This Week in Tech 457 (Transcript)


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This Week in Tech 457

Leo Laporte: It’s time for TWIT, This Week In Tech. John C. Dvorak joins Dan Gilmor and Matthew Ingram to talk about the week’s story. The Oracle, Google decision, big one for the internet. The FCC open internet decision, the votes coming Wednesday. And in believe that you have been lied to about the Apple Beats acquisition. I’ll example why next on TWIT.

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Leo: This is TWIT, This Week In Tech, Episode 457, recorded May 11th 2014

Hopped up on Goofballs

This Week In Tech is brought to you by GoToMeeting from Citrix with HD faces. The powerful, simple way to meet with co-workers and clients anywhere. Share the same screen and see each other face-to-face with HD video conferencing, even present from an iPad. Start your 30 day free trial of GoToMeeting today, visit gotomeeting.com, click the try it free button and use the promo code TWIT. And by stamps.com, use stamps.com to buy and print real US postage the instant you need it right from your desk. To get my special offer go to stamps.com, click the microphone and enter TWIT. And by Carbonite, whether you have one computer at home or several at your small business, Carbonite backs up your files to the cloud automatically and continually. Plus accounts your files anytime, anywhere with the free app. Start your free trial at Carbonite.com, no credit card required, use the offer code TWIT to get two bonus months with purchase. And by Gazelle, the fast and simple way to sell your used gadgets. Find out what your used Apple or Android device is worth at Gazelle.com. It’s time for This Week In Tech, the show the show that covers the week’s tech news. And this was the week that was. We’ll talk about it in a second. First, hello to John C. Dvorak.

John C. Dvorak: Hello.

Leo: Who’s dressing down once again. You're getting worse and worse. You look like you just woke up.

John: I did.

Leo: Are you wearing jammies?

John: I got these things, it’s kind of a quasi-old man hipster look.

Leo: You're doing that now.

John: Hey, hey I like you kids.

Leo: Hahaha, John is my – I'm touching him and he’s leaning away. John is my old, old buddy, got me started in this business.

John: Oh yeah.

Leo: I owe yeah.

John: Yeah you do.

Leo: I do.

John: You can write a check.

Leo: I will. Now also with us, Matthew Ingram just back from Perugia and New Orleans. From Gigaom.

Matthew Ingram: Hi.

Leo: What was the deal? You guys had a conference in Italy and then had a conference in New Orleans?

Matthew: Actually the one in Italy was put on by someone else. It’s the international journalism festival.

Leo: Ah fun.

Matthew: And then we had a Gigaom editorial offsite in New Orleans.

Leo: On the way back.

Matthew: On the way back.

Leo: Yeah, god how do I get invited to the International Journalist Forum?

John: Just go.

Leo: That's sounds fun.

Matthew: I could put in a good word for you.

Leo: I would – Perugia is a medieval – isn’t it the oldest university in Perugia? Medieval University? It’s one of the oldest.

Matthew: It’s certainly pretty old, I mean it was the capital of the Etruscan Empire. So that's pretty old.

Leo: Well, you don't get better than that. Hey I want to welcome Dan Gilmor back to the show. I think the last time Dan was on was many moons ago. It’s great to have you, Dan was for a long time at the San Jose Mercury News. He left to create Citizen Journalism as we know it. He is a technology writer, director of the night center for digital media entrepreneurship at the Cronkite School of Journalism as ASU. And writes a regular column on the Guardian which I find increasingly – I turn to because you really seem to do a very good job of boiling this stuff down.

Dan Gilmor: You're kind to say so, it’s a lot of fun to back in the Journalism thing.

Leo: Yeah, the Journalism thing that we love so well.

Dan: By the way I was over in Perugia as well.

Leo: Aw man.

Dan: So we’ll both put in a word for you.

Leo: Was it wonderful?

Dan: It’s an amazing conference, absolutely amazing.

Leo: Yeah that sounds like a good conference actually.

Matthew: It’s incredible.

Leo: Yeah, so let’s talk – we’ll get started off with the FCC. We've been talking about Net Neutrality now for a couple of weeks. Wednesday’s the day that we will finally see what these proposed rules are. It was leaked to the Financial Times apparently who wrote a couple of weeks ago “Oh my god, the end of the world is – the FCC is going to allow carriers, broadband carriers to charge for accounts to their customers.” In other words, to charge Edge providers like me, like Netflix—

John: You're an Edge Provider?

Leo: Anybody who provides content over the internet. You're an Edge provider, and you're an Edge provider, and you, and you, and you. And of course the world went “What!?” and there's Alexis Ohanians raising money to put a billboard up outside the FCC. I told Tom Wheeler a troll. You know I mean it’s just – but the truth is we haven't seen the rules right, Dan? Or do we know what the rules are going to be?

Dan: Well we know pretty much what they're going to be. And it’s a proposal, it’s not official rules yet but they're in the process of if it happens the way Wheeler wants then there will in fact be a slowlane and a fastlane on the internet and it would be pretty damaging.

Leo: The rule – what's going to happen on Wednesday is the commission as a whole will see these proposed rules for the first time, vote to open a period of public comment, I think it’s a total of 90 days of public comments, 60 and 30. And then vote on the rules. This is in response, and stop me anybody if I'm saying this wrong, I'm doing my best but this is – a it’s technical, so you have some technical expertise and a lot of the commentators I've read who understand the politics of it don't understand the technology and vice versa. So you got to understand the politics of it and the legal ramifications of it and the technology of it. But this is my understanding, the FCC proposed internet rules, Verizon challenged them in court and won. And the court said is “You don't have a mandate from Congress under the telecommunications act to tell internet service providers what to do”, the court said “Come back”, they said “We reckon the effect in the opinion, we recognize open internet, a free internet is important but you just don't have the legal authority to do this. You don't have jurisdiction. Come back and try again.” And there are a couple of approaches. One, the FCC can rewrite the rules under the framework proposed under Title 3 of the Telecommunications Act section 706. Or, and a lot of people are suggesting they should do this, they can use Title 2. They can declare the broadband providers a common carrier, like a Telco and say “Hey you're a common carrier, now we’re in charge. The FCC regulates common carriers. We could say—

John: I always thought we didn't want the FCC or the government involved in the internet but now all of a sudden we do, okay.

Leo: No, well see this is- and I agree this is part of the conundrum of this is, certainly government regulation of the internet, everybody agrees it’s a bad idea.

John: But it’s going to happen the way it’s headed and the way you guys are promoting it. You guys are actually promoting it.

Leo: Well I don't know even know that. The government set up a situation in the United States that is pretty bad with a really strong lack of competition. They basically gave monopolies to cable companies. They created Duopolies in most areas where you have two possible providers, your phone and your cable company. There's not a lot of competition. The lack of competition means you can't go anywhere if you don't like what your what your cable provider is doing.

John: Right, you're stuck. And the local governments can't do much about it because of certain regulations that were put in place.

Leo: Now we had a very good This Week in Law on Friday and I was listening very carefully to it and a couple of things came up. First of all, some of the panelists on the show believed that Tom Wheeler was not the devil incarnate, who knew? Did not represent the interests of the cable companies and the wireless companies, both of which he’s worked for in the past as a lobbyist. But in fact was trying to do the best he could without going Title 2. And the panel felt that the Title 2 rules were really draconian, start to regular like broadband providers like common carriers and it is a nightmare. In fact that was AT&T’s opinion. This week AT&T said “Oh, no title 2, that's going to kill the internet.” Dan maybe can you cut – have I said anything wrong at this point and can you cut through this a little bit?

Dan: Well I'm equally concerned about the idea of going to the common carrier rules without thinking through really carefully what that means. And it could all go wrong if they do that. However, as John pointed out himself, what we have now is effectively a duopoly or really a monopoly in the places where either Verizon has Fiber or Comcast of the cable companies pretty much everywhere else, if you want to have even decent speed. And we've seen that these carriers simply are going to insist on the right to decide what bits get delivered where, at what speed, whether they get there at all. And that's just not acceptable. Common Carrier notion means that they have to do their best. And you also pointed out and this is right that the lack of competition for what we laughingly call broadband in this country, which isn't really broadband, the lack of competition comes from that the fact that the government, starting with congress, basically gave these companies control and here we are what people been predicting for more than a decade is starting to come true. And Title 2 is awful but it’s probably less awful than letting the cable companies run rush shot and the telecoms run rush shot. And keep in mind that with wireless mobile, it’s already over. No one’s even contesting that they're going to control that stuff.  So this is really close to being over.

John: Well, actually why don't people complain about that more? That the wireless things – there's no equal bits, equal packets for everybody on wireless. It’s a horrible action.

Leo: Even Google is in bed with Verizon on this one, they said well we understand that wireless, and I think this is true, wireless is very different technical considerations and wireless shouldn't have to be at least at this point neutral. But the landline should be neutral.

John: Well it’s not going bad, it’s not going backwards.

Dan: I don't understand why we accept this for wireless either. Yes they have different issues but if it’s a matter of capacity then charge people on how much they use but the people out of the edge of the network should making the choices not the people in the center. And that inexorably we're moving toward the people in the center deciding for us.

Leo: Really the real problem—

Dale: In conjunction with their partners that are really big companies in other respects.

Leo: No but I don't want government involvement in the internet. But I also don't trust Comcast as far as I can throw them. And all of these companies, AT&T, Verizon, Comcast, their job, their mandate is to maximize profits.

John: I love [?] Comcast.

Leo: They don't have—

John: Well I can't use it for podcasting.

Leo: Why not?

John: Because we have Jitter, it’s weird.

Leo: Well what a surprise.

John: Yeah well…

Leo: I mean that's the other problem, is that these companies are all in the television business, they're all in – you know Comcast not only—

John: They're NBC.

Leo: It’s NBC, it also provides content, premium content over the wire. And they have Telefony. So all of these companies are in direct competition with the free internet sevices.

John: So this is all monopoly stuff that—

Leo: It’s a mess.

John: But that's the real problem to me as far as I'm concerned.

Dan: So there is a way out but we're not going to get there with the people in charge. The way out is to do what other countries have done in many cases, which is to say to the people who have these monopolies or at most duopolies on the pipes, say “Okay you have to lease capacity to competing ISPs at an imputed cost that's roughly what you pay now.” And that doesn't fix it instantly but that's what we have to do or we're just not going to get there.

Leo: I loved your article in the Guardian, the FCC’s about to axe- murder net neutrality but your advice is don't get mad, get even and you suggest, and I think I agree, I think this—

John: Can I guess what he says? I didn't read it.

Leo: Yeah, how would you get even?

John: Get off the internet now and kill your cable subscription.

Leo: No he’s saying – hahaha, that's not practical.

John: Yes it is. There's no reason for us—

Leo: No then we have no net, we can't – but you just put me out of business, thank you very much.

John: You're not a business.

Leo: Without the internet.

John: Okay, you can find something else to do. You make most of your money from the radio show anyways that's syndicated. You make a fortune on that thing, you can still do that.

Leo: John you are such a disturber.

John: I'm just saying.

Leo: You recommended, and in think this is a good solution, community internet movement. I think that's a really good movement. If you don't like the internet, build your own. Community broadband networks owned and operated for the public you say waiting for Google Fiber. You might as well wait to win the lottery. Google is not your daddy or your savior.

John: Well you got that right.

Leo: Yeah and then call congress and – see I, and you know I talk to John Perry Barlow about this a couple of years ago. He’s of course founder of the Electronic Frontier Foundation on the board, he said “Even among the board members of the EFF, we're divided. Some of us understand that government regulation would be a terrible thing in any regard. Others say well but there's no other solution at this point.” Matthew Ingram help us, cut the Gordian Knot. What do we do? Your fault, yeah you're Canadian.

Matthew: Wow.

John: He’s Canadian, he doesn't care.

Leo: You can say whatever you want.

John: Hey Canada.

Leo: Stop it.

Matthew: I do the only sort of rational argument that I've heard for why making the cable carriers, common carriers wouldn't be a good idea came from Mark Andris who I had a sort of back and forth with along with a bunch of other people on Twitter about when this first came up.

Leo: Right.

Matthew: And when they lost the ability to regulate and everyone was saying make them common carriers. His argument was “If we want to have the internet get faster and faster and faster, more and more bandwidth so we can do you know virtual reality or so that we can do telepresence and we can do all these amazing things. Education and so on over the internet then we need investment in the infrastructure.” And his point was “If we make cable companies common carriers, they lose the incentive to invest or over invest in the kind of infrastructure that we need.” I'm not saying I believe him but that was the sort of nub of his argument that – and he didn't really know how to prevent them from doing the things we want to prevent them from doing either but his point was if you just legislate that they are common carriers, they will presumably lose the incentive to invest as much as try have.

Leo: This is why it’s so damn complicated. And I don't know if there's a golden or silver bullet on this. I really don't. The more I learn, the more intractable it seems, frankly.

Dan: Well you know if this country had common sense, which I'm afraid we don't anymore, we would look at this the way we looked at the interstate highway system in the 1950s. A public works project that is essential.

Leo: Right.

Dan: That we the tax payers should pay for. We should put Dark Fiber everywhere essentially, as tax payers we should put it there and then let private industry light it up. Again I don't see us doing it. I think there's been a conscious decision made by the government to get in bed with the telecoms and to control our communications. And I don't mean – that's not a conspiracy, it’s just reality.

Matthew: I think there is a lot, another thing that Mark and others have mentioned is that there’s a lot the FCC and the government could to in terms of helping regions or towns or cities, you know provide their own high speed access and some of that is freeing up on license spectrum, you know forcing carriers to give up spectrum their not using so that then you can you know, those different like smaller areas can create their own effectively Google Fiber or their own ISP and provide some competition.

Leo: Great post on level three’s blog, Observations of an internet middle man. This is Mark Taylor writing and he really kind of lets you know that these big broadband providers are not looking out for our best interest. Level three is kind of an internet middle man, they own backbones, they make deals with other networks to provide access to the internet. Most of these deals are peering, what we call peering relationships. Mutual agreements that have gone on since the beginning of the internet. Often handshake deals between engineers saying “Hey we’ll direct connect you if you direct connect us.” Sometimes those relationships are asymmetric, one user sends more data over the network over the other, in those cases maybe there's payment and so forth. But he says typically, in these agreements, the way it works is everybody’s responsible for fixing congestion. If all of a sudden the way people use the internet changes and there's a lot of congestion in a particular route or router, they beef it up. That's normal. So he mentions that level three, and by the way these are real numbers and that's one of the nice things about this is that this is somebody who’s right there in the middle. Level three has 51 peers like that. They are interconnected in 45 cities. 1,360 10 gigabit Ethernet ports. That's capacity of 13.6 thousand gigabits per second.

John: Thirteen terabytes.

Leo: Thirteen terabits per second, per second! And the average number of internet connections, cities per peer is five. So he shows a normal situation where this is a hundred gigabit port in Washington, DC a peer connection without congestion. That's the bottom graph here, and you see these spikes of usage. But there's not congestion. All the packets get through. In fact the bottom right hand graph shows zero packet loss. Look at the top line. This is a connection with one of the five major broadband providers in this country. It is congested so you see that the top, the peaks of the graph are cut off and you see packet loss, significant. I mean, at the point where the port is so congested that it is unusable.

Matthew: And he says that all six are large broadband consumer networks with a dominant or exclusive market share in their local market.

Leo: And interestingly enough they're all dead last in customer satisfaction.

John: For that reason.

Dan: So you can triangulate on that one pretty quickly, you know exactly who it is.

Leo: Yeah he doesn't name names, these are customers, these are deals he doesn't want to—

John: Sounds like everybody.

Leo: Basically, yeah one is in England and five are in the US. Basically all the big broadband providers in the US are intentionally letting ports become congested because what they try – it’s essentially blackmail to level three and others saying “You know what you—

John: You know for a fact that this is intentional? Or are they just—

Leo: Well they're asking – they're demanding money.

Matthew: It’s a heck of a coincidence.

Leo: They're coming to level three saying “You need to pay us or we’re going to keep those congested.” They did this to Netflix.

John: They said—

Leo: Netflix internet connectivity went down on Comcast 38% since last October. And that's Comcast basically saying “You know what, you're sending a lot of traffic—

John: They wanted better peering, Comcast or Netflix so they did the deal.

Leo: Well Netflix did the deal but they're not happy about it. Reed Hastings just published you know under the Netflix blog that he felt he was blackmailed. By the way now it’s Verizon and AT&T are coming to Netflix saying “If you would like for full access to our subscribers, it would behoove you to pay us a little money.”

John: I think this’ll all be solved by a fast lane.

Leo: What's a fast lane?

John: I don't know, that's what Gilmore said.

Leo: An HOV.

John: An HOV, you need two people watching Netflix. Or three depending if you're in the bay area, it’s three or can’t get on and watch it. We usually just watch it with two.

Leo: I feel like we should be able to cut through this and explain it. I don't feel like we – no, Vi Hart has done a great video. Have you seen Vi Hart’s video?

John: Who’s the guy who said that we should have it more like a public utility?

Leo: That was Dan’s position, I agree.

John: You do?

Leo: Yes.

John: Oh that was funny because at least two years ago I went on and on about how we should meter the internet like a public utility and oh we can't meter the internet but that's what they do with public utilities. So why don't we meter the internet?

Leo: No my position was—

John: Ah you changed it.

Leo: …you meter it but there's plenty of bandwidth if in fact we did what Dan’s suggesting which is laid Fiber across this country that's owned by the government, lease it out to people. There would be true competition. The highway system would be preserved. I truly don't mind paying for more speed. That's not what we're talking about. I'm talking about—

John: How about metering?

Leo: We're talking about equal access to customers for edge providers. And that—

Matthew: What about bandwidth caps?

Leo: Yeah, bandwidth caps, effectively are causing part of the same problem.

John: This guy in the chat room says they meter the interstate? No they meter utilities. Water, electricity, hello.

Leo: …the interstate.

Matthew: They don't meter the highway.

John: Well they do in some places, they have toll roads.

Matthew: Right, that's what we're talking about.

Leo: We don't want a toll road.

Matthew: Maybe we do.

John: I would rather go with the metering the internet. I've said this for years.

Leo: I'm not sure I really understand what you're talking about.

John: You pay for your bits. You buy a million bits, you pay for a million bits. You buy one bit, you pay for one bit.

Leo: That's fine as long as all bits are equal.

John: It’s fine with me. They would be equal because you're paying for them.

Leo: Well that's not what these companies want.

John: I think if they—

Leo: Go ahead.

Matthew: The risk is not for Netflix, you know Netflix—

Leo: They can afford it.

Matthew: Right, they can afford it, they have lots of money. The risk is that you have smaller content companies and smaller providers who can't afford to pay for the fast lane. Their content gets slowed down. That's a risk, not just for people who want to watch TV programs, that's a risk for free flow %of information period.

Leo: Right, by the way a quarter million people have watched Vi Hart’s video on net neutrality. I recommend it. I'm not going to play the whole thing. It’s on Youtube if you look for V-I-H-A-R-T and net neutrality. I think it’s an analogy that's perhaps a little strange. She describes the internet service providers like delivery trucks. But I think the gist of it is accurate.

John: The cost of gasoline and delivery trucks, it costs money.

Leo: Yeah nobody’s saying it doesn't cost money, John. Nobody’s saying that.

John: Yeah.

Leo: I want Comcast to make money. I'm not saying don't make money Comcast. I'm not a commie.

John: …you we're a commie.

Leo: Go ahead. Go ahead Matt.

Matthew: Mark Reed used the truck analogy too and said you know if Netflix – if Netflix trucks were using up 80% of the highway system—

Leo: Okay so that's B.S., and this is why, Vi Hart describes this, that's B.S.

John: This is one of those drawing things?

Leo: She does a good job actually and I highly recommend it.

Matthew: It is a drawing thing.

John: I hate to use drawing. You know the other way it – stop, the other thing I hate besides these drawing things is that you ever turn – like watch this video and it’s just a bunch of words coming at you. It’s like you're reading in slow motion.

Leo: This is a poor woman’s way of illustrating what she’s talking about and she does quite a good job. She’s actually a good artist.

John: No okay, I've gone mad. I've gone mad.

Leo: [laughter].

Matthew: You don't like drawings John?

Leo: John doesn't like life.

John: No I love life, it’s crap I don't like.

Leo: You should listen to his – so her point is, look you're already paying for delivery of these packages via this truck.

Matthew: Right.

Leo: It’s as if UPS said “Oh Amazon, you're sending us so much business that we want you to pay as well as the customer.” The delivery is already paid for, they're double dipping going to Amazon saying “If you would like to reach our customers, you should, because you're sending so much business to us” and Amazon’s just saying “Well that's good, isn't it?”

John: Wow that's the most specious thing you've ever said.

Leo: Really, why is that specious?

John: Well for one thing, for half the time you're not paying for Amazon, it’s always free. And the second thing is Amazon does pay them to ship the stuff and Amazon if they want more—

Leo: Well somebody pays, either me or Amazon but the point is to ask for both—

John: And if UPS wants more money, they can charge more money and they do that commonly, charge more. The post office does it, they keep raising the rates.

Leo: No that's fine if it’s equal.

Dan: Actually John there's a discount for volume in shipping and—

John: No that's true, in fact it—

Dan: Amazon is—

John: They pay less.

Dan: The customer’s paying for the shipment from Amazon.

John: Right.

Dan: It’s not Amazon paying for it, it’s the customer.

Leo: Right, John’s very confused.

John: No I'm not confused. Amazon writes the check.

Leo: Well they do because I pay them for prime.

John: And if they – at the end of the day the customer pays, I agree with you.

Leo: That's true, yes it’s as if they said, if UPS said both parties should pay. That's what basically Comcast wants to do. They want Amazon and you to pay.

John: That's what you think.

Leo: And what they say is because you're sending us so much business.

John: Well but you got to take Gilmore’s point into account which is that they actually give them a discount for all that extra business, which is the reality of it.

Dan: If there was one shipper that Amazon could use for any given community, only one was allowed to serve that community things would be really different.

Leo: Right.

Dan: It would be a lot worse for everybody except for that shipper.

Leo: I think we all agree that if there were a real competition in internet service, we wouldn't have to worry about it.

John: And by the way this common carrier idea, this was going on with the phone companies for a while and if you remember probably the  mid, late  90s when they had North Point Communications and all these other guys, and they were running through the AT&T switches or the Pac Bell switches, you'd lose the connection commonly because every once in a while some guy would be in the office saying “Oh is that the North Point thing? Let’s pull it out.” And they were always playing dirty and these guys play dirty too so that idea’s never going to fly.

Leo: Huge coalition led by – go ahead.

Dan: How did the internet get popular in the first place? It was because it was on the telephone networks.

Leo: It was on a common carrier.

Dan: Which was a common carrier network. And there were a bazillion competing ISPs. That's one of the reason the internet got huge quickly in this country. Because the phone company, which was then the carrier monopoly said was not allowed to discriminate.

Leo: Right.

Dan: That's why we had the internet services.

Leo: There's one thing FCC could do right now that in fact I think would work. They've required Telcos to allow 3rd party DSL providers to sit on the Telco networks. They never did that with cable providers. If Comcast built the plant, Comcast is your provider. No other company could ride that cable. As they said as they did with DSL—

John:dot net your buddy.

Leo: Yeah if they did with DSL, Sonic Net can ride on AT&Ts wires into my house. If they did that on cable and said “Hey Sonic Net, would you like to be an ISP on top of Comcast Cable?” They could do that right now. They did it with DSL. That would change things. That would provide competition.

John: Is that what you recommend?

Leo: Yes.

John: Okay, we're done.

Leo: Dr. Laporte writes his prescription. Amazon, Microsoft and other have agreed. Google, Amazon, Ebay, Facebook, Netflix, Twitter and Yahoo have all agreed. They've written a letter to the FCC saying “You guys, you cannot let net neutrality die.” They don't unfortunately tell the FCC what to do, just what not to do.

John: I think you solved it, we should just create the common carrier on the cable and see what happens.

Leo: You think that would – that would provide competition.

John: It would do something.

Leo: I love the idea. I just don't think local communities have the cajones to do it. I would love the idea of local municipalities to say “Hey we're going to create a broadband infrastructure. We will let 3rd parties provide the service on top of it.” This is Bob Frankston’s idea by the way of—

John: Local governments are too stupid.

Dan: And in about 20 states they're forbidden by the state legislature which has been paid off by the telecoms to actually do that.

Leo: That started in Philadelphia with municipal wi-fi. And of course Philadelphia’s Comcast’s backyard and they immediately went to the state legislature and said “What are they doing there competing with us?”, you know and I kind of understand private business saying the government shouldn't be able to compete with us. So maybe that is a reasonable thing.

Dan: Campaign contributions are an amazing thing. Just amazing.

Leo: May 1 dot US supports Larry Lessig’s citizen funded, crowdsource super pac to end all super pacs. You probably hate this idea too.

John: Oh yeah.

[laughter]

Matthew: Hey John, what do you like?

John: I like a lot of stuff.

Leo: Well let’s find out right after this word from GoToMeeting.

John: There you go.

Leo: We're going to take a little break. We’ll come back with more great panel. Dan Gilmor is here, the original citizen journalist from the Cronkite School of Journalism, The Guradian and elsewhere. John C. Dvorak, channeldvorak.com and noagendashow.com, johndvorak.org.

John: No, channeldvorak.com.

Leo: You got dot com?

John: It’s Dvorak.org and noagendashow.com and I had Dvorak.com too but I just prefer using the org since—

Leo: Because you're non- profit.

John: I'm not making any money.

[laughter]

Leo: He’s a 501 3C.

John: I'm not. I pay all my taxes straight up.

Leo: …on everything he makes, every dollar. And Matthew Ingram from gigaom, great to have you. You're not in Canada, or are you?

Matthew: I am.

Leo: Wow, so you're really are and unaffiliated combatant.

John: What Canada part?

Matthew: I am in Toronto.

Leo: What language do you speak? Oh okay.

John: Oh Toronto, yes.

Leo: Oh Toronto.

John: Great place.

Matthew: And we do have our own problems with competition so—

Leo: Michael Geist actually has a—

John: …in Toronto.

Leo: Oh I love Toronto. Michael Geist actually has a good article. He is the Larry Lessig of Canada.

Matthew: Uh-hmm.

Leo: And he talks a little bit about – he’s got an article called “Different regulations, different regulators behind Canada’s net neutrality advantage”, this is on his blog on Michaelgeist.ca.

John: Shock cable rocks, no.

Leo: No I think there are issues – [?] for a while was knocking Skype off. I think they've fixed that, we don't have any problems with the Canadian contribution anymore.

Matthew: Yeah it has gotten better. I've noticed, yeah.

Leo: Yeah, but it used to be I couldn't talk to Amber for more than an hour, I would drop out. Yeah.

Matthew: Yeah.

Leo: That seems to be fixed. Is that the CRTC or just – Canadians want to be nice.

Matthew: Yeah it’s hard to say, I mean [?] it’s a bit black box, you know you can't tell why they do what they do, why things get brought and why they get worse.

Leo: Yeah, I think in some ways what Tom Wheeler, to give him a little credit is trying to do is similar to what the Canadian CRTC has done which is basically to provide transparency. Wheeler said “No, if an internet service provider is doing this kind of thing, they may be allowed to but they have to tell you.”

Matthew: And that is better than no transparency. You know if you're going to rank them, it is better to have all those deals publicly available so that you can see so and so paid this much to get, you know to whoever and then at least you have some ammunition.

Leo: Right.

Matthew: …to say it’s unfair or to whatever to argue.

Dan: It’s not even clear they have the authority to do that.

Leo: Yeah that's the problem.

Matthew: Uh-hmm, right.

Leo: The truth is, the telecommunications act of 1996 has really cut these guys off the legs and that's the real truth of the matter. Our show today brought to you by one of the great services that has sprung up on this internet of our, this free and open internet and it’s from Citrix. It’s called GoToMeeting, GoToMeeting helps all of those teams like us that's are distributed all over the world. You know people I know don't like meetings but meetings are often the only way to cut through the confusion to get brainstorming to getting everybody in the same room is really almost you know vital in business. I would say it is vital. Collaborating and so forth and with teams distributed all over the world I tell you, GoToMeeting’s awesome. GoToMeeting’s pricing is awesome too. Their flat rate pricing means, and I know a lot of teams do this, you fire up GoToMeeting in the morning and leave it running all day and you can keep in collaboration, you can share screens. You can even see each other face to face with crystal clear HD video conferencing. GoToMeeting has really transformed what is means to collaborate around the world. I think it’s just a great solution. It’ll save you time, it’ll save you money and it lets you work smarter. Try GoToMeeting today for thirty day, visit GoToMeeting.com, click the big orange try it free button and use the promo code TWIT and you will see why GoToMeeting is the choice for online meetings. Try it free for thirty days, GoToMeeting. All right I think – I'm going to go out on a limb here, Apple buying Beats. This was the story that came out late last week. 3.2 billion dollars, I'm not sure who had the story first, I can remember. Was it the Financial Times? Anyway, still no confirmation. I think it’s a bogus rumor. I don't believe it.

Matthew: Really?

Leo: Yeah, why?

Matthew: I thought Dr. Dre confirmed it on—

Leo: So Dr. Dre posted something on his Facebook that apparently was a phone call and he said that “I'm rap’s first billionaire.”, which he would be with the 25 percent stake in Beats adding to his existing fortune, he’d be well over a billion dollars. Then he pulled it down. Now I got to tell you, Beats business is almost entirely driven by marketing.

John: It’s a fad.

Leo: The headphones are crap.

John: Oh yeah.

Leo: The streaming music service has been a flop despite the fact that AT&T has offered a family plan for it and aggressively marketed it. It is a marketing driven business. It has been from day one. It’s the name of Dr. Dre, the name of Jimmy Iovine, the music industry cache, the design, the styling and frankly the huge advertising budget.

Matthew: So they're not good?

Leo: No they're terrible headphones. You don't have any?

Matthew: Okay.

Leo: Yeah.

John: I want to point out something that the chat room pointed out, Dr. Dre’s not a real doctor.

Leo: What?! Another lie. He’s a doctor of musicology. He actually is a very important and successful producer in the music world. He’s discovered a great many acts.

John: Yeah I know he’s famous.

Leo: Including M n M, Mr. Snoop Dogg, you've heard of him.

John: Mr. Snoop Dogg?

Leo: Have you heard of him?

John: Is that spelled D-O-G, D-O-G-G or D-A-W-G?

Leo: Double G. Go ahead.

Matthew: It’s Snoop Lion now.

Leo: Now it’s Lion because he’s a lion of Judah.

John: So you think this is bull crap?

Leo: I am the only person in the world apparently who thinks this is bull crap. I cannot think of any reason why Apple should buy this company. Admittedly they have a cashful of billion dollars per year, so a 3.2 million dollar acquisition’s not an expensive acquisition.

John: Well 3X sales is pretty high.

Leo: But you also got to wonder why they they're for sale. And I have a feeling that this streaming music service has been a flop.

John: Well that's the only reason to buy them.

Leo: Apple can make these deals. Apple has these deals and there's no guarantee that Beats deals would survive a sale to Apple. The music industry—

Matthew: They wouldn't, they wouldn't.

Leo: Yeah, so what are they buying?

John: That's an interesting comment.

Matthew: I think you're probably – if I'm hoping you're right because if they're are buying them, I think it’s a bad thing. I think it’s a bad sign for Apple.

Leo: Well it’s a sign they've lost their way, I think.

Matthew: Right.

John: You don't know this.

Leo: Well I like to say it.

John: Okay.

Leo: [laughter].

John: They may have a grand scheme behind it all. They have yet to screw up major league.

Leo: Oh no, no, Apple screwed up.

Matthew: I disagree.

Leo: They've screwed up many times.

John: Well name one.

Leo: Ping.

Matthew: iCloud, iCloud.

Leo: iCloud, there plenty of Apple screw ups in the world. They have yet to create a music service, streaming music that's any good, that's successful. iTunes radio has not worked.

Matthew: iTunes makes me want to punch myself in the face.

Leo: iTunes is horrible itself.

John: I agree, it’s horrible.

Leo: Two words, I know you're going to defend it, Apple Maps. I know you love it.

John: I didn't say I love it. I don't use an iPhone but I do know that when I did a showdown with a bunch of people using different map systems, I won.

Leo: I got lost.

John: You got lost with Apple Maps?

Leo: I was in the showdown. I got lost with Google Maps. You're trying to find a Falafel place. I went to the wrong Falafel place.

John: Yeah that's because you were using Google Maps.

Leo: Right.

John: Yeah the Apple guy was nailing it.

Leo: And that's John, scientific study.

John: It worked, it was a study and you got lost.

Leo: Science!

Matthew: Science.

John: There you go.

Leo: So you're right, either this is like Apple like what the hell. You lost your way Apple. Tim Cook has clearly got no new ideas or it’s a false rumor. I prefer to think it’s a false rumor.

Matthew: I have to say though, maybe this is not a good deal or the right deal but I cannot, for the life of me, understand why a company like Apple that is so good at so many things, particularly hardware, that makes people go insane and want to pay vast sums of money for their hardware and computers. Their cloud services are the worst. Like it might as well been invented by the Soviet Union in the 50s. Except they're better looking. But they are so painful to use and so awkward and they do such incredibly terrible things. It’s like, I don't know, I don't understand. Couldn't they spend some of their 160 million dollars, or billion dollars to hire some people who could figure this stuff out? Like it’s just mind boggling.

Dan: You know Cupertino to journalists is the Kremlin so…

[laughter]

Leo: And you say that as somebody who sits in a red square all day looking up at the towers of Saint Peter’s, Saint Basil. So this is the funniest part of this. Jimmy Iovine and Dr. Dre would apparently become Apple executives.

John: Yeah, well Dr. Dre part time.

Matthew: Hahaha.

Leo: What?! Hahaha, whawhat?!

John: I’d love to see those meetings.

Dan: For about a month.

Leo: Yeah.

Matthew: Yeah for about a month.

Leo: I can't see Jonny Iovine looking at Beats and saying “Those headphones are the greatest headphones we've never designed.” It’s not invented here, they're not great headphones, I mean nobody who like audio says they're great headphones. They're highly enhanced bass which is great for rap but nobody thinks they're quality headphones.

John: No.

Leo: The kids like them because they've got Dr.Dre. It’s all about marketing.’

John: Yeah.

Matthew: Uh-hmm.

Leo: 3.2 billion is coincidentally exactly what Google paid for Nest, a thermostat company. So 3.2 billion’s the new 1 million.

John: I guess, it’s weird.

Leo: The other thing I’d point out is that most of Apple’s 160 billion dollars is overseas, it’s off shore. And to spend it, there would be a significant tax consequence.

John: They would have to deal with that money and they're using that.

Leo: So if Beats were a European company, I’d say “Well that makes sense, you know because they've got all this cash off shore and they can't repatriate.” But it’s an American company, right?

John: Well we don't know.

Dan: The cash they carefully put offshore so they wouldn't have to—

John: It could off shore.

Leo: Well, using the Dutch reach-around.

John: It could be in the – that's different. It could be in Bermuda for all we know. I don't know, we didn't look into that. Because nobody came up with the this is a scam and a lie like you did. This is the first time I've heard this idea.

Leo: Well let me see. Where is Beats located?

Matthew: The Dutch reach-around, did you just say?

[laughter]

Leo: It’s not the name it’s—

John: Don't ask him for any more details.

Matthew: All right.

[laughter]

Leo: Beats by Dre, formally established in 2008, is the brainchild of legendary artist and producer Dr. Dre and the chairman of Interscope Geffen A&M Records Jimmy Iovine. Right there-

John: I think it’s off shore. I think Geffen and that whole operation is off shore and I think that's where they set this up.

Leo: It’s not off shore.

John: It’s got to be.

Leo: It’s only now—

John: I think you've stumbled on to it. This is exactly what's going on – money.

Leo: You mean right here where it says Beats electronics is based in Santa Monica, California.

John: Doesn't mean that they're incorporated there.

Matthew: That's true.

Leo: Beats is partially owned, there's a stake in Beats from Hewlett-Packard. 25% of Beats is owned by a financial holding firm.

John: Where are they located.

Leo: They bought their stake from HTC. Remember HTC attempted to use the glitter of Beats to sell smartphones.

John: Poor HTC.

Leo: Yeah, that was a mistake. You know what's actually poor HTC? If they just held on to this deal, that quarter would save HTC.

John: Yeah it would've been seven because it would triple.

Leo: 800 million dollars.

John: …the valuation has tripled.

Leo: They would've been like “Whoa, that's a good deal! We can run for another 3 years on that.”

John: That's just out of luck.

Matthew: I don't really understand, like if Apple was going to do something like this, why wouldn't they just buy Spotify or somebody like that?

Leo: Much better, I mean Beats—

Matthew: A service actually like.

Leo: The thing that Beats streaming did, they bought Mog which was a nice service that was struggling, but they came too late because there's Google Music, there's Spotify, there's Rdio. Everybody’s chosen and I know this because the deal AT&T was offering, $16 for a family was much better than the Spotify deal and Google Music deal. So I went to my kids, 18 and 22 and I said “Hey kids, let’s all use Beats”.

John: Okay dad.

Leo: No!

John: No?

Leo: They said “No I like Spotify. No I like Rdio.” I mean we're all using—

John: Maybe there too old?

Leo: Oh yeah if they we're four I could convince them.

John: Why that's what I'm thinking.

Leo: Apparently, according to on story I read, 200,000 subscribers is not a significant number. Not worth billions. You know the New York Times is confirming this, the Wall Street Journal is confirming this. It came from The Financial Times. I'm going to be the guy that stands up and says “I call B.S.”

John: This would be a good call. Just in the long shot, I think you're doing the right thing.

Dan: But no one will remember if you're wrong anyway so don't worry about it.

Matthew: That's true.

John: That's the key.

Leo: John understands this whole dynamic.

John: I know that game.

Leo: Say something outrageous, if you're right people will go “Whoa, he knew it. He was the only one.”

John: It works.

Leo: And if you're wrong, well just another – I'm the guy by the way who said two weeks ago to short Apple.

John: Yeah that was a good one.

Leo: That was a good call. Haha.

John: Fantastic.

Leo: I'm the guy who when Apple said “We’re going Intel” said “What are you nuts?”. So don't listen to me, I just – so Matthew you agree with me, this is a kind of a bad bell weather for Apple I think.

Matthew: I do because as soon as I heard about it, even though I've never used Beats headphones, if haven't used the service it troubled me that they would say that much for this thing. That says to me “We're out of ideas.”

Leo: It would be the largest acquisition in Apple’s history by several orders.

John: If I remember the good old days when the biggest acquisition Microsoft ever made was the 600 million dollar one of web – whatever it’s called—

Leo: Web TV.

John: Web TV, and oh they we're putting themselves in kind of an awkward position and then they went up, they went up and now they're just throwing money away.

Leo: So I have to correct myself, the Dutch reach-around, you're right it is something else. What Apple used is a strategy known as the Double Irish with the Dutch Sandwich.

John: That's worse.

Matthew: That's a thing?

Leo: That's a thing.

John: I think that's just another word for the Dirty Sanchez.

Leo: [laughter].

Matthew: Yeah that's – we're going down a nasty road here.

Leo: I think we just brought Urban Dictionary down.

[laughter]

Leo: But what you do with a Double Irish with the Dutch Sandwich is root profits through Irish and Dutch subsidiaries and then off to the Caribbean and this is exactly what Apple’s been doing for some time now. The problem with doing that is they now have a huge cash stake—

John: Overseas.

Leo: But they can't use it, unless they buy a European country.

John: Here’s a question, the Supreme Court has been bringing this up, that corporations are people and if you're a person, an individual and you try to move your money and hide it off shore the IRS goes after you. Why don't they just go after this money? If the corporation—

Leo: Well, and I agree with you, but it is legal. That's basically the story.

Matthew: So far.

Leo: So far. Anyway I think that's enough on Beats. If the deal goes through, it’ll go through early next week. You know what we should do? We should make a recording of this show—

John: Aren't you doing that anyway.

Chad: I'm one step ahead of you.

Matthew: I agree that you should do that regularly.

John: I think you're doing that.

Leo: And then we can play it back next Sunday. Leo was right, it was a rumor created by Dr. Dre and Jimmy Iovine in attempt to sell headphones and stock or whatever to drum up, gin up some interest in a company that's actually failing. That's what I think.

John: You actually took a good—

Leo: Went too far?

John: Yeah, way too far.

[laughter]

John: When you bring up a crack pot idea like this you don't want to extrapolate to make it worse.

Leo: Oh yeah just kind of vague outline.

John: Vague it.

Leo: Vague outline.

Matthew: Vague it out.

Leo: If you missed – you know one thing we did do which was amazing, we recorded last week’s shows and if you missed any of them we've got this little synopsis. We call it House Ad.

Previously on TWIT. Triangulation.

Jack Conte: Because of Youtube, because of sefl-publishing and free media in the web like you can be a band that's making a living. You can be a small sustainable business version of a musician which never used to exist.

Tech New Today.

Mike Elgan: Apple is in talks to buy headphone maker Beats Electronic for 3.2 billion dollars.

Gordon Kelly: This feels not so much like a typical Apple purchase which is, you know buy all sorts of cool technology that we don't have. It feels more like a Microsoft purchase which is we missed something in the market and we're trying to buy our way back in.

This Week in Google.

Jeff Jarvis: Well there are people who literally believe in a metatag called the Google Pray metatag.

Leo: Google Pray, Google please rate me high by keyword UMEX search.

[laughter]

Leo: Is that the weirdest thing you've ever seen?

Jeff: No not even close.

Know How.

Fr. Robert Ballecer: Quick question, I created a few videos that I want to turn into animated gifs and believe it or not every version of Premier has a tool built into it that will let you make animated gifs.

TWiT, technology isn't always pretty but we are.

Leo: They were great. That was so much fun.

Leo: Yeah, holy cow.

Leo: That was last week. That was so much fun.

John: I can't believe that the father says the word gif knowing full well that the inventor of the format calls it Jif.

Matthew: It doesn't matter what the inventor calls it.

Leo: I can't believe Adobe Premier has a built-in animated gif tool. That seems like a total waste of space.

John: So you're using that word that was too? You've turned on me.

Leo: It’s always been gif.

John: Not it’s not.

Leo: Not but John, wait a minute, I should – now if we only recorded our old radio show, I’d bet you anything you said Gif back in the day.

John: I never said gif, never.

Leo: You always said Jif?

John: Yes.

Leo: That's a peanut butter.

John: No that's Jiffy.

Leo: I mean seriously, you think it’s Jif?

John: That's what the—

Leo: It’s the Graphics Interchange Format. G-G-G-Graphics Interchange Format.

John: It’s pronounced Jif.

Leo: G-G-G-Jraphics? The Jraphics?

John: Okay, okay.

Leo: The Jraphics Interchange Format?

John: You want me to come up with every word in the world that doesn't match this sort of model that you just created in front of me right now?

Leo: This is one of the most stupid and yet the most hotly debated items in technology.

Matthew: Uh-hmm.

Leo: Is how to pronounce that word.

Dan: So why is my not pronounced Jilmore?

Leo: Yes, I rest my case.

John: What’s it got to do with anything?

Matthew: Nothing.

Leo: Frankly I don't see why the guy who created the format, crap format that it is, should have any say.

John: It’s lossless, that's kind of cool.

Matthew: He doesn't have any say in it but he created it.

Leo: Jiff is not – oh it is lossless.

John: It’s totally lossless.

Leo: That's why it got sued.

Matthew: He gets to say how to say it.

Leo: He does or not?

Matthew: No we do.

Leo: We do.

Matthew: You create something—

Leo: Not even we, I do.

Matthew: People can call it whatever they want.

Leo: Because I am on the radio, and have been since 1976.

John: Oh really.

Leo: I am the one who pronounces most of these words out loud for the first time.

John: 45 years.

Leo: Yeah, since I was a kid.

Matthew: When I was in Italy everyone called it Jigaom.

Leo: Hahaha.

Matthew: Instead of Gigaom.

Leo: Matthew Ingram from Jigaom.

Matthew: Jigaom and I kind of got used to it.

Leo: Jigaom.

John: England where it’s Beta.

Leo: That's sounds French though, it should be Jiga Om. Aye Jiga om. Oh G-I is Gigaom.

John: Sorry I brought it up.

Leo: Yeah.

Dan: If it’s in Italy you’d have to wave your hands as you say it.

Leo: Gigaom.

Matthew: Gigaom, yeah.

Leo: Gigaom.

John: Wow it’s so easy to get off the track here at this show.

Leo: Actually there are Apple hoaxes. Remember all the Apple journalists who reported that Apple was going to make biometric earbuds.

John: I never said that.

Matthew: Yeah.

Leo: It was a hoax. Some guy posted it on Secret.

John: Oh so you're going to stick with this thesis of yours instead of moving on to the next topic.

Leo: I'm just saying the Apple Press is – there's so little, I know because we do an Apple podcast, every week we do an Apple podcast and there is no Apple news because Apple says nothing.

John: Why do you do the podcast if there's zero Apple news?

Leo: Well there used to be but Apple has just kind of – it’s just, there's nothing going on. And so you got to report rumors.

Matthew: Well Secret is the new place to go for hot rumors. Most of which are not true.

Leo: Are wrong, although occasionally there is a good rumor from Secret. Do you look at Secret?

Matthew: Secret’s the new Twitter then.

Leo: Yeah very much so. It’s the new Twitter with sex. Apparently almost all of my friends are having group sex.

John: Really.

Leo: Seems to be.

John: Have they invited you?

Leo: No, no, no I read about it on Secret.

Matthew: I didn't need to know that.

Leo: Well it’s probably just as phony as the other stuff. A good news here is there's going to be an Android Secrets soon.

John: What is it?

Leo: You're doing this to men on purpose, I know you are John.

John: No.

Leo: I don't understand why though.

John: I got up at 6:30 in the morning because of barking dogs.

Leo: Really, I know how that is. Let’s see, okay, I don't – gosh I'm trying to separate the Oracle Google story from the FCC story because it’s another thicket.

Matthew: Uh-hmm.

John: I think we should move to that story.

Leo: All right, well let’s take a break then we’ll do the thicket because I think this probably the most important story of the week, is this court case. Court ruling in Oracle’s favor and that could be very bad news for a whole lot of stuff. We’ll talk about that in a second.

John: Oh wow.

Leo: First, good news, if you mail things. Do you mail things?

John: Yes, I believe in the post office.

Leo: Yeah we want to support the post office. Do you mail a lot of things? Like do you fulfill stuff? Like do you have a vinegar store online where you sell people vinegar and stuff?

John: The vinegar’s coming.

Leo: You should. I would buy Dvorak vinegar.

John: Ah, you know what, the way I make—

Leo: Did you call it Piss and Vinegar? John C. Dvorak’s Piss and Vinegar.

John: Well people would think there's piss in it.

Leo: There's not much piss in it.

John: There's not much vinegar if you make vinegar the right way at home. The production is not what you'd hope.

Leo: That's the problem.

John: You make a few gallons a year and that's about it.

Leo: Yeah, that's not going to be a home business.

John: No.

Leo: Well if you had something you mailed, you know fulfillment is a very fine art. And, gosh I am surprised often how many packages I get with – people are going, stickin on stamps. I got a package from a company that wants to promote – they got this little bungee cords from wiring. And they sent me those.

John: …yah those things.

Leo: And they put six stamps on it. And they didn't put enough, it was 85 cents postage due. So what a lousy impression, right? You should not have this kind of lousy impression. If you're in a business that requires mailing, whether it’s invoices or brochures or products, maybe you're an Etsy seller. I can't believe the number of Etsy sellers, it looks like the package was handmade. They should look professional. That's why you need stamps.com. Stamps.com lets you print your own official US postage from your computer and your printer. Ebay, Etsy, Amazon wherever you sell. You get a scale, we're going to show you how to get the scales so you always have exactly the right postage, you're not guessing. You're not applying it with your mouth and your tongue. You actually could print right on the envelope with your company logo, the return address is very professional. It really is a great way to do any kind of mailing. The mail carrier comes to you and picks it up. In fact there's even a big button in the stamps.com interface that says get the mail carrier here so if you miss the pickup you can get another one free. Plus you get special discounts on mailing and shipping you can't even get at the post office. Stamps.com last year, take a guess how much postage, I’ll hide the number. How much postage stamps.com customers printed last year. Just take a wild guess.

John: A lot.

Leo: A lot, very good that's exactly right. One and a half billion dollars worth of postage in one year.

John: Wow. What piece of the action do they get? What's their profits?

Leo: I don't know but I would guess you know a tenth of that.  150 million? Probably.

John: Maybe.

Leo: I don't know, it’s a good deal anyway for you and I want you to try it right now we've got a special offer, a no risk trial. Here’s what you do, you to stamps.com don’t – you might be tempted by the 80 dollar bonus value and all that stuff, click the microphone at the top of the home page, enter the offer code T-W-I-T and you're going to get a hundred ten dollar offer. Now that includes the USB scale I mentioned.

John: Look at it, there's a picture of you.

Leo: I know, who would've thunk. How did that happen?

John: Look at your face. You're thinner, your more vital.

Leo: I'm happier because I'm using stamps.com.

John: Oh okay.

Leo: I had that USB scale, I plugged that right in. I always knew the exact postage. You get the scale, you get $55 worth of free postage you could use for the first few months of your account. You get an activity scale. And you get a month of stamps.com. That's a good deal, now you will pay shipping and I want to be absolutely upfront, I think there's like 5 bucks shipping and handling on the postage meter. I mean not the meter, it’s not a postage meter, it’s a USB scale but you get to keep the scale even if you cancel so that's – I mean and you get a lot of other stuff too. It’s a good deal. Stamps.com, we use it here.

John: Can you use the scale for weighing food?

Leo: Anything you want. Anything you want. You know I weigh when I bake, I do not use—

John: On baking you got to be really careful.

Leo: Grams, I go by grams.

John: That's the way you should do it, for baking.

Leo: Yeah.

John: Yeah, my daughter’s a baker. I don't like baking.

Leo: Otherwise they say sift. Eh.

John: Eh.

Leo: I want to weigh it.

John: Weighing’s good.

Leo: Yeah.

John: Most American recipes are designed for falling metric.

Leo: I know they never tell you, I know.

John: So Europeans are into weighing.

Leo: So all right, let me see if I can explain what happened here. Google, when it started shipping Android phones. Actually Google acquired Android. Andy Rubin started the company and then Google bought it. When Android was created it was based on Java.

John: Right.

Leo: But they did not have an official Oracle Java Runtime on it. They had their own, it was called Dalvik, D-A-L-V-I-K and it was, correct if I'm wrong here, reverse engineered to be compatible with Java but it wasn't the Java written by Oracle which owns the rights to Java. Java’s invented by Sun in the mid 90s and bought out.

John: And bought out.

Leo: It was written as a write once, run anywhere application programming language. A lot of people use it. So Dalvik is open source, it was written by Dan Bornstein who named it after an Icelandic fishing village. I thought you might be interested in that little tidbit. And it is a API compatible with Oracle’s Java. Oracle sued Google saying “You stole our APIs”, lower court said “No you can't steal APIs, that's just the names of calls, you can't steal that.” Oracle appealed the US court appeals for the federal circuit.

John: What district?

Leo: That's a good question, I don't know what district.

Dan: It’s the one in Washington that does Patent cases.

Leo: Okay, it was a DC patent case overturned the lower court ruling saying that APIs are subject to copyright. This is a huge deal because - well software is subject to both patent and copyright. The idea of the name you give a call or the name you give a variable being copyrightable is really tough. The jury has previously deadlocked on this. Whether Google’s use of Java APIs was covered by fair use and that basically is the contention. Oracle sued Google for patent infringement and copyright violation.

John: Interesting.

Leo: The jury said no patent infringement but Google did copy the code from 37 APIs. Google said that computer code like concept in a written language are subject to fair use in terms of structure sequence and organization. You can't copy verbatim the words.

John: Which they did.

Leo: Well that's what’s interesting on this. They did say Google had copied this code, nine lines of code. The judge of the times said “Well any idiot could write a range check, in fact I decided to learn programming language and I wrote one.” Which I kind of admire the judge for that.

Matthew: This judge compared the descriptions or the calls in the API to Dickens: A Tale of Two Cities. I'm not sure we're at the point where we want to say that computer calls in an API are literature, but that seems to be where he was going.

John: Yeah. Right, interesting.

Leo: Well I think people in the past have said that computer code is somewhat like say, literature or music, and that it is a creative act of that kind.

John: It's an art. Calls is not the artistic part.

Leo: That's what the EFF said. They say treating API's as copyrightable has a profound negative impact on interopability and therefor, on innovation. All software developers use API's to make their software work with other software.

Matthew:  It'd be more like a phonebook, it's a mechanical- It's not a unique expression.

Leo: It's like saying that you can own an alphabetic sorting of names.

John: I really have no opinion on this story.

Leo: Allowing a party to assert control over API's means- This is the EFF still. -Means that a party can determine who can make compatible, therefor, interoperable software. For instance, there's an emulator on Linux called Wine that allows you to run some Windows software on Linux. The way it does it is not by duplicating the Windows code, but merely by duplicating the API. So when a program says, open a window, draw a window, put a line there, it does it with the same calls that it would if it were on Windows. The code it runs may be different but it would respond in the same way. So, an API means that you can create an emulator. This ruling would allow Microsoft to say you cannot ever create Wine, Wine is dead.

Matthew:  Yeah, the potential implications are horrendous.

Leo: Well we use API's all the time. If you write software, for instance, to get mail from a mail server, you're doing it by publicly published API calls.

John: Yeah but the guys you are talking to are not objecting to it.

Leo: They want it. It would now, all of a sudden give them control. You could write, for instance, a mail server that only works with clients you approve.

John: You could.

Leo: I think it'd be a big change in the way we do things.

John: You think?

Dan: So this court is the one that has done patents for years and has- Basically, this court is in love with anything that has intellectual property attached. And they're getting increasingly slapped down by the Supreme Court because they've been going vastly overboard the appeals in favor of patent holders. So maybe this will get slapped down by the Supreme Court, but it's pretty bad. And the other thing I'd be pretty curious about is, I think it's inevitable that Oracle has done it's share of what it has sued Google about.

Leo: That's a good point.

Dan: And I'd kind of like to see a list of the API's that Oracle, by it's standard, has been stealing over the years, I bet there are quite a few.

Leo: Of course Google says it'll appeal. The first thing it'll do is go back to the lower court and see if they can rewrite it and get the higher court to approve it. But ultimately, I think you're right I think this is going to the Supreme Court, and there is hope there. Although frankly, the Supreme Court we have I feel like it's unpredictable. You never know what they're going to do. But Dan, you say that this is the kind of thing they might well overturn.

Dan: Well it's another case of Congress not doing it's job, so we have to wait for the Supreme Court to do Congress' job.

John: In this particular instance, since it's a highly technical issue, I don't see the Supreme Court being able to figure this out, I don't care who explains it to them.

Leo: Well it's easy, let me explain, and I'll read this from the judgement. To use the District Court's example, one of the Java API packages it issued is java.lang. Within that package is a class called Math. Within Math, there are several methods, including one that is designed to find the larger of two numbers, we'll call it MAX. The declaration for the MAX method to find for integers is; public static int MAX (int X int Y) where the word public means that the method is generally accessible - That they're publishing it, in effect. Static means that no specific instance of the class is needed to call the method. The first int indicates that the method returns an integer, int X. XY are two number's inputs being compared. Now I think any literate person could understand what I'm saying there.

John: Absolutely, they'll all figure that out no problem.

Leo: The programmer calls the MAX method by typing the name of the method: M-A-X and providing X and Y. The expressions used command the computer to execute the implementing code that carries out the operation, returning the large number.

John: Oh, I bet they'll have that down. I'd like to hear the questions they have about this. What if it's Y?

Leo: Right. Does Oracle own the words MAX, X, and Y? Because they say they do.

John: I think Scalia would have something to say about this.

Leo: Yeah, when is Wapner on maybe? I don't know.

John: There's a call-back for you, Wapner. Fifteen years ago.

Leo: But you got it. Google believed, what a shock, that Java programmers would want to find the same 37 sets of functionalities in the new Android system call, go by the same names, MAX as example, as used in the Java. That seems reasonable, that's why we have an API.

John: There you go.

Leo: Oh well, I don't want to say the sky is falling, but I think the sky is falling.

John: Well it's not a good thing, let's put it that way. There's nothing to discuss.

Leo: There's nothing to discuss because there will be appeal and of course, it's not. So it's not falling but it could-

Matthew:  It could fall.

John: It could always fall.

Leo: -At some point in the near future, the sky could fall. Google's trying to sell Google Glass at a gold tournament.

John: There's something funny about that.

Leo: There's something odd about it.

Leo: It's at the player's championship, Google has a booth and there is somebody right there in the booth selling-

Dan: Is this because country club golfers are the only people who can afford it?

Leo: When you're selling a $1500 gadget that doesn't really do much, you probably should go to the gold tournaments.

John: It's probably more entertaining than the golf game itself.

Leo: Google has said, our hope is to bring Glass to new explorers like Optometrists, sports lovers, online retailers, cooks, and travelers. So we're going to go to places and try to sell this stuff. I had the opportunity to buy Glass, I did not-

John: Wait a minute.

Leo: Well I did buy it technically. -But I gave it to Jason Howell. And I'm glad I did because Jason Howell's daughter, Savanna- He had just had a baby... What are you taking a picture of, what is that?

Chad Johnson: I'm just showing off the thing. Because I was watching John C. Dvorak-

Leo: He is a really attractive man, isn't he? I think flannel suits you, my friend.

Chad: I'm all for the flannel.

Leo: Are you thinking of joining a grunge band?

John: Oh yeah, yeah that's what I'm thinking.

Leo: I'm trying to find real quickly... Because what Jason did made me happy that I did buy the Glass and give it to Jason. His daughter Savanna took her first steps and Jason got it on video via Glass. A video he probably would not have had if he hadn't had the Glass on.

John: So he just wears these 24/7?

Leo: All the time. And all you have to do is go, "Glass, take a movie."

Matthew:  You know, that's a great example. I remember when my kids were little, and they would start doing something cute so you'd run to go get the video camera-

Leo: And it's over.

Matthew:  -Which, in my day it weighed 45 pounds so you had to drag the whole bag and the battery and everything, so by the time you got there, they finished doing whatever was cute.

Chad: It's a good quality video too.

Leo: And he'll have this forever. I remember Henry's first steps and Abby's first steps but I don't have a record of it in any way. This is awesome! So I'm a little skeptical of Glass in general, but this is one case where the Glass-

John: So you recommend it to anyone with newborns.

Leo: That's why I gave it to him. I said, you know what? You have a newborn baby and you should have Glass.

Matthew:  To get back to that news story, I could see if you went to a really high-end golf course and they just gave you Glass while you're playing around.

Leo: For the 19 or 18 holes, I think that's a good idea.

Matthew:  Yeah, and then maybe there's an app built in that tells you how far away you are from the hole or something and then you get to keep the video.

John: Still not going to make it into the hole.

Leo: Chad's in love with that shot of the Glass. That's the fourth time you've shown it.

John: He loves that shot, I'm telling you, Chad's on something.

Matthew:  Chad, do you need to get out?

Leo: Get some fresh air, Chad. We love Chad. Without Chad Johnson, the show would be nothing, he is great. According to the next web, Google is testing-

John: There he goes again with that shot.

Leo: He likes to do that to you, John. He's hoping he'll catch you with your finger up your nose or something.

John: I don't do that.

Leo: He's hopped up on goofballs, it's okay.

John: That's pretty obvious.

Leo: I don't even know what that means. What's a goofball?

John: A goofball, I believe, is a combination of Heroine and Meth.

Leo: That's a speed ball.

John: Oh okay. Well a goofball must be Heroine and some downer maybe, I don't know. What are you asking me for? Go to the Urban Dictionary and look it up.

Leo: Again, with the Urban Dictionary.

John: I'll go look it up.

Leo: Apparently, Google is testing a new Gmail interface that is a very simplified interface that is focused on mail. I have been struggling with Google Mail for some time now. If you use Gmail in the web interface, it's great. But it is a broken implementation of iMap and I've been trying like the dickens to get a Macintosh email client, including Apple's own Mail to work with Gmail.

Matthew:  Have you tried Mailbox?

Leo: Yeah, like Mailbox. It doesn't have some of the things I need but I've been using something called Mail Mate. And is written by a Danish programmer and it's really good. But the problem with iMap on Google is that it's just really weirdly implemented and it's not standard at all.

Dan: Does ThunderBird work with it?

Leo: Yeah, all of these things work okay but there are issues. And Apple's Mail only started breaking with Mavericks but it just adds to my general pain and frustration with email.

Matthew:  I though Mailbox was working really well and I was doing really well but then I found out it was auto-archiving important emails from people and so that was awkward.

Leo: It's just very odd.

John: So the goofball is no real combination of drugs, it's just something that people say.

Leo: I think it's a letterman thing. Anybody using the #AmazonCart?

John: No, who would use this?

Leo: I signed up for it.

John: Oh what do you get out of it?

Leo: Squat.

Matthew:  You can buy stuff quickly.

John: What's this Google's got some new shopping thing with same day delivery. What's this all about?

Leo: Yeah, they're trying to eat Amazon's lunch.

John: Let's talk about that.

Leo: I will here in a minute but first AmazonCart. If you find a Tweet with an Amazon product link in it and you reply with the hashtag #AmazonCart, they add it to your Amazon cart. So basically, they've doubled the Tweet count for that item.

Matthew:  I don't need any help buying things.

Leo: But it's so easy.

Matthew:  I know, it's too easy. I need things that are harder.

John: It seems to me-

Dan: Why would you buy something based on someone's Tweet?

John: Because you're maybe an idiot. I like to go to Amazon when I buy something and actually shop a little bit. Look at alternative possibilities, look at the reviews. I always like to read the 1 star reviews and see if the guy just doesn't know what he's talking about.

Leo: Well there's an interesting story about that. There is a guy who wrote a negative review of a router. Actually to me, this raises some interesting issues. The router is from a company called MediaLink. Mediabridge products took umbrage at the negative review, threatened to sue the guy for libel, got him to change the review. Then Amazon weighed in and said we are not selling Mediabridge products anymore.

John: Good for them, I hate these companies that do that. That's very common, you run into some litigious company and they're so thin-skinned- Some joker who writes some negative review on an online forum they get so thin-skinned that they sue you, this is not a company you want to do business with. It's not killing them, I don't know that negative reviews even have that much of an impact.

Leo: Now I'm going to add the other side to this story. What the Mediabridge company said is, "The review is libelous because he refers to two facts that are not true. One, he asserts that we are posting fallacious reviews of our own."

John: Which most companies do.

Leo: "And two, that the Mediabridge router is a rebranded router from another company."

John: Most routers are.

Leo: The Mediabridge folks said that those are both demonstrably not true-

John: So they actually hand make this thing themselves?

Leo: I don't know, but they are libelous, so they actually have a case for libel. This is one thing I thought was kind of interesting, if you're a reviewer you might actually be libeling a company if you say something that is demonstrably untrue in the review.

John: I've always believed that too.

Leo: Be careful. Because in fact, when queried by Arstechnica about this, they said that they actually have a case.

John: I'm surprised that more people don't get sued. Yelpers, for example, they come and smear some operation because they didn't like the-

Leo: Let's give a little- We're sitting here with the Director of the Cronkite School of Journalism-

Dan: I'm not the Director.

Leo: The guy who runs the whole place, the man who invented journalism, Dan Gillmor, who is the Director of the Night Center for Digital Media Entrepreneurship at the Cronkite School. Tell me what libel is because at  some point, somebody at Journ Day School or somewhere told you here's what you can and cannot do.

Dan: Where there are a lot of nuances in libel. But basically if you say something or publish something or publish something that is defamatory, that injures the reputation of someone else, and it's false-

Leo: Aha! That's the key, the false part. Because it has to be a demonstrable fact.

John: There's malicious, that's part of this problem.

Leo: There's also intent.

John: You can be accidentally wrong. 

Leo: Right, but John, if I call you a shmuck, you can't sue me-

Matthew:  Because that's an opinion.

Leo: That's an opinion. But if I say, John you're a crook-

John: Yeah, I could sue you. I always tell journalists do not use the word crook because you're asking for trouble.

Leo: Literally, libelists are slanderous depending on-

John: Or criminal, always a criminal.

Leo: You know how I found this out, I was talking about patent trolls on Tech TV and I called the guy an extortionist. And the lawyers said, that's libelous, take it back.

John: You could call him a virtual extortionist if you had some example.

Leo: I can say it's extortion-like or tantamount to extortion, but I can't say extortionist.

Matthew:  I remember Penn & Teller saying fraud is bad, you should never say that because then you have to prove it. But douchebag or ***** are fine because those are just judgments.

John: Douchebag is a funny one because if you actually sued over that, it'd be a great court case, could you imagine?

Leo: I am not a douchebag. This is a douchebag, here I am. Do I even look like a douchebag, I ask you? Well you look a little like one. But I'm not one! No you're not, sir. You win. So anyway, I do like the fact that Amazon stepped up, on the other hand- In fact, they might have been in the wrong because the Mediabridge company may have had grounds for a lawsuit.

John: Yeah but still, you don't sue in the drop of a hat and to some poor guy.

Leo: Well they didn't sue him, by the way, they threatened him.

John: Which is worse.

Dan: The Streisand Effect is in play at this point. They have now shown themselves to be a company with thin skin and with serious questions raised about the routers they're selling. I don't know whether it's true or false, but it has made me less likely to buy it for two reasons. The first one is that I don't like companies that sue people for things like this, and the other is that I don't know much about the router.

Leo: Right. So that's good on Amazon, here's one bad on Amazon; Hachette.

John: Okay, the big publishing house.

Leo: The big publishing house. Among Hachette's authors, Malcom Gladwell. If you go to amazon.com and search for The Tipping Point, lovely book and highly recommended, by Malcom Gladwell, you'll see Amazon says, oh yeah The Tipping Point, we'll get that to you in 2-3 weeks. Usually ships in 2-3 weeks.

John: I see that.

Leo: Hachette says, that's not true. We have pallets of that book.

John: What about priced as Prime? It should be two days.

Leo: Amazon is saying they don't have it in stock, and apparently they're doing this with a lot of Hachette books.

John: I tell ya, all the New York publishers do when you go back and have meetings with them is complain about Amazon pulling these stunts.

Matthew:  This is like net neutrality but for books. Amazon is basically controlling the pipeline for books.

John: That's exactly what it is.

Matthew:  And if they don't pay then they delay the shipment.

John: So what's the back story, why are they doing this?

Leo: We don't know, but apparently there's a dispute with Hachette over pricing. So what happened when Amazon first started out, the publishers loved them.Oh my God we have someone we can go to that won't charge us like Borders or Barnes & Noble. And then Amazon puts Borders out of business, shrinks Barnes & Noble's presence significantly, and then Amazon goes to them and says, oh by the way we're going to take a little more money.

John: This is what Tower Records did.

Leo: So I don't know what's going on but it seems likely-

John: I'll find out. This is a great story.

Leo: -That Amazon wants a bigger discount from Hachette and they said no.

John: It could have to do with the eBooks because Amazon really only gets defensive when it comes to the eBooks.

Leo: Yeah. But it's affecting a lot of authors and the authors are pissed because in some cases, the discount has disappeared so they're charging full freight and many cases where it just wasn't available. So who does it cost really? Not just Hachette, it costs the authors lost sales.

John: 2-3 weeks to ship.

Leo: 2-3 weeks.

Dan: I should preface what I'm going to say by saying that I have owned a small amount of Amazon stock for a long time. There are other book stores and if Amazon is doing this, it's stupid and arrogant. And it's going to come back and bite them because they do have enough market power in books that they should not be pulling stunts like that, assuming that's what they're doing which seems really likely at this point. It's really really dumb on their part.

Leo: You have to think that this is the kind of thing that the FTC would get involved in.

John: It does, it's got FTC written all over it.

Leo: All over it. Amazon has also- This is a little weird. -Patented the white seamless background.

John: Yeah that's a classic, this has got everybody up in arms.

Matthew:  It's ridiculous.

Leo: First of all, I don't know whether to blame Amazon. I think I blame the US Patent and Trademark office. Amazon has patented the idea of taking a picture of a product against a seamless white background. Amazon's filing said, "In the past, you've had to use green screen, or post processing or other special effects to achieve the result of an object set against a true white background. Thanks to our amazing invention, you can now take pictures of an object against a white background that don't need retouching.

Dan: Whoever approved this at the Patent Office should be fired. Whoever submitted this from Amazon, whoever the lawyer is should be disbarred. This is bull. But mainly it shows the complete and utter incompetence of the US Patent Office, which routinely give out ridiculous patents and that's why we have this ridiculous and terrible patent situation.

Leo: If you want to read it it's patent #8,676,045. They got the patent on March 18, and if you look at the diagram it's...

John: The diagram is like stick figures. It's not even an interesting diagram, they didn't even pay $5 to some artist to do it right.

Leo: A piece of curved paper, and some lights, and you too can take perfect pictures against a white background.

Dan: Are you sure this wasn't published on April 1st?

Leo: It feels like it.

John: That's the first thing I thought when I saw it.

Dan: Because look at it, look at that picture. Children do better than that, that's really amazing.

John: It's ludicrous.

Matthew:  Makes no sense.

Leo: Look at the man, look at the person. He is literally a stick figure.

Chad: Yeah, he's literally a stick figure. That's great.

Leo: What is this a telephone? I think they patented a telephone.

Chad: I think they're just trying to make a mockery of the whole thing.

Leo: You know what happens at companies like Amazon, Apple, and Google? They have on staff- They're not even on retainer. -On staff attorneys, often their own building is full of them and their only job is to go around and the story was told in Fred Vogelstein's excellent book, Dog Fight, Apple attorneys going around asking what people invented that day.

John: Yeah. Bill, you got any good ideas? We can patent that.

Leo: Yeah, that's patentable. What else? Oh that's patentable. I don't blame the companies because it's such a broken system, they should patent everything. Why not? I wish I would've patented podcasting when I invented it.

John: You still can, there's time.

Leo: I can reinvent it.

John: Yeah.

Dan: They'll approve any new invention just submit it. But don't look for prior art, that's a problem you should avoid.

Leo: Oh no, they don't so why should you? It seems to be that, and maybe this is a law I don't know but the point is, they probably approve most patents and let them fight it out in court. Because they don't have the manpower or the intelligence-

John: That's what they always say. We haven't got the manpower- The second thing is more important. -They should look into something like that and if you don't have the manpower, just take a quick look and say, this is out! If you haven't got the manpower, you don't want to spend time approving this crap.

Matthew:  Well the number one feature you're supposed to look at is novelty. Is this something new? Presumably this would fail right away, a child could figure out what we've been doing this.

John: Yeah, presumably.

Leo: So, get this... This is a graph from Tim Lee. Patent Approval Rates. The Patent of Office says we approve 54% of all patents. But that's a little funny number because what they're saying is, of the patents that come in the door, 54% get approved immediately. But it turns out, what mostly happens when a patent gets turned down is the guy goes back, rewrites a few words, and brings it in again. Of all patent filings, 94% are approved.

John: That's nice.

Leo: 94%... Here's a graph but it's kind of hard to see so I'll zoom in on this a little bit, Patent Office Allowance Rates. The Patent Office uses the lower line, but if we look at the top line that's all patents that ever come through the door, whether they ever get patented. We start in 1996, got almost 100% in 2001 and then it dipped a little bit but under President Obama's Patent Commissioner, who happens to be a former Googler, by the way, it's skyrocketed and is currently at 94%.

John: I ought to show the thing that guy Clinton put in. I was actually at a meeting at the Common Wealth Club, where it was the patent guy that was with Clinton and I think it was maybe Lessing or somebody saying this was bogus. And I asked an interesting question because they had all of these business practice patents now legal and I said is it possible to patent a football play. He said, well the problem is there has to be some technology aspect to it or you can't patent it. So I said, what if it's a timing play? He says, yeah you could patent that.

Leo: I'm sorry, he's not a Googler, he's an IBM-er.

John: Oh well IBM is the number one patent-

Leo: They've had a few, Dave Kappos was former under Secretary of Commerce for Intellectual Property and Director of US PTO until 2013.

Dan: Didn't IBM invent patent trolling?

Matthew:  Pretty much.

Leo: I think you're right. Now the current Interim Director of US PTO is Teresa Stanek Rea. She's a pharmacist. Who else does a lot of drug patents? Oh yeah, Big Pharma.

John: They're patenting genes.

Leo: Oh wait a minute, she resigned in November.

John: Who is it now?

Leo: Okay any guesses on who this person will have worked for, Peggy Focarino. She is not even in WikiPedia. She began performing the functions and duties of the Commissioner for Patents, but we don't know who she is. I bet she worked for someone who did a lot of patents.

John: Big Pharma's the one that really dominated.

Leo: Yeah.

John: In fact, if I was Big Pharma trying to patent all of this crazy stuff, I'd put some of these goofball patents through like the one about the white background just to distract from the really nasty patents going through for drugs.

Leo: That's actually really clever. We'll talk about SnapChat and wrap this up in a second but-

John: SnapChat.

Leo: I know you love SnapChat for sending sexy pictures.

John: I never use SnapChat, actually and I've always thought it was a honeypot.

Leo: Maybe it is, the FTC thinks it is.

John: Somebody thinks it is.

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John: They can provide each other child pornography.

Leo: I don't think they do that. I think that's what adults think they would do if they were teenagers.

John: Because that's what we would do.

Leo: But in fact, both of my kids-

John: There's a lot of sexting.

Leo: Is it really, come on, is it?

John: The place is loaded with it, that's where you go to do this.

Leo: Again, that's what you think.

John: Fine, maybe I'm wrong. But everybody out there who used the system to send a couple of racy pictures, you can-

Leo: Well we all thought they disappeared. When you send a picture, you can say I want it to be visible for 10-30 seconds and then after that it disappears. Both of my kids use it a lot. We talked to Danah Boyd on Triangulation a couple of weeks ago and she is a wonderful Harvard researcher who really keeps up on what kids today are doing and thinking and-

John: These kids...

Leo: She's good, she said, they understand privacy and the implications and they just want ephemera. They don't like the fact that everything they do is preserved forever on the internet. They want to be able to send an ephemeral picture every once in a while.

Matthew:  Yeah, I've actually talked to my daughter and some of her friends about it. They're teenagers and it's not so much that the pictures are dirty, it's that they don't have to care about is as much. So if you take a picture and put it on Instagram or Facebook, people are going to see it forever so then, you have to agonize over whether it's any good or not. If you just want to take a stupid picture of yourself sticking your tongue out or making a stupid face, you don't have to worry about everybody seeing it because only the person you're sending it to is going to see it and they're only going to see it for 10 seconds.

Leo: My kids say exactly the same thing, it isn't about sexting. I have to think there must be kind of a subtle pressure on people who use Facebook, Istagram, and Twitter that this is going to live forever. Just this little niggling feeling.

Matthew:  Well and it's the social pressure. In fact, I was at a party yesterday and there was this little kid who was like 14 and he was talking about how this picture got this many likes and this picture got that many likes-

Leo: Right, it's all so important.

Matthew:  Yeah. And there's a huge amount of social pressure to just think, why didn't my picture get any likes? Well with SnapChat, you don't have to worry about any of that.

Leo: Well clearly the kids like it, somebody likes it because it's huge. Let's talk about this here in a minute. But first, Facebook or Google tried to buy them for $3 billion. SnapChat said, oh we're worth more than that. They probably would have been, except for this, maybe they wish they would've taken the money now. Facebook tried to compete with Poke, Mark Zuckerberg said, I wrote this myself. Actually this week, Facebook announced that they're killing both Poke and Facebook Camera, two apps that they developed that nobody adopted but SnapChat lived on. A settlement with the Federal Trade Commissions the FTC said SnapChat had been deceiving customers because- Well see, I think this is BS. -Because their ways to save the message for instance, opening it in a 3rd party app or doing a screenshot, I think everybody understands that.

John: Yeah, for sure.

Leo: And you can't fight that, I mean you could always put the SnapChat picture up there and take a picture with a camera. But also, there's some issue about whether SnapChat is or isn't getting rid of that image on the server.

John: We'll apparently they've been keeping something because a bunch of phone numbers were like ripped of by some hacker.

Matthew:  Yeah, it's not just the images. They've kept your location in some cases, they kept contact information and other personal information. Like the images, I think we all knew that if they are on your phone, someone can get them if they want to.

Leo: Well the FTC did point out that for a year the FAQ at SnapChat's website read like this, " Is there any way to view an image after the time expired?" SnapChat's answer is "No. Snaps disappear after the time runs out." I think it's reasonable for the FTC to say, well a consumer  might read that and foolishly think that those pictures have disappeared.

Dan: The third parties were getting access to the phone numbers of other people, that was the real problem I think.

Leo: That happened with What'sApp as well, by the way. There was a couple of malware apps on Android that were sending bogus page texts, remember? And the way they got the phone number was they just checked with What'sApp. They said, what's the phone number and What'sApp said, I'll tell you. The FTC's is also complaining of several security failures at SnapChat. A data breach in December in which, 4.6 million SnapChat accounts and cell numbers were leaked on the internet. But did anybody assert that SnapChat could save those images on SnapChat's servers because I read that as well.

John: I did too, why not.

Dan: It's not clear that they did.

John: No, but why wouldn't they?

Matthew:  They did give location information and contact info.

Dan: You know I have a rule of thumb about information that goes online, if it's something I'm really going to want to have later, I need to back it up myself. If it's something that might embarrass me someday, I don't need to take any action, it will live forever without any intervention on my part.

Leo: That's the case, that's for sure. Information Week lists five ways SnapChat violated your privacy security. Recipients may have saved your image, recipients may have saved your videos, SnapChat may have transmitted your location, SnapChat may have collected contact information from your address book, and the Find Friends feature was not secure.

Matthew:  I thought it was interesting that there was no financial penalty.

Leo: This is a penalty though. For 20 years- Like SnapChat's going to be around for 20 years. The FTC has mandated a monitor. They're going to have to wear a bracelet around their ankle. 20 years...

Dan: It won't be 20, you're right, they'll be out of business. Or the next Republican President will just drop it.

Leo: Yeah, well let's be honest. The same thing happened to Microsoft in that Department of Justice case, and that was one of the penalties. Microsoft had to have a monitor, and I think that person is not doing much.

John: That's a good job.

Leo: Yeah, that's a good job. You get to have an office in Redmond, you're just sitting there.

Dan: Yeah, that ended.

Leo: It did end. Okay.

Matthew:  What did the monitor do?

John: Nothing.

Matthew:  Okay.

Leo: What would you do?? Hey Bill, I haven't talked to you in a while, anything you want me to know?

John: No.

Leo: Okay, thanks.

Matthew:  It's like a Parole Office, you drop by and say hi, check and see if there's anybody buried in the backyard.

Leo: What's in that backyard, there's a lump there with some fresh dirt. Is that anything I-

John: It's a flower bed.

Leo: Okay thanks, see ya'. Let's have lunch someday, what do you say?

John: Burger Master.

Leo: Okay. Target's CEO out of a job. See, there's repercussions.

John: I'm surprised that these guys lasted that long. That was a huge screw up. To this day, I go to Target and I pay cash. Actually, last time I was there I was pulling out my credit card and then I was like, no I'll pay cash.

Leo: Yeah. Because I don't know if I trust you still.

Dan: That may be the first time there has been actual consequences for a company doing a big data breach and typically, there's no consequence at all.

Leo: It's the first one I remember.

Dan: I think it's great that they fired him and I think it's great that they're losing business. That's what needs to happen.

Leo: Are they losing business?

John: I think they lost a lot of business.

Leo: Wow.

John: I still go there, but I pay cash.

Leo: Just a little tip to CEO's of major companies, whenever there's a security breach you do not tell anyone.

John: That's old rules, that's old school, Leo.

Leo: Well look what happened, he told people and boom, he's out of work. Keep it a secret, no one needs to know. Hey congratulations to Brewster Kahle on the internet archive. You know the Wayback Machine, which has been indexing the internet since 2001, can you imagine?

John: I thought it was before that.

Leo: That's when the Wayback Machine launched. In 2006, Archive It launched allowing libraries to create curated collections of content, in other words, enlisting libraries to help them. They built a new data center in 2009, a 3 petabyte data center. In 2011, the http:// archive became part of the internet archive. I don't know what that is, I'm just reading crap here. How about this, this is the landmark. 400 billion indexed webpages. 400 billion, that encompasses the web as it looked any time from late 1996 up to a few hours ago. That is a major milestone.

Matthew:  You know what I didn't know, I went looking for Twitter's first home page because I wanted a screenshot to use in a blog post, and I searched for it and the Wayback Machine said Twitter has blocked us and that website is unavailable.

Leo: Oh really?

John: So they sent the content to the Library of Congress with a huge pipe and they also sell the pipe to anyone who has enough money, you can get the pipe and all the Twitter stuff, but they won't let archive.org to put a simple screenshot up?

Matthew:  Yeah, I thought that was weird.

John: Those douchebags.

Leo: I don't see a lot of CSS but this is Twitter from 2006 when it was Twttr. Use Twttr to stay in touch with your friends all the time. If you have a cell phone with text messages, you'll never be bored again, ever.

John: I use it and still get bored.

Leo: Here's a public timeline of actual real live people doing stuff. Rich Tweets that Mars the red planet is about to be spectacular. Then he Tweets, and the installation is freeeee. And then apparently, some guy using Twitter, Rich Tweets, watching a special on Andre the Giant. And then Ray Ready Ray Tweets, had a good conversation with my mom. This is Twitter as it was.

John: Actually it's not that much different.

Leo: And here's where you put in your mobile number and everything so there is some early stuff. It also says try other things that Odio makes, because we don't know if this Twttr stuff is going to survive. The Internet Archive is at archive.org and you can enter in URL's. The earliest is August 2, 2006 for Twitter. That's kind of cool. So there is some old stuff, Matthew.

John: There are no screenshots.

Matthew:  Yeah I was looking for the image that was used, like the logo and stuff that was used on the page.

Leo: Here's another early Tweet.

John: This is what it's come to ladies and gentlemen listening. Old Tweets, not even new Tweets. Old Tweets. The Old Tweet Show.

Leo: That's an idea!

John: An idea for your network, the Old Tweet Show with a Couple of Old Farts.

Leo: And then Biz Tweeted, alrighty I'm heading home now.

John: Fascinating.

Leo: My Tweet is, it really is the first day of the rest of my life.

John: It can't get any better than that.

Leo: You can't make up stuff this good.

Dan: I'm going to take a nap.

Leo: I do think that someday the future of TWIT is me and John sitting on the porch playing checkers.

John: Could be. Chinese Checkers, to be exact.

Leo: Let's take a break, when we come back a final word. We'll say goodnight to our friends and family and Happy Mother's Day. Anybody want to say Happy Mother's Day to their mom we'll give them the chance here in a second. First let's ask Mike Elgan what's coming up in the week ahead.

Mike Elgan: This week ahead, Motorola's making a big announcement in London on Tuesday May 13th. We're expecting the company to launch an updated version of the Moto X phone plus a new low cost phone called the Moto E. And the Federal Communications Commission has scheduled a vote on Thursday May 15 on proposed rules that would end net neutrality in the United States. That's what's coming up in the week ahead, back to you, Leo.

Leo: Mike Elgan, TNT, every Mon-Fri 10 am Pacific, 1 pm Eastern time, 1700 UTC your daily dose of tech news. And of course, we now have an evening show 4 pm Pacific, 7 pm Eastern time, 2300 UTC TN2, Tech News Tonight with Sarah Lane so we've got your tech news covered. Our show today brought to you by gazelle.com, the fast and simple way to sell those old gadgets. John, I gave you my old HTC One and I know you would like the new HTC One M8.

John: Can I sell the old one?

Leo: Sell the old one. You know what, we should check. Let's see what it's worth. One of the nice things about gazelle- We've got some new gadget announcements coming up. The nice thing about gazelle.com is the quote you get today is good for 30 days so if, for instance, Motorola comes out with a new Moto X- And of course when it does, the price is going to go down on the old one, you've got that quote locked in for $115 for the old Moto X. That's a good deal.

John: What about my HTC?

Leo: HTC alright, let's go here. The iPads iPhones- Yours is unlocked which makes it extra.

John: No, it's not.

Leo: Oh that's the one I gave you that was locked, I'm sorry.

John: It's good for playing Angry Birds.

Leo: Is that what you're doing with that?

John: No I just use it for miscellaneous things. You can still use WiFi with it, Skype with it.

Leo: Here it is. The One 32 gig, good condition, $145. It's like I gave you cash. It's like I gave you actual money.

John: I better lock this deal in before the HTC 3 comes out.

Leo: Gazelle.com they will buy your old gadgets, they will give you cash. Actually, it's kind of nice. So all you have to do is get the 30 day quote and you don't have to pull the trigger until that new thing comes out. You have time to decide, time to buy it, time to move the data over. Then check out, they'll send you a box and pay for the postage on anything worth more than $1, and yes, they buy broken iPhones broken iPads, and yes those are worth more than $1. They'll remove the data if you don't and then they'll send you a check, a PayPal credit, or an Amazon gift card that's worth 5% more because they just like you so much. So if you are an Amazon user, Gazelle is a great choice for you. Visit gazelle.com, join the 700,000 customers who have been paid more than $100 million by gazelle.com. The easiest way to move those old gadgets out of your life and move some cash into your pocket, gazelle.com. I really like this M8.

John: I know you do. But you said that about this phone too.

Leo: This is even better, but I'm curious to see what Motorola's going to announce.

John: You keep going from phone to phone.

Leo: It's my job.

John: Have you not liked a phone?

Leo: Many, I don't like the Samsung's anymore. They're all crapped up.

John: A lot of people feel that way.

Leo: Well I'm not alone.

John: Alright, well that killed the show. I think we're done.

Leo: King me! King me, John. Somebody has been wanting me to show this picture from Autotopia. Solar panels that you can use as parking tiles in your driveway. They're so tough, you can drive on them. Did you see- And if you didn't see, I think we're going to launch it right after the show, right? I want you to be on it John, in fact, all of you. It's called I'd Fund That. The idea is people have kick starters or indie go go's, we'll line up 3 or 4 of them, they'll come in and pitch us so we sit here and ask questions to decide whether we'd fund it or not.

John: So this is like Shark Tank.

Leo: It's like Shark Tank for crowd sourcing.

John: You cloned Shark Tank for crowd sourcing.

Leo: Shark Tank was a clone of Dragon's Den.

John: You're right. Which was a clone of something else.

Leo: Probably was. The fun thing is it's for crowd sourced stuff. The first one was yesterday and it was so much fun. We're going to replay it after the show so stay tuned. And you'd be a great judge because you're so skeptical.

John: No, I'm a good guy.

Leo: Because you just hate everything.

John: No, I like everything.

Leo: I don't think so.

Matthew:  Unless it involves drawing in a YouTube video.

John: Oh for sure.

Leo: Matthew Ingram, gigaom.com. He's back from Perugia and he probably wants to go back to Umbria.

Matthew:  I do.

Leo: Anything you want to plug, anything at all?

Matthew:  I've got nothing.

Leo: Are you wearing Vibram Five Fingers shoes right now?

Matthew:  I am not.

Leo: Doesn't he look like somebody who might be?

John: No. Not to me, he looks Canadian.

Matthew:  I thought about it.

Leo: They lost in court and they're going to pay people back because they made claims that were untrue.

Matthew:  They're not that good for you to run in, actually.

Leo: Yeah, but then James Fallows wrote a spirited defense.

John: So if Fallows wears them...

Leo: Yeah, he said, they were great for me. I'm not going to ask for my money back. But yeah, they claimed health benefits that really aren't true. The funny thing is, I don't think anybody cares one way or another about that. It's like the reaction to Crocs. They're so horrendously awful looking, that people just hate them. And they just are so happy that they lost that case. If you want to wear shoes with two toes, who cares?

John: I can't believe anyone would wear those.

Leo: Let's look at our audience because we frequently have people wearing them. We've got a good crowd today.

Dan: So if somebody is wearing those plus Google Glass, you're really going to-

Leo: OH!

John: There's your stereotype, Silicon Valley written all over it.

Leo: And then they hop on their Segway at the end of the show.

John: Yeah, and run into a wall.

Dan: No, no, they get onto a Google bus.

Leo: Yes, have you guys been watching Silicon Valley?

John: Yeah, the problem with Silicon Valley is it's hard to ridicule a clown and Silicon Valley itself is so idiotic with some of the stuff you can get off of YouTube of people giving lectures and speeches like that character from AOL that has the long hair and the British accent.

Matthew:  Shingy.

John: Yeah that guy, you can't make fun of him.

Matthew:  You can't make that guy up, yeah.

Leo: The guy who play Peter Gregory, who is a thinly veiled parody of Peter Teal-

John: Yes, that's a good character.

Leo: Christopher Evan Welch. He passed away and I don't think he'll be in this week's episode.

John: I didn't know he passed away.

Leo: His last episode was last week I think. He did 5 episodes, 47 years old, he died of lung cancer. He knew that he was dying when he took the job. I wonder what they're going to do with it this week. But it was sad because he is the highlight of the show. Kind of borderline autistic venture capitalist, you can't take your eyes off of him.

John: They'd just have to kill  him in the show and get someone who is worse.

Leo: He had that really thin car and he couldn't look anybody in the eye. John C. Dvorak channeldvorak.com but most importantly noagendashow.com. How is Adam doing these days?

John: He's going to Japan and now we're going to do a show from Tokyo, it should be kind of interesting.

Leo: Is he moving to Japan?

John: No.

Leo: He seems to be in like some sort of fugitive thing, he changes countries a little too frequently.

John: They're after him. And he's just going there for a week. But noagendashow.com, we've got some good stuff. People should check it out if they haven't already.

Leo: Just go to the website?

John: Noagendashow.com is the best place to start.

Leo: Or if you're in Silicon Valley look at any news stand and John goes around leaving CDs of the show.

John: Marketing.

Leo: Hey it's so great to see you again, Dan. Thank you for the work you do at the Guardian I think you're really the voice of reason around there. It must be fun working at the Cronkite School, that's great.

Dan: It's fun and there are great students. The future is there, they're going to do stuff that we never thought of.

Leo: Well you focus on digital.

Dan: I do.

Leo: Do you teach a different kind of journalism because it's digital?

Dan: Journalism is journalism. I'm working on things like media literacy and entrepreneurship, things like that.

Leo: I tell you what, if I were a young person I would start my own business. This is a great time to be an entrepreneur if the government doesn't screw it up maybe it will continue to be so. Thank you Dan, it's great to have you here, it's great to see you again.

Dan: Thanks for having me.

Leo: Thanks to everybody for joining us, we do TWIT every Sunday afternoon, 3 pm Pacific, 6 pm Eastern time, 2200 UTC. It's great if you watch live, we love our chatroom, we love the interaction we get from it.

John: It's fantastic.

Leo: If you want to be live in studio we always have a nice bunch of people in here, they mostly wear regular shoes and occasionally wear Glass, but you can do that by emailing tickets at twit.tv and we welcome you. It's always great to see these people. You can also always get the show after the fact on demand audio and video at twit.tv but also everywhere you can get shows of this sort. The other day I saw it on TiVo.

John: Roku also.

Leo: Actually the apps are a great way to watch. We have a great group of developers on Android, iOS, even Windows phone.

John: I watched Roku the other day and it's nice and clear, that's why I complained about these mics.

Leo: Because you suddenly saw us as a television show. I like the look, it's a little retro, I just like the idea of a big fat mic.

John: At least you aren't wearing the cans.

Leo: Big mic, thank you everybody for being here. We'll see you next week! Another TWiT is in the can. Thank you everybody! They tell me if I put my arms up, people will applaud.