It works really well. And they've got a lot of people who trust them.

Like, there's a move here for old Tappel. That's what I call them. to get in on it. Can I help wrap this up on a personal note? Yes. I was talking to my mom the other day, and she's like, I was trying to convince her that technology is good. And she said, two of my sons have Android phones now, and now I can't text them. Yeah.

That's right. Casey, what happens next? What should people be watching for? What happens next? Well, I would be curious to see if any regulators try to pull a last minute. Whoa, whoa, whoa, hold your horses. Don't unify the back ends of these things. We still have questions for you.

Some people might see this as a last ditch effort to protect the possibility that Instagram and WhatsApp could still be spun out. Facebook has said it's going to take until, I think, at least the end of this year to finish this process. And Zuckerberg himself said that for the timeline for the rest of the things we've talked about today, is going to be on the order of years. So nothing is going to happen immediately, but let's watch how regulators act in the meantime. I guarantee you, at least on the European side, that they will try to make them hit pause while they sort out what they want to do. I think in the United States, what we're going to end up with is like a fine on the order of billions, which for Facebook is like 72 hours of Facebook, and then we'll move on. But McKenna and I have been watching the sort of regulatory action around this infrastructure merging, and that,

The chatter is just... No one's being shy, right? When, like, when, like, sitting in United States senators are like, this is a real F-bomb from Mark Zuckerberg, we're going to break him up. Like, there's no one's shading anything. So I think I'm very interested. Obviously, of course, I'm very interested in that part of it. Okay.

I want to take a break? Julia, who's been patiently listening to us rant about messaging services, is going to tell us what on earth is going on in the streaming wars. 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.

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That's Grammarly.com. All right, we're back. Julia. Yes. There's a lot going on in the old Stream Wars. Yes. Let's start with our old friends at AT&T. Well, they made some big changes at HBO.

Yeah. I think we should start there. So they bought Time Warner. Yeah. They rebranded it as Warner Media. Yep. They closed a bunch of niche little services that were very YouTube-centric. They laid off a bunch of people and decided they were going to focus super hard on their kind of main brand, specifically HBO,

which logically led to HBO's president, Richard Klepper, Levinck. Yeah. Which is a big move. It's a major move. This is the guy who's kind of helped or created the HBO that we know and love today in terms of content. Yeah. So what naturally happens is you're coming to get bought. They say, we're going to give you a lot of money.

and you say, I'm leaving. Yeah, naturally. Why did he, that doesn't actually, to be clear, that's a joke. Why did he leave? He doesn't actually really say. He just said that it was his time to go. He didn't feel like he was forced out. But I think what we're seeing is AT&T asking HBO to do something that PLEPR and the rest of, based on reporting from different outlets,

the rest of HBO's core team, I think, disagree with. I think AT&T came in and said, we're going to invest 50s. 50% more. In HBO, we want you guys to create 150 hours of content. We want you to be Netflix. And HBO is specifically succeeded because they're not Netflix. And that's a huge task to ask people to do. And so famously, John Stanky who runs, Nett Warner Media, who is, to be clear, a telecon executive that was put in charge of the media company. Yeah. He was on stage with Plipler like last year. They had a town hall. They had a town hall. And Plepper was like, don't worry, HBO is profitable. And Stanky's response was.

was just not enough. Yeah. Which is wild. To which Plepler later came back and said, more is not better and only better is better. And then revised it to say, I've switched that now that you're here to more isn't better, only better is better. But we need a lot more to be even better. Which is a wild statement to make. It's a wild statement.

Sure. Yeah. Plepler then hit his bong and rode off into the sunset. Yeah, he was like, I'm going to go mess around. with dragons on HBO and Game of Thrones, I should say. And then Stanky, one of my favorite quotes from that meeting, that town hall that came out with him saying, a network doesn't get built in a day. You think it takes a long time to write a script, film it, edit it, distribute it, bring it out.

It takes even longer to build a wireless network, which is exactly how I compare Game of Thrones to 5G wireless networks. Oh, God. So it's just the telecom guys are firmly, and I think disclosure, Comcast is an investor. Actually, NBCU is an investor in box media, which owns The Verge. NBCU is owned by Comcast. Which is launching its own streaming service? Who isn't these days?

A good comparison here is obviously Comcast bought NBC, and they have effectively left it alone. Yeah. Right? Like when you read the financial reports, we read the analyst statements, they're like, these are basically two companies. There's a cable company, and there's NBC Universal, and they run a bunch of theme parks, and there's minions. and those streams don't really cross,

and they did a good job because they left the content company alone. AT&T does not appear to be doing that. They showed up. They put a telecom guy in charge. Ploffler is the guy who greenlit Game of Thrones. Alongside Michael Lombardi, or Lombardo, I should say, who left 2016. So, and Game of Thrones is coming back final season,

and then it's over. They got HBO to survive post Game of Thrones. It's a scary time for HBO, who sees, like, massive increases in HBO now, subscriptions between the premiere of Game of Thrones and the end of Game of Thrones and then a huge drop-off. True Detective does not keep subscribers. Unfortunately.

That's the least surprising thing ever. So they hired this guy Bob Greenlatt, who used to be actually an NBC guy, but he's now in charge of HBO. And he said this thing to NBC News, which is, I'm just going to read it. Netflix doesn't have a brand. It's just a place you go to get anything. It's like Encyclopedia Britannica. Which is, A, a weird, like a weird shot at Netflix, but also just a deeply weird shot at the Encyclopedia Britannic.

That's really mean. Like, who has ever looked at the Encyclopedia Britannic and then, like, that generic pile of trash? The thing is, like, he comes out and he says this, and this is the main line of defense that everyone uses against Netflix. Disney CEO, Bob Eiger, who is someone's career. is someone who I watch very closely because his decisions are interesting. He uses this line of defense with Netflix, too. And he says Netflix is variety. They have everything, but they don't really have anything great.

And to an extent they're not wrong, Netflix invests in everything. And Netflix has a brand. I mean, like Netflix and Chill is a thing. Like people are very aware of what Netflix's brand is. But HBO and Disney, for example, succeed in that they have a very specific kind of aesthetic to their shows. in their films. And so when you have someone like Green Black come in and say, yes,

this is exactly what we want to do. We're going to stay core to HBO. That sounds great. But then he makes these other statements in different interviews that are, have absolutely, like just completely throw that into the garbage. So he comes in and he says things like there, you know,

there's a degree of uncertainty that this is even going to launch in 2019. It might not launch until 2020. That he says it's very difficult to pull. This is the new streaming service. The new streaming service. It's very difficult. to focus specifically on HBO when they're working on bringing in other Warner Media Turner Brands that they need to have a ton of content.

And he's suggested in interviews that it is going to be a little bit difficult to go from having a niche amount of shows to being on the same level as a Netflix or a Disney when the streaming wars really gear up, which is at the end of this year, when everything is launching. Julie, hasn't somebody also implied that they would be open to, I mean, we've all made the jokes about like the 45 second snackable Game of Thrones episodes for mobile. But hasn't there more recently been a suggestion that like, sure, we'll run Game of Thrones reruns on, I don't know, WGN and TNT or whatever. Like, why not?

Yeah, this is like the really interesting thing is that WarnerMedia specifically, this is where you see them buttheads. John Stanky has come out and said, hey, AT&T isn't a whole pile of debt. There's a lot of debt at AT&T. Like, I can't remember the exact number, but it's huge. and part of the way that they're going to make money is licensing things like Game of Thrones or whatever to Amazon. So you can right now go to Amazon Prime and you can watch like HBO series. And right now that brings in a lot of money for HBO specifically.

But then on the other side of it, you've got other executives who are saying, well, we would love to eventually go exclusive, which is what Disney is betting on, for example. Disney is saying we're going to make our money or we're going to bring in subscribers by being 100% exclusive and not deal with anyone else. And so WarnerMedia is at this really interesting point where if you can get to HBO shows via like Amazon Prime subscription or whatever, why would you specifically sign up for WarnerMedia if nothing is exclusive? But they need to be able to have the deal with Amazon because they have so much debt that they need to pay off. And they want to pay it off they told investors by like in the next few years. Let me just read this lengthy quote from Bob Greenblatt. Wait, remind us who Bob Greenblatt is. He's now running Warner Media.

Got it. Well, the easiest way to think about what AT&T owns, they own this huge bundle of stuff. They own CNN and they know HBO, right? And Jeff Zucker runs CNN, and Greenblatt runs HBO. And then there's like a bundle of stuff surrounding it. But here's Greenblatt asked by variety, how is your streaming service going to work?

Here's his answer. It's really early days. I don't have a great and comprehensive answer for you yet. I would say the goal here is to just put all these assets that this company has, from the movie studio to HBO and Turner and the Vass Library. and build a platform that is robust and a great value to consumer. There's a million questions to answer about where we're already selling content now. Should we continue to do that?

How exclusive should we be? There's a million questions that we have to be answered. We all need to roll up our sleeves as one company to pull that together. I would just suggest to you that perhaps you should have some answers to these questions before you buy Time Warner and fire all the creative executives who made the content that you were purchasing. Like it just seems like this Is this dude a clown? He seems like a clown.

No. No. You don't think he's a clown because he, you know, he produced a bunch of shows. He's made a bunch of shows for NBC, for Showtime for HBO. He did six feet under. Or he was a producer on six feet under. But the thing that, the question that they need to ask is not necessarily HBO. Everyone wants to focus on HBO because it's like prime prestige award-winning television.

The $100 million question is like friends. It's people forget that Warner Media. owns the rights to a lot of shows and films that are on Hulu and Netflix currently. And Friends is the big one because Friends, Netflix played $100 million for non-exclusive rights to Friends, which is wild. That's a lot of money for a show, a mediocre show from the 90s. Wow. Whoa.

Whoa. I'm just saying. Accurate. But still. My wife and her friends are going to be so mad at you. But the thing is there's a lot of content that I think someone like John Snanky used at AT&T sees as we can continue to license this out and make a lot of money and we can pay off our debt, which is what he's thinking about. At the same time, he wants to focus on HBO and he wants that to be. It's not sure.

It's not clear what they want HBO to be. It's not clear if HBO now will continue to be a thing once the streaming service launches. it's not clear. Here's another example. They announced that there's going to be a three-tier system to like the Warner Media Streaming Service that HBO will sit at the heart of. Does that mean the basic package gets HBO?

Or is that like the premium package? How much is that going to cost? So there's so much about the streaming service that's really interesting that if they play their cards right would give them a huge advantage in the streaming wars, but they just don't have any idea of what they're doing. Yeah, that much seems abundantly clear. And the other thing that makes streaming services important is not necessarily just content.

It's like how does your service look while you run it? Does the service run properly? I mean, HBO now does not run well when Game of Thrones is on. Well, I think that noted software designers and engineers at AT&T will certainly be of use solving this problem. Well, and the... Put at the edge. I mean, it's just like AT&T is not a great software company. unless they're programming 5G modems.

Well, and they were banking on a small little piece of media called BamTech, which Disney came in and was like, no, we're going to take it. And so bought a 30% stake in Bamtech, and AT&T in 2018 backed away from it. They were like, oh, we don't want to have to rely on Disney. We've actually profiled Bamtech before. Yeah, so for those, so Bamtech started as the, you probably know it because it started doing the MLB baseball streaming. And they were very, very good at it. And do you remember when HBO now and HBO Go first launched and one was good and one was crap? BamTech, they launched the crap one.

You had to have an HBO subscription. I think that one was HBO. That's go. Go? That's go. And it was terrible. And it crashed. It didn't work.

And it could never watch anything. And then when they launched their standalone HBO service now, they're like, yeah, no, we're not going to just do that. Then so they got Bamtech, which has, like, spun out become an independent company to run the streaming service. They were like, they're the gold standard in, I want to run a streaming video business. I think they do wrestling too, right, Casey? Yeah, they do the WWE app. Yeah. And Disney bought a huge chunk of it.

And Disney was like, we're going to get into this. We're going to be Netflix when everybody was gearing up for it. And Bob Eager, as he does, the CEO of Disney, it was like, we're just going to take a huge portion of it. It's going to be ours. AT&T said we don't want to rely on Disney or have anything to do with them. So we're going to do our own thing. So not only are their content plans, unscrued about. but I don't know what their actual app is going to look like.

I don't know if it's going to run well. And if you don't have an app that runs well in a marketplace where every single streaming service runs very well, like the major ones, Hulu, Netflix, I assume Disney's will. And you're launching at a very late period, Apple as well. It's like you have nothing that makes you stand out. And if I have $15 to $20 to spend per month on streaming services, why would I choose yours?

And just to bring this full circle, why wouldn't you choose the one that has the most stuff? Yeah. Like, Casey, you talk to me about subscription fatigue all the time. Like, everyone is asking you to pay for stuff. At the end of this, why wouldn't you just pick Netflix, which will have some selection of things that you want as opposed to, well, I just, I'm going to spend my $15 a month on like dark, gritty HBO stuff.

I think what you're saying, Nilei, is... Who? No, speak for me, Dieter. What you're saying, Neal, is enough from you today. If you can only buy one set of books. you should buy the Encyclopedia Britannica. Yes, I think that's what I'm saying. It's so true, though.

Have you read the encyclopedia? Okay, when I was off the internet, I got a DVD copy of the Encyclopedia Britannica, and I started looking things up. Like a DVD ROM. Yes. Okay, not like you weren't watching the Encyclopedia. Not a movie, not a video version, which would be great.

But, like, Encyclopedia Britannica articles are often essays. They are in-depth explorations. Let me tell you all about Egyptian archaeology. It's a weird shot to take. Well, I mean, to be fair, for years, Encyclopedia of Britannica was very ethnocentric. So, I mean, there's that. Right. And it's been since supplanted.

But Paul's right. Like, it's just a weird shot to take. Like, I grew up reading this. Anyway. Listen, let's, can we talk about the PLEP-LAR opportunity here? Because I want PLEP to get a little pet back. in his step and I know how he can do it. Tell me, Casey. The plepler gambit?

Yes. I would now like to propose the plepler gambit. Now, all of us here are probably familiar with Quebey, which is the new streaming service that, as I understand it, is being put together by Meg Whitman and Jeffrey Katzenberg. 100% true. Please spell Queeby. I believe it's Q-U-I-B-I. Yes. Just to be clear, they claim it stands for Quickbytes.

Quick bites. So they're going to essentially invent a bunch of new video formats. It's like, hey, why aren't drama seven minutes long or something like that? And they're going to make a whole bunch of new shows. And because of who they are, they've raised like ungodly amounts of money and they're running their mouths in the press about, you know, this is the future of content. They need Richard Pleplers so bad. And so I think like right now, like probably honestly right now as we're talking, Plepler is either having a meeting with Meg Wlipler. or he's like thinking about what he's going to say in his meeting with Meg Whitman. Do you know what's like so infuriating to me as like someone who covers YouTube a lot is whenever these companies talk about the future of like streaming and entertainment and where they're at, like making sure that they become the number one platform for these things, no one acknowledges that YouTube is a thing. And YouTube is by far the most popular, like video platform. And just totally take, you can take all the views per month from Netflix who,

all of them, and they're still make up, like, they make up a tenth of what YouTube gets. And if YouTube really wanted to invest in prestige content, maybe PLEPler can go to YouTube. That would be wild. Like, there would be, and like people already buy YouTube bread or YouTube premium just so they can get rid of ads. Like, hey, say, I know you. That's why you do it or whatever. The best YouTube. Like, you might as well just, if you want to invest in it, God knows you have the money to do it.

Look, I'm into this idea of PLEP tube. If Lepler goes to YouTube, I'm into it. Do I think it's a Quebebe-level move? No, I don't. Julia did an excellent job because we do need to talk about YouTube for a few minutes. But before I do that, I just want to read you this Meg Whitman quote about Quebey. It's a profile in fortune. It's a long profile of these two.

And they're saying all this stuff that, like, Hollywood executive states about watching content on phones to prove that they, like, do it. So she's like, I refuse to watch anything not on a phone anymore. I'm like in it. I lived this life. And then she's like, I had my brightness slider all the way up while watching Bodyguard, the long-form British terrorism thriller on Netflix.

And it was still dark, she says. And that's because the original film was not shot enough contrast. And so everything on Queevy will have an appropriate level of contrast. You're not going to believe the contrast on Quebeenby. It's like, I just read this and I was like, none of those things are connected to each other. Like, contrast isn't brightness, first of all.

Whatever she describes a television show, like the long-form television sitcom friends. Yeah. She'll always have to add long-part. Here's just another little shot at Queeby, because I can't help myself. Whitman is also figuring out how the company can make mobile viewing more immersive, more encompassing more like the experience one would have in the screening room that she now only uses for meetings. Beyond boosting the film's brightness, she wants to optimize. Here's a quote.

While you're on the bus commuting, it's quite quiet. And suddenly you get out and it's all this noise, but you still want to watch. What? Have she ever been on a bus? That's the opposite of a bus. You know what drives me crazy? When they make the flight announcements and you can't hear a thing, it's so loud. And it goes on for a long time.

I have no idea how this is connected to Queenie. Like that is just the rantings of someone who travels a lot. Queeby is going to come with a doctor's warning not to listen to it because that's how loud it is. You need a prescription to use Queeby. Maybe you play the show in like JetBlue mode and it will perfectly synchronize raising the volume during announcements. And then the next line in this article is Queeby does not yet have a media player to test. But she knows the video is going to be bright and shit. And the audience is just going to duck all around.

for the bus commuters who are like, I got to get my quebey. Neil, look, the important thing, who cares what the media player is like? What's clear here is that Quebebe is a lifestyle and Meg Whitman is living it and they will build the player around the Queeby lifestyle. Plypler's got to get it on this.

That's what I'm saying. Okay, let's just quickly rank these things on the Go-90 scale of likelihood of failure. By the way, the full Go-90 is failure. If you've gone 90, you have failed. Queevy is a full go-90. I think we're all just agreed on that. That shit's already at like 45, trend into 60, right?

I want to see the contrast before I went on. You know, who hasn't sat around watching a show on this phone? Say, I wish I had more contrast. All right, so Queevy, I would say, trend into 90. Warner Media, I would say, is a giant scale Go-90 waiting to happen. They're going to have money. They're going to pay people a lot of money. Prestige brands.

A long form go 90. Yeah, a long form go 90. I think it's a direct TV now thing. I think they think it's a big deal and then it will eventually fail, but they'll keep pouring money into it. Yeah. I just think I feel like once those brands get tainted, the creatives leave and that death spiral begins. Yeah. Okay.

How about a federated open source media platform? Oh, God. With enough contrast. Disney Plus, which I has not yet watched. A plus Plus. Disney Plus is going to do incredibly well. I just, Disney Plus, they announced today, he told shareholders today, Bob Iger did, that the vault is coming to an end. The vault for people who don't follow Disney as much. When a movie comes out, it has its initial run on DVD or VHS Blu-ray, and then it goes into a vault for like 10 years.

Then it comes out for like three weeks and you can buy it and then it goes back into the vault. And this was originally done so that Disney could control the market. place. And now it's done out of, I don't know why. But it works on digital too. So like you can't get like Aladdin on anywhere online right now because it's in the vault currently. And so what Bob Iger said was like, hey, we're launching the streaming service. It's going to be substantially lower than Netflix. My bet is $6. They haven't announced anything yet, but I assume it's going to be $6. I think that's what they're going to go with. That's wild. Yeah. And I think the fact that they're going to have this exclusive catalog

of old movies like The Lion King. I think parents who want to watch movies with their kids or just want to put their kid in front of something and they can trust it, that's no longer YouTube. It's not YouTube anymore, so it's like, hey, we'll just pay $6. They can watch Disney movies. They can watch Marvel movies. They can watch Star Wars.

And then we've got these huge, big budget Amazon style live action series from like Star Wars and Marvel that people are going to want to sign up for because the fan base and the stand base is huge. And they're using Bamtech, so it's going to run really well. And it's going to be exclusive. Disney will be

I think a big competitor. Would you describe yourself as a Bob Iger Stan? I mean, I have a framed photo of him on my desk. Okay. So the answer is yes. Okay. Last one. Apple. Oh, boy. I mean, my entire experience of Apple video is watching three episodes

of Planet of the Apps and feeling like I needed to go to therapy. Well, and apparently Tim Cook is like personally G-rating every single show. He's His most common note reportedly is, why do you have to be so mean? It's like Mr. Rogers running Netflix. How could Tim Apple have such a bad sense of what people want to watch? I genuinely think this is just my, like, I'm someone who's obsessed with drama, and I am,

I genuinely think Tim Cook just wants to be able to, like, go to the Oscars and Golden Globes with Jeff Bezos. Like, he just wants to be invited and, like, go hang out. So I don't think he cares about whether or not it does well. Maybe they'll package it into Apple Music. And it's like you have an Apple Music subscription. You get these shows and you can just watch them. And then he gets to go to like the Golden Globes. And that makes him happy and that makes everyone else happy.

I would say that if I can be at the level in my life where I'm the CEO of the world's richest corporation and I can just blow a billion dollars on a golden globes ticket, that would be great. That's what I mean. TC actually the other day I said his goal in life is to do what Bezos does when he gets a customer complaint, which is to just form. it to a random deputy with a question mark and just assume that it will be resolved. Like there are goals that you have in this life. I think Apple, I think everyone would suspect that I would say Apple's a go-90 waiting to happen. Yeah, I have no faith in it.

I don't think so. I have no faith in it. I mean, I think these horrific production notes are going to take a while, but I think they're going to... But they've invested a lot of money. What I'm getting at is they did Apple Music. They went from nothing to something, and they just made it happen. And they just sheer force of will made Apple Music happen.

And I think they've got a lot of the same incentives around TV service. Okay. We're going to take a break. We're going to come back. Paul's going to do a thing. Julie's going to tell me about YouTube. Support for this show comes from Whatnot. Whether you're selling online or out of a storefront, you already know the challenge.

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Start building at MongoDB.com slash build. Okay, we're back. Paul, every week. Oh, yeah. You do a segment. It's got the same name. People rely on it. It's always been called robots dance while they die.

A cloud computing murder tale brought to you by the same people who collectively write all the James Patterson novels. Wow. Wow. Do you get sponsored this week or something? Yeah. James Patterson. The airport bookstore sponsor you?

So you may or may not be aware that Gibo is a not very good robot that was, its brain was in the cloud. And when you are an unsuccessful product and your brain is in the cloud, you die. And Gibo die. this week

and it said really sad things. Thank you very, very much for having me around. Oh my God, what? Maybe someday when robots are more advanced than today and everyone has them in their homes, you can tell yours that I said hello.

And then it throws like shade on future robots. It's like, and can they do this basically? And then it starts dancing. And then your Gibo is dead. So Gibo is like, like the little, it's got the big round face, right? Yeah, it's, it kind of looks a little bit like the, what was it, Eva?

What's the robot and Wally? Eve, yeah, Eve. Queeby. What's the brightness or the contrasts like? So yeah, Gibo is, it's like got a circle face and then there's a little screen in there and then, and then, I don't know. We reviewed it, it was terrible. I just want to be clear.

It was a very bad robot. It's just, but it's also bad. It's like doubly bad. It's bad that it was a bad product, but it's also bad that you make a product that can just disappear when you turn your servers off. Yeah, which is a $900 product. $900. I forgot that it was $900. Well, I will tell you this, our friend Joanna Stern basically danced on GBO's grave because she hated it so much when she reviewed it.

This is a fact. But I think we're going to get some stories. I was talking to Ashley. Some Gibo owners have reached out and said they were really sad because GBO become part of their family. so I think we're gonna work on that we're gonna try to get some look when a robot becomes part of your life you know it's like a thing

and then it has some weird dancing death sequence collect those stories and then put them into a book and then sell it in airport bookstores all right Paul's segment brought to you by airport bookstores around the world all right Julia there's just a lot of stuff

you were just talking about YouTube this whole time and then we got completely distracted by Quebe but there's crazy shit happening on YouTube right now. There's MoMo, there's the family comment situation, there's channels being deleted. There's stuff hourly on YouTube. What is going on with YouTube? Where do you want to start? Let's start with MoMo because I think we can just knock it out. Okay. So MoMo was this hoax that started in like 2016 on Instagram and like

what's the app that everyone uses to text each other and it's not good? What's that? Wow. Wow. Friends sucks. WhatsApp sucks, man. Anyway, so it started there, and then it was basically debunked. And then a couple of parents heard that it was happening on YouTube. They made this huge case about this to the point where schools were like banning YouTube, like restricting access to YouTube.

Kids were like having nightmares because their parents were telling them about this scary monster. So the hoax is that the Momo pops up in the middle of the video and tells you to kill yourself. Yeah, it's like a base on a piece of art by this Japanese, artist that's very spooky, but it's meant to be. And it appears in this video and basically tells kids to kill themselves. YouTube confirmed this has not appeared in any of their videos on the kids app, and that it mostly was not available on the YouTube main app, but they can't ever really confirm anything on the YouTube main website because it's too big.

But on the kids app for sure, it wasn't there. And essentially what we have is a story of like a bunch of people overreacting something that did not happen. And really an interesting case study in how to talk about things on the internet to kids because it's a hoax. And a lot of the stories that it came out afterwards were that parents were like really scaring their kids by talking to them about it. And their kids were like, I have no idea what we're talking about.

But I've heard about it and my friends have heard about it. And now we're Googling it because kids Google. And it led into this huge situation. But it was a nothing incident that YouTube is effectively put out. They've extinguished. And they've demonetize. all the... Yeah, they demonetize all...

If the image appears in the video, which a lot of news organizations do, so if you search Momo on YouTube, you'll get like NBC, ABC, because YouTube's new algorithm uses authoritative sources for news events, so it pushes down, like, conspiracy theories.

And all of those videos have been demonetized because using the image violates their advertising guidelines, which is not new, but it's something that they enforced and, like, people weren't aware of it. Well, it's funny because that changes the YouTube incentive structure. If you can't make money making this video, a bunch of the crazies probably won't make it.

Right. I mean, actually, just today, I noticed so a couple of days ago, if you looked at Brie Larson, if you search that on YouTube, you get a lot of, like, men's rights activist style stuff saying that Brie Larson was terrible because she said she wished there were less, like, male journalists interviewing her about Captain Marvel because it's such a female empowered movie. So it's got a lot of backlash from a lot of angry men on the internet. and today YouTube changed it so that it's a news event and literally none of those videos are on it.

They don't appear anymore. So it's just like E and like NBC and Entertainment Tonight, which is wild. Yeah. And to me like signifies that YouTube is aware of how people are using its platform and they've got a way to fix it. They just don't know how to fix it on mass.

And the other thing is if they start surfacing news sources primarily, you're going to get a lot of backlash from creators. A lot of backlash. Yeah. I mean, this Casey is writing about how to moderate platforms at scale, like, every minute of every day now. Like, this is not a solvable problem. It doesn't seem like. Nope. Best of luck to us all. All right. So then what's going on with the family vloggers on YouTube? I mean, it just seems like YouTube is exercising control over its platform right now.

Yeah. So then last week, a couple weeks ago, time is flat surface. this video came out by this creator who said there are predators in common sections who are leaving timestamps, which is like go to zero point, like whatever, three seconds in. And they were using that to sexually exploit very innocuous videos of kids like doing gymnastics or running or swimming or dancing, something that like vloggers do if they've got kids, something that like a lot of proud parents will just put on YouTube. And so YouTube, what started happening right away is that advertising. started pulling back. So like AT&T pulled out Epic Games who publishes Fortnite paused advertising

spending. So YouTube's first reaction, as always, is to protect advertisers. So what it came up with was closing comments entirely on any video that featured a minor. And YouTube separates minors into two categories. There's 12 and under and then 13 to 17. So 12 and under is automatic, they told us, and then they published this blog post, is automatic comments closed. 13 to 17 depends on the type of video. And they specifically said that excludes like celebrities. So like James Charles, for example, is a really big beauty vlogger and he was like 16 when he got really big. He would be excluded even though he's a minor because he had like 6 million subscribers.

And his comment section has to be open for reasons. And so there was this wave of backlash from a lot of family vloggers because for a long time, the rumor was that. that comments signified engagement on a video and the higher your engagement, the more likely it was that YouTube's algorithm would recommend it or put it on the home page. And that would lead to additional views, which would lead to more advertisements. YouTube told the birds, that's not true. They totally debunk that. They were also concerned.

Do you believe them? No. I think. There it is. Yeah, I don't. I don't think any YouTubers believe them either. I know. You, 100% don't believe them.

There were also concerns from family vloggers. there was rumors that they heard from their own creator rep. So major creators have a rep specifically at YouTube that voices their concerns to other teams and executives. So there were some vloggers who heard from their reps that eventually they were going to demonetize videos that had minors, like young minors, as a way to protect advertisers. YouTube told us that that was also untrue, but we don't know yet. And so essentially family vloggers are threatening to leave YouTube because it's not a welcoming platform. platform anymore. We've seen this time and time again over the past two and a half years. It's something that creators refer to the as the adpocalypse, which is they prepare for a mess on

YouTube essentially. And they're threatening to leave to go to Facebook, which I thought was interesting, Casey. They were like, Facebook videos where we're going to go. I was like, you and Jada Pinkett Smith. Facebook doesn't have any monetization. Yeah. Yeah. I mean, it's one of those like I'll believe it when I see it type of things, right? I mean, the sad fact is that none of these people have any leverage there at the whims of a platform where there is no justice or appeal to anything. So, you know, why you would choose to build a family business there raises certain questions in my mind. But, you know, God bless. That's the thing.

I mean, family vlogging is inherently very creepy. I mean, like, Jake Paul essentially kidnapped a family and are like, he's like housing them at his mansion. so that way he can have a four-year-old in his videos and get more ads, which is, like, he's very much said that. He's like, I can either go and do more adult stuff because I'm 23 and get no ads or I can have a four-year-old in my video and make slime and make bank. And so he's like kidnapped this family. I've done this all wrong.

Yeah. He's like kidnapped his family. Why aren't I not monetizing my baby? But I spoke to a lot of vloggers for the story. And it's an interesting predicament because they get where YouTube's coming from. These are predators. There's children whose safety is at risk. My solution would be to not upload your kid to YouTube in general, but if you want to monetize your child, which I appreciate, then like, I suppose... Don't monetize your child. It's just like a very easy answer. It's just like

don't rely on your kids to make bank. But all the vloggers said, like, we get where YouTube's coming from. We understand if this is a temporary solution, fine, but this can't be the solution in a year. And from what I heard from sources at YouTube is that the idea is to make it temporary, but I've reported on YouTube for about two and a half years. And every time I speak to them, it's like, well, the advertisers are always going to be first and foremost the concern. So ensuring that Epic is happy, Nestle is happy, Disney is happy is extremely important. And at the end of the day, family vloggers are a section they don't necessarily need. They've got like a bunch of other sections that they can rely on.

So it's an interesting kind of change because a year and a half ago, YouTube would point to family vloggers as like, hey, look, we've got really cool stuff. Don't worry about Pity Pie. He's fine. These guys are great. And now they can't even point to them anymore because of the comment situation. So it's a weird time for YouTube. And they're very much struggling to kind of figure out how to keep up with everything from what I understand. I mean, I don't think enough people pay for red.

I think maybe we do. Maybe some listeners do you. I can't because I report on monetization. I need to know if there are ads on videos. You poor thing. You're a hero. You're a true Canadian hero. Yes.

But that's not a huge number. Right. And so of course they have to keep their advertisers happy. That's the money. That's like where it comes from. I think we're just in this mode where everyone's going to start asking for more money directly from people. And this business is going to turn into something much smaller, probably richer.

because if they can guarantee to AT&T that everything's going to be fine, they can probably extract more dollars. What we're going to see happen, I predicted this a year and a half ago, and I'm 100% convinced it will happen by the end of 2021. Like, it's the death of the vlogger. Like, that's what I refer to it as. And it's this idea that YouTube, for those exact reasons, want advertisers to be happy. YouTube doesn't know what YouTube bred or premium is to the point where, like, CEO Susan Wojcicki came out on stage and told, like, Kara Swisher at Recode, that it was a music service. One of my all-time favorite quotes. And everyone was like, what?

Yes. No, it's true. The Verges of Print Magazine. Yeah, exactly. But I genuinely think that they're going to be MTV for a new generation, and it would make sense. I mean, their most popular vloggers are essentially jackass 3.0. They have creators they can work with, but they also have a very lucrative business with music videos. And so turning it into a music service that you can just run all your ads on like Selena Gomez videos or whoever's popular.

I don't know. the Jonas Brothers are back. If you can run ads on the Jones Brothers videos, then why would you worry about anything else at that point? So I think what we're going to see happen is YouTube specifically turn into a music platform with creators on the side

versus what it was in its heyday in 2012, a creator platform with like some other stuff. With some copyright infringing music. It was a good way. It was a good business. Anyway, Julia, thank you for being here. Casey. Thank you. You're welcome. I'm glad that we had that interaction that way.

Everybody else, thank you for being here. Thank you for listening. We are going to be at South by Southwest this weekend. So if you're in Austin, you're at South by, come see us on Sunday. Like Deeter said, we want to line around the block. We want to show what this flagship is capable of. You can also listen to other Vox Media podcasts. You can listen to Pivot with Scott Galloway and Kara Swisher. You can listen to Caras Swisher to Recode Decode. You can listen to Peter do Recode Media, which is very good. and you can find us on all the social channels, including not least YouTube. Anyway, well, we're going to have a run of episodes here.

So we're going to put out the South by episode on Tuesday in place of the normal interview episode. Then we'll have another Vergecast at the end of next week, and then we'll be back on our regular schedule. So get ready for some Vergecast. We'll see you soon. Rock and roll. Paul. Provo code.