The Vergecast - Microsoft Q4 earnings, Spotify’s subscribers rise, and Instagram walks back its changes

Episode Date: July 29, 2022

The Verge's Nilay Patel, David Pierce. and Alex Cranz discuss the quarterly tech earnings from Apple, Microsoft, Spotify, and more.  Further reading: Meta and Apple in ‘deep’ competition to build the metaverse, Zuckerberg tells staff Yes, it’s weird for the two-year-old Meta Quest 2 to go up in price Meta might let anti-vax posts back onto Facebook and Instagram  Instagram walks back its changes Microsoft Q4 2022 earnings: Windows and Xbox fall in $51.9 billion quarter Meta reports revenue decline for the first time in Q2 earnings Here’s where to buy the Meta Quest 2 before it costs $100 more Alphabet Q2 2022 earnings show profits dropped compared to last year Comcast’s broadband business stopped growing for the first time ever Spotify’s subscribers rise to 188M amid podcasting setbacks Spotify amps up fiction podcasts with new leader of scripted content Spotify paid $123 million for audiobook company Findaway Spotify has stopped making its Car Thing dashboard accessory Apple’s latest iOS 16 beta ensures you can’t hide your mistakes with an edit Apple’s new Home app in iOS 16 is better but still half-baked SpaceX says Dish’s 5G plan would be ‘detrimental’ to millions of Starlink users You can re-watch Game of Thrones in 4K on HBO Max next month President Biden’s awesome video conferencing setup starts with a $7,000 Zoom gadget Asus’ compact Zenfone 9 comes with incredible gimbal-like camera stabilization Email us at [e-mail], we'd love to hear from you. Learn more about your ad choices. Visit podcastchoices.com/adchoices

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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 infinite scrolling vertical video, which is happening to you whether you like it or not. Not on Tumblr.

It's just been the theme of the week. There's like two social medias that don't do it yet. Yeah, it was Twitter, which can't do anything. And Tumblr. Which can't do anything. The two least innovative social media platforms have not yet pivoted to take time. They're just out there like, we're boring. Love it.

Everyone else. Tumblr's still out here. They're like, do you like a slideshow? Can I interest you in a gallery of images? Has Pinterest figured out how to make money yet? No. That's a whole can of worms. Pinterest has all the exact same ideas as everybody else,

except that they can't make any money off of them. Because they're nice, and there's no money in, like, being nice. And so this is the problem of Pinterest. But they're not nice. Pinterest is the worst one. All right. Here's the story. This has been a test for every social person we've ever hired.

The Verge has 1.3 million followers on Pinterest. Seven million people look at our Pinterest every month. Wow. And we do nothing. Like it's just, so if you can figure out what to do with our Pinterest and how to turn it into money, send me a note. Send me a TikTok. Send me a Pinterest pin with your ideas. And we'll talk.

But I will tell you for 11 years, we've been like, what should we do with our Pinterest? And these poor people who interview are like, we don't know. No. And then we just move on to the next thing. And then Pinterest says that's how we feel and hires them, I'm sure. That's how it is. Right now, what we're doing, what it looks like... You can follow people on Pinterest?

Oh, my God, Alex. I hate it so much. Are you a Pinterest fan? Please call David Pierce personally. He'll love it. We'll do a whole Vergecast segment on people on their Pinterest. By the way, we haven't introduced ourselves. I'm Neela.

I'm your friend. David Pierce is here. Hi. I'm your friend who is just DMing you Pinterest Pins all day. Alex Tranis is here. I'm your friend who hates Pinterest the most. Just like yelling in bars about Pinterest. Just hate it.

Get off of Pinterest, Katie. Stop using it. Don't send me your boards. I don't want to, I don't care about the furniture. I won't be able to buy it. So why are you sending it to me? You're just sending me like a link to another link to another link. Pinterest is a recursive link nightmare.

Yeah, it's the worst. Every time I'm like, I want to get some cute eye shadow. Nope. Do you ever Google something? and then the first result is a Pinterest link. And then the Pinterest link leads you, like, legitimately back to, like, a Google shopping result. Yes.

And suddenly, like, it's just, like, the internet's black hole comes and just swallows you. I'm fairly confident this is that we get 7 million views a month on our Pinterest. And of those 1.3 million have been like, I like this experience enough to hit follow. I don't know why. So if you can figure it out, just like, let me know, because we've been wondering for a while,

we'll take pitches, we'll run the pitches on the verge cast. Here's what you should do with your pen. Maybe it's a horrible idea. No, it's a beautiful idea. Really reconsider that in the middle of saying it. This is what the Vergecast hotline is for. 866, Verge 1-1. Call us and tell us how to fix Pinterest.

I'm in. I will do this. All right, there's a lot of news this week. Meta, it's funny because the Wednesday show, Alex Heath was on to talk about Land of the Giants and meta and Instagram, turning in TikTok. And since Wednesday, we're recording this on Thursday.

it's going to go out on Friday. But since Wednesday, there's been infinity more news about TikTok and Instagram, like, just the most. So we got to talk about all of that. Meta had earnings. Mark Zuckerberg is yelling at everybody. Gary from Chicago. The world of pain for Gary. Oh, Gary.

It's actually earnings week. So Microsoft had earnings. Apple had earnings. Alphabet, the band formerly known as Google, had earnings. Comcast, broadband subscribers are flat. Peacock isn't growing. They say they have content problems, which is like very confident thing to say. Like the problem with Peacock is the content.

Yeah. Spotify. So we got to talk about all that. We got some gadgets to talk about. Let's start with meta in this Instagram situation. Because we started the week with a big Alex Heath, David Pierce feature on Mark Zuckerberg, just telling everyone that they're lazy and they should work harder, get out. and it was kind of unclear, like, in what direction?

Like, if you work in sales marketing at Meta, like, I'm not sure what you're supposed to take away from that instruction. Like, meta's a huge company. They've hired, like, 40,000 people in the pandemic. And he's like, realistically, some of you shouldn't be here. Which is the thing he said in all hands meeting. Alex and I run the staff meeting for the verge for 100 people every week. And, like, I've never taken a formal how to run a staff meeting, like, class.

but I would say instinctively I know that one thing you should not say is realistically some of you should not be here. I've definitely had CEOs say that at companies I've worked at. Some of you, you know, you should just quit. It'll be easier for you. And you're like, what?

It's not a good thing to hear from your boss, especially when your boss is Mark Zuckerberg. The God Emperor of Facebook. Yeah, like not good. But I will say, we talked a bunch about this in the run-up to the story. And the story after it got published got exactly the reaction we were hoping for, which is that a lot of people, like the vast majority of people are like, that is ridiculous. Facebook is a bad product. Meta is a bad company. Mark Zuckerberg is a bad guy. Everybody's very mad at everybody.

And then there were a bunch of people who read this stuff where Mark is like frustrated at how sort of soft the company has gotten and he's mad that he can't get people to have meetings. And there are a lot of people who read this stuff and are like, yeah, I kind of get where Mark's coming from. Yeah. And it was just like there's just enough of that like, yeah, he might not be totally wrong here. Like, I don't think you say that on a staff meeting with your 77,000 employees. Well, you do. If you're Gary. Right.

So the meme of the story is this opening anecdote that Alex had, which, and I feel bad for Gary because the question's pre-recorded. So Zuckabwe gives this entire speech, but everyone needs to work harder, focus up. Some of you got to get out of here. We're tightening the performance reviews. And then the first pre-recorded question is Gary from Chicago. and his question is, are we going to have extra vacation days next year? Because we had extra vacation days in pandemic. And Zuck is like, you can probably guess how this is going to go.

Like, that's what he says. He says, you can assume from my tone how this is going to go. And he canceled the extra vacation days. And I just feel bad for Gary. Like, he didn't know. He had no idea. If someone had told him before he pre-recorded his question. But then the people who, like, played the prerecorded question also could have picked a different one.

Yeah, Gary from Chicago got kind of hung out to drive on that one. Gary from Chicago had some enemies. I've known a lot of Gary's from Chicago. I used to live in Chicago. I know a lot of Gary. I get it. I get that city is not about, you know, when you move to New York, everyone talks about work all the time. This is an experience everybody has to New York.

You move from anywhere else in country. You get in New York, and then suddenly everyone, all they talk about is work. That is the heartbeat of the city. Chicago is mostly about finding a friend with a boat so that you can hang out in the playpen on Lake Michigan in the summer. Like that's most, it's like, what bar are we going to? What are the drinks like at that bar? Do you have a friend with a boat? I live there for a long time.

That was the circle of my social life. So I feel Gary very deeply. He just wants to be out on the boat, using his meta days, having a good time. I never actually ended up with a friend with a boat. Maybe because I was so aggressive about wanting a friend with a boat. You, sir, do you have a boat? I don't feel like personality-wise, like you're the friend with the boat. See, that's really.

That's like a job you had in your circle of friends. Everybody was like, which one of us needs to get a boat? And they were all like, it's definitely Nilai. And you just like never quite got the message. Well, I moved out of Chicago. I had to start paying New York City rents, man. Things change. So Mark gives us big speech at the all hands.

You got to shape up. We ran a story, I think it was very good. David helped write it. Mike Isaac ran a story at the Times of a memo that was like tightening our culture. Same kind of deal. Inside Facebook, Zucks turning up the heat. The next day is earnings. Meta's earnings are going down.

Remarkable stat in our story in general. Apple turning on app tracking transparency, the Ask App to Track button, cost Facebook $10 billion. Which is the exact amount of money that Mark has spent on Facebook Reality Labs, the Metaverse division. So like literally the thing zeroed out.

He was like, I got an extra 10 bill, I'm going to spend it on VR and build the next platform. And Apple is like, what if you didn't have that money? So, like, you know, enormous pressure on Facebook to survive the current moment so they can execute on the big pivot to the metaverse. The results are down. TikTok looms, right? People are switching from Instagram and Facebook to TikTok. And Zuck says on the earnings call, we're going to put even more algorithmic content in the feed.

Right now it's 15%. It's going up to 30. And then the Kardashian chaos. That was the 2Ks, by the way. The Kardashian chaos. No. Takes place. Kylie Jenner says, make Instagram Instagram, make Instagram, which is a meme that's floating around.

Kim Kardashian retweets it or repost it. And then Adam Messary has to make a video where he explains to you in the exact tone of voice I used to tell my four-year-old that it's time for bed, that it's not going away. And then today, right before he came on air, actually they walked it all back. Messeri sat down for an interview with our friend Casey Newton, which is published on The Verge. And they're walking it all back for a minute. And then they're going to do it again. I love it. Yeah, the clear thing here is like the direction has not changed, right?

There's the thing where Instagram walked it back and it seemed for a minute, like it was like, oh, if Kylie Jenner doesn't like what you're doing on your platform, you change what you're doing on your platform, which is like a thoroughly non-crazy way to run your platform. Like, if you make Kylie Jenner happy, like odds are you're going to make an awful lot of money over time. But they're very much in on this idea that like Reels is everything, full screen video, it's the future. It's the whole thing. Adam Aseri was basically just like the way we built this was bad and everybody hated it and the usage data. And that was the crucial thing he said. Like this company is

very good at weathering criticism. Right. Like everybody who works at meta has spent the better part of 20 years like listening to people talk about how awful the product is and just sort of laughing hysterically all the way to the bank. But what happened this time is it sounds like people hated the changes they were making and thus stopped using the product. And that is the thing that is going to immediately make Instagram and Facebook, like, turn on a dime and do something else. Miseri said to Casey, people are frustrated and the usage data isn't great. It's very much on the, like, the food's horrible and the portions are small. Like, yeah.

It's nothing about this is good. You don't like it. So we're turning it off. But even on the same interview, he said to Casey, hey, this is still where we're going. We're going to figure it out. And we're going to come back again with another shot. And he framed it. Again, Adam, Adam's been on decoder.

Adam's great. We know Adam. His tone, and a lot of this stuff is like, you need a timeout. It's fine. I understand you're upset. I'm listening. I hear you. But we're still going to turn the whole app in the video. And that's, you know, because I'm your dad. And like, very direct. Casey asked, is there a vision for Instagram? Messeri was like, yeah, we still, you know, it's to make the most engaging social media out. It's to make money. Like, that's just his, I don't know, I keep thinking about all the algorithms that they're pushing out here now, right? Like, part of the hatred for this was, yes, it was the full video and everybody hated the video. But it was also, they were using algorithms to, like, thrust this in front of people's faces when people were like, I just want to look at picks of my friends. And they're ignoring the fact that repeatedly people are like, hey, you know what I don't want?

A bunch of garbage. I don't want to watch the people like pour paint on something and then say, now it's glass. Like all the crap that we saw on Facebook all these years, they went and they started doing it on Instagram and then were shocked that everybody was upset. And it's like, yes, because you've already done this. You ruin the blue app that way. And now you're going to just do it again. You're not learning from any of your mistakes. The core thing, and I'm curious how you two feel about this, his thesis is the way people communicate is changing and now it's all video.

And even if we did nothing, this is like his quote from his very much. video. Even if we did nothing, we see that video is rising in the app. And that's people's native format. And it's like, maybe. But like, also you're in charge of the app. So if you start nudging people into video, you're going to goose the slider on video in a way that you cannot like account for or control for. And I just, I don't know that it is true that suddenly a bunch of people who built their businesses on Instagram like Kylie Jenner and Kim Kardashian woke up one day and like, you know what, video is my native format. They built businesses on this platform. And And this is true of YouTube.

If you just like zoom out and look at YouTube, I always say this. Every YouTube creator eventually makes a video about how mad they are at YouTube. And it's because the sands of YouTube shift beneath your feet. And you have to go from making prank videos to like making kid content to doing like six hour live streams. To becoming a UFC fighter. Like you just have to like change with the algorithm in a way that is not sustainable or does not reward passion. And it feels like that moment for Instagram is here.

But instead of the algorithm is going to reward different subjects, different things, they're like, actually, you built a photo sharing business, and now it's TikTok. And I just don't think anybody's ready for it. I think that's right. And it's why it's a bigger change. Because, like, to your point, everybody gets mad on YouTube, but YouTube is like, feels solvable to creators in a way, that it's like, there was that great, I think it was a Taylor Lorenz story about all the creators who started making videos about the Amber

Her Johnny Depp trial. And just very nakedly, we're like, I'm just going to pivot back to the thing that I'm doing. But this is how I'm going to get a lot of views. I'm going to get in the partner program. It's like, it is a puzzle to be solved and a game to be won. And it can be very frustrating in that sense. But it's at least like you sort of understand the field that you're playing on. And like, Instagram and Facebook have just like changed the sport that you're playing every three years for its entire existence.

And it gets, it's just got to be exhausting. And it's like, okay, there was a certain like kind of photo. and then it was like, oh, everybody likes the galleries. And then it was the stories. And then it was like, and now it's reals. And like, it'll be something else eventually. And it's just like, I can't imagine just constantly having the rug pulled out from you like that over and over and over again as a person trying to figure out how to build a business on this platform. Yeah.

I mean, I think that's like the underlying story of the creator economy. It's like on the one hand, it is very frustrating. On the other hand, lots of people have figured out how to make a lot of money doing it. So yeah. So it goes. But fundamentally, it's every so awesome. often the platform that you think is the most stable platform in your life becomes the least stable. So you actually, every creator that I've ever talked to is like, I need to be diversified.

And your audience in all the platforms, because if YouTube goes sideways, I'll have Instagram. And when Instagram goes sideways, I'll have TikTok. And when TikTok goes sideways, I'll pivot back to YouTube. And it's like, that sounds exhausting. And I understand why all of you have turned out. Like, yeah, that's the game. Mosares said a thing that I thought was really interesting. They were talking about the friends and family thing.

And he said basically that all of the like friends and family people talking to people, they know activity on Instagram has shifted to DMs and group chats. And he was saying, like, more photos and videos are shared in DMs in a day than are shared into stories. And more photos and videos are shared into stories in a day than are shared to feed. Yeah. Which is wild. So it's actually like the thing we think of as Instagram, like the public, you know, nine squares on the screen, Instagram is actually like the least important Instagram at this point for most people.

That's fascinating to me on a bunch of levels. And also then it's like, okay, if nobody cares about the feed anymore, like, like, let's just turn the feed into like a money pile for everyone involved. And it's like, cynical is all hell, but it sort of makes sense. And then on the other side, he's like, well, we don't have any control over how people use the app. And that just always makes me think of like there was this story about Gawker Media. I have no idea if it's true, but it feels true. So I have always thought of it ever since where they did an experiment where they would change the size of the text box

and see how long people would write based on how big the text box was on the page when you were writing something in the CMS. And they found that there was like a measurable difference that, like, If you give people a tiny text box, they will write less. And if you give them a big one, they will write more to fill the text box. And it's just like, that's all. I have no idea if that's true. I was like, that feels the most true. But like, I heard it from people who are trustworthy enough that I like believe it enough to buy into it.

And it's like that's the kind of thing that if you're making a product like Instagram, you make 150,000 decisions like that every single day. And so the idea that they have no control over how people use Instagram is just a crack a shit. And people always say it. And it kind of makes me angry. It is true, by the way. I will post his stories once in a while. And putting something on the grid for me is like, ooh, that's going to last forever. You're a big close friends user.

I've noticed that recently. Yeah. I try to keep my... It's an honor to be in the group, by the way. Here's my social media personalities. Like, Twitter is like all spiky bracelet. I'm mad at you. Break him up.

Instagram, public Instagram, you know, just want to be a little human, want to cultivate some people who recognize I'm not a monster all the time. And close friends is like total schmoop ball. Like, you know, and then, and then my LinkedIn is just like ice cold business. And so I don't use LinkedIn. It's right up there with Pinterest me. I don't know what happens there. LinkedIn is where you tell made up inspirational stories about people who hired who went onto massive success. Yeah. That's what LinkedIn is for. I knew David is an intern. He has skills in web design. Boop. Some other meta news that we absolutely should talk about, very relevant to, like, verge stuff more so than the behavioral connotations of the Instagram text box.

The Metaverse seems like it's in a weird zone. So the MetaQuest 2, which I always say this because I think it's important to give credit where credit is due. The MetaQuest 2 is a great product. Yes. It is a complete. I have one hanging behind me. I love it. Wonderful.

It's like a finished product with an actual app ecosystem. It's just a good product. It is also two years old, and they are raising the price by $100, which is not the cycle of things. No. Like, we're at the, we give them away part of the cycle. Well, I mean, you are unless you lose $10 billion to your primary Metaverse competitor. And then you're selling it a lot of it. They're scared of them.

If you're ice cold markets, like a market, this is when you flood the market with Quest devices. Yeah. So when Apple releases theirs, everyone is like, I don't need one. I mean, that person sees, I. ice cold. I think especially on hardware, he's not, like, at all. If you listen to this speech, realistically, Alex, I don't think you belong in that. I don't. I don't. I need to leave meta. I'm not prepared to be there. But yeah, no, I think it makes sense why they did it. It's still really, really stupid if you do truly believe in the

metaverse. But also, I think the metaverse is kind of stupid. So, like, I think we are so far away from his big dreams of that ecosystem and that way of interacting with the internet that like, yeah, this is, like, it should be a hundred dollars a lot. But think about it in a different way. Like, yeah, it's the metaverse and you have the gut horizon world

and if you install like 45 helper apps on your laptop, you can take a meeting in VR with your screen shared to a fake laptop that's in front of you. You look like a Nintendo Me character. It's very good. I will say it's so complicated that it's not worth doing

with any regularity, but installing all the, if you have a Quest 2, installing all the various apps and laptops, your screen gets shared into Horizon meetings or whatever it's called, and then you're sitting in front of your real laptop, but you're wearing a headset and you see a virtual laptop that you're then typing on.

You're like, wait, there's something here, and I'm not sure if it's a good idea, but this is one of the dumbest, silliest technology hacks that I've ever participated in. And if you're listening to this show, I think that appeals to you. Yeah. So, like, I recommend doing it at least,

once and just being like this is the like the amount of like virtual dongles that are required to look at your laptop and VR right now is like out of control and if you have an Intel Macwick which is when I did it the fans are just like I'm mad at you you're not in a virtual reality listen to me in real reality people just assume you're on a plane that's very bad to all that aside right it's a game console yeah what what people do in there as they play games and they have in-app purchases and like it's the same thing thing. Like, it's an Xbox. Yeah.

And Xbox sells an expensive at first and get cheaper over time and they sell every unit at a loss and they make the money on the games. Yeah, but it's just weird that they haven't, maybe they're not making enough money. I think the problem is that they're not thinking of it as a game console. I think, I think they are thinking of it as this big window into the metaverse and they want people to adopt it because they want the metaverse to be created so that they can own the metaverse. and they're not thinking of it as the way my nephew plays it. I came over to their house. I hadn't seen it in four years or something.

I walk in and there's just this little kid in the corner with his headset on, just going phew, pew, pew, phew. Yeah. And I'm like, that's great, terrifying and great. And, like, that's what it is. It's little kids playing. It's me doing supernatural, your wife doing supernatural.

Like, it's people using it as a game console. Meta doesn't understand that. and then they continue to forget how game consoles work. Game consoles work where you release a cheaper version with, like, less cool stuff on it. And instead they're like, yeah, we're going to do the next version. It's going to be even more cool. And it's like, no, you forget your life cycle. Like consoles now are lasting, what, six, ten years?

They're very, they're two years into their life cycle. This is when they should be thinking about releasing a cheaper one. And instead, like, okay. Right, what you would do now is you would put out. out the Project Cambria, which is the next generation one, that would take over your old high price points, and you would still sell the Quest 2 for $100 less. That, to me, is the thing that really jumps out about this is the only reason you wouldn't do that is if you couldn't do that.

And there's just no way for me to look at this announcement and not think there is not a next move that is ready or even remotely close to ready. Well, they've been trying off a lot, right? Zuckerberg is posting pictures of myself wearing prototypes. They've talked to me. They've talked about it. I mean, they're working on a lot of stuff. There's prototypes for days, right?

But there's plenty of next moves. But I'm just saying, like, to your point, like, this is now the moment where you release a thing that is $500 and you either do the Apple move and keep selling the two at its current price or, like, drop it by $100 and try to juice adoption that way. No, I think this is the moment where you release a cheaper, shittier version. They tried that, though, and nobody wanted it. It was the Oculus Go and it was junk. That was too shitty.

Calibrate the shittiness. You know, like Nintendo, how many iterations of the DS did we see? The 3DS, there was like, I think I have like seven that all came out in like two years of each other. You bought all seven. Yeah. I made bad choices. I have way too many 3DSs and I don't even play it that much. Like, what is my problem?

Look, I think there's like probably two things here. One, I think you're right that they don't want it to just be a game console. They want it to be a computer, right? The vision is to replace a laptop or somehow connect. a software dongle so you're existing extremely unhappy Intel MacBook. But they know it's a game console because keep buying game companies. Like, again, it's meta. There's a company that measures everything.

So they have to know that most people are gaming on this thing. Well, and they're including Beat Sabre with it now if you buy it. Like, that's a pretty strong indication that they know what you're doing when you turn on your headset. That's the first thing. They're throwing you 30 bucks of Beat Sabre. Yeah, pretty much. Yeah. You're going to have to buy that Imagine Dragons like D.

A game, which is only truly fun if you buy the DLCDLC. music. They got you. They're like, we're going to make up that money on the back end. But I will say, they're blaming it on supply chain issues, and they probably can't subsidize this thing the way they were because their revenues going down. Right. Then the next piece of VR news is we just, Alex Spencer's Supernatural. I think Supernatural is the best non-game app on the Quest 2. It's a workout app. It's really fun. Boxing. It's basically like Beat Sabre, but Peloton, Peloton Beat Sabre. I don't know how to describe it in another way.

That's precisely correct. They're growing. They're doing well. A couple of months ago, several months ago, META went to go buy within, which is going to make Supernatural. Somewhere on $400 million, I think is a reported number. All cash deal, great for Supernatural. And what struck me about it is the CEO within Chris Mill had been on Decoder,

and he's like, fitness is a killer app for VR. My user base is like 50, 50 men and women, and they're mostly over 40, and that's not VR gamers. Yeah. Right, that's people. So, like, what initiates you to buy a quest? If you're not a gamer, you're not a kid, it's this fitness game. So, most meta goes to buy it.

And the FTC yesterday sued to block that deal saying Meadow was rolling up all the VR game studios. Yeah. And what they should do, if they were truly being competitive, is turn Beat Sabre into a fitness platform, which is, like, one turn too many. You know, like... What you should do is steal the good idea of the company you want to buy and aren't allowed to. You're a copy. They were basically like they should compete, right? Especially if you just like look at it, if you think Apple is coming and we think Apple is coming with a product, if you're supernatural, you should be, now you're in the capric seat, right?

You're like, this is the product that makes people buy a VR headset. Cut us a deal. Like, who's going to give us better terms? Who's going to grow our thing? If you're Apple, you're like, screw it. We'll just do Apple Fitness Plus VR, which is probably what Apple too. And if you're Facebook, we're just going to buy you. And I think the FCC's argument is they're just buying their monopoly position.

We screwed it up by letting them buy Instagram. We're not going to repeat that mistake because the FCC really, this version of the SEC really believes they screwed up by letting Facebook by Instagram. They did. But Instagram at that time was like a time. It was like four people. They couldn't keep the lights on. They should have known better. So it should have known better.

But there's all these documents from that acquisition where Zuckerberg is like, this is the next sharing mechanic. We need to own the mechanic. We're going to buy it and squeeze it and we'll have it. Yeah. And I think we'll see what happens. I will just say meta's response to this lawsuit, very funny. They were like, we looked into making our own fitness app and decided we were not in a position to do so. And it's like, you guys think you can make the whole metaverse.

You couldn't make a workout game? I mean, Apple can't make a workout app. Well, it can. I love Apple Fitness. But they made one. Yeah, that's true. They don't have to go out and buy. You can make a thing.

Yeah. Peloton is, as we have discovered, one of the worst run companies in America. And they, like, managed to do it. It's just, like, that whole dynamic of they're in all this trouble. They need to pivot to whatever's next. The users don't want them to pivot. And now they might not even be able to acquire their way out of the mess. Just a hard mix.

I mean, I just really am enjoying how much meta is in the hot seat right now. It's not quite to the same levels of hubris as what Elon has been doing with Tesla. But there is like a certain level of hubris. There is a certain level of like you grew too fast. You thought you could control too much of the world. And now you're getting slapped by like reality. Yeah. And yeah.

And there was there was the thing where meta's belief was always like our audience is, you know, network effects, network effects, network effects, we're just going to buy the next thing at whatever price it costs and we will win because we're bigger. And every single piece of that theory is rapidly being tested. They don't have the money to do it anymore. They don't have the like commanding lead and user base they once did. It's just like the invincible force field that made Facebook successful no matter what it tried to do is like rapidly starting to disappear. All that said, their revenue is only down 1%. They missed earning, but their revenue is down one person. they still made like $26 million.

Yeah, I mean, it's like when they lost users. It's like we went from all the users in the world to all the users in the world except for six. And it's like, well, okay. We'll see. I will say that whenever I rant and rave about antitrust, someone pops up and is like, you know big companies just fail on their own, right? You can just wait. And it's like, oh, is this that moment or is it? But Zuckerberg can't be replaced.

No one can fire him. Yeah. I remind people this all the time. Every quarter, every time they have a shareholder vote, the shareholder vote, the shareholder there's a Facebook put forth a proposal to limit Zuckerberg's power, and he just votes against it, and it loses. One day he's going to accidentally hit the wrong button. All right.

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Let's do earnings. It's earnings season. Of course, with Apple. Apple did fine. They made money. Good job, Apple. I mean, yes and no. Apple continued to make a lot of money.

It's very funny when all these happen in the days together where you're like, oh, Facebook's a big business. And then Apple just shows up and is like, what's up? Yeah. Oh, you thought Facebook. Facebook was a cool business. Just slap enough. Check this out.

We made eight Facebooks in like 12 minutes. Like, what's up, everybody? But yeah, Apple, Apple made a lot of money. Profits are fine. They made $23 billion in operating cash flow. Like, they're going to be just fine. But the interesting thing is the iPhone revenue is up a little bit. Mac revenue is down 10%-ish.

iPad revenue is down a bit. Wearable revenue is down a bit. And service revenue is way up. And evidently, the thing Apple is blaming is, like, all the same like foreign exchange rates that other companies have been talking about. Like when the euro goes down, they lose money in ways that I confess

to just really not totally understanding at all. But currencies are a thing. And also that the supply chain has been a thing, which we've been tracking for months, right? Like a new Apple product goes on sale and like instantly you can't buy it for like weeks and weeks and weeks. And this is, it is apparently starting to hit pretty hard.

Yeah. So the max sale drop is interesting. Right? There's a new MacBook error. so you would assume they announced it we're in that weird window between quarters they announced the thing you'd expect MacBook Air sales

to drop ahead of the new one which didn't come out until just now into this quarter so that makes sense but a friend Steve Kobach at CNBC tweeted he just got the phone and Tim Cook he says the 10% drop in Mac sales is supply constraints in foreign exchange

which you could still sort of peg to the MacBook error because it's hard to get yeah right sold out like right away. It's a new design. It's just not out yet. But overall, that that supply chain issue is starting to catch up to Apple on the Mac side too. Yeah. And Apple has been more immune to this over the last couple of years than most. And like we've given Apple a lot of credit for like being the one in charge of its supply chain in such a way that when everybody else got squeezed, Apple just like giggled and kept making iPhones. And yeah, you get the sense. It has finally

come for everybody. Steve also says Cook told him the impact of the supply. chain was less than $4 to $8 billion. They warned the last quarter, but they wouldn't say how much. Of course they wouldn't. They'd no numbers anywhere in this. This is the most ambiguous financial document I've read. He also said Apple will be deliberate in hiring, but wouldn't call it a slowdown. So Apple's feeling it.

Yeah. But what's interesting is services are up, right? They're getting better at milking every iPhone customer for more money. Love that Ted Lassow. What a guy. We'll see. Like, we're expecting all this stuff in September. Right?

new watches, new iPhones, new AirPods, all the lines that are down are like some combination of supply chain, the end of the cycle and new ones coming. Like the end of long cycles. Like the AirPods have been out for a while, right? Like the watch, the basic design of the watch has been the same since the beginning. Like we're expecting big changes and that's typically an Apple does well. The question is why I can build enough stuff. Right. But they made $83 billion.

Yeah. Like Apple's going to be just fine. But yeah, no, I think you're right. And I think the question of like these sort of increased upgrade cycles, too, is the other one that it's been like, okay, when is this going to come back and actually make a meaningful difference to Apple that people don't upgrade their phone every year or every two years? Instead, it's like every four or five years. And again, there's just no way to know what's what and what accounts for things. But I think like the last two quarters of this year are going to be really interesting for exactly the reason you just described. Like, is there still a gigantic audience for any new iPhone, even if it's basically the same as the last four. iPhones, it just like makes blurrier portraits. But only in some spots. We'll see. Just a smudge. I'll talk about the rest of earnings.

It is just earning season all over the place. Microsoft in a weird spot, David, what do you think? Yeah, Microsoft is like, it's a weird time because we're sort of at this moment at the end of like the pandemic crest where we're trying to figure out like who is in actual bad shape or who is in regular shape. all the numbers from the last two years have been nuts. So, like, Microsoft's revenue is up. The, like, top line numbers are all pretty good.

But, like, PC shipments have been way down. So the Windows OEM revenue, which is, like, the money that Microsoft gets from hardware manufacturers who make Windows computers is down. Xbox hardware is down. LinkedIn is up because LinkedIn is just, you just, you can't. That's where it's all business, man. There's no stop. That's just me. That's all NELI.

LinkedIn up 26%. That's the Patel bump, baby. Think Fluence in all day. They just heard we're going to put decoder on LinkedIn. They were like, oh man, fom. Turn it up. Turn up the knob. I don't know who runs LinkedIn, but he's got a knob.

His name was like Mark something, wasn't it? Mark LinkedIn. Yeah, you'd get the emails from him when LinkedIn first started. They'd always be like, it's Mark. And you're like, oh. Like Tom from Myspace. Yeah, basically like Tom from Myspace. Somebody wants to connect with you and talk about business.

And it's just him getting a thumbs up. Is Xbox hardware down because they can't ship enough Xboxes? Well, it's, so it's two things. It's that and it's also that the most recent Xboxes are now two years old and there was always going to be a time when they stopped selling in such like absurd volume. And that's basically what Microsoft said. They're like, this is just, they're not new anymore. But also there's the weird moment that we're in. And this is the weird moment that we're in the weird moment is like there's the big macroeconomic stuff going on right now. Inflation, everybody's worried about a recession. There's all that stuff. There is like where we are in the pandemic moment. There's the where we are in the supply chain moment. And so what's what and what is causing what is like a, big, complicated, messy questions that all of these companies are trying desperately to figure out. Like, do we have a real problem or is it just a weird time to be alive is a really hard and difficult thing to suss out right now for a lot of these companies? And I think, like, the Xbox thing is a perfect example of that. Yeah.

I think in general, though, everyone went to work from home. They bought a bunch of PC stuff. The other earnings that I was like on this week were Logitech, which were we don't usually pay a lot of attention to logic earnings. But they were like, okay, mice and keyboards, super weird flat. Web cams still up, corporate video conferencing going back up. And, like, everyone's like looking at, I was on CNBC, and they were, like, trying to figure out what it meant. It was just like, just sprockets were, like, springing out of people's brains.

You know, like, what does this mean? Corporate video monitoring instrument is going to be. Does that mean we're all going back to the office? Do you need to throw my computer away? Like, I don't know. No, everybody got to the office. They were like, wait, why is the box sticky? Oh, God.

And it's time to get rid of there. Alex is just trolling me. So Alex and I are in the office together today. We are. In every piece of AV equipment in our, every conference room is like broken in like. Sticky. Just like disaster ways. We just got to buy some new logitech stuff.

That's the answer. So that's not your signings. They're doing fine, right? Like revenue is up, but windows and Xbox are falling. And it seems like that's part of that shift. But like, as you said, David, no one knows. We already talked about meta. Google slash alphabet, very strange position.

Alphabet's the weirdest company to me. And it's like, oh, the ad business, very good. The end, all the time. It's all you really need to know about Alphabet is like they sold some ads more than anybody else doing just fine. But then like YouTube's revenue growth is slowing down a bit, which is interesting. They're still just pouring money into all of their other bets. Like Google Cloud continues to lose a ton of money.

all of the far-out, you know, Waymo's of the world are losing money. So it's Google has this like one just like unfathomably gigantic business that seems absolutely unstoppable. And then it's just like bleeding money at various degrees through every other part of the company. It's nuts. It's what gets me is Google, we saw like Snap had bad earnings and they're like this Apple stuff really hurt us. People are not doing it.

Shopify had layoffs because people weren't buying as much stuff online and is more, more meta, losing $10 billion because the Apple privacy changes. Google's like, we're good, actually. It turns out we run every web browser in the world. Yeah, a lot of people have Gmail accounts. Turns out monopolies, great. They don't have the cookie problem. They have not been allowed to own Chrome on iOS since Apple's like, no, you're not doing

that. They pay Apple for that search placement. So then you go into Google on your iPhone. I mean, this is where Apple's stuff, like, really falls apart, like Apple's privacy stuff. They pay to have Google as default search on your iPhone. So then your IP address, or if you're logged into Google, your Google account is searching for stuff, and that data is not third-party data for Google. Right. It is Google's first-party data that they're collecting on you when you search on your iPhone, because it's the default search provider.

and then you use your Chrome on your desktop. They can collect all the data and they can match it up and they can deliver the ads and then they can track the conversions into sales just as well as they ever could. But what about if you use Microsoft Edge? Well, you're still logged into Google. Like, at the end of the day,

like, that's the game that Google is playing. Like, they've gotten you logged into Google. The problem for meta is, like, you have the Facebook app on your phone. That's their data. They are not allowed to track you off of Facebook onto whatever retailer you might be shopping on and saying you saw this ad

and then you went and bought this and we can match up the cookies and we know that this ad sent you into this site on your browser or wherever you are and that's what killed their business because their ad effectiveness went down. Google just does not have this problem. And so every time Google makes noise

about like removing cookies or doing every Apple does like it's like very backwards you would not expect it but like the European antitrust regulators like you can't do that. Because then no one will be able to compete with you. Yeah.

Yeah, a world in which third-party data is not allowed is like the best possible case scenario for Google because it has the most first-party data. Google doesn't care about what you do when you leave its platforms because you never leave its platform. You just basically can't. And then forget about Apple, like Android. Oh, they own Android, which 90% of the smartphones

on planet Earth use. Like, it's just their lead just gets bigger every time anybody cracks down on any of this stuff. Yeah. Their profit did go down, little bit, though. So, you know, they only made $16 billion in profit this past quarter. They probably spent an extra $2 billion on Waymo cars. We got to hire Dieter somehow, right?

Deeter's bag. That's like a line. Deeter bag. I don't know. They're in a weird, like, if there is actually a recession, which nobody knows, and consumer spending goes down and advertising spend goes down and Google is, like, exposed. But it was just weird. It's not happening the way people think it is. David, you picked this one up. The Comcast Numbers, Disclosure, Comcast Investor in Box Media, which on Sufferge. They're not going to be happy we talked about this.

Just rest of short. But you picked up some interesting stuff in the Comcast numbers. Yes, so basically there's been this interesting thing happening to these companies where they're all desperate to keep selling you cable boxes. They're all desperate to get into streaming, and they're all desperate to keep selling you Internet. And the Internet continues to be the thing that funds the rest of it, right? They're like, these other things don't have to work as long as people keep paying a lot of money for Internet connection. It turns out in Comcast cases, all three of those things are going kind of badly at the moment.

They're still bleeding cable subscribers because everybody's bleeding cable subscribers. But the broadband subscribers that they have was flat from the last quarter for, I think, the first time ever. And the number of peacock subscribers is also flat, which is a scary thing for like a relatively small upstart trying to spend a lot of money on like the office and friends to get people to subscribe to. It's relatively new thing. We can't spend a lot of money on those, right? I think Peacog's big problem is that they haven't spent a lot of money on original programming. They've got Yellowstone, which for some reason, even though it should be on Paramount, they ended up buying it and Paramount's on record saying,

we shouldn't have given them those streaming rights. That was stupid. They've got Yellowstone. They've got office. They've got like what really bad British science fiction shows that I watched for some reason. They thought the Olympics were going to be their thing. And then it turned out that the streaming. They thought like sports and friends in the office was going to carry them.

A perfect vend-eyed area with my interests. I would frame the money thing slightly differently, though, because even if it's true, like they already own the office, right, so they don't have to like pay more money for that. But the amount of money that you're leaving on the table, not licensing friends and the office and Parks and Rec and some of these other shows to other streamers is massive. Like those deals are worth a ton of money. So it's like they're spending less for sure, but there's a lot of money that they're putting into the sort of peacock bucket.

Wait, wait. Anyway. No, no. Yes, you're dead correct. But it's even worse because of the way these companies are structured. NBCU paid $500 million to take the office off of Netflix. Yes. Because of how your internal accounting works.

So it did pay for its own show. Oh. So they threw some money at it. Yep. Universal Television had to hold an auction. And like Netflix, Hulu, Amazon, and potentially Apple. reportedly were like in the auction. So then if you're the big boss, you're like,

no, like we're not leaving the money on the table. Yeah. You've got to pay up. So like even in like the case where it's all one thing, they end up paying the money. And like they need to spend a lot more money. They're very forthcoming to make the service work. They need hits. So they're just going to like spend money on hits. People like, can you name any peacock originals? I can think of one.

Ooh, the really great British one about the all-girl band. That's the only one I can think of, too. Girls 5Eva. No, there's two of them then. Oh, there's another one? There's another one which was, oh, I have to look it up. Hold on. Girls 5Eva is excellent, by the way.

Everyone should watch it. When do you two find time to do this? It's like the boo bitch of PICA, I would say. Just like, I look at these titles. I went and looked at Boo bitch after last week, and I just thought to myself, I'm not giving you this hour. Like, I'm not getting younger, you know? Like, I got a daughter.

Like, we're going to, I'm going to go talk to her. We're not talking about boo bitch. I'll tell you that much. She's four. I don't think that would go over her. What's she watching on Peacock right now? She's not watching Peacock. She's watching Gabby's dollhouse on Netflix, which she loves very much.

She's watching Bluey on Disney Plus. But because of Gabby's dollhouse, she's taking the calling all things that seem like chemistry, spa science. This is like a real thing from the show. which is very funny because Creighton, who is the producer of Decoder, worked on Gabby's dollhouse. He thinks it's the funniest thing in the world. That's awesome. Yeah. Okay.

So, like, most of their big ones, they had vigil, which was the one about the woman who was at a traumatic car accident where she nearly drowned. And they said, hey, do you want to go investigate a murder on a submarine? And she said, yeah, I'll be fine. Cool. She wasn't. But I'm talking about what they have now. What are they coming up? Nothing, right?

We've got to have something coming up. I'm looking. We Our Lady Parts was the British band show. I will say if they had something coming up that they were super excited about, you would think it would have come up on the earnings call. And instead, all they talked about was being in a, it was like, I think a content crunch was the phrase that they used. And it's like, that's not where you want to be.

Yeah, I think they really thought they were going to do this weird mix of what Netflix has been doing where they buy up a lot of international shows. So they were specifically buying up a lot of British shows. So all these shows that were airing in Britain, they were like, were there Peacock Originals in the United States? And then they were like, well, we're going to do kind of what CBS and what Apple had done and really go in on big budget peacock originals. But they were all bad. So it was like Bel Air, which I think we reviewed Charles reviewed it and was like, it's fine.

Oh, no, Charles hated Bel Air. Did he? Hated it. Okay. Maybe he just said he was excited about it to me. You know, I think everyone was excited about it. Belair is a show, just total tangent. It was like a fan project to make a joker, gritty, fresh.

Prince of Bel Air. Yeah. And so they cut a trailer. And then Will Smith was like, I'm going to make this for real. And then it came out. And it turns out that's not a great idea. No. And then they got Rutherford Falls, which critically very, like everybody loves it.

It's a really great show. I don't know how many people are active. Have you heard Rutherford Falls? You could say the names of anything to me. And I would believe the movie shows. They had the Tiger King made for a TV show. See, that's fake. You just made that up.

They had McGruber. That's fake too. That was already a fake show. They had Curious George. That's real. That's real. All right. It's time to readjust the Go-90 scale of Doom Streaming Services.

Oh, wow. So Netflix, for the long time, was at zero. So the scale is from zero to 90. Yeah. 90 is dead. Quibi hit 90. The scale is named after Go-90, Verizon's failed streaming service, which went 90 immediately. That was the one where Verizon executives were like, what the kids want to do is

join gangs on streaming apps. Like, it was, like, legitimately how they talked about it. Like, our social features are called gangs. Like, I don't remember what it was. It was on the order of that. Go 90, what 90? Dead. Quibi, 90.

Dead. I have long said Netflix is a zero. Netflix is ticked up to, like, 20. Oh, that high. No, that's too high. I think it's, like, five to ten. Five to ten. Yeah, I think that's right.

Yeah. Right. So Netflix was default alive at zero. And you're saying it's five to ten. Five to ten, yeah. Yeah. All right. I think Disney Plus is the new zero right now.

Disney Plus is the new zero, you think? Yeah. I think so. All right. I mean, I think Disney, yeah, HBO Max was living at like 30 to 40 when it launched. Just a real mess. I would say they're solidly in that zero to 10 range again. Yeah.

Agreed. Especially because they're going to put out Game of Thrones in 4K and we're going to see if that fixes it. It won't. We're all going to watch that show again in 4K HTR. And then we're all going to get to the last season. and be like, why did I spend my time on this? And then House the Dragon's going to come out. Like, that's how that's going to go.

I'm ready for that. Peacock feeling like it's at 45. I think that's right. I would say it's almost higher. A little higher. Like, it's not going to fail. NBC Universal needs it to not fail. Every single broadcaster is trying to own streaming

and own their own streaming service instead of getting in bed with Hulu, which Peacock was originally part of. Yeah. So I don't know. Hulu is at like 20. Yeah. Hulu's ABC.

Only because everybody forgets about Hulu. No, Hulu is like the one. Hulu for the longest time was the closest tonny because the people who owned Hulu hated it. Yeah. Yeah. Every single one of them were like, we don't want to own you. We want to destroy you. And then Hulu's like, but we persist.

We persist. But they've come around because they're owned by Disney. Yeah. We're Disney. And Pekog is like NBC Universal got out of business with Hulu. They started Peacock. And I think they're just struggling to, figure out how streaming is different than broadcast.

Like, I think Paramount figured it out pretty quickly when it was still CBS All-Axas. I'm sorry I'm as Paramount Fangirl. Honestly, again. Again. It's like Plex and Paramount Plus. Paramount Plus is going to go for, I think Paramount Plus is like over 45 right now. I would say it's way lower than Peacoff. This is why we have the scale.

It's to have these debates, but you're wrong. You're wrong. It's all right. It's fine. But when Top Gun Maver comes out, Paramount Plus. Just shum. No, that is the day they realized they did not build a tech stack for any demand. Right now, they might be doing fine because, like, you know, Star Trek nerds are doing Star Trek things.

I'm watching evil. That's great. But, like, Maverick is going to hit, and everyone's going to be like, all right, I'm signing up for Paramount Plus. And, like, a data center somewhere is going to be like, we're on fire. You didn't buy enough of us. Tom Cruise will save us. We'll see. All right.

So that's Comcast, the delightful Go 9-9. scale, which is the end with Spotify, which has blessedly been trying to shift its revenue from music to podcasting for 400 years. Yeah. We've gone through two different podcast reporters at the time. God bless Ashley Carman. Joe Shapiro now, Ariel Shapiro now writing Hot Pod, sign of a propod. It's great.

They're still where they are. Spotify is just losing money because they lose money every time you play a song. And then everyone still thinks they don't pay artists enough. I was trying to think if I could come up with a company that is like a good analog for, Spotify because Spotify is like objectively a music service that knows for sure that it will never make any money being a music service. And so it's it's now trying to figure out like, okay, we've been very successful as a music service, but we can't make a nickel doing it. So how do we find other ways to make money around it? So like even just this week, they closed their

deal for an audiobook company called Find Away for which ended up costing them, I think, $123 million. They hired a new person to do fiction podcasts. They're all in on podcasts. They've been saying this for years, and that continues to seem both like a gigantic, like, cultural mess internally and not that go to business. It's just like they started to do the car thing and then stopped making it. I'm kind of sad. I never bought one.

The little dongle. Yeah. And it's just like, what is Spotify? It's going to end up being this, like, ultra successful, super cool thing that never makes any money for anyone. Spotify's going to get like. nationalized. Like Sweden?

Yeah, Sweden's just going to be like, you know, we own you. Don't, you know Sweden. Like the EU is going to be like, we need one tech company. Yeah. It's not no key. But the world needs music. Seamins, we don't even know what they do. It's Spotify.

Right, the economics is Spotify. You pay Spotify however much money you pay them month, $15 a month, 10 bucks a month of whatever that's the year. I don't even know. I don't pay for Spotify. That's why I don't know. Apple music till I die. Because of the lossless, which Spotify won't do.

But you pay Spotify, however much money a month. Every time you play a song, Spotify gives some of your money to them. It's just a bad deal. Like, they're like, well, our choices are we can ask the people for more money, which they can't do because Apple and Amazon will just ruthlessly undercut them at every turn. Or we can pay less money to the artists, which they can't do because then, like, Taylor Swift yells at you. Or Jay-Z is like, I'm going to do title. Right?

And then, like, Jack Dorsey's like, what if I bought time? And then no one knows what the fuck is going on. It's just like legitimately how that went. That's about right. So like they're just in this hard spot where their margins are fixed unless they can find something else. And they're like, okay, we'll do Joe Rogan. So then you pay us however much money, 10, 15 bucks a month.

When you listen to Joe Rogan, we've already paid him. So we're not giving some of your money and Joe Rogan. We've already given him the money. And if you, lots of people listen to Joe Rogan, we'll recoup all that costs and we won't have to give all their money. So like that's the strategy. it's just not working as far as near as I can tell I think that's right and there's really no evidence that any of that is going to work right like audio books have never been a gigantic business podcasts have never been a gigantic business this podcast is gigantic business enormously we're in TikTok now uh follow us on TikTok it's for you it's on the verge follow the verge on TikTok follow the verge decoder's on TikTok I'm not allowed to mention that

Oh, my God. Forbidden. I've never heard of it. But they're just making all these bets that they can squeeze money out of things that no one has ever proven there's money in. And I sort of admire the effort. And, like, they, what were the numbers? They have 433 million users and 188 million paid subscribers. Like, those are both giant numbers.

That is, like, bigger than Netflix as far as, like, overall subscribers go, right? Like, they're huge. And they lost $127 million in the last quarter. It's like maybe we're trending in the wrong. I don't know. And I just, I'm sort of at the point where it's like, what is there a move here? And they've made all these bets. They tried to go into the clubhouse thing.

They bought this company locker room. Then they called it green room. And now it's Spotify Live. And if you, listener to the Vergecast, have ever used Spotify Live, I would love to hear about it and all your experiences because that is an app I forgot existed until just right now this second. And I just don't know. What like, yeah. Do you think they're going to like maybe just. fight the R-I-A-A, just be like, I don't know, we want to pay less for these sales.

No, no, no. The Hulu thing, all the labels are investors in Spotify. Oh. Like, Spotify is like a zombie in that way. Like, the labels can be mad at Spotify, but ultimately they're paying themselves. Like, it's important that they have that hedge against Amazon and Apple. But do you notice, you know, Amazon has a dominant position in country music? Yes, because of Garthbrook's.

Because of Garthbrook's. They signed a Garthbrook's exclusive. Every country music fan in America is an Amazon music subscriber. They had the need to feel the thunder. Incredible Garth Brooks song. Why did I open this door? Alex. Alex is like, full Texas.

Like my hat just came on. Suddenly I'm on the horse in the studio. Liam's very upset. Sorry, Liam. Full horse. Never go full horse. But if they screw around, Apple and Amazon can, you know, they can just, Apple can just subsidize the music service.

Yeah. They don't need the money. But Spotify does. And the labels need Spotify to exist as a hedging. It's Apple so they can negotiate against Apple. So, like, it's like a ghost, a zombie, a mummy. Like, it's just, like, it's just stumbling through a haunted house of the music industry, like, bumping into walls.

And everyone's, like, just don't fall down the stairs. Just holding hands with Rihanna. Yeah. All right, that's enough earnings. Let's take a break and do a lightning round. 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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It's from feelings about Instagram and Go 90, which is great. That's us. That's who we are. We cared about Peacock more in this podcast than anybody who actually has ever thought about subscribers. I have spent more time talking about Peacock than watching Peacock at this point in time. All right, let's do a lightning around. So iOS 16 beta continues to roll out ahead of presumably Iowa 16 in September. Some changes.

The public betas are out. They're being updated. Apple rolled out editable iMessages. And then they, I think they rolled it out without a message history. And they quickly realized that they should have a message history. Those are important. Yes. Yeah.

And they also shrunk the amount of time in which you can edit. I think it was 15 minutes before and now it's two. Or maybe that was for the sending. To be honest, like what's an unsend versus what's an edit is a fun philosophical distinction about messages. But it's kind of great. It gives you the edit history. It gives you these like increasingly sort of transparent versions of your message as they scroll up. I really like it.

It's really nice. It's the walk-in city. I love it. I use it. Oh, absolutely. It's the most beautiful jail in all of technology. I'm so excited to find out how trash it looks if you have an Android person in your group chat. Like the thing that shows up that's like the message you get that's like so-and-so loved and then shows your message again. Like this is going to be even worse.

I can't wait. Amazing. New home app in Iowa 16. Gen 2e wrote a review of it, not a preview. Some things are better. It's not out yet. So it's not really a review. We're very weird.

We're in that weird space. about these words. But a preview of it because it's that in public beta. Better design. Some confusing decisions. Apple doesn't know what people want to do

their smart home, which mostly like automate things. Yes. And they, that's the part where it's, I think it's the weakest. I think you see with like all of these smart home apps

that they're very clearly made by software developers, software engineers and not by like normal random people. You guys are, you guys are normal. too. But, you know, it's made by people whose brains think a very particular way. And so unless

you're thinking like a software engineer, it's hard to use these things. And Apple still struggles with it. Yeah, I would say the one note from Jen's piece that really jumped out to me. They've redesigned the buttons that you tap to turn lights on and off. But now the buttons, without any delineation, have two buttons contained within each tile. So if you click on the left side, that's where you turn the light on and off. And if you accidentally click on the right side, You get the menu. I don't like that. It's like, what?

See, that's what I'm saying. This is why long presses exist. This is long presses. Long press now puts you in a jiggle mode so you can move all the tiles around. Oh, God. It's real good. It's real good. Obviously, this is all because of matter.

So there's some hope that matter will continue to happen. Yeah. Can matter fix the menu button? Matter will. No, but you'll get more device types in there. No, this is all. They want you to. go out and they want you to get the home pod

mini so that you never use the buttons because you're always shouting at you know who. I can't say her name out loud. My watch will activate. I'm not speaking her name. But speaking of HomeKit wire cutter came out hard. Was it last week against HomeKit secure video?

Oh, real hard. They were like, do not buy a camera with HomeKit secure video. It's bad and it's crap and none of it works. That's hard from the wire cutter. I mean, it's fairly accurate. I have one that's been sitting face down. for like three months.

I don't know why I still have it plugged in. It always is like, it's recording. I'm like, what is it recording? Yeah. Nothing. Other lightning news, this fight between DISH Network 5G and SpaceX continues to be literally the funniest thing that we cover on the site. I mean, it is like so esoteric, right?

It's like two companies with networks, like tiny networks compared to the Comcasts of the world, like filing white papers at each other at the FCC about the future of broadband. And it's like, you guys. So DISH wants to use 12 gigahertz for whatever future 5G it can dream up. I would just point out to everyone, it's supposed to be building a 5G network now and has not done so. Well, it can't because it's got to use the 12G. So many phone support. And Starlink says this is bad.

And if Dish is allowed to do this, quote, the band would become unusable. It would potentially end Starlink service for customers. So shouldn't SpaceX have, I don't know, gone out and bought the ban if they were going to need to use it? Well, they, so the FCC opened up the band. Like, satellite use, this is a satellite band. So they've been using it for satellite uses. Yeah.

They have the access to it. But then the FCC was like, we should open up this band because most satellite companies are garbage. What if we did better stuff with it? And DISH was like, yeah, we're going to use it for a 5G network, which definitely exists. I just know that Starlink did not ask for a lot of permission from like federal international regulators when they started rolling out Starlink. They were just like, yeah, move fast, break things. And I would not be surprised if...

Let me just give you this quote. This is how petty this fight is. Starlink sent on an email to all of its customers. Okay. Tell the FCC this is bad. Okay. And then the SpaceX Senior Director of Satellite Policy, which is a great title, by the way, Dave Goldman. Would love to talk to you, Dave, if you're listening.

His quote, we haven't seen anything from my... either Dish or Dell, Dell, by the way, is part of this Dish thing. We haven't seen anything from either Dish or Dill where they've been able to get any customers to file in support of their service. Likely, that is because they don't really have a service. It's just ice cold. It's great. It's Mitchell. It's just Mitchell.

This person is definitely a pseudonym. This is Elon Musk's Starlink Burner account sending you this email. Anyway, DISH and a consortium of other companies, which are no. is the 5G for 12 gigahertz coalition responded to this pet equally petty. They've argued they're saying SpaceX sent a manipulated filing to the FCC and quote, this tactic, which is commonly used by Elon Musk, is not only disingenuous, but it promulgates an anti-5G narrative

that is harmful to American consumers. 5G's here to save us. It's like, dude, have you talked to anybody? with a 5G phone, they will promulgate an anti-5G narrative. This has to go to chance record. It's the only solution. It's like the lowest stakes,

the lowest stakes, pettiest fight. I cannot get enough of it. God bless you. If anybody from the 5G for 12 gigahertz Coalition wants to come on this show, we will welcome you with open arms. Or Elon. I feel like Goldman is like

Elon and he's just going to wear a different, like a mustache. He's going to show up to Chancery court. We're in a little mustache and be like, no, no, I'm not Elon. He's going to wear his warrior costume from when he was on SNL. No customer support this network because they have no network. All right. David, last one.

You fell down one of the funniest Virg rabbit holes of all time with this video conferencing story where Biden has like a startup Zoom gadget and then you found what all the other presidents use. Yeah. This ate my weekend in a way that. I'm not really proud of. But basically, like, Joe Biden tweets a picture of himself, sitting at a desk in the residence, you know, having COVID, live in large.

He's got a mask in front of him, a coffee cup next to him. And this, like, unbelievably cool-looking video conferencing board on, like, a wheelable easel there. And I was just like, what is this thing? And why is Joe Biden's Zoom set up so sick? So I spent what I would say is, like, an inappropriate amount of time looking at YouTube and Getty images and official White House press pools to see, I learned a lot about how President's video conference. And they all turn off self-view, which I thought was very, like, responsible of them. Because nobody wants to look at themselves when you're on video conference, and the presidents

know that. But yeah, it turns out Joe Biden is using this thing from this, like, tiny two-year-old company in Oslo, Norway. It's called the Neat board. And the one he has cost $7,000. And it's awesome. And I apparently, like, blew up this company's email inbox by writing about them this week. So to everyone at Neat, I'm very sorry for doing this. happy with you. But, yeah, but Joe Biden, the White House is all in on Zoom, has been for a bunch of years now. And he's just, he's just tearing it up. And he's got it.

He can spin it on his desk in the Oval Office, or he can spin it around and have it on the couch. And it's just like, guy knows what's up. Like, kudos to the White House. This is like the one thing they've accomplished. I just want to point out. Yeah, listen, I mean, you don't have to get your agenda done as long as you look good on camera, not getting your agenda done. I'm sorry. It's pronounced the chips and science bill.

Oh, sorry. Which is very funny because there was actually, I think, a representative tweeted that, like, we backer named salsa and we didn't get there. They could have called it the chips and salsa bill. So, like, as we're speaking, by the way, they were so close. They were so close. Chips and science. So they, yes, it is true. The Senate passed it.

The House passed it. It's going to Biden, big investment in semiconductor manufacturing. This is, like, happening as we speak. Yeah. Very good. And apparently there's some sort of climate bill, but that hasn't been signed yet. So they've done two things. Other than that, it's like mostly he has a cool video conferencing set up.

But it's very cool. It's true. I want to get one. All right. We're over, as always. It never ceases to amaze. It's been a good one. I enjoyed my time with you.

It's fun. I like being in the office, everybody. Okay, that's it. We'll be back on Wednesday. Dave, what's happening Wednesday? What is happening Wednesday? I'm going to be on vacation in Miami. So we're doing a whole episode on like the work from anywhere life.

We talked to Thomas Ricker, who is our official van life. correspondent. We did a bunch of stuff on space internet. We're going to go even deeper on the 5G dish Starlink stuff. So get excited about that. And then there will probably be a long time of just me lying in a pool telling everyone how cool my life is. So look forward to that. All right. You can tweet at us. We love hearing from you. I'm at Reckless, David's at Pierce. Alex is Alex H. Kranz. And then Decoder next week, our friend Hank Green, going to be in the show. It's going to be really good. Talk about bitch from my YouTube. We're going to get into it. It's be good.

That's it. Rock and roll. Thanks for listening to this week's show. And hey, we'd love to hear from you. Shoot us an email at vergecast at the verge.com. And if you'd like to the show, share it with a friend. Vergecast is a production of the Verge and part of the Box Media Podcast Network. Today's episode was produced by me, Liam James, and our senior audio director, Andrew Marino.

Our executive producer is Eleanor Donovan. That's it. We'll see you next week.