WEBVTT - How Monopolies Are Making Tech Worse 0:00:02.520 --> 0:00:07.000 All Zone Media. Hello and welcome to Better Offline and 0:00:07.080 --> 0:00:21.159 of course I'm your host, head Zeitron. Before we go 0:00:21.200 --> 0:00:23.720 any further, as a reminder, check out the show notes 0:00:23.720 --> 0:00:26.080 for links to back up everything I'm saying. I'm not 0:00:26.120 --> 0:00:30.080 creative enough to make this stuff up. It's real, I promise. Anyway, 0:00:30.720 --> 0:00:33.320 the start of August felt kind of surreal for the 0:00:33.320 --> 0:00:36.480 first time since jack GBT launched in November twenty twenty two. 0:00:36.720 --> 0:00:39.159 There were signs that the markets were finally starting to 0:00:39.200 --> 0:00:42.040 wake up to the bullshit of generative AI and kind 0:00:42.080 --> 0:00:45.800 of seeing that it wasn't making anyone money really, you know, 0:00:45.880 --> 0:00:47.839 the very obvious thing that some of us have been 0:00:47.880 --> 0:00:51.640 saying for quite some time. Anyway, though, it was remarkable, 0:00:52.360 --> 0:00:54.840 but not as remarkable as what happened in August fifth, 0:00:55.040 --> 0:00:57.640 when a federal judge delivered his ruling in an antitrust 0:00:57.680 --> 0:01:01.240 case filed against Google by the US Department of Justice. 0:01:01.280 --> 0:01:04.440 In three hundred pages of dense legal text, Judge Amitt 0:01:04.520 --> 0:01:08.240 Meta confirmed an excruciating detail that lengthened the breadth of 0:01:08.280 --> 0:01:11.240 what all of us Gander's sort of new. The Google 0:01:11.240 --> 0:01:14.640 has a monopoly in search and online general text advertising. 0:01:14.680 --> 0:01:18.840 And that's a specific term of art. For many reasons, 0:01:19.160 --> 0:01:22.399 this ruling was a humiliating one for Google, not least 0:01:22.440 --> 0:01:25.080 because it showed the sordid, nasty little details of how 0:01:25.080 --> 0:01:28.440 it's maintained its market dominance and actively impeded any chance 0:01:28.480 --> 0:01:32.600 of fair competition in the search market. Documents obtained through 0:01:32.600 --> 0:01:35.960 discovery revealed the incredible amounts of money that Google's been 0:01:36.000 --> 0:01:39.840 paying companies. They paid Samsung eight billion dollars over four 0:01:39.920 --> 0:01:42.800 years and Apple twenty billion dollars in twenty twenty two 0:01:42.800 --> 0:01:45.760 alone to remain the fault search engine on their devices, 0:01:45.920 --> 0:01:48.440 as well as Mozilla that makes the Firefox browser. They 0:01:48.480 --> 0:01:51.560 pay about half a billion dollars a year. To be clear, 0:01:52.240 --> 0:01:54.880 this is one of the grizzlier puts. Mozilla is an 0:01:54.960 --> 0:01:57.240 organization I actually admire and they do a lot of 0:01:57.240 --> 0:02:00.600 cool stuff technologically, but it also kind of revealed how 0:02:00.600 --> 0:02:04.040 dependent they are on Google's money to stay afloat. Anyway, 0:02:04.640 --> 0:02:07.200 Judge Meta found that Google had violated the Sherman Act, 0:02:07.520 --> 0:02:10.919 a century old Dante trust legislation that, among other things, 0:02:11.000 --> 0:02:13.239 led to the breakup of Standard Oil in nineteen ten, 0:02:13.400 --> 0:02:15.160 as well as the breakup of AT and T in 0:02:15.280 --> 0:02:19.040 nineteen eighty two. This is a significant moment in Silicon 0:02:19.120 --> 0:02:23.200 Valley history, and it's an existential threat to Google. While 0:02:23.200 --> 0:02:26.120 Google's initial success came thanks to it being actually better 0:02:26.200 --> 0:02:27.080 than the alternatives. 0:02:27.200 --> 0:02:29.480 Anyone remember alta Vista? How do this? You see this? 0:02:30.160 --> 0:02:34.119 Google's continued existence is largely thanks to various interconnected monopolies 0:02:34.120 --> 0:02:37.400 it's established, creating a choke hold on Well Search and 0:02:37.600 --> 0:02:41.560 I'd argue the web at large. Over half of Google's 0:02:41.600 --> 0:02:44.280 yearly revenue comes from Google Search, over one hundred and 0:02:44.280 --> 0:02:46.840 seventy five billion of the three hundred or so billion 0:02:46.880 --> 0:02:49.280 that Google makes every year. And it's hard to imagine 0:02:49.320 --> 0:02:52.720 that Google could sustain said revenue or its dominance without 0:02:52.720 --> 0:02:56.000 paying billions of dollars to starve the competition, and indeed, 0:02:56.040 --> 0:02:59.520 this ruling kind of proves that they can't. As I mentioned, 0:02:59.560 --> 0:03:01.880 the Sherman Act is roughly one hundred and thirty years old, 0:03:01.919 --> 0:03:04.840 and since its creation, it's unwoven some of the America's 0:03:04.919 --> 0:03:07.919 most intractable monopoly players, single handedly ruining the days of 0:03:07.960 --> 0:03:11.840 oil company CEOs and rail barons alike. It's robust, powerful, 0:03:12.240 --> 0:03:14.880 and it's a really good piece of legislation which in 0:03:14.919 --> 0:03:17.360 the decades since its creation, has been augmented with new 0:03:17.440 --> 0:03:21.799 laws to cover the blind spots missed by the original authors. Problematically, 0:03:22.000 --> 0:03:25.800 the Reagan administration kind of detoothed it by refusing to 0:03:26.080 --> 0:03:28.320 actually enforce it. You heard a little of that from 0:03:28.360 --> 0:03:32.120 Matt Stoler's interview from last episode. But crucially, the Sherman 0:03:32.200 --> 0:03:35.360 Act has teeth. It contains provisions that allow judges to 0:03:35.440 --> 0:03:38.920 levy big fines, impose criminal penalties on CEOs or anyone 0:03:39.000 --> 0:03:42.440 else involved, and those penalties can be about a decade long. 0:03:42.720 --> 0:03:45.360 They can also order companies to perform specific actions like 0:03:45.440 --> 0:03:49.600 divesting a business unit to remedy the situation. It's good shit, 0:03:49.760 --> 0:03:52.640 and it's exactly what we need. Well, I don't think 0:03:52.640 --> 0:03:55.600 that Sundar Pashai is going to prison, which would be very, 0:03:55.720 --> 0:03:59.200 very funny, mostly because hardly anyone ever actually gets prosecuted 0:03:59.240 --> 0:04:01.440 for violating the shit German Act. I do think this 0:04:01.560 --> 0:04:05.040 ruling has the potential to kill Google, at least the 0:04:05.120 --> 0:04:07.560 current Google that we see today, this present form of 0:04:07.600 --> 0:04:10.400 this company that bankrolls its other entities using a crooked 0:04:10.480 --> 0:04:14.320 monopoly over the search market. And in this two part series, 0:04:14.360 --> 0:04:16.320 I'm going to take a look at how Google created 0:04:16.360 --> 0:04:18.599 its monopoly and how that monopoly allowed it to. 0:04:18.600 --> 0:04:19.960 Become fabulously rich. 0:04:20.480 --> 0:04:22.960 I'll also talk about what might happen next, which for 0:04:23.040 --> 0:04:25.960 the most part, will involve a mixture of history, lessons 0:04:25.960 --> 0:04:29.520 and a healthy dash of bullshit speculation. Ah, I'm kidding, 0:04:29.520 --> 0:04:33.240 it will actually be good, but trust me, even the 0:04:33.240 --> 0:04:37.960 best case scenario for Google here is fairly grim. You 0:04:38.040 --> 0:04:40.719 may also wonder why I've been going on about monopolies 0:04:40.760 --> 0:04:44.720 for weeks, and I really want you to understand. Monopolies 0:04:44.720 --> 0:04:46.960 are a big part of why everything feels like it 0:04:47.040 --> 0:04:51.080 stopped working. So many problems in the modern tech industry 0:04:51.080 --> 0:04:53.640 are a result of a lack of competition, of monopolies 0:04:53.640 --> 0:04:56.560 and oligopolies that change the incentive of a company from 0:04:56.600 --> 0:04:59.760 selling you a service, you a customer who likes the service, 0:04:59.800 --> 0:05:02.440 and for it to extracting as much value from you 0:05:02.480 --> 0:05:04.919 as possible because you have nowhere else to go or 0:05:05.120 --> 0:05:09.360 leaving is difficult. Competition is deeply important. After all, if 0:05:09.360 --> 0:05:11.520 you're not worried about the competition, why would you worry 0:05:11.560 --> 0:05:15.480 about your customers leaving? The incentives of the monopolist are 0:05:15.480 --> 0:05:20.960 inherently degenerative. Monopolists are not concerned about building better products. No, 0:05:21.279 --> 0:05:24.880 they're concerned about squeezing their captive audience as much as possible. 0:05:26.040 --> 0:05:28.240 The documents I covered back in April in The Man 0:05:28.279 --> 0:05:30.880 Who destroyed Google Search are a great example showing how 0:05:30.920 --> 0:05:34.400 Prabagar Ragavan god I love saying his name. The former 0:05:34.440 --> 0:05:37.320 head of ads at Google demanded an increase in queries, 0:05:37.560 --> 0:05:40.400 meaning more searches rather than better results, as a means 0:05:40.400 --> 0:05:42.719 of increasing the amount of time one would spend on Google, 0:05:42.760 --> 0:05:45.480 which in turn would allow Google to show you more ads. 0:05:47.240 --> 0:05:50.160 However you feel about capitalism, a better economy is one 0:05:50.200 --> 0:05:55.200 where actual, real competition between businesses exists, one based on 0:05:55.320 --> 0:05:59.440 their ability to meet customers' needs. This stuff feels very obvious, 0:06:00.040 --> 0:06:03.640 but it needs repeating. A company that fears the competition 0:06:03.760 --> 0:06:06.719 is one that will compete to win a customer's business 0:06:06.720 --> 0:06:09.480 and heart. And conversely, a company that has no real 0:06:09.520 --> 0:06:12.640 fear of losing customers because they've dominated the market with 0:06:12.960 --> 0:06:15.960 say a monopoly, or set up a healthy cartel of friendly, 0:06:16.000 --> 0:06:20.920 other bigger quote competitors where newcomers are effectively chased out. Yeah, 0:06:21.600 --> 0:06:23.760 they can make their products worse without fear that customers 0:06:23.839 --> 0:06:27.479 might do something annoying like choose another option. You see 0:06:27.480 --> 0:06:31.000 a lot of it outside of tech two. Ticketmaster and 0:06:31.040 --> 0:06:33.760 its associated properties have dominated live events to the point 0:06:33.760 --> 0:06:36.880 that they control both on sale tickets and the resale market, 0:06:37.200 --> 0:06:41.120 leading to things like their horrifying Platinum Seats deal, where 0:06:41.120 --> 0:06:44.359 Ticketmaster reserves tickets so that it can sell them for 0:06:44.440 --> 0:06:47.159 a higher price to fans that couldn't buy them the 0:06:47.200 --> 0:06:50.760 normal way, which Ticketmaster also runs. And that's why the 0:06:50.800 --> 0:06:53.840 Department of Justice is suing them, and they suit them 0:06:53.880 --> 0:06:56.839 in May for their monopoly. I wish the executives at 0:06:56.839 --> 0:07:01.200 Ticketmaster nothing but the worst. Four companies control eighty percent 0:07:01.240 --> 0:07:04.560 of US air travel after decades of acquisitions, allowing them 0:07:04.560 --> 0:07:06.880 to effectively charge whatever they want, and because there are 0:07:06.960 --> 0:07:09.240 so few of them, they'll pretty much keep their prices 0:07:09.279 --> 0:07:12.960 around the same amount. It's a fake competition and a 0:07:13.000 --> 0:07:16.680 fake competitive environment, and it's bad for customers and it's disgusting. 0:07:18.000 --> 0:07:20.520 Now you may think, ah, I got really shitty internet speed, 0:07:20.560 --> 0:07:22.800 and whenever I call customer service, they don't seem to 0:07:22.800 --> 0:07:26.000 pick up. And that's because most Americans have no real 0:07:26.120 --> 0:07:29.200 choice in internet providers thanks to monopolies run by companies 0:07:29.240 --> 0:07:32.640 like Comcast, Charter Central, Lincoln, Cox, who can charge what 0:07:32.760 --> 0:07:36.440 they want, perform a fairly mediocre standard, and effectively abandoned 0:07:36.520 --> 0:07:40.840 less profitable rural areas, discarding some to ultraslow DSL Internet 0:07:40.880 --> 0:07:43.720 that many of you probably have not used in decades, 0:07:44.920 --> 0:07:47.920 and one of my favorite ones are the real fuck nuts. 0:07:47.920 --> 0:07:51.800 The scumbags are at Frontier Frontier Communications, which is partly 0:07:51.800 --> 0:07:54.720 owned by a private equity firm called Cerebrous Capital Management, 0:07:54.880 --> 0:07:58.320 which owns part of Albertson's, a grocery store that's currently 0:07:58.320 --> 0:08:00.320 in the midst of a battle with the FDC over 0:08:00.360 --> 0:08:03.000 a larger chain called Kroger's trying to buy them, with 0:08:03.080 --> 0:08:06.160 the FTC correctly arguing that it would eliminate competition and 0:08:06.200 --> 0:08:10.520 allow one firm to control grocery prices. Hey, that reminds 0:08:10.520 --> 0:08:15.520 me of something. You remember when inflation was increasing prices everywhere. Yeah, 0:08:15.800 --> 0:08:18.840 if you'd like a journalist who was writing, actually, it's 0:08:19.000 --> 0:08:21.240 it's nothing to do with the companies. You're fucking wrong. 0:08:21.320 --> 0:08:23.000 You were wrong at the time, and you should not 0:08:23.120 --> 0:08:27.360 write anymore. It's disgusting. What actually happened was the increasingly 0:08:27.480 --> 0:08:30.640 dwindling amount of competition in many consumer goods companies allowed 0:08:30.640 --> 0:08:33.520 them to all raise their prices at once, gouging customers 0:08:33.520 --> 0:08:34.959 in a way that should have had someone sent to 0:08:35.040 --> 0:08:39.440 jail rather than make nineteen million dollars for CEOs that 0:08:39.480 --> 0:08:43.360 were bleeding Americans dry. It's also much much easier for 0:08:43.400 --> 0:08:45.920 a tech company to establish a monopoly because they often 0:08:45.960 --> 0:08:49.119 do so nestled in their own platforms, making the monopolies 0:08:49.200 --> 0:08:51.080 just a little bit harder to pull apart. Without a 0:08:51.080 --> 0:08:56.760 three hundred page legal document. One can easily say, if 0:08:56.800 --> 0:08:59.080 you own all the grocery stores in an area, that 0:08:59.160 --> 0:09:01.480 means you can control the price of groceries. That one's 0:09:01.520 --> 0:09:03.720 a bit more obvious, but it's a little harder to 0:09:03.760 --> 0:09:06.640 point at the problem with the tech industry because said 0:09:06.720 --> 0:09:09.880 monopolies are. They're pretty new and different, yet mostly come 0:09:09.960 --> 0:09:12.400 down to owning on some level both the customer and 0:09:12.440 --> 0:09:16.160 those selling to the customer. There are no alternatives. 0:09:17.320 --> 0:09:19.000 This is a fairly. 0:09:18.720 --> 0:09:21.839 Basic part of all commerce. One cannot have a lawyer 0:09:21.880 --> 0:09:24.840 represent both sides, and one ideally should not have the 0:09:24.880 --> 0:09:27.120 same agent represent both the buyer and the seller of 0:09:27.160 --> 0:09:30.320 a house, which does happen in some states, which is insane. 0:09:31.000 --> 0:09:33.080 And yet it's these conflicts of interest that the tech 0:09:33.120 --> 0:09:35.560 industry has made billions of dollars off of and I'd 0:09:35.640 --> 0:09:39.400 argue that they can't operate without metas monopoly over the 0:09:39.400 --> 0:09:42.040 advertising on both Instagram and Facebook, as well as its 0:09:42.080 --> 0:09:45.360 own black box algorithms allow it to make the products 0:09:45.400 --> 0:09:48.520 that you use every day so much worse just to 0:09:48.600 --> 0:09:51.560 show you more ads, and they can increase advertising prices 0:09:51.600 --> 0:09:54.920 whenever they want something they've done multiple times without anybody 0:09:54.960 --> 0:09:57.920 really covering it. As a result, Meta is also the 0:09:57.960 --> 0:10:01.480 only source of truth for houses successful your advertising is, 0:10:01.679 --> 0:10:04.080 to the point that it tricked the entire media industry 0:10:04.200 --> 0:10:07.320 into pivoting to video using phony numbers. Hundreds of people 0:10:07.320 --> 0:10:11.520 lost their jobs. Nothing happened to Meta. Meta, as with 0:10:11.600 --> 0:10:14.800 any digital advertising monopolist, can basically say whatever it wants 0:10:14.840 --> 0:10:17.439 to you, inflating stats where they need to as a 0:10:17.480 --> 0:10:19.199 means of getting more money out of you, which is 0:10:19.240 --> 0:10:21.640 why there is a seven billion dollar class action suit 0:10:21.640 --> 0:10:25.560 against the company for literally doing that. How has it 0:10:25.640 --> 0:10:28.760 taken this long to do anything? It drives me fucking anyway, again, 0:10:28.840 --> 0:10:31.959 it's about incentives. If Meta has no competition, Meta does 0:10:32.000 --> 0:10:35.040 not have to act honestly or give detailed metrics about 0:10:35.040 --> 0:10:37.840 ad performance, because where else are you gonna go, You're 0:10:37.880 --> 0:10:41.160 gonna go to the other advertiser on Facebook. As Matt 0:10:41.200 --> 0:10:44.120 Stoler said in the last episode, as Mata isn't really 0:10:44.240 --> 0:10:47.720 losing business as their products decay, that seriously suggests they've 0:10:47.720 --> 0:10:53.000 got a monopoly over well the advertising on their own products. Now, 0:10:53.080 --> 0:10:55.440 I know some of you say I'm too easy on Apple, 0:10:55.480 --> 0:10:58.440 but don't worry. I'm writing the ship Apple has, at 0:10:58.520 --> 0:11:01.320 least outside of Europe, with the European Commissioners ruled the 0:11:01.320 --> 0:11:04.319 company must allow third party app stores the monopoly over 0:11:04.360 --> 0:11:06.800 the iOS and associated app stores as well as the 0:11:06.840 --> 0:11:09.600 advertising connected to it, meaning that it can set the 0:11:09.640 --> 0:11:12.640 prices such as it's seventy thirty revenue split, what can 0:11:12.679 --> 0:11:15.840 be installed and house said apps and monetized, which is 0:11:15.880 --> 0:11:18.360 again why the Department of Justice has recently sued it 0:11:18.360 --> 0:11:22.560 for antitrust violations. There is only one way to buy 0:11:22.600 --> 0:11:24.840 apps on your iPhone, and that's why the app store 0:11:24.880 --> 0:11:27.720 is so utterly swamped with micro transaction, pumped filth and 0:11:27.800 --> 0:11:31.960 random flashlight apps with invasive advertising and spyware and shit, 0:11:32.600 --> 0:11:34.400 there's not really quality control. 0:11:34.440 --> 0:11:35.080 And that is. 0:11:35.120 --> 0:11:39.480 Usually, by the way, what their argument is, especially Apple 0:11:39.520 --> 0:11:41.640 and I use Apple devices and recording this on an 0:11:41.640 --> 0:11:44.280 Apple device. I use an iPhone and a MacBook. But 0:11:44.360 --> 0:11:46.680 come the fuck on the whole point of the app Store, 0:11:46.960 --> 0:11:50.760 this whole time with Apple holding onto it with their nasty, 0:11:51.160 --> 0:11:55.640 gauntleted fists, was that they hold the quality up. But 0:11:55.800 --> 0:11:58.280 what you see with the app Store today is a disgrace. 0:11:59.280 --> 0:12:02.960 Everything is micro transaction field. And I know the argument is, well, 0:12:03.000 --> 0:12:05.800 that's what customers want. Fuck you, it's what you allow. 0:12:06.880 --> 0:12:10.520 Apple allowed the micro transaction industry to grow on iOS 0:12:10.800 --> 0:12:14.880 and in doing so, effectively killed gaming on your phone. 0:12:14.920 --> 0:12:18.000 The reason that most games require some kind they're free 0:12:18.040 --> 0:12:20.280 to play, but they require some kind of micro transaction 0:12:20.360 --> 0:12:23.400 to really use them is because these games are insanely profitable. 0:12:23.559 --> 0:12:27.240 They're also deeply evil and exploitative. Yeah, Apple allows them 0:12:27.280 --> 0:12:29.640 because Apple makes so much money off of them, thirty 0:12:29.679 --> 0:12:34.400 percent of each transaction. If there was a just world here, 0:12:34.480 --> 0:12:36.680 if we lived in a just society, if the App 0:12:36.760 --> 0:12:39.240 Store was a just society, Apple would have said, no, 0:12:39.480 --> 0:12:43.600 this is an evil kind of money making thing. There 0:12:43.679 --> 0:12:46.679 is no reason why this should exist. And I know 0:12:46.800 --> 0:12:48.760 I sound a bit radical on this, and I'm sure 0:12:48.800 --> 0:12:53.120 someone would disagree and say, oh, I like playing Warlords Battlemasters. 0:12:53.520 --> 0:12:56.640 I don't care. Those games are evil. There's a reason 0:12:56.679 --> 0:13:00.480 why mobile gaming is so thin, and it's because of 0:13:00.520 --> 0:13:03.679 companies like Apple, and Matt Stoler said this on the 0:13:03.760 --> 0:13:06.720 last episode, and I really like this. When you have 0:13:06.840 --> 0:13:09.760 such a strong monopoly, you're effectively a political power, and 0:13:09.960 --> 0:13:13.240 things grow within the system, evil things when you use 0:13:13.320 --> 0:13:16.880 that monopoly and that power in a way that incentivizes them. 0:13:17.120 --> 0:13:19.839 Apple could and should have and the play Store to 0:13:19.880 --> 0:13:22.960 an extent. Sure, but Apple really created this market, should 0:13:22.960 --> 0:13:26.800 have crushed microtransaction filled free to play games. They should 0:13:26.840 --> 0:13:29.040 have rate limited them, I don't know, or they should 0:13:29.040 --> 0:13:32.079 have just not allowed them to live. Companies like Ebony, 0:13:32.240 --> 0:13:34.800 for example, have got so rich over these games that 0:13:34.800 --> 0:13:37.840 require people to put hundreds of dollars to even compete. Hey, 0:13:37.840 --> 0:13:41.880 it's another competition thing, all right. I'll stop rating about 0:13:41.920 --> 0:13:45.000 this though. We'll get back to the advertising side of 0:13:45.080 --> 0:13:48.280 the app store. And Apple, just to be clear, is 0:13:48.320 --> 0:13:51.000 the only advertising firm on the app Store, and that 0:13:51.120 --> 0:13:54.240 is a big problem. Apple has aggressively moved against tracking 0:13:54.280 --> 0:13:56.840 of iOS users, a good thing, by the way, yet 0:13:56.840 --> 0:13:59.400 they hold a complete monopoly on any advertisements on the 0:13:59.440 --> 0:14:02.719 app Store on their phones and any associated advertisement at 0:14:02.800 --> 0:14:06.680 all on the iPhone, and yeah, you just have to 0:14:06.760 --> 0:14:09.960 trust them, by the way, on the results there as 0:14:10.480 --> 0:14:12.920 that's the only company you can advertise with. There's not 0:14:12.960 --> 0:14:13.880 really any other choice. 0:14:13.880 --> 0:14:16.400 Sorry. Also, that's why Apple is also. 0:14:16.200 --> 0:14:19.120 Being sued by the DOJ for alleged German Act violations 0:14:19.120 --> 0:14:22.120 over allegations It's control of services like I Message, which 0:14:22.160 --> 0:14:25.880 is unavailable on Android, door Windows, and as internal documents show, 0:14:26.120 --> 0:14:29.240 is seen as a useful tool for ensuring customer loyalty 0:14:29.400 --> 0:14:32.120 has allowed it to restrict competition in the messaging, smartphone 0:14:32.120 --> 0:14:36.360 and wearable markets. And what's frustrating here is Apple is 0:14:36.440 --> 0:14:40.680 probably not as evil as Google, and I've definitely gone 0:14:40.720 --> 0:14:43.200 to back for Apple. But when you really sit and 0:14:43.240 --> 0:14:46.520 think about it, does it need to be like this? 0:14:47.320 --> 0:14:49.600 Could Apple not open this stuff up? There's not really 0:14:49.600 --> 0:14:52.240 a quality control thing. Eddie Q, if you're listening, come 0:14:52.280 --> 0:14:55.000 on the show shoot the shit with me, because I'd 0:14:55.080 --> 0:14:58.600 like to hear the justification. Steve Jobs was a horrible 0:14:58.640 --> 0:15:01.560 man at Deadbeat Dad, real piece of shit, but he 0:15:01.640 --> 0:15:04.240 at least realized that there was a level of quality 0:15:04.280 --> 0:15:07.040 you had to provide and the app store doesn't have it. 0:15:07.200 --> 0:15:09.520 There is an App Store episode coming, By the way, 0:15:09.960 --> 0:15:12.000 I'm gonna really take it to task because I think 0:15:12.080 --> 0:15:15.600 that Apple's responsibility to society here is yet another thing 0:15:15.640 --> 0:15:19.640 they've defaulted on, just like Google's defaulted on search. And 0:15:19.680 --> 0:15:22.800 you know, this whole thing is it comes down to restrictions. 0:15:23.280 --> 0:15:25.800 And I don't think you should live restrict for lives. 0:15:25.840 --> 0:15:29.360 Though restricted lives, I don't know, but if you want 0:15:29.400 --> 0:15:32.240 to free yourself and especially the money in your wallet, 0:15:32.600 --> 0:15:34.480 you should buy one of the following products. 0:15:34.560 --> 0:15:34.960 Or don't. 0:15:35.200 --> 0:15:38.000 That's what a life unrestricted feels like. But take your 0:15:38.000 --> 0:15:40.760 wallets out and maybe start spending on this product that's 0:15:40.760 --> 0:15:43.440 coming up that I'm sure you're gonna hear the ad 0:15:43.440 --> 0:15:45.800 and you're gonna be like, damn, damn, that's so. 0:15:45.840 --> 0:15:47.800 Good for Ed. Ed probably loves this. 0:15:47.880 --> 0:15:50.600 It's probably hearing this ad and saying, damn, they really 0:15:50.680 --> 0:15:53.440 nailed the things that I believe in. So go on, 0:15:53.720 --> 0:15:55.560 show them your credit card, wave it in their face 0:15:55.600 --> 0:16:08.640 a bit yum young, and we're back. But I want 0:16:08.640 --> 0:16:11.160 to make it clear, and I will make it clear. 0:16:11.560 --> 0:16:16.160 The competition is good. You want competition. Every one of 0:16:16.200 --> 0:16:19.120 these companies has sold you a lie that allowing them 0:16:19.120 --> 0:16:22.240 to control the experience makes it better because it'll be 0:16:22.320 --> 0:16:25.360 curated by the company that made it. Yet the companies 0:16:25.360 --> 0:16:28.440 that make these things a huge constantly laying people off, 0:16:28.480 --> 0:16:30.720 though this isn't the case with Apple, and when given 0:16:30.800 --> 0:16:33.120 the chance, will take as many liberties as they can 0:16:33.320 --> 0:16:36.480 to squeezees many dollars out of every user. And when 0:16:36.480 --> 0:16:40.240 they don't have to compete, they get lazy, they get domesticated. 0:16:40.400 --> 0:16:42.800 They don't have to innovate or impress you. They just 0:16:42.880 --> 0:16:44.920 have to keep you there, and keeping you there can 0:16:44.920 --> 0:16:47.600 be as simple as it's really difficult to move, or 0:16:47.600 --> 0:16:50.200 where else are you going to go? I keep using 0:16:50.280 --> 0:16:53.160 my iPhone because I genuinely like iOS, but I also 0:16:53.240 --> 0:16:55.240 know that if I message was an app rather than 0:16:55.280 --> 0:16:58.400 a thing only found in Apple products, I'd absolutely consider 0:16:58.520 --> 0:17:01.360 using another platform. I'm sure someone's going to message me 0:17:01.400 --> 0:17:04.119 about goddamn beeper or something like that. It's not a 0:17:04.119 --> 0:17:08.160 good ux. I don't like it, sorry, Casey. Anyway, when 0:17:08.160 --> 0:17:11.480 you have a marketplace entirely dominated by one company selling 0:17:11.480 --> 0:17:15.080 advertising on services it runs, you really have no idea 0:17:15.119 --> 0:17:17.760 what you're buying. And this is when we get back 0:17:17.760 --> 0:17:22.159 to Google and specifically their AI powered Performance Max platform, 0:17:22.320 --> 0:17:24.920 a four year old black box advertising solution that covers 0:17:24.920 --> 0:17:28.160 all of Google's properties, letting you run one campaign across 0:17:28.200 --> 0:17:33.560 every Google property. Man, how convenient, right? You just tell 0:17:33.600 --> 0:17:35.680 Google what you want, how much you want to spend, 0:17:35.680 --> 0:17:37.959 and roughly who you'd like to see it with what 0:17:38.000 --> 0:17:40.159 you're advertising a Google will magically tell you at the 0:17:40.280 --> 0:17:42.840 end how many people saw your ads and how much 0:17:42.840 --> 0:17:44.920 you owe Google for the pleasure. And no, you do 0:17:44.960 --> 0:17:47.719 not know where the ads ran, which is a problem 0:17:47.800 --> 0:17:50.960 That means that hundreds of large brands find themselves every 0:17:51.040 --> 0:17:53.600 year spending money on spammy and scammy websites that likely 0:17:53.640 --> 0:17:56.600 never get them any real customers. And as an aside, 0:17:56.640 --> 0:17:59.640 by the way I'm hearing tell that there's a big 0:17:59.680 --> 0:18:04.359 problem in CPM advertising cost per mile, so impressions where 0:18:05.080 --> 0:18:07.359 I don't know the impressions might not be real people, 0:18:07.400 --> 0:18:11.159 they might be bots. Oh and you know what, I 0:18:11.200 --> 0:18:13.600 have to wonder if the end of this trial doesn't 0:18:13.640 --> 0:18:17.000 involve that data being shared with the rest of the 0:18:17.040 --> 0:18:19.200 companies in the industry and US finding out it's a 0:18:19.280 --> 0:18:22.080 much bigger problem. I have an advertising episode coming up 0:18:22.119 --> 0:18:26.200 as well. This, by the way, all of this horrible 0:18:26.240 --> 0:18:29.639 monopolistic chicanery. This is what keeps the lights on for 0:18:29.680 --> 0:18:33.119 these companies. Google and Meta own both the products and 0:18:33.160 --> 0:18:36.240 the advertising services available on those products, and thus set 0:18:36.240 --> 0:18:38.520 the terms of every part of the transaction. Because there's 0:18:38.560 --> 0:18:41.680 no other way to advertise on Google, Search, Facebook, or Instagram, 0:18:41.920 --> 0:18:45.040 there are entities competing for placement, but that competition is 0:18:45.080 --> 0:18:47.760 done on the terms and the platforms set by the 0:18:47.760 --> 0:18:51.320 platforms themselves, which in turn control how and when the 0:18:51.320 --> 0:18:55.160 ads are shown and how much you'll be charged for them. Crucially, 0:18:55.480 --> 0:18:58.719 these companies also control all the data involved. They are 0:18:58.720 --> 0:19:00.879 both the companies selling you the ad space and the 0:19:00.880 --> 0:19:04.240 company auditing said ad space and the business. If you 0:19:04.280 --> 0:19:07.360 do not like Google as an advertising vendor on Google, 0:19:07.920 --> 0:19:10.760 or Meta as a partner to advertise with on Facebook, 0:19:10.840 --> 0:19:13.400 you are shit out of luck, both if you want 0:19:13.400 --> 0:19:15.199 to try an alternative and if you need them to 0:19:15.240 --> 0:19:18.160 improve the product in question. This is the exact reason 0:19:18.160 --> 0:19:21.080 that Google is so nervous about its upcoming antitrust trial 0:19:21.119 --> 0:19:24.800 over its accused monopoly over digital advertising, because the government 0:19:24.800 --> 0:19:27.840 wants it to divest its ad management divination, which would 0:19:27.840 --> 0:19:30.840 in turn create an entirely different marketplace, one where it 0:19:30.880 --> 0:19:34.800 actually I don't know had to compete. I also don't 0:19:34.800 --> 0:19:37.480 believe that most of these companies can operate without their monopolies. 0:19:37.480 --> 0:19:41.119 As I've said before, Facebook and Instagram are increasingly decaying 0:19:41.160 --> 0:19:43.640 products that make tens of billions of dollars a year 0:19:43.800 --> 0:19:46.439 because there's no competitor that can undercut or compete with 0:19:46.480 --> 0:19:50.119 metas advertising dollars, which make up ninety eight percent of 0:19:50.160 --> 0:19:53.800 their revenue. Meta made thirteen point four to six billion 0:19:53.840 --> 0:19:56.960 dollars in profit last quarter on thirty nine billion dollars 0:19:57.160 --> 0:19:59.400 in revenue, which is a direct result of it being 0:19:59.400 --> 0:20:02.159 able to manipul the platform to show more advertising and 0:20:02.320 --> 0:20:06.400 increase the pricing of the advertising being shown. Metas users 0:20:06.400 --> 0:20:08.720 are trapped because Meta owns two of the largest social 0:20:08.720 --> 0:20:10.840 networks in the world three if you count Threads, though 0:20:10.880 --> 0:20:14.639 it doesn't show adds yet, and Metas advertisers need to 0:20:14.640 --> 0:20:16.600 be able to access the swards of people that the 0:20:16.640 --> 0:20:20.960 platform has. Everyone loses except for Meta. Of course, Meta 0:20:21.000 --> 0:20:24.879 does so very well, but we need to crush their monopoly. 0:20:25.840 --> 0:20:27.600 And by the way, all of this goes for Google 0:20:27.640 --> 0:20:30.400 two and they made a profit of twenty three point 0:20:30.520 --> 0:20:33.600 six two billion dollars last quarter, but on revenues of 0:20:33.680 --> 0:20:37.560 eighty four point seventy four billion dollars. Do you really 0:20:37.640 --> 0:20:41.080 think that sixty one billion dollars in expenditures or losses 0:20:41.119 --> 0:20:43.800 is sustainable in the event that Google no longer owns 0:20:43.800 --> 0:20:47.680 a monopoly over its advertising space. All those costs aren't 0:20:47.720 --> 0:20:51.479 all associated with Google Search half of their revenue is, 0:20:51.720 --> 0:20:53.720 and how much of said revenue is tied in the 0:20:53.800 --> 0:20:57.600 vagueness of the metrics it provides to its advertisers. Using 0:20:57.640 --> 0:21:00.000 these numbers, we see that Meta had expenditures of twins 0:21:00.000 --> 0:21:03.720 tent five point five four billion dollars over the last quarter. Again, 0:21:03.840 --> 0:21:06.400 can it sustain this level of spending without a monopoly 0:21:06.440 --> 0:21:09.720 on advertising on Facebook and Instagram? I don't think they can. 0:21:10.080 --> 0:21:12.399 And sure they could cut back on the tens of 0:21:12.440 --> 0:21:15.480 billions of dollars they're putting into reality labs. That might help, 0:21:15.760 --> 0:21:17.680 but at some point they're going to run out of 0:21:17.720 --> 0:21:21.040 people to sell to and they definitely couldn't survive if 0:21:21.080 --> 0:21:24.080 they couldn't rig the dice how they have been. And 0:21:24.160 --> 0:21:27.000