Industry veterans, degenerate gamblers & besties Chamath Palihapitiya, Jason Calacanis, David Sacks & David Friedberg cover all things economic, tech, political, social & poker.
Fri, 31 Jul 2020 23:30
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Jason's recent Big Tech antitrust hearings breakdown: https://www.youtube.com/watch?v=VWeMnJ0-a_U
All right, everybody, welcome back. It's another episode of All in podcast, the podcast that is racing up the charts. Despite the fact that we recorded every three or four weeks as no marketing, there's no ads in this podcast. It's just four friends who play poker together, who've decided to talk about the most important issues in the world. Welcome back to the podcast, David Friedberg, the Queen of Kinowa himself, obviously climate.com Eatza, and an undisclosed beverage. Start up that I'm not supposed to talk about it. Sorry about that. I know a lot of people were tweeting about this beverage startup. You still not ready to talk about the beverage startup? Thank you, Jake. Paul. Yeah, welcome back to the show. I always appreciate your promotions. But when will the beverage, by the way, do you guys want to talk about, do you guys want to talk about Jason's home address? Because I have that, I think, but please know I wanna ask is, is that a picture in the background? I love space, by the way, as you know. But is that a picture of your Uranus or what is that picture, I think that Saturn, Saturn. It's like it's Saturday. It's not Saturday. Friedberg, obviously taking the first Virgin Galactic flight. Chamath Palihapitiya of course. With us here, the Prince of Spacks calling in from an undisclosed location that is not burning down like the United States. How you doing on your vacay? Doing really well, thanks. Thanks. I'm giving you the three button salute as I told. Yeah, thank God. The microphone is perfectly positioned so we do not have to look at your chest hair, all six of your chest hairs. Oh my God. It's like $1000 suit. That's missing all of its buttons or shirt, rather. I mean, they couldn't afford to put buttons all the way up on your, like, probably $2000 shirt austerity, get back to the United States. As Jason said, my haberdasher will meet me at playing second. So the three buttons, when he when he leaves for Europe, they remove the three buttons. He comes back. The haberdasher puts them back on each shirt. He does that for the entire wardrobe. And of course, chiming in is Rain Man himself, David Sacks, block professional Blogger and yeah. Fund manager of craft Ventures, of course, before that working at PayPal with Peter Thiel, Elon Musk, and a bunch of other famous people. Two of which have gone on to have demonstrably more success than sacks, but sacks having of course more than success to much more success than the other 72 rocket science tists from PayPal. In between, he did a little company called Yammer, which Microsoft bought for a billion dollars. Speaking of big companies and big Tech, we had a big tech hearing this week. And Jeff Bezos, Sundar, and Zach himself. As well as Tim Cook, 2 founders and two hired guns. Uh, people who were hired for their positions defending themselves from what I thought was some pretty good questioning. My my expectations were very low that anybody on that panel would know what they were talking about. For me, I thought Jeff Bezos did the best job. He had a great opening statement and he was the most candid and I think least likely to get broken up going around the horn here. Chamath who did the best job in the hearings. Don't know if you saw all of them or just clips. Who do you think shined? I I only saw, to be honest with you, your recap, which I thought was frankly really, really good when we should, we should probably link to that in the show notes so people can listen to it. I saw a couple of answers. The the thing that jumped off the page to me was I I read a little bit of Bezos's statement. I thought it was pretty fire. I thought he did the best job, kind of positioning himself. But the reality is, you know, it's kind of what I said a few days earlier on CNBC. But I just thought going in, this whole thing was set up to be kind of performative theater. And it basically was that, you know, the just like the the level of questions are just so poor, the level of understanding is so bad, and then, you know, people just use it as a way to grandstand and everybody did. And so, you know, I wasn't completely blown away by any of it, to be quite honest. What do you think Freeberg who had the best showing in those hearings? I think Zuck was the most kind of eloquent in the on point responses. He was super, super well prepped for this thing. I think Bezos and and others were obviously you know, they had they had great kind of prep work done for their statement, but in terms of like warding off the attacks, I think Zuck did did a great job. It, you know, it was weird. It didn't feel like like Tim Cook should have been there. It was like kind of a random thing that he was there because everyone had an axe to grind, and the axe that everyone had to grind was a little bit different. It wasn't like this was a a true objective discussion about, you know, antitrust. And so the the acts that people had to grind were kind of pointed at Google and Facebook and Amazon in different ways. Tim Cook was kind of, you know, hey, yeah, this is cool. You guys go ahead and. Give your responses. I'm gonna go and do you think that's because Apple does not have a monopoly position on a on a numbers basis and anyone era and or and or because their products are so loved and universally you know, used. I think it's actually a function of what these companies do. So if you look at the the Jim Jordan rant, I don't know if you guys watch this but Jim Jordan did this big rant at the opening and he went on and on and the first thing he said, he's like big Tech is out to get. Conservatives. And then he went on and gave all these examples about how Twitter has been pulling down Donald Trump's tweets and flagging them and and Facebook's been being, you know, cancelling certain people on the platform. And his whole axe to grind was really about censorship on social media platforms, which has ******* nothing to do with antitrust and has nothing to do with Apple's business. And so, yeah, I guess my point is, like, and then other people have issues with, with the, with Google's dominance and ads and Amazon's impact on local business and so there, there wasn't much of an axe to grind, frankly. With Apple, at the end of the day, as I said, I just don't think that it was a function of, you know, a true kind of objective antitrust approach. And it was just more about like, hey, we've all got different things we want to address and we finally got these guys here. Let's beat them up. And you know sax, what do you think you you with freeberg that it was performance art or do you think that or performative rather do you or do you think that there are actually substantive issues that came up during the hearings that we should discuss here? Well, you know, it was both, you know, certainly there was a. Tremendous amount of grandstanding and political theater and the politicians on both sides wanted to take shots at at the companies for various reasons. I mean I think they have a slightly different hierarchy of hate. I think the the left sort of hates Facebook the most because they blame it for Trump's election, which I think is kind of a a ridiculous scapegoating which we should talk more about. But and then I think the right is is most suspicious towards Google. But I think there are you know legitimate issues here as that that were brought up and I I think the congressional hearing did score some hit points and I think your your previous post did a good job showing some of those the these hearings were teed up apparently over the past year by a series of subpoenas of records that the the Committee this is the. This is the House Subcommittee on Antitrust had teed up. And so there were some moments where I thought that, you know, that the representative scored some hits on, you know, Facebook and Google. What do you think the big who took the biggest hit in all of this? Who, who, who do you think has the most? Putting aside all this performance, obviously, and the politicization of everything in our country? And Jim Jordan, who to me is like the, he's like the dad at the baseball game. Like the Little League like Game who runs on the court and pushes the empire and gets banned for the season. Like he just yells over everybody for no reason. But what is the actual, what was the punch that landed that is the most valid as we go around the horn one more time here now that we got our initial thoughts about it, what punch landed the squarest in one of these companies faces? Well I, I, I me set this up. I think there were three big areas of concern where just about all the companies with maybe the exception of Amazon took hits, although even you know Bezos took hits. I think one is with respect to anti competitive actions that these platforms are taking, particularly with respect to the applications or small businesses that operate and are dependent on those platforms. I think all of the companies were interrogated about that. You know Bezos took a hit when he had to. Admit there were concede that the company may not have always followed its policy with respect to using its you know third party sellers data to to figure out how to compete with them. You know Google was interrogated about snippets there was news today actually just out of Australia that the government's gonna order Google to pay small businesses for the use of its its content for snippets which you know so so the the regulations are kind of heating up on this but the sort of the first area was sort of anti competitive. And I think Facebook took some some hits with respect to the Instagram acquisition, which, you know, Congressman Nadler really went after him and then I think. Jayapal's as well and that that's a tremendously threatening issue for Facebook because if it is forced to divest Instagram, it would just be crippling for for the company. We'll talk more about that. Yeah let's take let's just a just a Jason just set the table. Two other issues I think came up. I'll just very briefly. The number 2 is sort of cozying up to China. I think Google is the one that's most vulnerable here. And then the third issue is sort of this issue of censorship and bias with respect to content and and. Politics, which has nothing to do with, which has nothing to do with antitrust, the censorship issue. So let's table that one. I think you're hitting the nail on the head. This was not about antitrust going in. I think people were, you know, kind of confused. Even Jim Jordan just I don't think he has any clue what he's talking about. He doesn't know the difference between regulation and antitrust. He doesn't know the difference between the Sherman act and like, you know, section 2:30. I think they're all kind of making it up as they go along. So in many ways, I think personally that the companies that were the most. At risk going in were the same companies at risk coming out? And so, you know, if you had to stack rank to risk, I think Facebook is #1 at the top of the list. Then I think it's Google, then I think it's Apple, and then I think far, far, far down is Amazon. In many ways, Amazon is the most innoculated simply because the end market that they operate in is so massive. And the market that Facebook operates in is so new, yet so constrained with very few competitors. So in many ways, I think that's how the risk cuts. I really think that the antitrust legislative framework that exists today isn't enough to touch any of these guys. Instead, I think what really happens is more regulatory. And if you really think about what these guys are very concerned about, it's more that Facebook largely and then Google to a smaller degree, essentially can be kingmakers with respect to popular. Indian sentiment, and I think that they want to have regulations and I think that there's a good historical precedent for a bunch of industries that have had to come under regulation when they effectively get to 100% distribution, you know, whether it's meat or airplanes or radio or television, you know, agriculture writ large, automobiles and transportation, whenever a market basically serves 100% of the total addressable universe, government stepped in. And they don't necessarily legislate and trust bust. They fundamentally regulate and tax. And I think in many ways that's just as bad. And frankly, in some ways it's worse because if you do that to a tech company, you're basically crippling the one thing that they're supposed to be very good at, which is to innovate. And that's the only thing that they can use to basically keep their stock price high, which is then the only thing that they can use to get people to continue to work for them. So that's the sort of circular loop that breaks if you regulate them. And I think that the risk coming in was the same as coming up. So Facebook, let's let's take a let's take them one at a time. Facebook, I thought, had the worst performance because it was pretty clear that Nadler was setting them up not only to not be able to buy a company in the future, but in that clip he was sort of teeing them up that maybe the Instagram acquisition should be unwound and they should be forced to spin that off because they were saying over and over and over again that Zuckerberg put in emails with his management team that they were going to buy these. Companies or kill them or copy their feature sets. And even though that may not be explicitly illegal, the fact that they've hit as chamath is talking about such incredible market share with billions of users and because of the track record of Zuckerberg, you know, which may not be at all related to this, but it sets the table. In fairness to mark, that decision wasn't made when Facebook had market dominance. That decision was made when Facebook was still fundamentally at risk, and there was a large period of time where a lot of other people, had they been left to their own devices or properly capitalized, could have actually become a relatively important competitor to Facebook. Instagram could have been at that point, but then Snapchat was the opposite. Snapchat, they were at scale, and then they were gonna buy it and threaten them. Either you sell to us or we're gonna copy the features. I think, I think, I think what a more logical and defensible reaction is, like, I I just think it's not defensible to say, oh, you know what, Facebook. I didn't like the acquisition you did 10 years ago basically because it worked. Yeah. And so I'm going to punish you 10 years later. That's crazy. That's stupid. Yeah. And the review mirror. No, no. Good. Yeah. I'm more reasonable place to be is to say, OK. This thing, meaning communications writ large has become a critical piece of societal infrastructure, and we are trying to figure out now what the rules should be. And rules shouldn't be brittle. Rules should be evolutionary. They should map, you know, to the moral decisions and ideas and frameworks of the time. And so you know we have to figure out, for example, #1 interoperability. So how can you message across all these multiple networks? Another simple example, we legislated the ability for emergency services to be able to send a message on your mobile phone line and your landline. You should probably be able to have a back door into all the messaging networks simply for that reason. So the point is that, you know, there are all kinds of things you can do today to make this. Infrastructure layer of society operate in a more predictable way on behalf of what was your best. Do you have have you thought about a regulation? Then let's stick to Facebook and then we'll go to Amazon. Have you thought about a regulation that would make sense to Facebook, whether it's divesting an asset or maybe a certain percentage of usage or allowing Facebook Messenger to work with, I messenger to work with, you know, Twitter DMS, I'll answer it in a different way. So look, I mean for 20 years I've run these kind of. Businesses like from from Winamp to aim and ICQ to then at Facebook. And so I remember at aim and ICQ we did all this hand wringing and all these meetings between US and Microsoft and Yahoo to make our messaging networks interoperate. And eventually we were basically just cut off at the knees because other people just moved around us. And eventually it all just morphed anyways away from these sort of brittle messaging that works. My, my kind of view is that I don't, I I think what's best for Facebook is the status quo. And so, you know, if, if, if, if they can basically. And by the way, I think the strategy is and and Mark wrote this in his manifesto, but a couple of years ago, you know, this is sort of what led to Chris Cox resigning. If I'm playing, you know, sort of like conspiracy theorists, if you read Zuck's manifesto, what he was basically saying is, listen, we're going to take all these product and we're going to take all that code and we're going to mesh them all together in such a complicated convoluted. Asked that if and when somebody ever tells us to rip it apart, it'll take another five or ten years to do it. And that's effectively the technical read on that manifesto. It's just like you're going to make it technically impossible to unthread these things as independent, and your thesis is that's a strategy against an antitrust breakup. I find that. No, I just think it's a really smart strategy. I mean he wrote it and he published it online. So it's not like you're hiding anything. He made it, right. I mean it's is the beautiful part about it. He made it completely in the clear now, right. So that's that's the strategy is to basically make it 1 monolithic code base so that if and when I think I don't, I'm not sure if this is the intention, but frankly if and when somebody knocked on the door and said, hey, you need to strip apart WhatsApp and Messenger and Instagram, you can say, well look, it's it's one monolithic code base and you know 50 million lines of code, it'll take me 10 years, but. Here, I'll figure it out somehow. So yeah, you know, I think what's good for Facebook is a status quo now that's different from what's good for politicians and then what's different for consumers. I think what's good for consumers is fundamental interoperability. Now, this is then what touches Android and Apple as well. Like the idea today that you cannot have a group text message that can only include iPhones. You know, on the off chance one of your friends is an Android phone, you're basically ******. Kind of, which happens every six months on our group that freeberg. What do you think in terms of Facebook and any potential action that could be taken? Or any possible solution to them having such a dominant position because they are the only one of the four that has a dominant position? I would think about the. You know how these businesses are, are kind of built right there in, in all these businesses there's an infrastructure layer, the infrastructure layer in the case of Google and Facebook is, is, is reasonably similar to, it's a bunch of data centers and and the hardware and software infrastructure to run all of their services on top. And then on top there are consumer products and then there are advertising products and the customer base for the consumer product is obviously users and the, you know customer base. The advertising products is these advertisers that pay to access these consumers and give them ads and get clicks from them and sell them stuff. And and so if you think about what do you pull out it, it sounds like on the Google side there's, there's there's concern both on the advertising and on the consumer products that are being offered and the scale and the leverage that Google has and how they make those products kind of come to market. And with Facebook, it's really about this absolute kind of monopoly on, you know, on social products and services, whereas Google's got this great monopoly on, on search products for consumers. So you could. Kind of take a layman's view and say, hey, like, rip out WhatsApp and Rip out Instagram. And you know, then Facebook is good. But the problem is in that infrastructure layer. They've created the social graph and this connection between, you know, all the people that you know, and they've got all the stuff sitting on the same servers and chamath points out, all the same code base. And there's a lot of commonality there. So the reality of like, ripping something out from there is a lot more nuanced and a lot more challenging than just saying, hey, you got to get rid of WhatsApp or you've got to get rid of Instagram. And it's more likely some sort of Chinese wall situation where you end up with a a negotiated exit, continued ownership and control. But, you know, almost like what happened with the banks in the 80s, you kind of gotta separate one side of the business from the other. That could be one way that this goes because, you know, it's really hard to kind of break apart given the way that these businesses are built. And what do you think about a solution, David, in which they conceded, hey, we're not going to buy any more of these competing social networks? But I think it would be kind of hard for them to buy one right now. I think that's done. I mean, like, you can even see that Google Fitbit. I mean Fitbit is, you know, what is it a 1.2 or $3 billion acquisition? It's gonna take almost two years to close. And Google's already making concessions, antitrust concessions to the EU or, you know, this is a $1 trillion company trying to buy a $1 billion company. So I think large acquisition in M&A by the Big Four, it's impossible. Is that good for society? Chemother bad for society? Is it good for? Our business of investing in services are bad for us investing in startups. Well, I think it's good in one very important way, which is that it forces the capital markets to support these companies. And what I mean by that is, you know, I've told you guys a couple of times, but in the year 2000, there was 8000 public companies in the year 2020, July 2020 as we sit there, August 2020, there's about 4000. So we've seen a shrinking of 50% of the number of public companies. So the idea that there isn't an. M&A on ramp anymore means that more capital and the capital markets will become more fluid and we will support emerging growth companies in the public markets is my suspicion. If only there was, yeah, if only there was an easy way for these companies to get public. Go ahead, David, respond. Well, I was. I mean I I I think that I think you're raising the right issue, which is the chilling effect on M&A that these hearings are going to have even if Facebook is never broken up or. Where that deal is sort of retroactively challenged, the the, the Big four tech companies have to be looking at these hearings and now they're going to be second guessing every acquisition they want to make and it's going to have a chilling effect. And I I think that's a disaster for Silicon Valley because we know that most of the startups don't work and you know, and there's really only, you know, most of them go out of business and there's only two good exits. One is an IPO, the other is M&A and if you take the M&A. Exit off the table because it's no longer sort of feasible from a regulatory standpoint. Not all those companies are going IPO. Yeah. But David, what you what you're saying doesn't make logical sense because if those companies are **** anyway, they should be going out of business and who cares about an Aqua hire or some mini modest hire that gets you two times your money. There's a lot of of acquisitions where the acquirer is picking them up because they provide an important component or technology or product, but that that that. Startup would not have been a great standalone public company. Yeah? Would be Yammer be worth more today and would you be worth more money? Would your investors be worth more money if Yammer had sparked? Yes or no, David? Yes, absolutely yes. OK. So David, you're your argument makes no sense. I think you're playing to lose. It's not that it doesn't make sense. I think David, David does bring up something that's important in the following way, which is there's a lot of companies, Jason that get to a certain amount of scale and then they basically start running out of oxygen, whether it's because they've overbuilt or they've over hired or they've overspent or there's a natural audience for the product. Emma B. But I think I think a lot of it is just sort of more overbuilding and just kind of distracted capital allocation. But then, you know, you need somebody to come in and this is the problem with Silicon Valley. And I think what David speaks to is the following. If big tech M&A is off the table, the single biggest thing that'll change is valuations by late stage private, late stage privates. Because if you know that you can't get a 2X mark to market from the Last Post, guess what will happen to your post money? It'll go way down. Right, because that was always the understood assumption. You know, all these guys, these late stage money can come in and say, well sure, I'll put you know, 2 1/2 billion dollar post, a $3 billion post. Because in their mind what they've been taught is that immediately sets the mark to get acquired AS2X. And in many ways Facebook started it because Facebook came to buy Instagram literally weeks after that growth stage round at 500 million. That's why they paid a billion one. They doubled the valuation. But wouldn't it hold on a second? Wouldn't it be healthier though for the entire ecosystem? If we weren't building those late stage companies to be flipped to a major company, may be merging them with medium sized companies or slightly stronger and then taking them public to your point chamath. My point is, if you don't have a ****** ** cap table, you can do all of those things. It's the ****** ** cap table. So this solves that. Who needs this late stage capital coming in and doing these faka crazy rounds? Why not take the company's public earlier? Well, because look, uh, you you don't always know what's going to happen. I mean this is the reason why Instagram sold is the reason Yammer sold is you don't know exactly what's gonna happen. You don't know what the outcomes gonna be. And in a lot of those cases that you're saying what would become IPO's if they weren't acquired, well, a lot of them just, you know, aren't going to work. It's it's crazy to be taking those exits off the table when both the startup and you know the acquirer or the big tech company you know want to do the do the transaction. And and and and and one of the reasons why I think these, you know there are a lot of these M&A type outcomes is because big companies have realized they're not very good at R&D at sort of good at sort of new product development. And So what they've done is they've outsourced a lot of their R&D budgets to M&A and so they let the startups run the experiments you know in any category, in any new area you end up having a dozen of these startups get funded. You know we we make fun of it because they're all you know there's so many competitors in every little. Space. But those startups are the laboratory where all these experiments are taking place. And then, you know, the big company comes in at the end and sees which experiment Freeballing acquire it. What do you think? I think it's, I mean, I think the advantage of being a platform business is you can plug something in and immediately gain a lot of scale from it. So, I mean, you know, Instagram and YouTube are perfect examples. They were, you know, reasonably fast growing, had millions of users, but once they were plugged into the engine of the bigger platform. They were worth 100 times as much over a few years because of all the usage and the infrastructure and the and the distribution etcetera that was provided. But you know it looked insane at the time to pay a billion dollars and a billion 6 for those two businesses. Each of them are easily worth 100 billion plus today, probably some multiple of that. And so I think it's a sack's point is right is like I'd rather as A and and look I worked in M&A at Google for a couple of years early. My career I left Google in in 2006 and a lot of the infrastructure that makes Google's, you know, revenue engine was acquired. You know, we bought a company called Applied Semantics for 100,000,000 bucks or 100 something, $1,000,000 at the time, which ultimately became Adsense. And applied semantics could scan a web page and basically determine what keywords that webpage represented and then match ads from AdWords onto that Web page. That acquisition was $100 million. I mean, I don't track. Anymore, how much, but 10s of billions of dollars of revenue are generated by that, you know, by that Adsense system today you're bringing up something really important, which is at the time Google was not a trillion dollar company. So the point is that Google had access to enough capital market scale where you know, nobody's going to get in the way of A5 ten, $20 billion company trying to buy $100 million business like that. I just don't think you're going to see, you know, any regulatory body take that seriously. Wait, so didn't we? To paint the perfect picture will be a trickle down. Wait, isn't that the perfect picture in picture? I think what it means is the $20 billion company now probabilistically can actually win. So for example, like, look, look at this Intuit Credit Karma transaction, right. The question is, you know, could a smaller company have bought Credit Karma? Probably, but not at the price that, you know, Intuit is willing to pay. Now if Intuit gets big enough where there's a chilling effect and regulators say, OK, you know, you're above a magic threshold and you know, no bueno on the M&A anymore. Now Credit Karma has two choices, which is maybe they sell for 4 billion to a very different company, right? Or maybe they sell. Actually this take a different example, PayPal. PayPal is now a top 20 business in America, right by market CAP. So if PayPal isn't allowed, for example to buy, you know, a bunch of sort of like. You know, payment, rail payment companies, maybe what happens is like a, you know, a medium to your business is allowed to buy them and now all of a sudden those medium to your businesses can compete with PayPal. That's what I think that that's actually seems like the best solution that we've, we've kind of stumbled on here. Can't slack then become or Dropbox or Uber or any Airbnb now they can become the acquirers of these companies and then they can compete. So why don't we just say, hey, if you're over a trillion dollars or if you're over 500 billion, you can buy 1% of your market cap? I'm just throwing a number out here. Jason. Let me jump in on this. The the that's not what Nadler was arguing for. You know, it's not like Nadler was saying that if you're a big fork tech company you can't do these deals, but everyone else can. The the standard that that Nadler and the precedent that he was essentially setting in that hearing is, you know, 2020 hindsight bias you know, if if a company acquires. Putting down there, so I agree with you on that. But putting that aside, if we were going to come up with a rule because we know the rules that as they currently exist are inadequate to do any type of regulation for these companies because none of them have 95% market share. So if in fact. We we need a new solution. How about this for a solution? I'm putting it out here. You can acquire something that is under 5% of your market cap. So if your market cap over the last year's a billion, you can buy something 50 billion or less if you're under 5. If you're under 250 billion, you could buy whatever the hell you want. But Jake, let me let, let, let me, let me ask this question. You know the the points we made earlier about YouTube and Instagram, they were successful because of the scale of the user base of the platforms that acquired them and the work that had already been done. And so they could plug in both been totally successful without they would have been success but would they have been worth $300 billion like they are maybe maybe more. But Instagram was 13 people, YouTube was a couple dozen people. It doesn't matter. The story is a small group were brought in with with an interesting platform that was kind of working at the time and then they became these $3 billion platform. So that's one scenario. And a lot of money could be used, and Google and and Facebook used a lot of money to be the best acquirer to be able to acquire those businesses. And that's the argument for this, hey, they're at such a scale right now. No one else can compete because only they can pay this this fee, as chamath points out with Intuit and Credit Karma, only into it can buy credit Karma at that price. Now the alternative way to think about this is, what if there is vertical expansion? So instead of leveraging their existing platform and their existing dominance, what if Google in this case is trying to get into the cloud business, right? And they're competing. Seriously, with Amazon and Microsoft and others in this enterprise cloud business marketplace that is continuously evolving, changing every year, there's a different kind of lead and A and a different company that suddenly growing faster than the others. And Google spent $2.6 billion to buy Looker. Buying looker for $2.6 billion does not advantage Google's advertisers. It does not advance. I mean, to some degree might. It does not advantage Google's users. And it is not about platform dominance in their traditional ad business. It's about vertical expansion into a new market. OK, so here's how I'll rewrite the law. David, if you have over 70% market share in your vertical, you cannot make acquisition additional acquisitions in that vertical. If you have, they're buying into a new vertical, right, that's my point. So then the caveat is if you're buying into a new vertical, you don't have to hit that. We already have that. We already have. I mean that that's that's basically the the the way the the rules work today is that you look at market share. I mean Coke cannot buy Pepsi, Facebook cannot buy Twitter today, but what we're talking about is at a much earlier. Stage, are you going to interfere with the M&A or are you gonna retroactively go back and unwind these transactions? Transactions makes no sense. Yeah. I think the point is this is all water under the bridge and but the incremental lemonade for these big guys is very unlikely. Now David does bring up a good point unless it's in basically a you know do nothing not at that important you know in in the positioning category relative to the core business. And so This is why you know. Again, go back to like, why did looker clothes faster than Fitbit? It's half the price. Looker is twice the price, right? Fitbit is half the price. Yeah. You mark new market completely. Yeah. Yeah. And so, so there is a fear that there is going to be a compounding advantage that regulators have a responsibility to stop. So I think it goes back to once you get to a certain level of scale, the thing that we're missing with online businesses is this kind of like there's like a great original sin here that we're not admitting, which is that. The Internet is now a pervasive and critical part of human infrastructure. As such, there needs to be people that regulate and manage the Internet the same way the FAA manages and regulates planes and wind turbines. Like think about the FAA. Let's just take aviation. It is impossible for you to go and just go into your garage. Build some random thing to carry people from point A to point B in the absence of some certification. OK, take agriculture. It is impossible. For you to basically go and like build up a farm and build up, you know, livestock or whatever and all of a sudden just supply it into ******* Sobeys and Safeway without any sort of like checks and balances similarly. And the reason is because it's simple human infrastructure that everybody relies on. And I just think that we have to admit that now the Internet company also, those are life and death. This can be too. I mean, like, was it the guy that read the post about like the pedophiles and the pizza joint came up with an AK47? Yeah. I mean, it's quite an edge case compared to flying on a plane. This stuff is life and death at some level, but even more than life and death, it's the anointing of power that then determines life and death. And that's, I think the key is that it's power. Yeah. Do you think that there should be an Internet regulatory body that decides how businesses operate and how content is censored and and managed on the Internet? Is that what you're kind of suggesting? Yeah. So let me be very specific. So I think that there are very specific kinds of businesses and business models that should be overseen. Specifically, I think the 1st and most important thing is a body that overseas the collection of user data and how it drives targeting and identification. So privacy concerns around that, that's a no brainer. That's the first one. And then I think the second one is something that essentially tears the fig leaf off of Internet companies and says, you know what? You are the equivalent of a publisher and a platform, some weird hybrid that we didn't think could exist when we wrote these rules. And so we're now going to adapt these rules. Because, you know, if you think about it, nobody is happy with the Internet publishers today. You know, the the left thinks that it skews right, the right things it skews the left. Everybody's confused. Nobody gets what they want. And so I think somebody has to step in and kind of swell. I think this is a good segue to saxis point. And then I guess we, we have, we have a fork here. Now in the discussion, do we wanna go and talk about censorship and that specific issue across Facebook or do we want to get into Amazon for a second? Which way do we want to go, sacks? Go to censorship? Well, I mean, well, let's let's just talk censorship. Let's jump the fence here. Should there be, to chamath point Sachs, a regulatory body that decides what people can and cannot say on social networks? Yes or no? No, I mean, let's think about that. What we're saying is we, we need the the politicians to set up a regulatory body to control how the people talk about the politicians. I mean, that seems like a recipe for disaster. What about specific lies and intentionality, to frame debates incorrectly? Exactly. That's not what I'm saying. I'm saying, like, like, you go to a movie and, you know, there's a little blurb here that says who can go to the movie and who cannot. You know, you get a you buy an album and it tells you whether there's explicit lyrics or not. Like you, before you turn on the TV, there's like some rating agency that tells you whether your kids should be watching it with you. My my point is, what is the equivalent version? We all need to think about what it is, but to say that there should be nothing, I think is crazy. Sacks well. Well, I think. So, I mean, those ratings are mostly about, you know, the standards related to to kids, you know, and the big Internet companies already have a lot of child safety features. I don't know that you need to create laws around that. And I and I don't think that's what we're talking about anyway. I mean, I think the big debate about Facebook or Twitter is whether they're engaging in censorship or bias, right? And that that goes way beyond. This topic of child safety. So, OK, let's let's unpack. I don't think that they're censoring all. All I'm saying is I think you need to label and you need to be more clearly designate what this content is so that people can choose. Like for example, on Twitter I follow a bunch of people on the right, I follow a bunch of people on the left. I follow one or two Q Anon accounts only because like I just want to see it all and then I want to judge and I feel like if I can see everything, I can sort of like lay it all on a table. And figure out where the rough center is and kind of move to that, you know, so you feel you're intelligent and mature enough to do that chamath, but the rest of the world isn't? No, not really. But I try to do it because I think it's important for me. Would you rather the platforms or some regulators come up with what you could see on those platforms to month? Again, not what I can see, but there has to be a simple way. For example, you know, you could have something and again, this, this, this all, all this does is it breaks business models, which then breaks modernization and it breaks the market cap of these companies. But for example, let's just say you had a new kind of job which was all these you had. You hired 500,000 people, and these were a combination of lawyers, journalists, you know, academics, all kinds of random people. Artists, everybody OK, normal folks, blue collar folks. And you paid them full time to basically read stuff and kind of like, you know, wisdom of the crowd style. Tell us where this sat in the spectrum. OK, this is on the left. This is on the right. This is kind of center. This seems laughable. This seems unbelievable. This seems relatively credible, and I think that you would get, you know, very quickly. And I don't think the latency would be that high, but probably minutes where, you know, 40 or 50,000 signals would tell you whether something is where something is in the spectrum of how to understand it. And then that system, that system will get paid, get played, though, it will get jammed, right? Like someone will figure out a way to turn all of Chamath's tweet labels into. Super Evil tweets and, you know now and everyone will mute you because you're super evil. Yeah. I think we just defined George Orwell's 1984 like or cancel culture, right. Like if you're paying 500,000 or a million people, if if Facebook and Google and these guys come together and Twitter and they pay a body of people to do this work. And so you don't know who posts it, you just see the content. You read it, you label it. It's a classifier. So what do you what do you think you would get classified as? And then what if you disagreed with what you were classified as? So the David. Like what I'm saying is you wouldn't know it's me. Like if I wrote an article on Medium, right? And I wanted to publish it in Twitter. That article first hits AQ, 50,000 people read it. They human classify it. And then it gets published. And now what if you don't like the way it's classified and you don't want those tags attached to it, and you want a place to publish freely without classification, without tagging, then there will be a company that supports that too, and you'll see how much people care about that. Yeah. I mean, I think the free market could handle what you're saying, chamah, because I think David's concerns would be the same as mine, which is who, who's doing this classification? What kind of transparency is there? And we already have the wisdom of the crowds, which is things that are outrageous or automatically get pushed up on Twitter. Which allows anonymous. And then Facebook seems to be. All the top trends seem to be on the right. Let's swing over to SAC. SAC, what do you think of, of the 1984 proposal from Jamaica? 500,000 sensors telling you what to think of a post before you read it. Yeah, I mean, it's the question, but it's an insane yeah, it's it's a it's a little bit like Twitter fact checking the politicians they don't like the digital politburo. It's it's a it's a form of, like, soft censorship. And, you know, I I actually think that, you know, Zuckerberg gets attacked the most, but I think his position on speech actually makes makes the most sense. I mean it seems like what he said is we want to be a neutral free speech platform. And, you know, whereas I think, you know, Twitter and Snapchat for that matter, are much more likely to engage in either, you know, censorship or or fact checking, which is paradoxical really. Twitter's initial position, David was it was the free speech. Platform and I totally agree with you. I think that's position is the most defensible but it also is the most untenable because it's the most it's the it's the it's the least technologically and to socially palatable but it is the most defensible and philosophically in my opinion the only position you can have. But it's not going to be what wins right? Well it's it's it's the the reason why Zuckerberg has hated is because if you're gonna defend defend the principle of free speech you always end up defending speech that society. Eighths, you know like the ACLU and sticky and and so, you know Zuckerberg I think has done the best job sticking to his guns. I mean the reason why Twitter is sort of you know loved on the left is is precisely because they gave in to the mob and they've, you know they've started taking down accounts at the mob doesn't like or or or or or you know fact checking them. Whereas I think you know and that and Zuckerberg's refusal to do that and by the way I don't think he's been like. Perfect in this regard. But he's been much better about standing up for the principle of free speech. That's what's made him, you know, anathema to the left. I think. That and the fact that Facebook still gets blamed for Freeburg. I have two, I have. I have two specific follow-ups to what David just said for you, which is 1, how much of this has to do with anonymity being allowed on Twitter versus not being allowed on Facebook. And 2nd, how much of it has to do with the fact that we have algorithms that trend topics if we didn't have those algorithms trending them? Perhaps this wouldn't be an issue because if you wrote something that was inflammatory, it wouldn't. And false, let's say in that situation, both characteristics, it wouldn't go to the top of the list, which is what everybody's kind of upset about is that something that's false goes to the top of your feed to comment on those two issues. Well, I think your second, your second point is an important one, which is like social media helps to enhance the stimulation of the amygdala in the human brain. You know, you see something that makes you angry or something that makes you elated. You are more likely to engage with it. If you see something that is kind of a rational discussion about something that doesn't incite emotion in you, you're less likely to engage in it. And so whatever the engagement model is, it ends up, you know, creating a lot more virality and chatter and and it kind of gets brought to the surface. And there's a lot that's been written and said about this that I don't think we're kind of uniquely in a position to to say anything more on. And that's obviously what a lot of people are kind of concerned about is the inflammatory and polarizing nature of the content that is getting highlighted on these platforms and is getting. Greater distribution on these platforms and then I think your prior point, I'm not sure it's about anonymity as much as it is. About any form of censorship that ultimately can be viewed as bias. So Jim Jordan's points were actually, you know, as much as the guy rants and goes on and sounds like a guy running on the soccer field to punch the coach. It it's really interesting to hear the point of view that as a conservative, I believe that a lot of what Donald Trump is saying or what some conservative voices are saying is reasonable and that voice should be heard. And to hear over and over about Twitter pulling these things down and then seeing a whole bunch of stuff like anarchists taking over Seattle and taking over Portland and they don't get their stuff taken down, you know, them claiming that they can hold down the streets of Portland and Seattle because that's, you know, the way that it should be doesn't, you know, incite any sort of censorship. But Donald Trump saying he's gonna end it inside censorship. And so I think it's not as much about anonymity as much as it is about, you know, having censorship tied to a voice and censorship tied to a labeled or tagged point of view or labeled or tagged individual or voice on the platform. So without anonymity, I think the problem goes away for Twitter. I think Twitter is working on a project, and I've been saying this for a decade, that they should let everybody pay $50.00 a year, $5 a month or 30 bucks a year. $10.00 a month, whatever it is, to go through a verification process to make sure it's their name on the account, which, by the way, next door is doing at scale, not only do they know it's you, they know it's you're. You're the person who lives at that address because you got a postcard there, I think. And in Korea, South Korea, you're required to put your Social Security number in to open a social account. That would solve the entire problem, now, that may seem, and then it would drive other users who want anonymity to anonymous platforms. And that's where Twitter is trying to have its cake and eating it too. And they're falling on their face. They have. Level, which is troll accounts, you can do whatever the hell they want playing on the same playing field with people who can and and this is just a disaster for them. That Jim Jordan may be an idiot and and just a loudmouth, but I think I agree with you, if the situation was reversed and we were talking about Obama being censored for some reason and the right and right wing people or left wing people being silenced or deprecated on the platform, you know, soft banned people would be up in arms, but that was a different form. He should be doing that. Censorship, and they should have a censorship committee talking about that. What do you think chamath about these two issues, anonymity on these platforms, and the velocity in which things that outrage people because you yourself chamath went from hold on, but I wanted to keep this up for each month. You yourself went from being a perennial guest on a lot of these programs. And then now, since you've been a little bit more vocal about how you feel about social issues, when you said break everything up, who cares on CNBC? And then when you said who cares, let them fail. They don't get their summer Hamptons. You gained 150,000 followers, and now you've learned that if you're more, I don't want to say the word outrageous, but if you're more vocal about social issues, you're going to gain a lot of attention. Do you think you should have been labeled as somebody who is hysterical by your 500,000 people or being outrageous? Umm. Both and all platforms are littered with fake accounts. The interesting factoid from yesterday was I think Facebook says they take down 6.3 billion fake accounts or something. Some crazy, crazy crazy numbers. So they are paying, playing whack a mole. Twitter just basically says we don't have the team and the infrastructure, so just got the 6 billion accounts beat. That's the only difference between Facebook and Twitter. It's a it's a, it's an acknowledgement of the problem and the transparency on the reporting. So. You know, look my my point of view on this is that. I think that irrespective of what I believe about free speech, I think it's becoming harder and harder for me just as a layman reading to figure out what's true and not true. I think that the line is getting very Gray and I think that sources that used to have complete integrity, that were just. Just beyond reproach in terms of their integrity, it's not clear anymore because the business model of the Internet is driven towards clicks. So I think what's actually happening is that we are dismantling information and news and journalism. The first place where I think that goes is places like sub stack which is going to rebuild. It bottoms up where people will vote with their subscription dollars, what to believe and what not to believe. And then on top of that people will overlay aggregation tools so that you can actually have multi subscriptions and create sort of like next generation magazines and content subscriptions or whatever. I think that's where that's where the world is going in terms of information and content, Jason. My honest belief is that I don't think I've ever said. Thinking that particularly crazy, I just think that I'm reasonably intelligent and I'm precise in what I say, and it cuts through a lot of the ******** because most people have nothing to say. So, you know, when I make a ******* investment, I write A1 pager and I post it, and I'm willing to be held accountable. You know, when I don't understand about climate change, I just posted about it, even though I want to invest $2 billion of my own money in it. And so I think being authentic and just being straightforward is sort of like what is valuable at some level on the Internet. I think that governments are going to regulate these companies. Let's just be clear. Yeah. And you, whenever I think about censorship. This doesn't matter what I think, because governments are of a belief that these platforms craft and shape. Public opinion and sentiment which drive the aggregation and coalescing of power which fundamentally disrupts the business model of the politician. Let's go swing over to sacks here. Sacks, any comments on that censorship issue or, uh, the. Once very respected sources of news, maybe being less respected now, I think the New York Times came to mind when Chamath was sort of outlining that phenomenon and then we'll move on to Amazon. Yeah, I mean, I, I think there are things that these platforms can do to elevate the, you know, the the discourse, you know, the the quality of the information people are getting. I think that eliminating the BOT accounts, I think it's a huge problem on Twitter that that it's, you know, that they're out there and they're not really doing much about it. I think that's something they could improve and fix, you know, requiring people to, to be who they purport to be. You know, I think and this is tied to the bot issue of, you know, not allowing. These sort of sock puppet accounts. So, but the thing about those, those steps that they could take is their speech neutral, right. The rules would apply to everybody, you know, to freeberg's point. And so I think they should look at doing more of those things. But you know what, what I'm concerned about is that, you know so, so much of the, the debate, so much of the pressure that's being brought on Facebook is to actually moderate and control the the type of speech that occurs on its platform. And and I think the reason why Zuckerberg is is attacked more than say you know Jack Dorsey is because he's been more resistant to to doing that. I I think I think it's actually because you have a bunch of what seems like real names. But again I think that there's a fake account issue on Facebook that's just as bad as Twitter. It's just the difference is, you know, the the fake accounts on Facebook have proper first and last names, whereas Twitter you have all kinds of alphanumeric garbage as as an account name. So here's a different proposal. Why? You know, maybe what? Maybe what we need is the decision that we allow complete unfettered free speech. And there's a layer of both Facebook and Twitter and YouTube where that's completely allowed. But the precursor to have that access is you need to put in your Social Security number or something that's uniquely identifiable by your government. So that if you say something and there's a law against you saying something already, a pre established law, there's recourse. Where can you go and be anonymous to mouth because you know, on a web page you can create any web page you want. Nope. Nobody's gonna say then. I think what it creates is a decision by a user to coalesce on completely different platforms if what you want is complete anonymity for a very different reason. And I think that that's very reasonable, too. My point is that the solution to this, David, is diversity. Not to have one thing and two companies try to create some Swiss Army Knife Frankenstein product that solves this. It's just not possible. And I think we're both saying the same thing, which is like, you have completely different behaviors. Trying to go in through the same channel, it's not possible. I actually, I I like the idea of these platforms doing more to eliminate bot accounts and and anonymity because those those are neutral rules of the game and they do improve the quality of the debate that occurs on those platforms. I think those would be good things. I think it's just hard to do. I think that those companies may even want to do that. It seems like Facebook certainly does. It's just a hard thing to exist. It's actually not that hard. I mean if you just said, hey listen this account in order to have a verified. Account, you have to have a phone number and e-mail. So that's two steps that a spammer trying to create a lot of accounts would not be able to do because you have to get burner phone number after burner phone number, which is a cost. It's possible, right? But it's a cost. And if you want to be verified, we need your phone number and we need your e-mail address and we need you to you put in your credit card and get charged a dollar on your credit card. Just that credit card. Overnight Reddit would become the new Twitter. Overnight Reddit would become 4 Chan would become the new Facebook. I mean overnight. Like I'm not saying to have an account freeberg, but to have the blue check mark so you would still be able to, and then over time people could say I don't want to see replies unless they've BeenVerified and it could be just a toggle you pick. By the way, Facebook, Google and Twitter already have this mechanism because that's what they do to graduate advertisers up the spending curve. You know, you can start as an anonymous advertiser just spending you know, onesie, twosie dollars just off of a web page. Basically just you go through and you do self-serve ads and the more you spend or the more targeting capability you want, you graduate, you self identify, you give more information, you get more capability back, you get more trust in the system. So it does exist for the customers of these big tech companies and this is the other. Big thing. What it shows you is that it's actually solved the problem for the customers is just doesn't solve it for the, you know, feudalist feedstock, which are the users because they won't pay. And so if you said, hey, listen, there's an answer to verify customers there, they could be those. Twitter's coming out with a paid version, so they're obviously on the, on the halfway there, they're going to come up with the paid version of Twitter. Jack said it on his quarterly earnings. I'm going to, I'm going to sell my Twitter stock. Well, I mean, it's not, it's not one of the other Freeburg though. You don't have to pick one or the other. You could still be anonymous, but you have the opportunity because right now they're not accepting new verified users and unless you're a mucky muck you don't get to even go down that route. So shouldn't everybody have the ability to? I I I would like I mean I personally would like Twitter more if it verified identity. I mean, I don't I don't think there should be a speech tax. I don't know why they have to charge a dollar, but but but taking well, taking a charging a dollar means we have your credit card. It's just another hurdle. That's why I put it in a dollar. Yeah yeah you, you you can do a like a $1.00 auth without actually charging anyone's card. Yes, you could do that, for example, like if you if you actually force people to verify by putting in their Social Security number. Like there's a couple of guys I follow. I'll just name them. Scott Adams, who wrote the Dilbert comics. Yeah, there's a guy, Mike service, who I'm really not sure I understand his politics, but I follow him because I because, you know, he he posts all kinds. He's a rabble rouser. Rabble point is, you know, it's it's not just people on the left, but I think it would be people on the left, people in the center, people on the right who would basically pay the quote UN quote tax because they're already real people and and they would just, they would then have more guarantees and assurances that Twitter won't be arbitrary. And I think that makes Twitter. Better. And if it maybe it makes it smaller, right? And then maybe you're right, freeberg like 4 Chan or 8 Chan or Reddit become good for a different kind of behavior, by the way. I mean, like, that's what we do today. We don't eat the same ******* thing every *** **** day. We don't wear the same pants every day. I agree with where he's going with that. I mean, the the the defining feature of Reddit is that it is basically anonymous. People have usernames, but you never know who it is. And yeah, pseudonyms. And it creates a certain kind of conversation and that's fine. Twitter. Is supposed to be real people. I mean, it's not. I mean Facebook, even more so, but you know, when I think about the accounts that I follow on Twitter. You know, it's it's you know all of them are are real people. Occasionally you'll get occasionally you'll get a C brags you'll yeah you'll get like a startup L Jackson or something like that and. You know, and I and I think that's OK, yeah. But you would choose to then follow them. The difference with like a startup L Jackson is they're not a fake account. They're just using a pseudonym. Right. And you know that when you follow them and over time they've proven to be to provide some value that makes people follow them. And so you could be anonymous. If you get a certain number of followers, I guess you rise above the noise. Here's another solution there. There are no, there's no nuance about truth or how much you believe this is true as a voting mechanism. So if you were verified on Twitter and there was a scale that says how true, how truthful do you believe this is and you could slide it and pick it, you know, from one to five, you could actually have another signal there. What do you think about some sort of a signal to tremont's point about community values saying, I buy this, I don't, 97% of people wouldn't use it and the 3% that do would completely bias their results. OK, Chamath what you think would happen? I agree with Freeberg. I I don't. I don't think that's a, it's just, I don't think it's a really good idea. My, my, my only comment was just offering the other thing. By the way. I know it sounds crazy. Was just offering it as like the, you know, the, the way that this negotiated solution will end up and it's kind of sort of what these Internet companies are being forced to do, which are these weird pseudo action bodies that like review things and like, you know, so it's all just a slippery slope to that outcome. But by the way, you were speaking about startup all Jackson, you know, there was another guy Super Mugatu and you know, he turned out to be this. You know, really good young up and coming investor Dan Mcmurtry and he was sued. You know, he used a pseudonym for a long time build up a huge audience and then flipped himself and basically came out and said here, my name is Dan Mcmurtrie and I run a fund and, you know, it was wonderful. Yeah, I think it's a very good marketing strategy. It's a growth strategy. Now be startup L Jackson. When you get when you venture partner, when are you gonna announce that you're the guy behind VC brags. Like, I'm not ready to do that. I'm not ready either. People thought it was me. I was like, I'm getting tortured. And then wait till you hear that I'm the guy behind zero hedge. That'll really think you, right? Well, zero, I mean, zero hedge is instructive. Didn't he get banned? Or did she get banned for posting? About stuff in coronavirus that eventually turned out to be acceptable and true. Now imagine if he had verified his account, he had his Social Security number, he had all that stuff in there just verified. That's it. Just information that says zero Hedge is real. It's a real person. Yeah. And you know, the rule is when you're that level of verified, you can publish whatever you want so you can say false statements as a real person. So Donald Trump is a real person. He's a verified account and he's saying things that Twitter is then determining or false or inflammatory rather. You know them not try to do it, and I'd rather have pundits that you can believe in. So, like, the other problem is like, look, when you have public figures, you have punditry around public figures. But the problem isn't what that person says, it's you can't believe the punditry because half of them are fake. So at some point you have to break the cycle and somebody has to be real. Well, and this is the problem with the the Trump issue in a pandemic is 2. Edge cases put together and now we're figuring out what the actual cost of it is, Trump said. Masks are ********. You don't need to wear a mask. Blah, blah, blah. I choose not to wear a mask. I'm not gonna give people a satisfaction seeing mask. Turns out masks are correct. We we should have put that or should we have put in front of Trump's non mass comments? Hey, this is against what the guidelines are or the fact is The Who said the World Health Organization said you shouldn't wear masks. Then it turns out now. They have a bunch of conservatives dying who didn't wear masks. No, I don't think, I don't think you should put anything there and let all the Conservatives who believe him die. It's it's not about letting conservatives die. I think that's a crazy way of positioning it, like he's allowed to have his opinion and really like, if anything, I think social media has shown that the way that we used to venerate, like veneration is sort of like, it's kind of, it's been disrupted by social media. Like the idea that you venerate somebody because like, they won an election in a moment is so crazy because they are basically like you and in many cases may be Dumber than you with respect. All these ideas surrounding the idea that we need to. Regulate these platforms. I think we just remember that the way stuff gets into your feed is that you make the decision to follow it. You know, these feeds are self curated. I mean there is this issue about, well, you know, the algorithm does sort of emphasize or or sort of increase the volume. And you know, we want to make sure those algorithms, you know, are done in a neutral way. They're not, they're not biased somehow, but you know, the the, the content that appears in people's feed is content they've they've chosen to see with the exception of trending topics on both platforms. Well, like I said though, as long as those algorithms are unbiased and work in a speech neutral way, I think they're they're fine. But the, you know, the the the the reason why Facebook has been boycotted. Is is that there that they refuse to censor some of Donald Trump's tweets? You know, and but but you don't see those. You don't see those posts. Rather, unless you've chosen to follow them, I think it's crazy that they want to ban him. The problem is it's a chain of, it's a chain of fake accounts and real accounts, right. Let's be honest, it's just a combination of both that exists on both Facebook and Twitter to amplify content in ways that none of us really understand. And I would be very skeptical that anybody there really understands every single piece of content, how and why it gets weighted the way it does. And, you know, like, I bet you that there's probably a way to tell whether an account is fake. I mean, obviously they have system integrity tools to figure this out. That's. And there's no way you could have eliminated 6 billion accounts if that wasn't true. But then, you know you choose not to suppress the weighting of those, or maybe you do suppress the weighting of them entirely. It's just an all you're talking about, but but in terms of inflation. OK, so maybe, maybe you can game the trending topics that way, but you can't get it in my feed unless either I choose to follow you or you you pay to, you know, run an ad which my eyes are just trained to skip over. So I, you know, I I think if you were to ask the average person, do you believe that you are sort of influenced by deceptive content on Twitter and Facebook or you're sort of unduly influenced, they would say no. You know, none of us believe that we are. But then if you ask, but if you, if you said, do you interact in groups and forums with a bunch of people that you don't know, the answer would be yes. But what I'm saying is that the average person doesn't believe that they're unduly influenced. But if you ask them, do you think other people are, they would say, yeah, I gave it, of course. Like, it's like, you know, when you're having a ******* Slurpee, it's like, you know, do you think that this is unduly gonna hurt you? No, no, it's 1200 calories of liquid sugar. All right. I think we beat this horse to death. There's no solution just on the edges, but let's let's go to Amazon because I thought that this was a particularly interesting one. Amazon, I thought, came out the best of everybody and is the least likely to be broken up. I think some of you agree with that. What were your impressions on Amazon's performance and Amazon in terms of being broken up? Let's start with you freeberg, and then we'll go back to Champ. I think the intention of antitrust law is obviously is to protect consumers and protect markets and protect market pricing from being manipulated by monopolists or monopolies. And so you know the the the the point that was made about Walmart years ago is the same point that's being made about Amazon today, which is that they're crushing small local businesses and as a result there is a lot of damage being done and they are quote UN quote too powerful. But the reality is that the the pricing. Effect of what they're doing is what needs to ultimately be scrutinized and I think is what will ultimately Dr whether or not these guys have either some massive penalty or get forced to break up. And so you ask yourself the question, look, if I'm going to buy, call it a mattress or let's let's use something like a pillow, is it cheaper for me to buy that pillow as a consumer through Amazon or from the local store now? What if the local store is put out of business because of Amazon and now Amazon is the only place I can get a pillow? Is the pillow now going to be more expensive? Less expensive than it would have been otherwise. And I think that is the lens by which we need to kind of assess and the regulators will ultimately assess whether or not Amazon is causing harm in the marketplace because of its position and its power. Look, I have several businesses that sell on Amazon and it is ******* expensive. One of my companies, I'm on the board of we, we've been the number one food product on Amazon multiple times and we, we kind of slide up and down the top ten. Can you say what that is? Yeah, Soylent. Soylent. And so we sell a lot of Soylent on Amazon. Yeah. And it is expensive, man. I mean, the fulfillment, the shipping, the advertising fees they force you to pay. I will tell you that as a business owner or board member of a business that sells and I have several others that sell on Amazon. It is a it is a grind and it is cheaper for us to sell directly through shop. Why don't you just raise the price on Amazon? So to some extent, so Amazon, this is actually part of the problem. So Amazon forces certain best pricing negotiations. If you're a large seller on Amazon, you have to make sure in order for them to promote you and make you kind of a sponsored item and show you at the top of the list, you have to give them the best deal, sort of like what Walmart does, right. You can't have a cheaper price anywhere else. And so that was something that did not come up. They force you to have the best price there even if you charge more on your website in these negotiated deals. Yeah. And so you have to make sure that you're providing. And I'm not sure what the deal is specifically with soil. So I don't want to kind of speak incorrectly here, but I know the same thing from other folks. What if someone is kind of part of what happens. And so I will tell you like it, it is harder for, it is cheaper for me to sell soil and I I think it's cheaper for some of these products to be. So I can tell you my other company which we sell quinoa, it's cheaper for us to sell through retail stores than it is to sell on Amazon. We actually give up more margin selling on Amazon. So why would you do it? Because of the volume and because they've aggregated all the. So you've made the decision. As an entrepreneur, to sell you quinoa in all places, even though you lose some margin, you make it back in Agra. Well, this goes on. The more capitalism to me. Well, this goes to the market problem because now I as a I have less choice as a business owner because the only place I can find consumers is in this online marketplace called Amazon. I can no longer go sell at 50 local grocery stores because people don't go to the friggin local grocery stores anymore. And that's obviously a little bit of an extreme statement, but let's say I'm a pillow guy. I can't go sell up 50 pillow stores because they've all been shut down because all the consumers go to Amazon. But could you also sell at Target? And Walmart and those other competitors who seem to be doing just, you know, pretty well actually they're doing well. Yeah. And and a lot of people have said that they're the kind of, you know, the exceptions, but there's 1000 versions of Sears and other stores that haven't done as well. Walmart and Target just happened to be extremely well run businesses, but there's nothing fundamental about those businesses. Kicked you off the platform and said we're not going to allow third party sellers. Would you be happier or would you be sadder? It would be sadder. Got it? Chamath, what are your thoughts? Amazon specific. Yeah, I think David said it really well up front, which is that it's a it's kind of a when and not an if. So it's, you know, Amazon today I don't think is at risk just because it's in market is so big. But I think within 5 or 10 years it definitely will be looked at through the same lens as Facebook and Google. And actually just those two look and I think David said it also really well, like the antitrust law. That you would get. You know, to be successful if applied to Facebook and Google has nothing to do with users and content, and it has everything to do with the pricing of the ads to their customers. And if anybody actually were smart enough to figure out whether there was some way in which their auctions were working that was effectively pricing inventory in a market, quote, UN quote, or in a system manipulated way, that's probably the best hook to, to nab one of these folks in antitrust law. But other than that, it's going to be regulation. In terms of Amazon, I think they're going to get away unscathed. What's incredible by the way is you know two days later they're like, hey, by the way, we just got an FCC license that we're doing a lot to $10 billion satellite constellation. And you know, if you, if you looked at their RFP to to the to the FCC, the number of people that you know basically complained and cried, it was incredible. By the way, I think this is a huge important point that we haven't made, which is the benefit of scale for large innovative companies. There is no way. Any company would have, out of the blue, been able to afford a $10 billion distributed satellite program without having customers and all this other stuff lined up. Amazon can afford to take that risk, just like Alphabet has taken the risk with self driving cars and did so before anyone else for many years, which is a net benefit for society corrective, which is a net benefit for society. So by having scale, by having incredible profits by and then by reinvesting it in R&D, creating jobs, innovating, it's the only way this kind of stuff is going to get done. You're not going to get it done by breaking up these companies and having 100 companies that only have $10 million of profit. Age and then each of them are, you know, no one at all can afford to do these grand important projects that that move markets forward ultimately for humanity. Freeberg you see these trillion dollar plus companies as because they can make those big swings a net benefit for humanity as a technologist and as a kind of person that hopes for the future. I hope, I hope that they that that these sorts of companies can continue to persist and that they're led by people that want to take innovative risk with R&D. And by the way, if they don't, they're gonna ******* fail eventually, right? It's these guys that are leading these companies and and putting these crazy bets on crazy new ideas that are allowing these businesses to remain competitive. And if they didn't, and you know, some big company manager were to come in and start running these things and distributing cash and dividends back to shareholders, these wouldn't be happening. And and, you know, capitalism would take care of itself and then the next big innovative risk taker that can generate a profit and reinvest that profit in a smart way. End up winning in the marketplace. So, sacks, you are a big investor in SpaceX at craft ventures. I understand. And when you see Bezos copy every single thing Elon does from, you know, launching the Rockets to then putting up the satellites, do you think he's just a copycat? Well, I, you know, I I think he's the scariest monopolist out of the the whole bunch. You know, if you look at kind of Amazon versus say Google or Facebook or Apple, I mean those those other companies are sort of sticking to their original footprint whereas Amazon keeps expanding into new areas. That that whole monetary has about your profit as my opportunity. And so yeah with each you know with with each advancement they make as they get into you know as they get to a new level of scale they then turn around and and seek to take over kind of the the you know the areas that that their vendors or or business partners are operating. And so you know it started with first they did retail you know books and then they expanded to other areas of retail and then they take over infrastructure and now there's talk about them getting into. To frayed or trucking. And so yeah they keep expanding into these new areas and it's it's really a statement about our politics. I agree with Jamath that that Bezos went pretty much unscathed and I think it has a lot to do with you know he he did win the Internet with that opening statement that he gave. It was really sort of great you know rags to riches only in America type story and and so I think I agree with he's going to get away pretty unscathed but I I do think that there they are the scariest monopolis of the bunch. Well comments. Specifically on him copying every one of Elon Musk's ideas. Well, you know, copying is it's it is, it is sort of a part of the game. You know, it is part of the game. And I've heard you attack Zuckerberg for doing the same thing. And, you know, look, I I get it. You know, we, we, we prize innovation and we, we, we love innovators. But as soon as you say that you can't, that other companies can't copy those innovations, you do stifle progress. And I look at it as more how consistently you do you do that. As your playbook when you look at Amazon basics, this is the point I wanted to make when and I made in my my earlier podcast, which was, you know, the Amazon basics and the third party seller system is the thing that they keyed in on these hearings. They did not key in on the issue of that Freeberg brought up, which was what is the margin they're taking from those third party sellers, which I think would have been a much more deft approach to questioning them. But when it comes to third party sellers, the fact is they're allowing people to compete with them on their own platform, which drives prices so low. And when they make a better USB C cable, that doesn't take a genius to make a better cable. So do you think Amazon basics should be allowed and is great for humanity, or do you think that that using of the data, because they have the sales data on it is in some way abhorrent and a problem given the way antitrust laws are currently framed for sacks? Well, OK, so I think this is an area where. So the the area you're talking about is the way that these platforms treat the applications or small businesses that operate on their platforms. And I do think this is a good area for Congress to keep scrutinizing. There, there there's a saying in chess that that the threat is greater than the execution. So sort of a chess strategy principle. I think that's true here where we, I I think the execution would be a disaster if we actually impose a lot of these rules, if we broke up these companies, if we stopped Amazon from innovating. I think that that would be a disaster for for for those companies and for the economy because I do think they they do a lot of good things. But in a weird way, I think we have to keep threatening to to do those things in order to get these. Companies not to do anticompetitive things. I mean, we heard Bezos say that he couldn't guarantee that they weren't using their their, their sellers data to to, to, to in inappropriate ways, basically Amazon to to break Amazon's own policy. And so I think you do have to apply this kind of scrutiny to these companies, because I don't think we want to be retroactively. You know, remediating a situation. I don't think we want to be breaking them up or doing something like that, but I do think we want them second guessing these anticompetitive decisions before they actually happen. Because otherwise, you know, so they the scrutiny some rules. But we certainly don't want to ankle them versus their competitors in China as we wrap up here because we're getting way past our hour. We're now at 80 minutes and we set a Max and 90 here, which is what we all agreed on. I want to talk about the election. We are now at the 100 day mark. We all thought Biden was a shoe in. Now I have my own thesis. I wanna float it and see what you guys think. You had Trump start wearing a mask last week, telling everybody they should wear masks. Now there's universal discussion of wearing masks. We've got a little bit of vaccine hope, and we'll get to friedberg's position on is that vaccine false gold or is it actual reality? But we know that masks are going to take three or four weeks, if they're implemented properly, for us to see the caseload go down, which then the caseload starts going down, and three or four weeks after that, the debts would start going down. We may have. Been a little plateau in the number of cases. Cases is ramping up. We had a record 850 or 900,000 just yesterday at the time of taping, I think on the 29th of July. Now my thesis is Trump goes all in on masks. The vaccine starts to show promise. Right as the debates start, he gets in there with Biden. We see caseloads go down, we see deaths plummet. We get down under 250 deaths per day in America. By September 15th the market rips. And on Sept, end of September, we have the first presidential debate. Biden dunks on a senile or maybe not crisp Biden. Trump sells in and we were just talking two months ago. Anything could happen, but Trump was definitely not going to be there. Let's go around the horn freedberg vaccine, false gold or really promising and what happens in the election? I think there's tons of promise with vaccine news in the next two months, three months. I guess the point is you're going to hear more upside than you're going to hear Downside news on vaccines for sure. You know whether or not we have a vaccine and by when and yada yada percentage chance we have a vaccine, we're gonna have a vaccine. I think it's a function of how many doses at what point in time. And you know there there is this 30,000 trial happening with Moderna right now there's a a Russian vaccine that just got approved yesterday in Russia that they're saying is ready to go and they're starting to distribute it. So there is a vaccine. There are vaccines, right. This is a a known known so. So that news will only continue to improve and build and they'll only be more and more indications of success with vaccines between now and November. How that affects markets, I think I'm not sure that drives markets as much as some of the other stuff that's going on in markets with with the Fed and and with policy and with stimulus packages. I think those are are frankly important drivers right now and how much the markets ultimately affect the election. Don't know. So yeah, it's still it's it's all still pretty uncertain who's gonna win the I I think it's pretty uncertain. I I talked to you put your entire net worth on one person go. Yeah, I, I I I still think Trump is I I I kind of have been vacillating on this. I I think Trump is probably only going to improve from here on out. So your entire net worth is on the line in three two place, your bet I'd go Trump. Wow. Wow. It's still it's it's still it's still to me. I mean Trump has got to be the huge underdog here. I mean, right now it looks like buying's going to win. I mean his basement strategy could backfire. In the sense that if you know fundamental conditions improve with respect to COVID or the economy, the fact that he hasn't said anything, done anything, gone anywhere, you know, it it it it could it could turn out to be a mistake. But right now it it looks like it's working and and you know, Trump seems to be completely knocked off his game. You know, just earlier in the week he floated this trial balloon about delaying the the election that was completely shot down by Republicans and it seems like. What did you think as a Republican when you saw him tweet that? What did you think what was your emotional visceral reaction as our token? You know I'm not I I I don't I don't necessarily identify with with partisan politics. So let me just, I have to state that but we should look but you know it's an American to him saying delay the election. Of course everybody everybody shut down for your reaction. Everybody shut it down for good reason. Everybody your reactions, of course of course we're not going to delay the election. We've, you know, you know, we we we haven't delayed the we didn't delay. The election to to Fight World War 2 pin does a Republican he's it's not gonna **** with your deal flow sacks you could be a Republican. OK. Your entire net worth. We have to wrap your entire net worth. Sacks you could right now 3 two now right now it looks like Biden's going to win that Trump's Trump's been knocked off his game. And we need to say like I I think the the problem that Trump has right now is he's a salesman without a sales pitch. You know you go back to the state of the Union pre COVID he had it all worked out. He was going to run on the greatest economy ever. Keep America great. That issue has been taken away from him. And it seems like he's still trying to regain his footing. He's trying to figure out what to run on. And the fact that he can't do these rallies, which were really, you know, the fact that he was able to go in 2016 to these swing states, he would be, you know, flying around on his plane and and and he would three. He did 3 rallies a day in these swing states with 10s of thousands of people wanted it. He wanted to win. It was. It was. It was that. And it gave him a way to go over the heads of the media and speak directly. To the people, and then those people talk to other people. There's a lot of word of mouth. And so he the inability for him to hold those rallies, I think, has just been devastating for the type of campaigning that he likes to do. And so, in a weird way, we have less than 100 days to the election, but it feels like the campaign hasn't really started yet because Trump can't do rallies and Biden hasn't left his basement. OK, chamath. Entire net worth on the line all spacks SPAC B SPAC CPAC did whatever you got smacked up. All your spacks on the line, everything. The Warriors position 322. But we don't need to guess. But I'll tell you why. You know. We had a 33% drop in GDP. We have double digit unemployment. And I think Trump's real path to winning the White House, which we talked about before, was getting an enormous stimulus bill passed, and he didn't force the Republican Senate to the table to make sure that these unemployment benefits didn't roll off. Now there's a very practical problem with these unemployment benefits, which is that it is not administered at the federal level. It's administered by. Literally 50 state agencies that run relatively decrepit software. Now, just so you guys know, why did we pick $600.00? It was an estimated numerical average because what the Republicans really wanted to do was just top it up, you know, whatever you used to get to get to 100. And it was technically not feasible to implement across 50 different. Right? And so somebody in Boise, ID, is different than somebody in New York. So, so they they were like ah 600 bucks. So my point is it's gonna take 4 to 8 weeks to reimplement unemployment insurance once we decide what we're going to do. So that basically if you started today puts you somewhere between September 1 and October 1 and so you have then 30 days to basically catch a positive tailwind or 60 days, so call it midpoint 45 days. You know you have now federal eviction laws that are rolling off so. I think that it's setting itself up for a different, very, very difficult path. He just stopped spending, I believe in Michigan. Trump did. Which is not a good sign. He actually has overspent in Georgia. So if you look at the facts on the ground, your entire net worth goes on. Now it Biden it's it's a languishing campaign as of today. David is right. He's a salesman without a pitch, and unfortunately he's a the path isn't clear. The path should have been paved with money. It's such a no brainer. Here, let me let me give you one last all that money too. And why would you stop printing the money if you gave everybody $1200 and six weeks of unemployment? Why not just do it for another six weeks and give everybody another 1200? I don't understand why that's such a difficult decision for Trump. Freeberg go. Let me give you a scary poll that just came out by you Gov. It's says 55% of supporters of Donald Trump say that they will not accept the election victory of Joe Biden if mail in votes are are are allowed. Wow. So you know the, the, the framing of this is actually a little bit more serious than just who's gonna win. There is a further polarization constitutional crisis question rioting you know whatever disregard for the election entirely kind of moment coming up here. Because Trump and others have kind of framed this as such a non election election because it's all fake and it's all fake news and it, you know, this is all part of the conspiracy. So there is something scary brewing, I think, and that that's what I'm kind of most interested in tracking is really where does this all go percentage chance that we get to a constitutional crisis and Trump says I'm not leaving the White House on a percentage basis freeberg. I don't think he'll say I'm not leaving the White House. I think he's going to be ******* happy to go back to wherever he's gonna go. OK? Yeah, but I think, I think there's gonna be other ramifications that are worth us figuring out if thinking about because that's the scary stuff that's coming next. OK, that's 25% chance of a constitutional crisis. I think if the elections close, we could easily have like a Gore V Bush type situation. It could be very damaging for the Republic. I do not think there will be a hanging Chad issue in this election. This is going to be one way or the other. Incredibly decisive on an Electoral College level. OK, final, final. Not set up for it to be that, that close. OK, well, I I don't think the election is right now. It's not trying to be close at all. It's trying to be a blowout. And so I think we'll avoid the the crisis because it's not close and it looks like Biden's going to run away with it, but if it does get super close. You know, I could imagine there being a crisis based on people not accepting the if the margin of error is within the margin of these mail in ballots and you have, you know, 3040% of the population saying they're gonna accept it. I'm not saying we'll have like a legal crisis, but I think you could have a legitimacy crisis. It could be very bad for the Republic. Not as bad as Trump's presidency, clearly. So final question, final, final question. If Trump believes he's not going to win and he's essentially given up right now, which he feels like he's kind of given up, what would do you think who would win if Trump says Nikki Haley and Pence can run? I've done such an amazing job. I've been the best president in the history of the Union, but I want to get back to my life and I think Pence, Nikki Haley should go for it. What happens and who wins? Sacks. Too late for that. Too late for that. You can't. You can't put Pence and Nikki Haley on the ballot. Why not? You? Of course you can if he says I'm feeling under it. If he bows out, the Republicans would have to pick a successor. It's not a new third party that the Republicans would be allowed to pick a successor. If he said I'm not doing it for, uh, you know, health reasons, whatever the reason he comes up with. Nikki Haley? No. Too silly. Silly. I think he might drop out. I think. There, I'm putting it out there. I think it's a 5% chance he doesn't wanna be demolished. And he says, you know what? I'll take the deal. You agreed to not prosecute me getting out of here. I'll take it. And and I changed. I changed my bet to Joe Biden. I've changed my bet after that. Just after you risk your whole net worth. You change Joe Biden? Well, he's clearly the favorite right now. And the question is whether there's still time for there to be a change. I mean, honestly, I think we should stop bending on what the outcome is. I think it's stupid. I think what we should really be worried about is what what are we doing? Like letting 10s of millions of Americans roll off of unemployment insurance with zero? Like the Republican Senate went on vacation? It's ridiculous. I mean, they should all be fired. It's it's the craziest thing. We have the biggest crisis in our lifetime. If you roll up the last three crises911.com bust and the Great Recession, those 3 pale in comparison. To the magnitude of this one and these ************* are going on vacation, I agree with you. It's outrageous. I I don't think partisan politics are that interesting, but I I think they will eventually pass a bill. I think the, the the issue on the unemployment is not that the Republicans don't support an extension of unemployment, but the the magnitude of the unemployment now exceeds what workers would get if they went back to work. And so I think they're concerned about creating a disincentive for for workers. But the difference why not make it $300? Honestly, there's such fake ******* news. Like, it's like it has been shown that people then end up spending that money. Like, I don't know if you guys saw, but like there are industries that are posting. It's not just Facebook, Amazon and Google posting meet and beats like you wouldn't believe. In boating, in housing. People are spending this money. It drives GDP. So whether you put 600 or 200 or 1200 into people's pockets, they have a proclivity to spend it. They should have gotten something done. Trump Trump as well as all the Republicans are up for reelection. I think we just cave on this issue and and I I think it will get done. The the Republicans are opposing it are the ones who aren't up for reelection and are concerned about debt. You know that's the, that's the, that's the concern that all of a sudden death matter. If we go into a depression. David, why not what the incremental six weeks of unemployment put it at $300.00, but get something done, David. Why are you not getting something done, David? Why is your team ******* this up, David? Yeah, I don't. I don't wear a jersey. I'm not on a team there, but I I think they will get something done. I mean, I'm not not back from vacation. Do you think they should have gone on vacation? They've got their own vacation, David. They can't. They gotta come back to work. These guys went duck hunting instead of taking care of the 15 million. Your team went duck hunting in Washington DC, because they're there. Obviously, there's a lot of there's enough Republicans who want to get something done. I mean, why not blame the Democrats for being too intransigent? Sorry. What I'm saying is it's not Republican. I'm saying the entire sentence. We're breaking your chops, sacks. The the entire group should not have gone on vacation. The entire half, half, half of the Congress is gone. They're not to be found. Where are they? What? What are they doing? That's more important. Maybe they're hanging on their basement, like, like Biden. I love you guys, all right? Everybody stays safe. On behalf of the dictator himself, bestie, see the the SPAC Meister himself, stay safe, chamath. On behalf of the Queen of Kinoa, the Fried burger himself, stay safe, David Frieberg, in whichever one of your three houses you're in right now. And. Terry? And to Rain Man, he's definitely burnt that don't burn, baby. He's definitely a great driver in the driveway. Yeah. Yeah, definitely. Yeah, yeah, yeah. He's definitely wapner. Wapner. And of course, having fish sticks. And of course, he's still investing from Kraft. Certainly craft funds still investing. We'll see you all next time on the 6th. Most popular podcast out of the gate. Let's see. Maybe if you tell your friends about this podcast, we'll go to #1 on the technology list. I love you. Guys, stay safe. Can't wait to play poker. Bye. Great job everybody.