WEBVTT - The Crazy Story of Pixelon 0:00:04.400 --> 0:00:07.800 Welcome to tex Stuff, a production from I Heart Radio. 0:00:12.080 --> 0:00:14.680 Hey there, and welcome to tex Stuff. I'm your host, 0:00:14.840 --> 0:00:17.760 Jonathan Strickland. I'm an executive producer with I Heart Radio. 0:00:17.800 --> 0:00:20.560 And how the tech are you? Uh So, this is 0:00:20.600 --> 0:00:22.680 probably gonna be a little long for a tech Stuff 0:00:22.800 --> 0:00:26.200 tidbits episode, but it's also I think it's gonna be 0:00:26.200 --> 0:00:28.400 somewhere between the tidbits in a full episode. We'll see 0:00:28.400 --> 0:00:30.400 when we get done, won't we. But I thought I 0:00:30.400 --> 0:00:34.160 would do a spotlight on a particular startup story during 0:00:34.159 --> 0:00:37.280 the heyday of the dot com bubble, as in when 0:00:37.360 --> 0:00:41.720 dot com companies were considered the new you know, gold rush. 0:00:42.000 --> 0:00:46.960 And it's a story about greed, deception, and a spectacular collapse. 0:00:47.800 --> 0:00:50.720 So let's set the scene. And by the way, this 0:00:50.800 --> 0:00:55.440 is a story that has been told before, and I'll 0:00:55.480 --> 0:00:59.360 talk a little bit about a particular depiction of this 0:01:00.040 --> 0:01:04.839 later on. Now, in the early nineties, very few people 0:01:05.000 --> 0:01:10.559 outside of academia and maybe some research facilities, some military facilities, 0:01:10.800 --> 0:01:13.200 very few people were aware of the Internet. In general. 0:01:13.840 --> 0:01:18.360 The mainstream was blissfully ignorant of the Internet. People might 0:01:18.400 --> 0:01:21.720 have made use of an online service provider or OSP 0:01:22.280 --> 0:01:24.200 or maybe if you were a nerd like me, a 0:01:24.240 --> 0:01:28.240 bulletin board system or BBS. But these were kind of 0:01:28.240 --> 0:01:32.560 windows into tiny walled gardens for the most part, and 0:01:32.600 --> 0:01:35.080 they only offered a hint of what would be possible 0:01:35.120 --> 0:01:38.839 with the proliferation of the Internet and the Worldwide Web. 0:01:39.760 --> 0:01:43.160 As such, no one was really thinking ahead about, you know, 0:01:43.280 --> 0:01:46.200 monetizing the Internet in a meaningful way, because again, most 0:01:46.240 --> 0:01:49.960 folks didn't even know the Internet existed, but then came 0:01:50.200 --> 0:01:53.440 the Worldwide Web in the early nineties. If you listen 0:01:53.480 --> 0:01:56.560 to my interview with barrittun Day Thurston, then you know 0:01:56.760 --> 0:02:00.320 I was skeptical of the Web when I first countered 0:02:00.320 --> 0:02:03.720 it in college, and I could hardly be blamed because 0:02:03.760 --> 0:02:06.520 at that point the Web was essentially a bunch of 0:02:06.560 --> 0:02:11.120 text based pages. Uh these were static pages, so nothing 0:02:11.120 --> 0:02:13.680 would change on them, and everything kind of looked like 0:02:13.720 --> 0:02:16.200 it was torn out of a statistics text book. It 0:02:16.280 --> 0:02:20.360 was not exciting. It didn't resemble today's web at all, really, 0:02:21.400 --> 0:02:25.800 But with netscapes, introduction of the Secure Sockets Layer or SSL, 0:02:26.600 --> 0:02:31.000 and the foundation of companies like eBay and Amazon, the 0:02:31.040 --> 0:02:34.520 mid nineties saw a glimmer of what the Web could 0:02:34.560 --> 0:02:38.360 be from a commercial standpoint, if you had to pick 0:02:38.520 --> 0:02:41.720 a year where things really began to take a turn 0:02:41.800 --> 0:02:46.840 towards the commercial would be a pretty decent choice. Shortly 0:02:46.840 --> 0:02:49.680 after that, folks began to really dream big about the 0:02:49.720 --> 0:02:53.119 sort of businesses that could be enabled by the Internet 0:02:53.360 --> 0:02:58.720 and the Web in particular. And behind those companies was 0:02:58.800 --> 0:03:02.239 the financial sector, And in this case we're talking mostly 0:03:02.240 --> 0:03:07.800 about venture capitalists and other types of investors who saw 0:03:08.080 --> 0:03:12.640 this as an opportunity to turn a lot of money 0:03:12.680 --> 0:03:18.040 into let's see a metric buttload of money. Yeah, so 0:03:18.080 --> 0:03:20.600 these are rich people looking to get way more rich. 0:03:20.760 --> 0:03:22.720 For the most part, there are probably some people who 0:03:23.480 --> 0:03:26.079 probably couldn't afford to invest, and we're doing it anyway. 0:03:26.240 --> 0:03:28.799 But yeah, this was these were the money people, right. 0:03:29.840 --> 0:03:31.720 The potential of the Internet in general and the Web 0:03:31.720 --> 0:03:35.120 in particular looked like it was gonna be uh the 0:03:35.160 --> 0:03:38.560 possibility of a huge payout, and for some cases it was. 0:03:39.520 --> 0:03:43.040 So we started seeing these various money people for ludicrous 0:03:43.120 --> 0:03:46.520 amounts of capital into various startups. Now, some of these 0:03:46.520 --> 0:03:50.080 startups didn't really have any business plan to speak of, 0:03:50.240 --> 0:03:54.840 So while they were flush with investment capital and they 0:03:54.840 --> 0:03:57.320 had a whole lot of money to spend. They didn't 0:03:57.360 --> 0:04:01.720 necessarily have a way to generate significant revenue, and so 0:04:02.000 --> 0:04:04.840 these were companies that were just kind of coasting on 0:04:04.960 --> 0:04:09.520 investment cash and not able to support themselves. So they 0:04:09.560 --> 0:04:11.560 were living on borrowed time. You know, a lot of 0:04:11.560 --> 0:04:14.800 them would end up seeking multiple rounds of funding, and 0:04:14.840 --> 0:04:18.279 they would stay afloat constantly in the in the effort 0:04:18.320 --> 0:04:21.640 to try to either find a way to generate enough 0:04:21.720 --> 0:04:26.320 revenue to sustain itself or and this was the preferred 0:04:26.360 --> 0:04:29.480 thing it still is to this day, get acquired by 0:04:29.480 --> 0:04:32.839 somebody else and and accept an enormous payout and get 0:04:33.040 --> 0:04:38.160 like bonkers wealthy. And some of these companies actually did 0:04:38.200 --> 0:04:42.360 have ways to generate revenue. They weren't like just completely directionless. However, 0:04:43.400 --> 0:04:47.240 most of the time we're talking about some relatively modest revenue, 0:04:48.000 --> 0:04:52.279 and maybe if they were allowed to grow organically, they 0:04:52.320 --> 0:04:56.560 could have stuck around. But a lot of investors were 0:04:56.600 --> 0:05:02.760 encouraging these companies to scale rapidly, to expand their services 0:05:02.760 --> 0:05:06.480 in their presence well beyond what they could support, and 0:05:06.520 --> 0:05:09.359 so these companies ran into serious trouble because, you know, 0:05:09.440 --> 0:05:15.359 scaling increased costs, but not necessarily an equivalent increase in 0:05:15.480 --> 0:05:18.640 the ability to generate revenue. So really it just meant 0:05:18.680 --> 0:05:21.880 that it was getting more expensive to run these companies 0:05:22.160 --> 0:05:25.440 as they were growing larger and larger. But we don't 0:05:25.440 --> 0:05:28.400 need to talk about all of that. We all know 0:05:28.880 --> 0:05:32.159 that the dot com bubble ultimately burst, and it was 0:05:32.240 --> 0:05:35.760 due to a lot of different factors. But our story 0:05:36.120 --> 0:05:39.960 focuses on one tech startup in this dot com bubble era, 0:05:40.560 --> 0:05:43.360 a startup that got a lot of attention and money 0:05:43.440 --> 0:05:47.200 before things went totally pear shaped, and that startup was 0:05:47.279 --> 0:05:53.039 called Pixelon. Now, a man calling himself Michael Finna founded 0:05:53.080 --> 0:05:59.839 Pixelon in n in San Juan Capistrano, California, and the 0:06:00.000 --> 0:06:03.640 whole purpose of pixelon was to bring streaming video to 0:06:03.720 --> 0:06:08.560 the web. In nine Now, let's get some perspective on this. 0:06:09.240 --> 0:06:13.239 In much of the world that was online was still 0:06:13.240 --> 0:06:16.520 relying on dial up internet. That meant that people who 0:06:16.560 --> 0:06:20.039 were using a modem connected to an ordinary telephone line 0:06:20.440 --> 0:06:23.719 and dialed into an I s P server. Now, the 0:06:23.760 --> 0:06:28.120 fastest modems on the market in were capable of download 0:06:28.120 --> 0:06:30.600 speeds of up to fifty six kill a bits per second, 0:06:30.960 --> 0:06:35.800 not gigabits, not megabits, kill a bits and that was 0:06:35.839 --> 0:06:38.560 the fastest. Not everyone had the fastest modems. Some of 0:06:38.640 --> 0:06:44.080 us were rocking significantly slower ones. And sure there were 0:06:44.080 --> 0:06:47.080 a few folks who had DSL connections in the late 0:06:47.160 --> 0:06:52.960 nineties which were significantly faster than dial up modems, and fewer. Still, 0:06:53.360 --> 0:06:56.159 we're starting to get cable internet connections that was really 0:06:56.240 --> 0:06:58.160 on the verge of becoming a thing more in the 0:06:58.400 --> 0:07:02.400 two thousand's era. By the late nineties, it was pretty 0:07:02.440 --> 0:07:04.680 darn rare, So it would take time for folks to 0:07:04.760 --> 0:07:08.120 migrate away from dial up, even as these services were 0:07:08.120 --> 0:07:11.640 starting to come online, because I mean, obviously rolling out 0:07:11.720 --> 0:07:15.240 these services across different regions took a lot of time. Now, 0:07:15.280 --> 0:07:19.360 to look at it another way, YouTube, arguably the best 0:07:19.400 --> 0:07:24.320 known online video platform, wouldn't debut until two thousand five. 0:07:24.760 --> 0:07:28.080 So a web based video platform capable of sending streaming 0:07:28.160 --> 0:07:31.400 video with a thousand different channels to a user's computer 0:07:31.800 --> 0:07:36.440 way back in was a pretty darn ambitious goal, not 0:07:36.600 --> 0:07:42.720 necessarily impossible, but very challenging to pull off. Now, Finny 0:07:42.720 --> 0:07:45.280 didn't just come into this idea out of the blue. 0:07:45.320 --> 0:07:49.080 He had founded a quote unquote computer business, which is 0:07:49.120 --> 0:07:51.920 about as specific as I can get. Because I couldn't 0:07:51.960 --> 0:07:54.600 find any real details about it, but he called it 0:07:54.680 --> 0:07:57.680 a re steck r E S T E C. Find 0:07:57.680 --> 0:08:00.080 out what it means to me. He leased off a 0:08:00.160 --> 0:08:04.720 space from this guy named Chuck Halsworth and Finney's clients, 0:08:05.200 --> 0:08:09.880 we're asking about the possibility of, you know, replaying horse 0:08:10.000 --> 0:08:13.960 races over a computer, like televised horse races, and that 0:08:14.040 --> 0:08:17.280 got him into thinking about computer video, and he and 0:08:17.320 --> 0:08:20.080 Houseworth put a couple of other folks together and they 0:08:20.080 --> 0:08:24.040 founded a company called Digital Motion Video. Over the course 0:08:24.040 --> 0:08:26.880 of about a year, their team made some progress, and 0:08:26.920 --> 0:08:29.240 that led Finney to think of the next big thing, 0:08:29.440 --> 0:08:33.880 a one thousand channel internet video platform capable of streaming 0:08:33.920 --> 0:08:36.760 digital video to users no matter where they were, as 0:08:36.760 --> 0:08:38.679 long as you know, they had a computer and an 0:08:38.679 --> 0:08:43.760 Internet connection. So Michael Finney seemed determined and he established 0:08:43.840 --> 0:08:48.199 himself as the head of pixel on. Uh, it depends 0:08:48.240 --> 0:08:50.840 what the title like. The title depends on what source 0:08:50.880 --> 0:08:52.480 you're looking at. It sounds to me like he was 0:08:52.520 --> 0:08:56.679 pretty loosey goosey with titles. In some accounts he's referred 0:08:56.720 --> 0:08:59.800 to as the chairman, and some the CEO and others 0:08:59.800 --> 0:09:04.160 the chief technology officer, and he worked really hard to 0:09:04.240 --> 0:09:07.840 get various investors to pour money into this endeavor, and 0:09:07.920 --> 0:09:10.760 one person whom he tapped to invest in his vision 0:09:11.360 --> 0:09:15.319 was the owner of an insurance company in southern California, 0:09:15.520 --> 0:09:19.960 a guy by the name Paul Ward. Now Ward was 0:09:20.080 --> 0:09:23.520 fascinated by Finney's pitch, but he didn't feel so great 0:09:23.559 --> 0:09:28.720 about Michael Finney himself. I mean, he seemed a bit unstable, 0:09:29.200 --> 0:09:32.600 to put it lightly. This was in the very early 0:09:32.760 --> 0:09:35.640 days of pixel On, when it was just a small 0:09:35.720 --> 0:09:40.080 office with a few employees, plus Finney himself and Finny 0:09:40.120 --> 0:09:43.199 had hired some engineers, but the whole enterprise seemed a 0:09:43.200 --> 0:09:48.280 little uncertain. Finny definitely seemed like a an eccentric leader. 0:09:48.880 --> 0:09:52.400 So Ward was guiding the company toward a round of fundraising, 0:09:52.760 --> 0:09:57.640 which was aiming for around thirty million dollars. Actually, the 0:09:58.080 --> 0:10:01.719 accounts on this very too. Some it says as low 0:10:01.760 --> 0:10:04.040 as twenty eight million, and some it's as high as 0:10:04.080 --> 0:10:07.319 thirty five million, But at any rate, Ward was getting 0:10:07.320 --> 0:10:12.559 a bit nervous about seeking this funding. Meanwhile, Michael Finney 0:10:12.640 --> 0:10:16.200 was publishing press releases announcing that Pixelon had signed a 0:10:16.240 --> 0:10:20.280 deal with Paramount Pictures and Paramount would lean on Pixelon 0:10:20.400 --> 0:10:27.560 to promote Star Trek Insurrection, the next generation film using 0:10:27.679 --> 0:10:31.480 online video. Star Trek Insurrection wasn't that great of a movie, 0:10:31.520 --> 0:10:33.360 so I guess that's was kind of a match made 0:10:33.400 --> 0:10:39.200 in heaven. Okay, the plot will thicken, but before we 0:10:39.280 --> 0:10:49.920 thicken the plot, let's take a quick break. Michael Finney 0:10:50.040 --> 0:10:52.560 didn't come across as someone who could build out the 0:10:52.640 --> 0:10:56.920 technical infrastructure to make something like an online streaming video 0:10:57.400 --> 0:11:01.640 network work. So Ward reached out to someone that he 0:11:01.720 --> 0:11:05.000 had met when a New York insurance company had purchased 0:11:05.200 --> 0:11:08.600 his California based insurance company. This was a guy named 0:11:08.720 --> 0:11:12.120 Robert Feldman. Ward asked Feldman to come on board with 0:11:12.160 --> 0:11:15.120 Pixelon to help make it work from a technical level. 0:11:15.559 --> 0:11:18.280 And uh, Feldman had been working in I T and 0:11:18.320 --> 0:11:22.839 telecommunications for years, So by this time we're into early 0:11:24.760 --> 0:11:28.160 Pixelon was working on components for streaming video. They would 0:11:28.240 --> 0:11:30.480 later turn out that a lot of the stuff being 0:11:30.480 --> 0:11:36.320 worked on wasn't actually Pixelon's own, stuff like the player 0:11:36.760 --> 0:11:39.959 wasn't Pixelon's. Instead, what they had done was they had 0:11:40.040 --> 0:11:44.920 re skinned. Essentially, they had disguised a version of other 0:11:44.960 --> 0:11:50.240 companies products, namely Microsoft's Windows Media Player. So it had 0:11:50.360 --> 0:11:54.199 a pixel Pixelon overlay, but it was in fact Windows 0:11:54.240 --> 0:11:58.560 Media Player underneath, so Pixelon wasn't even a real pixelon product. 0:11:58.559 --> 0:12:02.480 It was just a you know, just a facade. But 0:12:02.720 --> 0:12:05.360 Feldman he comes on and he's told his title as 0:12:05.440 --> 0:12:09.320 Chief Technology Officer, but as I mentioned, the titles were 0:12:09.360 --> 0:12:14.000 real Lucy Goosey. Feldman himself said that maybe that was 0:12:14.040 --> 0:12:17.400 something that Michael Finney was doing intentionally in order to 0:12:17.480 --> 0:12:20.280 keep people kind of off balance and at odds with 0:12:20.320 --> 0:12:23.040 each other so that no one could really challenge him 0:12:23.080 --> 0:12:28.280 as a leader, which should sound a little suss. So 0:12:28.440 --> 0:12:32.199 Feldman starts to work on establishing the technical components to 0:12:32.320 --> 0:12:37.280 make Pixelon's business possible. The company built out a server room. 0:12:37.360 --> 0:12:40.920 They established a few co located server spaces and other 0:12:41.000 --> 0:12:44.240 cities because they knew that if they just depended upon 0:12:44.400 --> 0:12:48.000 one centralized server room, they would not really be able 0:12:48.040 --> 0:12:51.480 to provide service across the country, Like there would be 0:12:51.640 --> 0:12:55.960 severe lag and latency issues the further out you got 0:12:56.200 --> 0:13:00.199 from the main server room, so they started to who 0:13:00.280 --> 0:13:05.520 locate servers in other places. There really wasn't any existing 0:13:05.600 --> 0:13:08.640 infrastructure for the company to rely upon, like there were 0:13:08.679 --> 0:13:12.920 no other providers out there that already had established server 0:13:13.040 --> 0:13:16.880 farms where you could lease space in the farms. That 0:13:16.880 --> 0:13:21.679 that that business didn't really exist yet, so they were 0:13:21.800 --> 0:13:25.080 kind of making it up as they go along. Now, 0:13:25.080 --> 0:13:31.319 the company also purchased some extremely expensive video encoding stations, 0:13:31.360 --> 0:13:34.920 so the idea was that users would generate video, they 0:13:34.920 --> 0:13:38.640 would upload it to pixelons servers. Pixelon would then use 0:13:38.679 --> 0:13:43.400 these very expensive encoding stations to encode the video to 0:13:43.520 --> 0:13:46.920 make it suitable for streaming, and then visitors to Pixelon's 0:13:47.000 --> 0:13:50.439 site would be able to watch that video on demand. 0:13:51.280 --> 0:13:54.600 While the engineers were trying to figure out streaming video, 0:13:54.880 --> 0:13:59.040 Michael Finna was planning some pretty massive moves. He was also, 0:13:59.040 --> 0:14:03.000 at least according to Fellman, hurling verbal abuse at various 0:14:03.000 --> 0:14:07.959 pixel On employees over the office's p A system. He 0:14:08.000 --> 0:14:10.400 would get on this p A system and talk about 0:14:10.720 --> 0:14:12.800 people need to go back behind the shed for a 0:14:12.800 --> 0:14:18.040 whooping because they weren't um performing up to his expectations. 0:14:18.080 --> 0:14:23.920 I suppose. He also occasionally would lead mandatory prayer services 0:14:23.960 --> 0:14:26.640 in the office, again something you don't typically see. Some 0:14:26.640 --> 0:14:30.960 folks would later liken a few of his activities to 0:14:31.200 --> 0:14:34.680 that of a cult leader. Now the biggest pr move 0:14:34.760 --> 0:14:37.720 that he made, and it was one that would really 0:14:37.760 --> 0:14:41.920 become the stuff of legends. Was a twelve million dollar 0:14:42.080 --> 0:14:45.040 party some accounts have it as high as like sixteen 0:14:45.040 --> 0:14:48.320 and a half million dollars that was held in Las Vegas, 0:14:48.360 --> 0:14:53.040 Nevada at the MGM Grand Hotel and Casino and it 0:14:53.160 --> 0:14:57.640 was called the Eye Bash Laura case I Big b 0:14:58.200 --> 0:15:01.520 I Bash. By the way, this is you know before 0:15:01.640 --> 0:15:06.720 like iTunes and stuff, So really edgy there, now, y'all. 0:15:07.000 --> 0:15:10.760 I work for I Heart Radio, and I Heart Radio 0:15:10.840 --> 0:15:13.040 really knows how to put on a big live music 0:15:13.080 --> 0:15:16.960 event like they do one every year. I've never been, 0:15:17.280 --> 0:15:21.440 but it's this huge event that happens again in Las Vegas, Nevada, 0:15:21.560 --> 0:15:24.040 and they get huge names on there, so that's not 0:15:24.200 --> 0:15:27.240 that unusual to me. However, if you look at the 0:15:27.280 --> 0:15:33.480 list of performers for Pixilons October debut party, like this 0:15:33.520 --> 0:15:38.440 is their launch party, it really boggles the mind. Let's 0:15:38.480 --> 0:15:41.280 do a quick rundown of some of the acts that 0:15:41.400 --> 0:15:45.600 performed at this insane launch party. Keep in mind we 0:15:45.640 --> 0:15:50.040 are talking about nine because at least one or two 0:15:50.040 --> 0:15:52.600 of the acts you might say, well, that doesn't sound 0:15:52.600 --> 0:15:54.520 like that's that big of a deal. These days you 0:15:54.600 --> 0:15:57.840 might find that person performing at a county fair. Not 0:15:57.840 --> 0:16:01.240 not the same in so up, first up we got 0:16:01.240 --> 0:16:05.560 the Brian sets Or Orchestra, which was desperately clinging on 0:16:05.960 --> 0:16:10.280 to the fading days of the swing revival fad of 0:16:10.320 --> 0:16:13.480 the early to mid nineties dark days. Indeed for some 0:16:13.560 --> 0:16:17.040 of my friends who some of them actually really got 0:16:17.040 --> 0:16:19.840 into swing dancing, so they loved it, but the others 0:16:19.880 --> 0:16:23.760 were like, why did swing come back? Um? There was 0:16:23.800 --> 0:16:27.080 also Tony Bennett, a familiar face on the Vegas scene. 0:16:27.840 --> 0:16:33.040 There was Faith Hill, Leanne Rhymes, Natalie Cole. There was 0:16:33.400 --> 0:16:36.320 Kiss you know, they rock and roll all night and 0:16:36.400 --> 0:16:39.960 party every day. There was Sugar Ray, which all right, 0:16:40.040 --> 0:16:42.880 get your jokes in now. And there were the Chicks. 0:16:43.480 --> 0:16:45.880 Back then they went by the name Dixie Chicks. They 0:16:45.960 --> 0:16:49.800 dropped Dixie in twenty twenty. This was also before they 0:16:49.880 --> 0:16:53.960 raised the ire of certain branches of their fandom when 0:16:54.040 --> 0:16:58.000 they started to criticize certain American military policies in the 0:16:58.040 --> 0:17:03.400 early two thousand's. But Happening Things Off was an incredibly 0:17:03.480 --> 0:17:08.560 expensive reunion of the Who. Big big deal there, I mean, 0:17:08.560 --> 0:17:12.320 the Who are like they're there at that upper echelon 0:17:12.560 --> 0:17:15.520 of rock Star right there, like at Rolling Stones level, 0:17:16.400 --> 0:17:19.679 and the plan was to live cast this party to 0:17:19.840 --> 0:17:24.520 a digital billboard in Times Square, New York. Feldman actually 0:17:24.520 --> 0:17:27.679 requested to be put in charge of making that happen 0:17:27.720 --> 0:17:30.399 because it meant that he could work on a technical 0:17:30.480 --> 0:17:35.040 challenge and more importantly, not be around Michael Finney, whom 0:17:35.080 --> 0:17:39.840 he found to be extremely abrasive. However, he discovered that 0:17:39.880 --> 0:17:44.040 the company's tech just couldn't do it, or maybe it 0:17:44.160 --> 0:17:46.240 was actually on the billboard side of things. They were 0:17:46.320 --> 0:17:50.520 leasing billboard space from a company and maybe that was 0:17:50.560 --> 0:17:53.080 where the problem was. In fact, he said that they 0:17:53.080 --> 0:17:55.080 were not able to figure out what was going wrong. 0:17:55.160 --> 0:17:58.879 They just knew it wasn't working. So instead of streaming 0:17:59.400 --> 0:18:03.399 over the inner Net to this digital billboard, Feldman and 0:18:03.480 --> 0:18:06.600 some other folks were able to set up a satellite 0:18:06.640 --> 0:18:11.320 dish on top of a telephone pole and connect that 0:18:11.359 --> 0:18:13.879 to the digital billboard and use the satellite dish to 0:18:13.960 --> 0:18:18.000 catch the satellite feed of the party and send that 0:18:18.280 --> 0:18:20.879 to the billboards. So, in other words, the video being 0:18:20.880 --> 0:18:23.080 shown on the billboard was not being streamed over the 0:18:23.119 --> 0:18:26.280 Internet at all. It was a satellite feed. See pixelon 0:18:26.440 --> 0:18:30.119 was actually beaming this feed via satellite, so that the 0:18:30.200 --> 0:18:33.360 offices in California would be able to receive the broadcast 0:18:33.880 --> 0:18:36.480 and then stream it. It's just that the streaming part 0:18:37.040 --> 0:18:40.320 wasn't working. Now. On top of that, the plan was 0:18:40.359 --> 0:18:44.720 to make video clips of this party the eyebash, available 0:18:44.760 --> 0:18:48.280 on pixel On the following day, the idea being all right, well, 0:18:48.320 --> 0:18:51.479 you know, well, we're going to cut this up into 0:18:51.560 --> 0:18:56.240 performance sized pieces, upload the videos to the service, and 0:18:56.280 --> 0:18:59.080 then people can watch it later. However, it turned out 0:18:59.119 --> 0:19:02.520 that Michael Finney had not set up the proper contracts 0:19:03.160 --> 0:19:06.200 with the talent to secure the rights to do that, 0:19:06.920 --> 0:19:12.639 and so apparently everyone except maybe Kiss, denied Pixelon permission 0:19:12.680 --> 0:19:17.280 to make available their performances at this party. So the 0:19:17.400 --> 0:19:21.240 twelve million dollar party was largely a bust, at least 0:19:21.240 --> 0:19:25.480 as far as demonstrating Pixelon's technology. Uh. It might have 0:19:25.880 --> 0:19:29.160 got a lot of press, but didn't get a lot 0:19:29.200 --> 0:19:32.120 of movement on the tech front. Now, towards the end 0:19:32.119 --> 0:19:36.840 of nine, Pixelon's investors had had enough of Michael Finney 0:19:36.960 --> 0:19:40.399 as chairman of the company. They felt that he was 0:19:40.440 --> 0:19:43.160 a detriment to the mission. They thought they still thought 0:19:43.160 --> 0:19:45.919 that the company had merit, but that Michael Finney was 0:19:46.160 --> 0:19:49.120 just a destructive force need to be taken care of, 0:19:49.760 --> 0:19:52.399 so they had decided to force him to step down 0:19:52.600 --> 0:19:56.120 from his role at the company. Now, according to Robert Feldman, 0:19:56.560 --> 0:20:00.800 this is when another really bonkers thing happened. Finn A 0:20:00.800 --> 0:20:04.639 apparently hired some armed guards to prevent folks from coming 0:20:04.640 --> 0:20:08.240 into his office. Uh so, really a couple of like 0:20:08.560 --> 0:20:12.480 big beefy bodyguards who at least according to some accounts, 0:20:12.760 --> 0:20:16.639 were armed. Now this was just as the investors were 0:20:16.640 --> 0:20:19.119 supposed to visit the company and convince Michael finn A 0:20:19.240 --> 0:20:22.879 two step down. And Feldman says that after contacting the 0:20:22.880 --> 0:20:26.760 Orange County Police Department, a SWAT team showed up and 0:20:26.800 --> 0:20:29.840 the guards ended up being dismissed. Like it, it didn't 0:20:30.119 --> 0:20:32.920 escalate from there, but it did require the SWAT team 0:20:32.920 --> 0:20:36.040 to arrive. Finn A was on the out skis because 0:20:36.040 --> 0:20:39.960 the investors told him he had to go, and Feldman 0:20:40.040 --> 0:20:43.199 and team rushed to lock finn A out of the 0:20:43.240 --> 0:20:49.200 company systems. Paul Ward would take over s CEO. But y'all, 0:20:50.640 --> 0:20:55.120 things are about to get even more crazy. See Pixelon 0:20:55.240 --> 0:20:58.320 was still trying to get services up and running. But 0:20:59.160 --> 0:21:01.119 just wait, at do we come back from this break, 0:21:01.760 --> 0:21:13.400 things are gonna go super nuts. So I said before 0:21:13.440 --> 0:21:18.399 the break, things were about to go super crazy, fun bonkers, 0:21:19.000 --> 0:21:22.400 and here we go. It turned out that Michael Finney 0:21:23.080 --> 0:21:27.600 wasn't Michael Finney. In reality, he was a man named 0:21:27.840 --> 0:21:32.879 David kim Stanley, or, as one Wired article accidentally put it, 0:21:33.359 --> 0:21:36.520 Paul Stanley. Paul Stanley is in fact a member of Kiss. 0:21:36.640 --> 0:21:39.120 But no, it was not Paul Stanley of Kiss who 0:21:39.200 --> 0:21:43.040 was posing as Michael Finney. It was David kim Stanley. 0:21:43.640 --> 0:21:47.440 Now David kim Stanley had a history of running cons 0:21:47.560 --> 0:21:51.600 and scams. He was a pastor's son. In fact, his 0:21:51.680 --> 0:21:54.160 grandfather was also a preacher, so he was the son 0:21:54.200 --> 0:21:57.480 of a preacher man. He had initially focused on tricking 0:21:57.720 --> 0:22:01.240 parishioners and his father's church out of their money. This 0:22:01.359 --> 0:22:06.879 graduated into an all out general stock fraud scheme and 0:22:07.160 --> 0:22:11.000 he was caught in nineteen nine. He was convicted on 0:22:11.160 --> 0:22:15.480 fifty five counts of fraud related charges, which authorities said 0:22:15.520 --> 0:22:18.840 amounted to around one point two million dollars of ill 0:22:18.920 --> 0:22:23.840 gotten gains. He was sentenced to thirty six years in prison, 0:22:24.400 --> 0:22:27.480 but the judge suspended all but eight years on the 0:22:27.480 --> 0:22:32.040 condition that Stanley repay his victims. So Stanley goes to 0:22:32.080 --> 0:22:35.720 prison for a while. He agrees to this this judgment, 0:22:36.359 --> 0:22:39.120 he's released from jail, and then when it came time 0:22:39.119 --> 0:22:41.520 for him to show up and pay restitution, what do 0:22:41.600 --> 0:22:45.639 you know, he didn't. He skipped town. So nearly a 0:22:45.680 --> 0:22:49.320 decade after his conviction, he would establish himself in California 0:22:49.480 --> 0:22:54.480 under the identity Michael Finney. He recognized pretty early on 0:22:54.800 --> 0:22:58.399 that there was this frantic rush towards funding businesses that 0:22:58.440 --> 0:23:01.359 were built on top of the web, and he knew 0:23:01.359 --> 0:23:04.120 a good opportunity when he saw one. Now, I've said 0:23:04.160 --> 0:23:06.360 this many times in the past, but whenever you've got 0:23:06.359 --> 0:23:11.520 yourself something that people do not fully understand, but they're 0:23:11.560 --> 0:23:14.879 excited about it, it opens up the opportunity for scam 0:23:14.960 --> 0:23:20.439 artists to take advantage of people's ignorance and enthusiasm. In 0:23:20.480 --> 0:23:24.960 the nineties, the web represented exactly that kind of opportunity. 0:23:25.119 --> 0:23:28.159 We see the same stuff happening today with stuff like 0:23:28.240 --> 0:23:31.200 cryptocurrency and n f T s. Now, I don't mean 0:23:31.240 --> 0:23:34.680 to say that all crypto is just a scam, or 0:23:34.720 --> 0:23:37.959 even that all n f T s are a scam. 0:23:38.000 --> 0:23:40.680 But what I am saying is that when people are 0:23:40.760 --> 0:23:44.760 eager to pour their money into something they don't fully comprehend, 0:23:45.520 --> 0:23:48.080 there will be plenty of other folks who are just 0:23:48.200 --> 0:23:52.359 willing to take said money. And Finney was one of 0:23:52.400 --> 0:23:56.320 those folks. Now, to his credit, he did actually put 0:23:56.359 --> 0:23:59.159 together a team of engineers who were legitimately trying to 0:23:59.240 --> 0:24:02.640 make the vision of Pixelon work, even if they ended 0:24:02.720 --> 0:24:07.000 up leaning very heavily on other companies products to do it. Now, 0:24:07.040 --> 0:24:09.400 this kind of makes me think of para no nos. 0:24:09.920 --> 0:24:12.600 I get the feeling that Elizabeth Holmes had a fairly 0:24:12.640 --> 0:24:15.960 good idea towards the end, that her vision of a 0:24:16.000 --> 0:24:19.320 device capable of running more than a hundred medical tests 0:24:19.320 --> 0:24:23.880 on the tiniest drop of blood wasn't really likely, maybe 0:24:23.920 --> 0:24:28.399 not even possible. Uh. She certainly didn't know how to 0:24:28.480 --> 0:24:32.040 make it actually happen, but she did have a whole 0:24:32.040 --> 0:24:35.800 company filled with engineers who were trying really hard to 0:24:35.920 --> 0:24:39.600 make that vision come true. They just couldn't do it. Now, 0:24:39.600 --> 0:24:42.800 I feel like Pixelon was in a similar place, only 0:24:43.880 --> 0:24:47.639 maybe Elizabeth Holmes might have been a bit more sincere 0:24:47.800 --> 0:24:51.280 in her initial effort. Maybe her earliest days were based 0:24:51.280 --> 0:24:55.479 more on naivete rather than you know, just a cold 0:24:56.600 --> 0:25:00.840 calculated approach to scamming people out their money. But finn 0:25:00.840 --> 0:25:04.399 a slash Stanley feels like it was more on the 0:25:04.800 --> 0:25:07.760 let's get as much cash as we can approach. I 0:25:07.800 --> 0:25:11.439 don't know. Maybe Finney believed it too. But eventually authorities 0:25:11.440 --> 0:25:14.399 in Virginia sussed out that the Michael Finney in California 0:25:14.600 --> 0:25:18.320 was in fact the David Kim Stanley who was wanted 0:25:18.320 --> 0:25:21.639 in places like Virginia and Tennessee. So they called him 0:25:21.720 --> 0:25:24.360 up and they told them they were onto him, and 0:25:24.520 --> 0:25:28.120 he would subsequently turn himself into the authorities. Now, as 0:25:28.119 --> 0:25:31.120 you might imagine, this sent some shock waves through Pixelon, 0:25:31.280 --> 0:25:34.840 even though he had already left Pixelon or been forced 0:25:34.840 --> 0:25:38.159 to leave. Finding out that your founder wasn't who he 0:25:38.200 --> 0:25:41.160 said he was is a bit surprising. I'm pretty sure 0:25:41.240 --> 0:25:43.639 that at least some people were not surprised that he 0:25:43.680 --> 0:25:46.480 had been involved in illegal stuff, but they might have 0:25:46.520 --> 0:25:49.480 been surprised to learn that he wasn't Michael Finney. Now, 0:25:49.480 --> 0:25:53.919