Speaker 1: Alson Media.
Speaker 2: Welcome Jacob app and here a podcast featuring a sound
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Speaker 3: This is not a visual podcast unless you have like
Speaker 3: setastesia and you could like start hearing seeing the strobe
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Speaker 4: Wish that was me?
Speaker 2: Yeah, So that that's Garrison. I'm the We're back again.
Speaker 2: We're back again for a dissented to hell. Yeah. So,
Speaker 2: last episode we talked about Colin Wang and the rise
Speaker 2: of PDD, which is China's second largest shopping app and
Speaker 2: the Chinese version of the app, Temu. So we're now
Speaker 2: in the post Colin Wang era, an era I think
Speaker 2: actually might be worse than the original era, which is
Speaker 2: kind of stunning. But you know, here we are, Here
Speaker 2: we are, and this era actually starts really well for PDD.
Speaker 2: This is like twenty twenty one. China's lockdowns are actually
Speaker 2: incredible for PDD because, as we talked about last episode,
Speaker 2: pdd's strategy is group shopping, right. It's about getting a
Speaker 2: bunch of people to buy things together to make it cheaper,
Speaker 2: this thus pulling in more in our customers. Now, China
Speaker 2: had real lockdowns and in a real lockdown. This is
Speaker 2: increasingly how people got food. You know, the strictness of
Speaker 2: the lockdowns very across, like depending on what province you're in, right,
Speaker 2: But so like my family was an inner Mongolia and
Speaker 2: an inner Mongolia in like the first lockdowns, you could
Speaker 2: send you could only send one member of your family
Speaker 2: outside per week to like, you know, to go get groceries.
Speaker 2: Otherwise everyone else fed all times has to stay indoors.
Speaker 2: And this meant that people started pulling together to like
Speaker 2: all buy groceries and then sending one person out to
Speaker 2: like go pick up the delivery. And this this ingrained
Speaker 2: PDDs like fundamental strategy of like buying into the into
Speaker 2: the consciousness of the Chinese public because they've just been
Speaker 2: doing it for like a year, right, and as twenty
Speaker 2: twenty for a word on PDD like skyrockets, this this
Speaker 2: is this the period from like twenty twenty to like
Speaker 2: twenty twenty four has been the period where pdd's grown
Speaker 2: them most. I mean it was already pretty big before then,
Speaker 2: but now you know, it's it's now like the main
Speaker 2: competitor of Alibaba. It was like the previously unassailable like
Speaker 2: online shopping giant the company grew so much that it
Speaker 2: forced the other like shopping companies to get into the
Speaker 2: fruit market because it was like clobbering them there so badly.
Speaker 2: So yeah, it was wild. But then a bunch of
Speaker 2: absolutely terrible stories broke about PDD in both the Chinese
Speaker 2: and American press. So we're gonna start with the stuff
Speaker 2: that's I guess less bad, and then it's gonna get worse.
Speaker 2: So question number one is the PDD at malware. All right,
Speaker 2: we're just really jumping right in here. Oh, this is
Speaker 2: this is the mild it, this is the Are we
Speaker 2: allout to say this legally? Yeah? It's well, here's the thing.
Speaker 2: So Google play removed the app from its playstore. Oh okay,
Speaker 2: so all right, so so okay, we we need to
Speaker 2: be very specific about we're talking it's too bad for Google,
Speaker 2: that it's probably too bad for you. Yeah, so very specifically,
Speaker 2: this is we're the thing we're talking about right now
Speaker 2: is not Temu. We're talking specifically about the Chinese version
Speaker 2: of the app PDD. And this was released on the
Speaker 2: Google Play Store in like the mid twenty the mid
Speaker 2: early like like I think it's like twenty twenty one
Speaker 2: or something and okay, so this again and to be
Speaker 2: clear again this is not Temu. This is specifically the
Speaker 2: Android version of PDD. And this is interesting too because
Speaker 2: so most people in China like don't use Android for
Speaker 2: you or sorry, they don't. They don't. They don't use
Speaker 2: Google Play, right, like they don't that that's not like
Speaker 2: the App store where they get their apps from. So
Speaker 2: when PDD released, like their app on the app store,
Speaker 2: this is this is them specifically going to the Western market.
Speaker 3: And did they have infrastructure set up in the States
Speaker 3: to support this type of like drop shipping or like
Speaker 3: how do this?
Speaker 2: Yeah, we'll get into it.
Speaker 3: It was like kind of later a little bit like
Speaker 3: gig economy stuff in China. But how how are they
Speaker 3: going to move that FedEx? Okay, yeah, right, well we'll
Speaker 3: get into that more later. We're talking about Timbo.
Speaker 2: This first one didn't like it didn't have that many
Speaker 2: users because it was just like the Chinese app. But
Speaker 2: like here, okay, so okay, there's something we also we
Speaker 2: need to get out of the way first, which is
Speaker 2: that there's like a massive panic in the US about
Speaker 2: Chinese apps being like Chinese government trojan horses, like especially TikTok.
Speaker 2: So unfortunately, before we start this, we have to sort
Speaker 2: out kind of well, like you have to make a
Speaker 2: judgment about what level of app surveillance is, like the
Speaker 2: level of apps surveillance you get in the US, because
Speaker 2: all of your apps are spying on you, and then
Speaker 2: what is like above and beyond the like quote unquote
Speaker 2: normal level spying and like TikTok is TikTok is unbelievably invasive, right,
Speaker 2: Like it is true, it's a privacy nightmare, but like
Speaker 2: so are most apps, Like TikTok's worse than normal, but
Speaker 2: it's not.
Speaker 3: That TikTok is by the Chinese communists.
Speaker 2: So this is something we're gonna get into. And this
Speaker 2: is this is true with pdu too. The US actually
Speaker 2: gets like the stripped down, cucked not as bad version
Speaker 2: of Chinese apps, like TikTok does not have a bunch
Speaker 2: of the like integration stuff that that Doyen, the Chinese
Speaker 2: like version of it has. We're like Douyen has this
Speaker 2: thing where like I guess Google's kind of doing it now,
Speaker 2: but like you can directly, like like an influencer can
Speaker 2: hold up a product and you could tap the product
Speaker 2: and go buy it. Google is trying to do that now. Yeahah,
Speaker 2: but China had that, like like Douyan's had that for
Speaker 2: like ages. Right, It's like so like the versions of
Speaker 2: the apps that we get here are actually less bad
Speaker 2: than the Chinese ones, which makes the whole panic so
Speaker 2: funny to me. It's like no, no, no, like they're
Speaker 2: sending you like a better version of the app, Like, well.
Speaker 3: That's because what Uncle Sam calls in our version, we
Speaker 3: have to take out all of the maoist influences, I
Speaker 3: don't know whatever whatever.
Speaker 2: All right, all right, so you know, look like so
Speaker 2: we have to we have to sort out of the
Speaker 2: difference between stuff that's just like the weird moral panic
Speaker 2: and what what's actually malware. So CNN did an investigation
Speaker 2: of this app. So originally there was a Chinese company
Speaker 2: that a Chinese security company was looked at this app
Speaker 2: and was like they're using a bunch of Android exploits,
Speaker 2: like they're like they're using like they're there, they're effectively
Speaker 2: hacking your phone, right, They're they're they're they're deploying a
Speaker 2: bunch of exploits of things that are like broken in
Speaker 2: in like in Android and allowing you like this, like
Speaker 2: lesson do stuff and I was supposed to be able
Speaker 2: to do And so CNN brought in a bunch of
Speaker 2: different security like analysts and like they brought in security
Speaker 2: companies like look at it, and here's what they found.
Speaker 3: Well, I don't know if you'd trust this. C it
Speaker 3: ed they're literally called the Communist News Network.
Speaker 4: Quote.
Speaker 2: The app was able to continue running in the background
Speaker 2: and prevent itself from being uninstalled, which allowed it to
Speaker 2: boost its monthly active rate. Hype on it. I don't
Speaker 2: know how pronounce this guy's name. I'm so sorry this guy.
Speaker 2: This guy's this guy's name has an umlot over the oh.
Speaker 2: I'm an expert at pronouncing foreign names. Give it to me.
Speaker 2: It's h y pp umlot o n e n good luck.
Speaker 2: You know what.
Speaker 3: I'm just gonna take a I'm gonna sabbatico.
Speaker 2: He put in I'm so sorry to this guy, who
Speaker 2: I think is fine. This guy's security analyst said it
Speaker 2: also had the ability to spy on competitors by tracking
Speaker 2: activity on other shopping apps and getting information from them.
Speaker 2: He added toshin, which is like another guy found PDD
Speaker 2: two have exploited about fifty Android system vulnerabilities. Most of
Speaker 2: these exploits were tailor made for customized parts known as
Speaker 2: original Equipment manufacturer code, which tends to be audited less
Speaker 2: than ASoP, which is like another kind of code and
Speaker 2: therefore prone to more more vulnerabilities. He said PDD had
Speaker 2: also exploited a number of AOSP vulnerabilities, including one that
Speaker 2: was flagged by Totioniin to Google in February twenty twenty two.
Speaker 2: Google fixed this bug in March. He said, I've never
Speaker 2: seen anything like it. It's like super expansive. Cergy Totionin,
Speaker 2: android security expert, he's the guy I said that. Sorry,
Speaker 2: I've never seen and Android Tracin said, I've never seen
Speaker 2: anything like this. It's like super expansive. According to Tosin,
Speaker 2: the exploits allowed PDD to access users location contacts, calendars, notification,
Speaker 2: and photo albums with ot their consents. They were also
Speaker 2: able to change system settings and access users social media
Speaker 2: accounts and chats. He said, now that is pretty bad.
Speaker 2: Will I will mention that like a lot of your
Speaker 2: normal apps can also do shit like that. Yeah, like
Speaker 2: that's stuff that you can get out of, like Google,
Speaker 2: but some it's not good. The other thing that they
Speaker 2: were doing is they're doing these things called privileged escalation
Speaker 2: attacks where they're trying to get like a higher level
Speaker 2: of privileged on the system so they can run code
Speaker 2: and not supposed to be able to. So you know
Speaker 2: how like sometimes when you're running something at a computer,
Speaker 2: you have to run it as admin so the thing
Speaker 2: actually works. Yeah, like Discord, Yeah, I actually Discord. I've
Speaker 2: been trying to stream Alan Wake two to my friends
Speaker 2: and oh my god, it has been such a nightmare.
Speaker 2: I'm gonna personally write the CEO of Discord a letter.
Speaker 2: And yeah, but like so like so there they're they're
Speaker 2: like the way the system security works is there's certain
Speaker 2: levels of users that are allowed to do certain things
Speaker 2: and certain people who aren't, and this is supposed to
Speaker 2: stop people from running malicious code. And so they're doing
Speaker 2: these privileged escalation attacks where they're trying to be able
Speaker 2: to like do stuff that only admins can do. And
Speaker 2: so I showed this to so I was trying to
Speaker 2: get a gauge on how much of this is real
Speaker 2: and how much of this is insane, And so I
Speaker 2: showed I showed it to my friend who's a software engineer,
Speaker 2: and he was like, what the fuck? So this is
Speaker 2: this is very tytyfically the privileged escalation attacks on the
Speaker 2: and the attack on the like the original Equipment manufacturer
Speaker 2: code like the OEM stuff. That's just not normal, Like
Speaker 2: that is that is actual malware. That is like not
Speaker 2: that is not normal app bullshit that like this thing
Speaker 2: is trying to hack your phone. So in twenty twenty three,
Speaker 2: the like Google pulled the app from the store because
Speaker 2: everyone was like, what the fuck. Wait, this is just
Speaker 2: literally malware. I'm gonna so so what were they trying
Speaker 2: to do? Here's CNN again. It was in twenty twenty,
Speaker 2: according to a current PDD employee, that the company set
Speaker 2: up a team of about one hundred engineers and product
Speaker 2: managers to dig for vulnerabilities and Android phones, develop ways
Speaker 2: to exploit them, and turn that into profit. According to
Speaker 2: the source, who requested anonymity for feear of for fear
Speaker 2: of reprisals, the company only targeted users in rural areas
Speaker 2: and smaller towns initially, while of winning users in megacities
Speaker 2: such as Beijing and Shanghai. The goal was to reduce
Speaker 2: the risk of being exposed, they said, by collecting expansive
Speaker 2: data on user activities, the company was able to create
Speaker 2: a comprehensive portrait of the users habits, interests, and preferences.
Speaker 2: According to the source, this also allowed it to improve
Speaker 2: its machine learning model to offer more personalized push notifications
Speaker 2: and ads attracting users to open the app and place orders.
Speaker 2: They said, so this all makes perfect sense with like,
Speaker 2: how we know that PDD operates right, Like, you know,
Speaker 2: they're trying to build detailed profiles or rural customers they
Speaker 2: can serve the more efficient ads, and they're doing it
Speaker 2: by apparently just straight up running an in house hacking team.
Speaker 2: I got pretty large one. Oh so they supposedly that
Speaker 2: team got like acted and they don't do it anymore.
Speaker 2: But who knows. So, Okay, this is not even close
Speaker 2: to the most batshit thing that PDD gets up to. Okay,
Speaker 2: we're going to escalate up the how weird this stuff is.
Speaker 2: So one of the things that that PDD has a
Speaker 2: six tonech reporting is that they have these really strict
Speaker 2: non compete clauses that prevent people from like, so if
Speaker 2: you take a job here and you get fired or
Speaker 2: eat like you leave, you can't take another job at
Speaker 2: a tech company for like years this is like fucking
Speaker 2: like any tech company, like fucking like I don't know,
Speaker 2: they're they're really expensive, like fucking like setting up your
Speaker 2: grandma's website like might get you trouble. It's like it's
Speaker 2: it's a real disaster. We have these in the US too,
Speaker 2: and they absolutely suck. So I think there was a
Speaker 2: ruling about them FTC ruling to ban them recently. Maybe
Speaker 2: Oh no, they're proposed, it hasn't gone through yet, trying
Speaker 2: to get rid of them. But yeah, they're they're in
Speaker 2: the US two. But these ones are really strict and
Speaker 2: apparently they're like PDD is really aggresive about it to
Speaker 2: the point where like people people will take other jobs
Speaker 2: under fake identities and like pdd's HR will like track
Speaker 2: them down. Oh wow, yeah, Like they're they're like headhunting
Speaker 2: these people, well like like inverse head hunt, Like they're
Speaker 2: they're like they're they're literally just hunting down people trying
Speaker 2: who are trying to get like jobs, right, And this
Speaker 2: apparently led people to adopt secret identities to like hide, right,
Speaker 2: And so this GIDS is something I I did not
Speaker 2: believe the first time I read it, which is that
Speaker 2: apparently and I regentally read this in n K, who
Speaker 2: is usually reliable. But I read this and I was like,
Speaker 2: no way.
Speaker 4: Uh.
Speaker 2: The thing that they said was that employees at work,
Speaker 2: like who work for PDD apparently use pseudonyms and like
Speaker 2: never tell each like almost never tell each other they're
Speaker 2: actual names. That's I mean, that makes sense. Uh. And
Speaker 2: apparently also they're banned from like like the information level
Speaker 2: of information control is so strict that like you can't
Speaker 2: you're not allowed to know what like the structure of
Speaker 2: another work group is. And like I read this, I
Speaker 2: was like, I don't believe this right, And then I
Speaker 2: started running it into like other outlets like Financial Times,
Speaker 2: was like yeah, no, no, apparently they they talked to
Speaker 2: they talk to people who work for the company. They're like, yeah,
Speaker 2: everyone uses pseudonyms. I didn't fucking know anyone's real name
Speaker 2: or like there was like one person who's real name
Speaker 2: that I know wild. I don't know why they do.
Speaker 2: I've never seen I've literally never seen this before with
Speaker 2: any company. It's it's fucking nuts. I got nothing. Yeah,
Speaker 2: I do you know who? No one had this company
Speaker 2: knows my real name. So that's true. I do actually
Speaker 2: operate by a pseudonym. Yeah, that's pretty funny.
Speaker 3: That is not like a sizable portion of the cool
Speaker 3: Zone media team.
Speaker 2: But all of us are fake names. Robert Evans, that's
Speaker 2: not Robert Evans, real Robert Evans was the producer of
Speaker 2: that movie. Yeah yeah, yeah, yeah yeah.
Speaker 3: Anyway, do you know who also has trustworthy names that
Speaker 3: you can trust these products?
Speaker 4: Woo so true?
Speaker 3: Jeff, Wow, that was a really funny joke.
Speaker 2: Bill. Oh, we're back. Sorry.
Speaker 3: I was just talking to the two fake fake name
Speaker 3: people who are listening on our call right now.
Speaker 2: Me I continue. So this is where we get to
Speaker 2: the truly bleak stuff. So all right, In twenty twenty one,
Speaker 2: one of pdd's employees in shing John just worked worked
Speaker 2: a shift, came home, and the dis straight up fucking
Speaker 2: died in her bed from overwork. This this was a
Speaker 2: you know, this very quickly turns into a giant media
Speaker 2: thing because this woman like she's in she's in really
Speaker 2: good health and she just fucking is worked so hard
Speaker 2: that she lays down in her bed dies. Then a
Speaker 2: worker who posted a video of an ambulance outside of
Speaker 2: pdd's headquarters with the caption another brave warrior of PDD
Speaker 2: has fallen, which great caption, terrible situation, great caption. He
Speaker 2: gets fired for it, and then very quickly like after that,
Speaker 2: so they have like a the company has like a
Speaker 2: Q and a thing like if effectively, what happens is
Speaker 2: someone responds to like one of their social media accounts
Speaker 2: with and asks them what do you think of the
Speaker 2: PDD worker who died after working overtime? Should PDD bear responsibility?
Speaker 2: Their corporate responded and I quote, look at those in
Speaker 2: the underclass who isn't exchanging life for money. I never
Speaker 2: thought that this is a problem of capital, but as
Speaker 2: a problem of this society. We live in an era
Speaker 2: where we spend our whole lives working hard. You can
Speaker 2: choose a comfortable life if you accept the consequences of
Speaker 2: comfortable living. People control how much effort they make. Everyone does.
Speaker 3: I can't believe there's people who genuinely like advocate that
Speaker 3: China is a like communist country. So strange, that's insane.
Speaker 3: They're only talking like God, this is.
Speaker 2: This is like this, and this is like and this
Speaker 2: is like this is one of the things that like
Speaker 2: I just like, I don't know, like I just can't
Speaker 2: fucking get over this. Ship because like, I have a
Speaker 2: bunch of fucking family in China, and you know, do
Speaker 2: they fucking quote Karl Marx, No, they quote Steve Jobs
Speaker 2: because they're all these like fucking insane entrepreneur bullshit, like
Speaker 2: like fucking literally like Ryan Set like straps, Yeah, it's insane.
Speaker 2: It's like, no, it's just your fault that you work
Speaker 2: too hard. This is actually labor's fault and not capital.
Speaker 2: Like this, this fucking blew up in the Chinese media
Speaker 2: and people got like people got really fucking pissed, and
Speaker 2: p d D at first was like, no, this is
Speaker 2: a fake post. We never did it. And the people
Speaker 2: were like, no, no, it's not this is we found
Speaker 2: the post. Right, they take they take it down, people
Speaker 2: like had saved screenshots and eventually the company was forced
Speaker 2: to admit that it was actually their account, but then
Speaker 2: they said that it was a social media contractor who
Speaker 2: put it on the corporate account. Quote by mistake.
Speaker 3: Oh sure, sure, yeah, that's like that. That's like me
Speaker 3: when I searched my twin peaks not safe for work,
Speaker 3: uh fan art on the coolest media account. It was
Speaker 3: a mistake, guys, didn't mean didn't didn't mean to post
Speaker 3: it there. I don't know how that happened, it got
Speaker 3: it got past the VODs. I don't know how.
Speaker 2: Yeah, and you know, people, people understandably are not happy
Speaker 2: like and that. And eleven days later, a PDD employee
Speaker 2: jumps off a fucking building again, also because they've been
Speaker 2: worked so hard. And this is where we need to
Speaker 2: talk about pdd's labor conditions, because they are fucking appalling.
Speaker 2: Here's sixth Tone. A former PDD employee who left the
Speaker 2: company a year ago told sixth Tone under conditions of anonymity,
Speaker 2: that excessive work hours are common practice. Around eight months
Speaker 2: after he joined PDD in early twenty nineteen. He said
Speaker 2: employees were told they need to work at least three
Speaker 2: hundred hours per month, amounting to nearly twelve hours per day,
Speaker 2: six days a week. We're going to get more into that.
Speaker 2: That's a schedule called nine niney six, where you work
Speaker 2: from nine am to nine pm, six days a week.
Speaker 2: This is incredibly common and try This is actually a
Speaker 2: good schedule. In a lot of Chinese work environments, it
Speaker 2: can get way worse than that. Here's another quote from
Speaker 2: that six Tone article. The company cares a lot about
Speaker 2: our work hours. It has become company culture. Even if
Speaker 2: staff is finished working, if they'll just stay in the office.
Speaker 2: I was one of the lucky ones. I only had
Speaker 2: to work from eleven am to ten pm, and my
Speaker 2: manager was nice to me. This person added that employees
Speaker 2: arriving after eleven am would have their daily wages docked
Speaker 2: by three hours. It's fucking insane. It's it's nightmarish. That
Speaker 2: same worker talked about how she would like and this
Speaker 2: is this is the thing that's like you see you
Speaker 2: see this a lot of different accounts, is that people
Speaker 2: would just literally break down crying at their desks because
Speaker 2: they had so they were so overworked. Are these like
Speaker 2: office jobs? These are workers, These are tech workers. These
Speaker 2: are fucking tech workers. Like right, these are the fucking
Speaker 2: bougie tech jobs.
Speaker 3: They're not like because they're getting over like a factory
Speaker 3: or like an Ama warehouse tech workers.
Speaker 2: And this this is the thing about this, right, is
Speaker 2: that like we we only we don't like there hasn't
Speaker 2: been okay. So the Chinese media, this actually like becomes
Speaker 2: a huge thing in the Chinese media is that these
Speaker 2: people are dying. There was another There's also around the
Speaker 2: same time, a delivery driver lit himself on fire like
Speaker 2: as a protest for like the amount of shit that
Speaker 2: he had to deal with. And this was a big,
Speaker 2: like a huge thing in the Chinese media, but almost
Speaker 2: all of the reporting and the coverage and stuff like
Speaker 2: that was about the tech workers. But like, fucking so
Speaker 2: many people work schedules that are worse than nine ninety six, right,
Speaker 2: Like that is a that is a that is a
Speaker 2: tech workers schedule, right, there are a lot of places
Speaker 2: where people were fucking way worse shit. The sort of
Speaker 2: countervailing force to it is people who, like you know,
Speaker 2: we talked about this kind of in the Lying Flat episodes.
Speaker 2: It's people working for like one day and then eating
Speaker 2: just like plain rice with some like whatever, fucking the
Speaker 2: cheapest thing they can finally they can fucking get out
Speaker 2: of it, and not working for two more days and
Speaker 2: working another day. But like it's it's so bad, like
Speaker 2: the little labor conditions are just appalling, and you know,
Speaker 2: like a bunch of stories sort of started coming out
Speaker 2: about how bad PDDs like conditions are. There was one
Speaker 2: on we chat that broke that I saw via six
Speaker 2: tone about the toilet situation in pdd's largest office building.
Speaker 2: So this building has one thousand people per floor. It
Speaker 2: has eight total bathrooms per floor one thousand people. They
Speaker 2: don't even have one bathroom for every hundred people.
Speaker 3: How does this even function? I mean, like I suppose
Speaker 3: it just doesn't. People are like pea like people.
Speaker 2: People fucking like you don't eat in the morning, or
Speaker 2: you try to hold out to lunch when you can
Speaker 2: run to a different building and try to use the
Speaker 2: bathrooms there, but like you know, you're trying to hold
Speaker 2: it all day, or you just yeah, where you fucking
Speaker 2: do that? You go, you use your lunch time instead
Speaker 2: of eating to fucking go somewhere else. You starve yourself.
Speaker 2: There are like there's a bunch of reports of guys
Speaker 2: just like shitting in urinals because there just literally wasn't
Speaker 2: time for them to fucking actually like use a stall.
Speaker 2: So they're just like they're they're just like they're they're
Speaker 2: pooping in urinals. Maybe the worst picture I've ever seen
Speaker 2: in my entire life is this is going to be
Speaker 2: the episode our PDD started installing timers over the toilets
Speaker 2: to show how long how long people had been there,
Speaker 2: So there's just like a like a a fucking clock
Speaker 2: over you that starts when you when you fucking close
Speaker 2: the door to try to get people to go to
Speaker 2: the bathroom faster. It is just appalling the conditions. And again,
Speaker 2: these are the conditions of like the office workers. It's
Speaker 2: apocalyptically bad. So I realized when I was researching this
Speaker 2: story that I actually ran into PDD earlier, because I
Speaker 2: I so like, way before I did this story, I
Speaker 2: hadn't looked into TAMU at all, and I realized that
Speaker 2: I had. I had ran into PDD earlier when I
Speaker 2: was tracking the story about UH tech workers banding together
Speaker 2: to like basically like on GitHub, these these office workers,
Speaker 2: like tech workers, like made a giant spreadsheet where everyone
Speaker 2: would document their hours and like their pay scales and stuff.
Speaker 2: And it was like, you know, it was this sort
Speaker 2: of like you know, it was it was this thing
Speaker 2: to like demand better labor conditions. Actually I'm pretty I'm
Speaker 2: pretty sure they were actually demanding like the workplace democracy too.
Speaker 2: It was pretty wild. But the thing that you get
Speaker 2: out of that is that PDD has the worst the
Speaker 2: worst hours of any tech company. They are. PDD is
Speaker 2: so bad. The other Chinese tech companies got worse in
Speaker 2: order to compete with them.
Speaker 4: Yeah.
Speaker 3: That is the the whole hard thing about setting the
Speaker 3: bar so low is that it allows other people to
Speaker 3: lower their own bars. Yeah yeah, and it makes just
Speaker 3: every everybody worse.
Speaker 2: Yeah, And again, like I can't emphasize enough the extent
Speaker 2: to which these are the office workers, right, Like, these
Speaker 2: are the people who are making the best money out
Speaker 2: of this, who are treated better than like the funking
Speaker 2: factory workers and the fucking like people in the rural
Speaker 2: areas like fucking doing farming.
Speaker 1: Right.
Speaker 2: But again we don't we don't know a huge amount
Speaker 2: about what those workers' lives are like because they're not
Speaker 2: urban tech workers. And urban tech workers can get their
Speaker 2: stories into the press, but like you know, migrant migrant
Speaker 2: factory workers, rural workers, there's you know, there's just not
Speaker 2: the kind of attention that you can get out of
Speaker 2: a big story about like an urban office building. And
Speaker 2: you know, I mean, these labor conditions are so bad
Speaker 2: that people are just straight up fucking dying. And the
Speaker 2: Chinese government eventually gets involved, like they're there, they're their
Speaker 2: version of the Streame Court eventually rules that like working
Speaker 2: people twelve hours a day, six days a week, is illegal,
Speaker 2: but it doesn't really matter, like a lot of those
Speaker 2: people still have those same schedules. Yeah, and you know
Speaker 2: and like this this is not a this is not
Speaker 2: a problem that can be solved just by like court rulings. Right,
Speaker 2: So yeah, it's it's really fucking bad. We're gonna we're
Speaker 2: gonna take an ad break. I don't I don't have
Speaker 2: a good transition out of that ship. And we're back.
Speaker 2: So all of this brings us to Temu And it's
Speaker 2: slogan shop like a billionaire.
Speaker 3: So, oh god, this the slogan. It's so it's like
Speaker 3: it evokes like a like a nauseous reaction in me.
Speaker 3: It's so it epitomizes everything that is wrong about our
Speaker 3: current way of living and the way we idealize the
Speaker 3: rich and put them on this like pedestal for how
Speaker 3: you should live your life, but also knowing that you
Speaker 3: will never actually be there. Yeah, this is this is
Speaker 3: this is as close as you're going to get.
Speaker 2: And it's it's it's also a thing where like it's
Speaker 2: it's a completely unreal lit like it's if that's this
Speaker 2: is a billionaire shop like billionaires. So it's not like
Speaker 2: you think those people fucking shop like no, No, they don't.
Speaker 3: They have they have over over like saving three dollars
Speaker 3: on on like a mango.
Speaker 2: You're like, no, yeah, like what the fuck are you
Speaker 2: talking about? Yeah? So yeah, like I I hate it.
Speaker 2: I hate it so fucking much.
Speaker 4: You know.
Speaker 2: So, as we said, like this is the time. It
Speaker 2: is the American version of PDD. If you're in the US,
Speaker 2: you've probably seen tim owas. Apparently they're not that many
Speaker 2: of them in like other countries, Like I have British
Speaker 2: friends who are just like, what the fuck are you
Speaker 2: talking about me? And I've never heard of TIMMU.
Speaker 3: Before the super Bowl, for whatever it's worth.
Speaker 2: The big place where they were advertising was YouTube. But
Speaker 2: if you're watching YouTube without an app blocker, don't I can.
Speaker 2: I don't know if I can legally recommend you probably
Speaker 2: probably that phone I can get it. It's an app.
Speaker 2: I don't do it. I don't know if it may
Speaker 2: be legal, it may not be. I can't say I
Speaker 2: will never advocate breaking the law.
Speaker 3: No, definitely buy utube. Yeah yeah, yeah, that's definitely the
Speaker 3: way to go. Absolutely, But you know, like they okay,
Speaker 3: like most famously yeah, yea, as you're saying, like, so
Speaker 3: they spent twenty seven million dollars buying three Super Bowl ads.
Speaker 3: It's all the same ad and it sucked. But you know, okay,
Speaker 3: this is only a fraction.
Speaker 2: Of their fucking budget.
Speaker 3: Right.
Speaker 2: Here's from the Wall Street Journal quote. Ten MoU's marketing
Speaker 2: budget reached one point seven billion dollars in twenty twenty three,
Speaker 2: and that figure will grow to nearly three billion in
Speaker 2: twenty twenty four. JP Morgan's analyst estimate. Last year, ten
Speaker 2: MoU's marketing spending contributed to an average loss of seven
Speaker 2: dollars per quarter, according to Goldman Sax estimates. They are
Speaker 2: buying so many ads they are literally driving other companies
Speaker 2: out of the ad market. LIKETCCO has been talking about
Speaker 2: how they can't afford to run ads because ads are
Speaker 2: getting too expensive, because they're buying so many fucking ads.
Speaker 2: Here's Reuter's quote. US companies dependent on commercial spending or
Speaker 2: spending on commercials, not.
Speaker 3: Yeah, commercial spending. They are buying commercials yeah yeah.
Speaker 2: Like Facebook, they say Meta, I refuse to fucking call
Speaker 2: that company Beta, like fuck that shit. Their Facebook are
Speaker 2: being saved by Chinese retailers like Temu and Sheian. They
Speaker 2: represent ten per those two companies, just Temu and she
Speaker 2: In represent ten percent of Meta's revenue last year. The
Speaker 2: Facebook owners said, so Temu is hemorrhaging money right now
Speaker 2: in order to do this right, JP Morgan thinks they're
Speaker 2: losing three billion a year. But they also project and
Speaker 2: to be fair, these projections, these projections are wrong so
Speaker 2: many of the time, of so much of the time,
Speaker 2: but they're projecting the ten will be making three point
Speaker 2: five billion a year in twenty twenty seven. And all
Speaker 2: of this raises the question why, and to answer that,
Speaker 2: we need to get into Chinese development economics. So the
Speaker 2: Chinese economy has a problem, and this is a problem
Speaker 2: that the CCP is known about for a long time.
Speaker 2: It's the problem of turning a sort of like a
Speaker 2: low on the value chain like manufacturing economy, to a
Speaker 2: consumption driven economy. Now, the problem with transitioning into a
Speaker 2: consumption driven economy is that people don't have enough money
Speaker 2: to boost consumer demand. The Marxist way of saying this
Speaker 2: is that under capitalism, both output and consumption are double
Speaker 2: determined by your wage. Right, your wage determines both firm
Speaker 2: output and also how much you can consume. Right in
Speaker 2: non Marxist terms. Oh no, no one has enough money
Speaker 2: to buy things. They did you consumer economy by brother
Speaker 2: in Christ. You set the wages. Okay, where are the fuck? Yes,
Speaker 2: where the fuck are these people supposed to be getting
Speaker 2: money from to buy your shit if you won't give
Speaker 2: them more money? Like wait, wait, wait, So you know
Speaker 2: you can't do this by just making them like work
Speaker 2: more hours. You know, you can work people for like
Speaker 2: twelve fifteen, like twenty hours a day, but there's only
Speaker 2: twenty four hours a day. Like, there's an actual definite
Speaker 2: there's an actual definite limit to the amount of exploitation
Speaker 2: you can do via increasing labor hours. This is this
Speaker 2: has always been capitalism's problem, right, Like the sort of
Speaker 2: rapacity of capitalism has hit the secular limit of time itself.
Speaker 2: So the solution to this is to expand into new
Speaker 2: markets where consumers have more money, which is to say
Speaker 2: the US. So PDD initially targeted like poor rural Chinese workers, right,
Speaker 2: and this is kind of the same group that Temu
Speaker 2: was targeting in the now. In the US, their initial
Speaker 2: base is people who like buy from dollar stores, but
Speaker 2: they've been spreading rapidly. Temu has outpaced she in to
Speaker 2: become the second largest shopping app in the US. But
Speaker 2: the important thing really, yeah, yeah there's second behind an Amazon. Yeah,
Speaker 2: they're they're destroying she in Like, wow, yeah, I did
Speaker 2: not know they were that popular. Yeah, I mean like
Speaker 2: estimates are like, well, I've seen simens to say they
Speaker 2: have one hundred million years. I don't buy that. I've
Speaker 2: seen the estimates that I think I'm more reliable are
Speaker 2: like fifty four million years in the US, although.
Speaker 3: Well, the thing is, we don't we don't have post
Speaker 3: super Bowl numbers between fifty and well.
Speaker 2: I think I think it's like fifty. I wouldn't I
Speaker 2: wouldn't expt on hundred million ones. I think that's bullshit.
Speaker 2: We don't have good post super Bowl data yet. Kind
Speaker 2: of the issue. But yeah, they're they're they're clobbering people.
Speaker 2: But the important thing about specifically the American market for
Speaker 2: TEMU is that, like the kind the equivalent person who
Speaker 2: shops at a dollar store in the US still has
Speaker 2: unfathomably more money than that same person in China because
Speaker 2: partially this is because the strength of the American dollar.
Speaker 2: Partially this is because American wages are just like unfathomably
Speaker 2: higher than Chinese wages, and that's that's that's true, even
Speaker 2: if you're like even when you account for like the
Speaker 2: relative strength and dollars to the yawn. So you know,
Speaker 2: the other kind of important thing about temis strategy is
Speaker 2: that they've been using this kind of like loophole that
Speaker 2: will set up a US customs law to allow people
Speaker 2: to like bring presents home from countries. So like, if
Speaker 2: you go to another country and you bring a present home,
Speaker 2: it's worth less than two hundred dollars, you go through
Speaker 2: like an expedited customs thing, you know, have to pay
Speaker 2: tariffs on it. Yeah, so I Temu and like a
Speaker 2: whole bunch of these companies just ship every single one
Speaker 2: of their packages in quantities where it's like seven hundred
Speaker 2: and ninety nine dollars, not eight hundred dollars ye legal, yeah,
Speaker 2: yeah yeah. And it's really funny. It's set off this
Speaker 2: like it's massive intra capitalist war because like a bunch
Speaker 2: of like like American right wingers, like American manufacturers, like
Speaker 2: the Republican Party are like, we need to close this gap,
Speaker 2: But then all of the fucking shipping companies are like, no,
Speaker 2: this is a vital part of the American consumer economy,
Speaker 2: and there's this like giant war going on like both
Speaker 2: in Congress and like the like in the press over
Speaker 2: whether they should when they should close as loophole now,
Speaker 2: you know. On the other hand, like there are real
Speaker 2: challenges to Timu being the first like company to break
Speaker 2: into the they're like Chinese companies like really truly break
Speaker 2: into the American market, like she and has done well,
Speaker 2: but they haven't like they have they have, They're not
Speaker 2: like a rival front to Amazon, right, Like they're not
Speaker 2: big enough to like knock off one of the sort
Speaker 2: of like American tech giants. And Temu's problem is that. Okay,
Speaker 2: so if you compare Temu to to PDD, right, the
Speaker 2: Chinese version, PDD is supposed to be about spreading through
Speaker 2: word of mouth, right, It's it spreads by like someone
Speaker 2: in your you know you as as of someone buying
Speaker 2: something from PDD taps your entire friend group and your
Speaker 2: family to get them to buy something for cheaper. Right.
Speaker 2: But the problem is that.
Speaker 3: Like fucking night, I forgot how marish this whole structure is.
Speaker 2: It's so bad. But the thing is, like Americans don't
Speaker 2: really do that, like there have been attempts to do
Speaker 2: like group on things, they never worked and Americans also
Speaker 2: don't group shop right because we're I don't know more Weird's.
Speaker 3: Just a fucking I mean, this is not a full
Speaker 3: full of a lot, more like individualistic impulse science that
Speaker 3: is that is kind of a large part of what
Speaker 3: the American shopping classes me is is built off of.
Speaker 2: And and this isn't This is an issue for Temu
Speaker 2: because like they don't have the word of mouth thing
Speaker 2: that drove them in China, so they're relying on just
Speaker 2: top down like like massive ad buys and stuff, and
Speaker 2: there's kind of a limit, and it's something that Temu understands, right,
Speaker 2: Like this is you know, the whole there's a whole
Speaker 2: thing in the Chinese tech industry about the power of
Speaker 2: being able to leverage people's like private networks, right, Temo understands,
Speaker 2: But they don't have a way to break into the
Speaker 2: American market because it just doesn't work like the Chinese market.
Speaker 2: So instead they're like buying three Super Bowl ads right now.
Speaker 2: There's another issue, which is that the goods that they
Speaker 2: sell suck ass and they break instantly. You know, that's
Speaker 2: an issue, But I don't know it's the US. Lots
Speaker 2: of things suck and break instantly, but like it is
Speaker 2: only that's been driving sort of negative sentiment from people
Speaker 2: who've used it, is they're like, they buy something and
Speaker 2: it's just like sucks, and they're, you know, they're unhappy
Speaker 2: about it. The thing I think is maybe the biggest
Speaker 2: problem is that their delivery times are really long by
Speaker 2: Americans den because they're shipping overseas, Temu had to build
Speaker 2: an actual logistics infrastructure where PDD like didn't, right because
Speaker 2: PDD is just using like Chinese versions of FedEx or whatever, right,
Speaker 2: and Temu is kind of doing that but in you know,
Speaker 2: in order to make it convenient for Chinese sellers. The
Speaker 2: way that they the way that they've sort of like
Speaker 2: set this up is they have a warehouse in Guandong
Speaker 2: and every seller like ships it to this warehouse and
Speaker 2: then Temu deals with getting it shipped overseas. The problem
Speaker 2: is that this is really slow, right. It takes like
Speaker 2: two weeks for things to show up, and that's not
Speaker 2: that slow by like normal standards, but this is the.
Speaker 3: US American standards. That is like a tortoise nightmareishly slow
Speaker 3: because we have gotten used to a level I'd say gratification,
Speaker 3: but like yeah, like this is a level of power
Speaker 3: that was previously reserved for like Chinese emperors, and we
Speaker 3: fucking use it every day to order fucking nailers from Amazon,
Speaker 3: right or in my case, so a whole bunch of
Speaker 3: materials to build a black logic which I will then
Speaker 3: return as soon as my party is over.
Speaker 2: Incredible, you know, And this is this is a This
Speaker 2: is also something that's kind of new for Temu because
Speaker 2: PDD was built on being able to doing sales or
Speaker 2: a fast enough they can sell fruit to people. Right,
Speaker 2: do you know how hard it is to sell fucking
Speaker 2: fresh fruit to people? That's like it's legitimately really difficult. Well, yeah,
Speaker 2: you can't. You can't ship. You can't have a two
Speaker 2: week ship for can But why it is? I mean
Speaker 2: you have to do a bunch of b you have
Speaker 2: you have to have an actual logistics infratructure set up
Speaker 2: for it, right. You can't just ship it in like
Speaker 2: an Amazon boll.
Speaker 3: They have to be they have to be like specifically
Speaker 3: ripening along the bill.
Speaker 2: Yeah yeah, yeah, and and and and Tim is also
Speaker 2: up to do that, right, And this is and this
Speaker 2: is an issue with all of their stuff because you
Speaker 2: know they're they're trying to do direct to consumer sales.
Speaker 2: But the thing is in China it's really fast, and
Speaker 2: here it's slow. And the upside for Temu is that
Speaker 2: their stuff is really cheap, right, It's unbelievably cheap. And
Speaker 2: you know, obviously they're losing money on the sales, and
Speaker 2: most of the money they're losing on the sales is
Speaker 2: from their ad spending, not from the actual sales. And
Speaker 2: this is this is where you get into again the
Speaker 2: really bleak part about this, where Okay, so are these
Speaker 2: why are these prices so low? And part of its
Speaker 2: tech money subsidy, but a lot of it is just labor,
Speaker 2: just pure, pure, unrivaled labor exploitation. You know, when with
Speaker 2: with the Chinese workers movement, like as like a a
Speaker 2: sort of like collective mass movement just completely broken by Tianamen.
Speaker 2: And then again dream like the crackdowns through the twenty
Speaker 2: tens that wiped out whatever sort of like classical workers
Speaker 2: movement style thing was may have popped up from the
Speaker 2: strikes in twenty eleven, like there's there's no there's no
Speaker 2: mass countervailing force in Chinese politics to try to raise wages,
Speaker 2: like independent union organizing is illegal. You will get arrested.
Speaker 2: The actual unions that exist, like they all trying of
Speaker 2: union federation doesn't do shit. We don't really have that
Speaker 2: kind of like fake union thing here. It's like it's
Speaker 2: like a different but you know, like they're they're I
Speaker 2: don't know, this is this is this is maybe not
Speaker 2: the time for me to try to explain China union system.
Speaker 2: Like the unions are fucking bullshit. They don't do anything.
Speaker 2: Like if you go to them and be like my
Speaker 2: wages are too low, they'll try to get you to
Speaker 2: like negotiate with the company directly, right like like as
Speaker 2: an individual, and like it's they're nonsense. They're completely useless.
Speaker 2: And you know the results of this and the results
Speaker 2: of just like the incredible poverty of the Chinese working
Speaker 2: class and the fact that you know a lot of
Speaker 2: Chinese migrant workers who are people who are actually making these goods.
Speaker 2: So a lot of some of it's real workers, some
Speaker 2: of its migrant workers, but a lot of these people's
Speaker 2: wages are lower than they otherwise would because they're drawing
Speaker 2: revenue off of like they're off of off of like
Speaker 2: the plots of land that their family has like back
Speaker 2: in the countryside when they like when they they like
Speaker 2: migrate to another city to to find a job. Yeah, so,
Speaker 2: like all of these factors are just institutionally like smashing
Speaker 2: the price of like like smashing like wages, and there's
Speaker 2: no there's no fucking there's not there's nothing really there
Speaker 2: to resist them and and act like, you know, it's
Speaker 2: not like the Chinese working class like completely takes it
Speaker 2: lying down, right, but it's like the resistance strategies are
Speaker 2: trying to work as little as possible, but that doesn't
Speaker 2: that's you know, and that's something that can be very
Speaker 2: effective in the sense of like you're working a lot less,
Speaker 2: but it's not something that drives up like wages. And
Speaker 2: so when when you're looking at Temu and you're seeing
Speaker 2: a pair of Jeanes for two dollars, like what you
Speaker 2: are seeing is the raw exploitation of the Chinese working class.
Speaker 2: And this is also true of like the rest of
Speaker 2: the fucking shit you buy from China, right, like almost
Speaker 2: all of the price of like a shirt that you're buying,
Speaker 2: I mean, Chinese textile manufacturing is kind of like not
Speaker 2: what it used to be right, but like you know,
Speaker 2: but like you're buying like fucking some bol shit from China.
Speaker 2: Like if you're buying from like another drop shipping company, right,
Speaker 2: like the thing you're actually paying for, you're paying the
Speaker 2: drop shipping company. You're not fucking paying the workers. They're
Speaker 2: not they're fucking not making shit all like all of
Speaker 2: the stuff that's like, I mean, it's not like one
Speaker 2: hundred percent, like a huge portion of of the fact
Speaker 2: that the price is higher on non Temu sites is
Speaker 2: just like it's just markups because this is this is
Speaker 2: just what the Chinese economy is. It's just sort of
Speaker 2: like it's you know, it's it's it's it's unbelievable exploitation.
Speaker 2: And this brings us to the thing we're going to
Speaker 2: end today on, which is does Temo use slave labor?
Speaker 2: Oh oh okay, And the answer is probably, but it's
Speaker 2: hard to tell. So this has been a big thing
Speaker 2: because Ten is one of the companies that the State
Speaker 2: Department brought up when they were doing their investigations into
Speaker 2: like like Sheian was the other one into like are
Speaker 2: these companies using shing John slave labor? And you know
Speaker 2: this is labor from people put in in the fucking camps.
Speaker 2: I think the answer is probably because I mean, so
Speaker 2: the thing is, the State Department doesn't have any actual evidence, right,
Speaker 2: Like they're all and they're they're doing this incredibly what
Speaker 2: We'll get into this in a second, Like, you know,
Speaker 2: obviously they're doing this because this is like this is
Speaker 2: an intra like capitalist feud thing, right. The State Department's
Speaker 2: talking about this because they're pissed at China.
Speaker 3: Yeah, this is like a nationalistic project for the United States.
Speaker 2: Yeah, but Comma, it's also probably true because these like
Speaker 2: and and this this is like the thing specifically with
Speaker 2: with PDD that we've been talking about is that they
Speaker 2: don't intimus Like, they don't vet the sellers of stuff, right,
Speaker 2: Like we talked about last episode that like people were
Speaker 2: selling sleeping pills as date rate drugs, right, they don't
Speaker 2: fucking vet it at all. So yeah, probably, like quite possibly. Yeah,
Speaker 2: the stuff the stuff that they're selling from shing Jun,
Speaker 2: and they have a pretty large presence there, like was
Speaker 2: using sort of like prison slave labor from the camps there. However, Comma,
Speaker 2: we can't talk about prison slave labor without talking about
Speaker 2: the fact that fucking every goddamn US firm also uses
Speaker 2: prison slave labor. Everyone from fucking McDonald's, the Starbucks to
Speaker 2: Walgreens to JC Penny, like fucking every every company, every
Speaker 2: American company you can fucking think of, uses slave labor
Speaker 2: or their slave labor in their in their supply chain.
Speaker 2: And they're using slave labor because in the US, under
Speaker 2: the Thirteenth Amendment, slavery is legal as long as the
Speaker 2: person as long as the person being enslaved is incarcerated.
Speaker 2: So you know, like it doesn't fucking matter, like this
Speaker 2: is this is this is the problem. It doesn't matter
Speaker 2: whether you buy from the US or China. Right like
Speaker 2: you're you're getting fucking slave labor. So if you if
Speaker 2: you want to not do that, you're you're your only option.
Speaker 2: If if you do not want to, if you do
Speaker 2: not want everything you consume, like the food that you eat,
Speaker 2: if you don't want, like everything that you use in
Speaker 2: your daily life to be the product of unfathomed human exploitation,
Speaker 2: your only option is to destroy the monstrous economic system
Speaker 2: that reduces humans to commodities and tear up the fucking
Speaker 2: roots of every single one of these companies from San
Speaker 2: Francisco to Shanghai and burn it to the grounds. That's that.
Speaker 2: Those are your options, like, it's not your individual consumer choice,
Speaker 2: not gonna make it any better. That's what I got.
Speaker 2: I okay, all right? Well oh god, like was it
Speaker 2: the Super Bowl great this year? Yeah? What a game?
Speaker 4: What a game?
Speaker 3: Almost almost double overtime?
Speaker 2: That was crazy. I I don't know that was that
Speaker 2: was the worst Chiefs team of all time and they
Speaker 2: nobody could fucking beat them. We're so duped. We're gonna
Speaker 2: get Patrick Mahobe is gonna win like a fucking twelve peet.
Speaker 2: It's so over for every other sports team. Better things
Speaker 2: aren't possible unless you make them possible.
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