This Week in Google 300 (Transcript)
Leo: It's time for TWiG, This Week in Google. Jeff Jarvis is joined by Mathew Ingram from Fortune Magazine. We're going to talk about the latest Google news. In fact, some big news coming out of Britain. Is it the end of free speech? Find out - we talk TWiG next.
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Leo: This is TWiG, This Week in Google, episode 300, recorded Wednesday, May 13, 2015.
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It's time for TWiG, This Week in Google. Jeff Jarvis is here in between his travels hither and thither.
Jeff: And yon.
Leo: I want to say, what's the opposite of yon? Hither and thither, here and yon?
Jeff: Is that what it is? Whatever it is, it's an eight-hour flight away and I'm going there.
Leo: You're going where? Helsinki?
Jeff: To yon.
Leo: I'm staying at yon's place in Helsinki for one day.
Jeff: I'm in Helsinki for Newsgeist, Google making nice with European publishers and we'll soon talk about Facebook being nice with all the web publishers.
Leo: I hear Mathew Ingram. Great to have you. Formerly of GigaOm and glad that Mathew, like many of the other - your colleagues at GigaOm landed at Fortune. You're in that group and that's so great.
Mathew: Yes, it is great.
Leo: I'm so happy to hear that. Unfortunately, Mathew had all of his stuff stolen in Italy, but what the heck? That was the old GigaOm gear. All new Fortune gear.
Mathew: I needed to upgrade anyway.
Leo: Hey, what's Om going to be doing, do you know?
Jeff: He's investing still, right?
Leo: He had left the day-to-day operations at GigaOm anyway, right?
Mathew: Yes, yes, about a year before.
Leo: Well, if you ever talk to him, we have to get him on. Let's get him on, Jason. I love Om. Love him. I know he's been kind of in mourning a little bit, poor guy.
Let us talk about Google, the meta-verse, the universe, the Twitter-verse, the Facebook-verse.
Jeff: The Face-verse.
Leo: The Face-verse and anything we want to talk about. This is the show for and by smart people. Not so smart in Great Britain. David Cameron, the prime minister of Great Britain, just off of his surprising election victory - people thought it was going to be closer than it was. The conservatives won a majority and now, Cameron is taking advantage of his majority by - I'm curious what you guys think of this, limiting the Queen's speech. Cameron - a great article by Glenn Greenwald in The Intercept. He calls Cameron's decree “Orwellian.” Quoting Cameron, “For too long, we've been a passively tolerant society, saying to our citizens 'as long as you obey the law, we'll leave you alone.' It's not enough for British citizens merely to obey the law. They must refrain from believing in or expressing ideas which Her Majesty’s Government dislikes.”
Mathew: Yes, that's - I can't understand how a modern politician in a country like Britain could say those words. I just don't understand what is going through his mind when he said something like that.
Leo: The issue is - I mean, I don't think anyone would disagree that if it's terrorist's speech, maybe, if it's something really - but how do you know? How do you define that?
Mathew: Right, who defines it? That's the question.
Leo: In the UK, they don't have as we do in the U.S. a First Amendment.
Jeff: Nor a Section 230.
Mathew: And it's pretty obvious.
Jeff: Yes, it really is.
Leo: The First Amendment says the government shall make no law abridging the right for speech. Now, there is in the U.S., even with the First Amendment, speech that is prohibited but it's pretty clear - you know, you can't shout, “Fire!” in a crowded theater. This sounds - this, you literally will not be able to tweet. I don't know what you could say in 140 characters that would be so damaging to the British democracy. Facebook postings, tweets and of course, articles. This bill will be - it's proposed. Does he have to get it approved? I presume so.
Jeff: The Queen's speech is his agenda to Parliament.
Leo: Oh, so it's a whole bunch of stuff. Wow.
Jeff: It will be an “anti-extremist” bill to be unveiled. I love this - Glenn Greenwald, “To stop those who seek to undermine our British values and instead ensure 'we are together as one society and one nation'. (I personally believe this was all more lyrical in its original German.)” Well done, Glenn. Well done.
Leo: If you wanted to tweet, you would have to submit to the police in advance any -
Jeff: Who has to do that? I don't understand.
Leo: Extremists. Are you a self-identified extremist?
Jeff: Some say I'm an extremist.
Leo: Right. If you seek to undermine democracy - you have to kind of read between the lines to even see what they're talking about. If you seek to undermine democracy or use hate speech in public places, but you are allowed to provoke hatred.
Leo: It will also include new powers to close premises, including mosques, where extremists seek to influence others.
Jeff: I think all in all, hate speech is a dangerous doctrine as well.
Leo: We kind of have that, though. Don't we have limits on what you -
Jeff: We do. We do more and more. But the classic American example is that we allowed the Nazis to march in Skokee and so to protect speech, we protect even noxious speech. That's an American belief and now, on some campuses, it's getting pretty ridiculous. “The speech not only offends me, it makes me feel unsafe.” It's just - this is classic works. Ideas don't hurt people. Being able to deal with ideas is exactly what we should be doing in democracy and education, good or bad ideas.
Mathew: In Canada, we have sort of a half-American, half-British approach, so we have hate speech laws and we don't have any sort of amendment that protects free speech but there's a real tension, at least here, between wanting to promote free speech but still kind of having that British history of some things you just should say. So the Harper government, it sounds like, is threatening to charge people with hate speech for promoting boycotts of Israel. So you know, you could probably - it would fit just about anything. There could be lots of things that fall under that broad definition depending on who you're talking about. That's the problem. Who defines it?
Leo: It's kind of shocking. All right, I thought I'd bring that up, that just crossed our wires.
Jeff: Late-breaking crap.
Leo: Late-breaking news. But there's a whole lot to talk about well beyond that and since apparently, our last show was more than two and a half hours long, I think we're going to get right to it.
Jeff: Is that right, Jason?
Leo: Right to it! Let's start with Verizon/AOL. That's a big story that broke a couple of days ago. $4.4 billion - now, some people say AOL was still worth something. That's not a whole lot.
Jeff: No, it's not. It's more than New York Times is worth, but …
Leo: Yes. Verizon buys AOL.
Mathew: It was - AOL was worth, what? $300 billion or something, wasn't it?
Leo: What was the Time Warner merger?
Mathew: [audio feedback] - I think.
Leo: Time Warner/AOL, $164 - well, actually, that was the opposite direction because AOL bought Time Warner, although for $164 billion. But Time Warner is not still part of AOL, right?
Leo: Although that is legendary. That 2001 merger is the biggest mistake in corporate history.
Jeff: I should have saved all the tweets to a collection. The wags of Twitter were in their finest form for this one. Yes, yes. It was beautiful.
Leo: The Verizon/AOL one? Well, it raises a couple of issues. You know, Engadget is part of AOL. Will they be, now that they're a house organ of the Verizon company - will they get as much freedom as they've had? If they don't like a phone, can they say it?
Jeff: Look at the history of Verizon. It's not good. They tried to start a tech site that would say nothing controversial and they killed it.
Leo: The late lamented SugarString?
Jeff: They also couldn't name things well.
Leo: That is the worst name ever.
Jeff: I always thought when the companies started, when they changed the name of the telephone company? I thought it was a French name, Verizon.
Leo: It used to be NYNEX, which was a good name. The New York New England telephone exchange or something like that.
Mathew: So SugarString, they said that you shouldn't write about net neutrality. So somebody reported that and they eventually shut it down.
Leo: Verizon says, “As you know, we always said this was a pilot project. We never said we were serious about SugarString.” Okay, so they said, “Well, I guess we can't do it ourselves but maybe we should buy somebody that can.”
Mathew: The sort of shorthand on this deal - correct me if I'm wrong, Jeff. It's that what Verizon really wanted was the ad tech that AOL has developed.
Jeff: Right, Mathew. The first story said they wanted the content, the video. I didn't believe that at all. It's both ad tech and ad sales. Tim Armstrong, remember, built the American sales operation for Google. Tim knows how to do this extremely well. He bought ad tech companies -
Leo: Tim Armstrong, the CEO at AOL.
Mathew: He's bought a bunch of companies who specialize in ad tech, particularly mobile and video ad tech. It feels like that's what Verizon wants when the content just comes along for the ride.
Jeff: So there's speculation and let's make it sure, it's speculation that others well buy - Axel Springer's been mentioned a lot, the German publisher would by the content businesses of AOL. One wonders why anyone would want them except for Huffington Post - [crosstalk]
Leo: [crosstalk] - okay. So mobile ad network, I understand, is not content. But isn't video content?
Jeff: Hold on, Leo. What video does AOL really have? Go to the AOL video page and tell me what you lust after there.
Leo: It's not AOL. It's the brand - Engadget. TechCrunch has a video operation.
Jeff: Yes, that's fine. But is that worth $4 billion? No. It's - you can license that stuff. No, I don't think they wanted the content at all. HuffPo is nice too.
Leo: That's another AOL property.
Jeff: Yes, but the reports have been that they've wanted to break off for the last year or so and they may break off now. There's been rumors, denials, so on and so forth. But I think if they could find anyone to invest in a management buyout or to buy them, they would. I don't think that - [crosstalk]
Leo: Here's AOL's video page. Let's see what we can see. Watch live, Brittany Snow, Skylar Aston and Kate Canon on Pitch Perfect 2. That's obviously an ad. Arnold Schwarzenegger on how California would survive a zombie attack. Build is an event - something they do, right?
Jeff: Yes, who does Build?
Leo: I don't know because there's Microsoft Build. That's obviously not what this is, I don't think. Here's what everyone's watching? A week-old story about Tsarnaev convicted - week old? Maybe that's three weeks old, the Boston Marathon bombing. Breckenridge couple appears in court on criminal charges.
Jeff: If you go to on.aol.com, that's another one.
Leo: All right.
Jeff: It looks like it's an Amtrak video, Tsarnaev video, it's probably a bunch of [0:13:55.5?].
Leo: Yes, this looks like news.
Mathew: Yes, I don't think Verizon cares about that.
Jeff: No, no.
Leo: What you're saying is, they don't care - they don't want this.
Jeff: Yes. They'll sell this off. Verizon, on the FiOS end, does still have some content for - I'm a FiOS customer. Its effort to do a news channel on channel 1 to compete with CableVision's News 12 in my market. That matters somewhat to them on the East Coast, but that's minor. I guess video matters online but this is not the video you want.
Leo: But you know, Verizon has a deal with the NFL. For instance, with the Verizon phone, you get exclusive mobile access to NFL games.
Jeff: And the other thing that's happening is Vice -
Mathew: But none of that is content.
Jeff: Right, exactly. Vice is making big deals all around the world licensing content or licensing a window to telco's. So I could see Vice doing a deal but I - this AOL video? Psh.
Mathew: I don't see how Engadget or HuffPo have things that are proprietary enough, like the NFL, that they could license it or have an exclusive deal with Verizon that could be worth that much money.
Leo: Here's some AOL exclusives. Adam Sandler: Million Dollar Noises. Season 1, episode 1. So this is a like a show. Laugh Lessons with Kevin Nealon. It has ads on it, by the way.
Jeff: I've never heard of it. Of course, these are the two sites - no one I know has ever quoted AOL or Yahoo and yet, supposedly, they still have huge traffic, fire hoses and yadda, yadda, yadda.
Leo: I'm starting to believe now. I kind of thought, “Content. Oh, they've got TechCrunch, Engadget, HuffPo.” But Verizon doesn't want any of that.
Mathew: No. I think those will all be gone.
Jeff: It's been trouble.
Leo: And if you're Engadget and you're limited on what you can review - you can't say a bad thing about Verizon or Verizon phones, that kind of eliminates the fun of it.
Jeff: Well, there was a piece - it was on the rundown where Engadget said, “They didn't buy us for our editorial.” They're not buying editorial. “They're not buying our soul and our voice. We will still be independent.”
Leo: Oh, they always say that. That's what CNET said until CBS said, “You can't give Hopper the Best of CBS award because they let you skip commercials.” They always say that.
Jeff: That's what the Wall Street Journal said when Rupert Murdoch bought it.
Mathew: [crosstalk] - said, you know, the editorial's going to remain - no one will have anything to say about it and this is a content deal. I think a lot of that is just gas.
Leo: I think what we all want to know is, frankly, what did Shingy have to say? Shingy says, “It's pretty cool, man.” It made his hair stand on end.
Mathew: “Pretty cool, man.”
Leo: That's what a digital prophet would probably say if you -
Jeff: I would just love - I would pay money to be in the Verizon executive meaning where Shingy shows up.
Leo: You figure Shingy's probably going to be available soon.
Leo: Shingy, for those of you who don't know, is this guy, David Shing. They call him Shingy. He's got quite a style going on. He's AOL's digital prophet. It's not really clear what he does.
Jeff: No, it's not.
Mathew: He redesigned Tim Armstrong's office.
Leo: Yes, yes.
Jeff: As an AOL shareholder, I've always wanted to know how much money goes into Shingy.
Mathew: Someone wondered whether Mike Arrington would be interested in taking TechCrunch back and he used an f-word, I believe, in his response.
Leo: No, he's got his money and he's living in Pacific Northwest. He's very, very happy. He got a -
Mathew: If he said he wanted it back, I would send him for psychological assessment.
Leo: TechCrunch has a conference. Verizon's not going to want that.
Leo: You know, Sarah Lane who worked here left to go do video for TechCrunch. They do have - she's doing a daily news show for them. There she is. So I could see maybe, there'd be some - Verizon doesn't want content.
Jeff: I could see there, for business stuff. Tim Armstrong said, “I'm not selling TechCrunch.” But it's not going to be up to him in the long run. I think there's going to be a market for TechCrunch. I think Wall Street Journal, Fortune, maybe? Not Forbes. Lindberg, Reuters.
Mathew: I could see [audio feedback] buying TechCrunch, Engadget or both.
Leo: Engadget is just valuable.
Mathew: Maybe even HuffPo.
Leo: HuffPo, you said, has been trying to get out of the AOL deal anyway, right?
Jeff: That's the reports - that's the rumors.
Leo: They also do video. Didn't they - they do something like TWiT, didn't they? Or they were going to. Yes, Huff Post Live. Right now on Huff Post Live - cocktail chatter with Josh Zepps.
That's old news.
Mathew: They did a lot of sort of hangout shows and Google Hangout shows where they would get -
Leo: It's kind of like TWiT, right?
Jeff: It tries to be more TV. There's a real cameraman there and there's teleprompters.
Leo: There's books on the bookshelf.
Jeff: Eight minute segments. I've been on it and it's very pleasant, very nice, but yes, it tries to be - it's more like old TV than it is like TWiT. They dress it up.
Mathew: Huffington Post gets a ton of traffic. I think it's uniques are in the hundreds of millions.
Leo: That's not to the video. That's to the stories, right, and that's because it's kind of like Upworthy. It's all linkbait and -
Jeff: No, they're hiring more real journalists. The other thing that's very impressive about Huffington Post - you know, as I always say, they laughed when Ariana sat down at the keyboard but she proved the world wrong. Now the emphasis - and Jimmy Maven, the CEO. The emphasis is on making it a worldwide brand and at the DLD Conference, Huff Post was there because they have a deal with who runs the conference. Ariana had her - I don't know how many it was, 21 world editors up there. They have Huff Post Canada, Huff Post Spain, Huff Post France, Huff Post Germany. They've really done a pretty amazing job of creating native language sites around the world and making Huff Post into a global brand.
Leo: But if you wanted this, wouldn't you buy Vice? There's got to be better content at Vice.
Jeff: If you wanted video, yes, you'd buy Vice. But if you wanted a hell of a lot of traffic and content - the other speculation, raw speculation. I don't think it came from anything but just saying, “Wouldn't it be interesting if ...” Somebody said, Facebook, given everything going on with Facebook. I don't believe that for a second. I think Facebook and Google cannot own content. It's channel conflict and it's antitrust-bait. They just simply can't. But I could imagine - here's the interesting part. A lot of the story after this is what about Marisa, now. Marisa was going to - Armstrong and Meyer were going to merge the two companies. There's been many rumors over the years. Who knew who'd be on top?
Mathew: I think Tim wanted that more than Marisa.
Jeff: I think so, too, but Marisa could take these content properties off while he can't.
Leo: Doesn't it feel like they're in the same business a bit? Yahoo and AOL seem like they're exactly the same.
Jeff: Yes. The same old business.
Leo: Two sides of the same coin.
Jeff: You can imagine HuffPo being a Yahoo.
Leo: Absolutely, so maybe that's what will happen is the content goes to somebody else like Yahoo and then the ad network -
Mathew: That's what it feels like to me.
Jeff: I could also see - the Axel Springer rumor comes from - there are companies elsewhere such as in Germany who would like to enter the U.S. who believe strongly they can't do it on their own. They could end up buying something as an entry to the U.S. market. Huff Post would not be a bad entry vehicle.
Leo: As an AOL shareholder, are you happy?
Jeff: Yes, I guess so. I've never been happy because I got - the way this works is I -
Leo: It's always been bad.
Jeff: I was given - when I was at People magazine, I was given a grant of restricted shares and this just shows you, don't ever listen to me about stocks. So you get - the shares are just given to you one day. Well, that day - and you pay taxes on the value you get then. I got them at the extreme highest price it's ever been in history, in the midst of the Time Warner/AOL takeover fight. I'm sorry, Time Warner/Paramount takeover point. So I still have, “Oh, it'll get up to $120 again.” Eff me.
Mathew: They're going to come back.
Leo: Any day now.
Mathew: Just wait, Jeff.
Jeff: Yes, so this whole thing has been unraveled since then. I have AOL, Time Inc., Time Warner Cable which is nowhere with that. Just because of that, leftovers. I haven't touched it because it's too painful.
Leo: Folks, don't get stock tips from Jeff Jarvis. It's the rule.
Leo: Of course, Verizon denies that this is just an ad deal. They say, “Maybe we're going to spin off Huff Post but we're staying in the content business.”
Jeff: Have they said that out loud?
Leo: Tim Armstrong says he's staying in the content business and not selling TechCrunch. Oh, wait a minute. That's Tim Armstrong. He doesn't get a say in this, does he?
Jeff: To Verizon's expense he does.
Mathew: Verizon said it was all about ads. Well, they didn't say that in too many words.
Leo: But the principle interest, says Verizon's John Stratton, is around the ad platform.
Jeff: I'm sure of it. What's interesting here is an ad platform - Verizon and other telco's - the NFL deal you mentioned. Phone companies think in closed, fenced in universes, right? Verizon put mobile ads on its own - this is where the kind of thing comes in. Serves ads on what, where and how? Does it become an ad-serving mechanism? You serve ads on content or on services. Verizon doesn't really have any services or any content. Fine, it could have HuffPo. Big deal. How much mobile traffic on Verizon phones is there on HuffPo and HuffPo's business, it's their interest to be on every other platform there is too.
So yes. I, too, accepted this idea if it said this. I think it's about ads and ad technology and I believe that in mobile but it's hard for me to understand Verizon's role in the ecosystem because Verizon never sees itself as a member of an ecosystem. Verizon always sees itself as its own tower.
Leo: And of course, Verizon's in what used to be a monopoly and a very strong business that's starting to become less so with Google getting into the wireless business and fiber business. Verizon isn't the must-win that it used to be.
Jeff: The funniest part to me is that Verizon can finally maybe serve all those dial-up customers left at AOL.
Leo: How many dial-up customers are still left?
Jeff: Lots, lots! That's where their free cash flow comes from.
Mathew: A couple million.
Jeff: Chat room, is there a number?
Leo: I'm looking. That would be a good number for the week.
Jeff: 2.1 million - CreamyCornCob. That's an authoritative source if I've ever heard one. Sorry, Creamy. He says 2.1 million. What's your source, Creamy?
Leo: Here's one from TIME magazine yesterday. 2.2 million dial-up subscribers. “The company's adjusted operating income from the unit that includes dial-up is down 8% year over year after the first quarter but $126 million.”
Jeff: That just - it blows the mind.
Leo: It's $20 a month, so that means there are a lot of people who either can't or don't want to pay for higher speed internet. Some of those, according to TIME, AOL dial-up customers actually aren't paying for the service. They're getting their connection for free after threatening to cancel their subscription.
Mathew: Scott Klein had the best line. He said, “Verizon, another old guy who buys AOL because he wants to connect to the internet.”
Leo: “I heard there were free disks!” Yes, the Wall Street Journal's immediate reaction was two crumbling empires merging, although I never trust the Wall Street Journal's immediate reaction because you have to wonder, what's Rupert's interest in all this?
Mathew: I actually read a piece - I can't remember who it was now, but their argument was basically, looking at Verizon, it says a lot more about Verizon than it actually does about AOL. It says Verizon is kind of desperate. This feels like a desperation move.
Jeff: But go back to what I said - let me ask what I asked a minute ago, Mathew. How do they add technology? Desperation to what end?
Mathew: Desperation means - [crosstalk]
Leo: Verizon, that's a problem. It's not like they can offer it to game developers or something.
Jeff: But then again, I go back. How did I -
Leo: They better not put ads on my phone.
Jeff: A guy named - I'm sorry, now I forget his name. What's his name? Wonderful man who was in charge of the AT&T online service. He's the guy who turbo charged the growth of the Net when he took the clock off and put $19.95 a month flat rate. That's what did it.
Leo: Now we're going back the other way.
Jeff: That was, to me, a crucial moment.
Leo: This is from Fortune. A good publication, I hear.
Mathew: Yes, that's right.
Leo: Aaron Griffith, last year the company earned - the company being AOL, almost $1 billion from display and search ads on the media properties it owned. It earned almost as much, $56 million, selling ads for third-party sites. That's AOL's fastest-growing segment. It grew 39% between 2013 and 2014. Revenue from in-house media operations from the same periods, display ads fell 3% and search ads grew just 4%. So this is one of those companies that hasn't licked mobile in that respect.
Jeff: This would help. Does this mean - everyone's enemy is Google. Verizon's enemy is Google. Is this Verizon saying, “Yes, we know this phone business isn't going to be so good. Let's get into the phone business.”
Leo: No, I wonder. That's interesting, isn't it? I can't imagine Verizon saying that, or can you?
Jeff: If you do honest forecasting and you're in their business, it doesn't look pretty.
Leo: Well, even Google is diversifying, right? Everybody should be thinking about the future. Yes, I mean, part of the threat is this move towards WiFi everywhere. You know, Verizon's going to face threats from Comcast, Xfinity which is essentially positioning itself to be a carrier by putting WiFi everywhere. Google Fi - I don't know how big a threat that is because it's based on carriers.
Jeff: Mainly a threat to pricing models.
Leo: Right, and even then it's about the same, isn't it? I don't know.
Jeff: Just a little less imprisonment.
Leo: Does Verizon want Tech News? Why would they want Tech News? Why would they want video for that matter? It just ties up their network, it doesn't -
Mathew: I just don't think they do.
Mathew: And if you look at the entire - AOL doesn't break out HuffPo or any of those assets but the media unit in their statements, I think last quarter, that entire unit had operating income of $13 million. That's Huffington Post, TechCrunch, Engadget.
Mathew: All those other sites. $13 million.
Leo: God, that's nothing.
Jeff: Jesus, Mathew, I haven't seen that number. Wow.
Mathew: It's tiny. That's pennies.
Jeff: What did GigaOm have, jeez?
Leo: I got to figure this is actually - I don't see why this is good deal for Verizon in any respect.
Jeff: More I think about it -
Mathew: The ad tech - the ad targeting tech is worth something, whether it's worth $4 billion or not I don't know, but I think it is worth something to -
Leo: What do they do, though? How do they use that?
Mathew: Well, they've got it so, my understanding is - and this is not my area, but my understanding is that AOL is good at figuring out how to deliver, and when to deliver and to whom to deliver video ads, so that's something that presumably would be worthwhile to Verizon. It knows a lot about you as a phone user, it's got your user ID, your device ID, you know, presumably it's got your location. So it has information with which it can target ads or videos. That's my understanding.
Jeff: I interviewed - I interviewed Tim Armstrong with Marissa Mayer at CUNY some years ago, and Tim's strategy at the time was to say that all the ad money goes to the top sites - media sites. That's the way the ad business works and still does, and I'm going to make AOL into one of those and that's why I'll have a lot of content. So I'll have a lot of volume, and the ad business, Lord knows, is still volume-based. My rallying cry these days is we got to shift - volume-based advertising will commodify towards zero and we have to shift to value-based models, starting with attention but also other value-based models, and pure volume is just going to be pure cats, and - you don't make it up with volume, it's not a good business. But that's where AOL was headed. He got more content. Meanwhile, he's really good at selling ads, really good at that structure and brought as much advertising as he could to it but, eh, so then he went more into the pure ad business.
Leo: Well, if you're going to go into ads, don't do online video ads because Google says, “Only about half of them are ever seen at all.” These are the worst statistics ever.
Leo: View-ability - so that means -
Jeff: View-ability is a gigantic issue in media right now.
Leo: “An ad is only viewable if half or more of its pixels are visible on the screen for at least two seconds.” So what it's saying is that of all the video ads being served, half are not even seen for two seconds.
Leo: 76% were in a background tab and were never on screen at all. 24% were scrolled off screen or abandoned in fewer than two seconds.
Mathew: Yes, I mean what proportion is just auto-play video ads where you've got a tab open and it just suddenly loads the ad?
Jeff: And we're ripping off advertisers, which is not a future business.
Leo: If an ad plays on a website and no one sees it, does it exist?
Jeff: Yours are seen and heard because-
Leo: They're interstitial.
Jeff: They're interstitial. They're native.
Leo: Careful with that word, “native.”
Jeff: I agree, but they are the good kind.
Leo: “Good kind.”
Jeff: They are true to the form. It's been absolutely corrupted and it's corrupting and you know I don't like it very much, but radio advertising, which is basically what you have, has always worked for that reason. It fits into the form.
Leo: Right. Now by the way - consider the source, this comes from Google, and you should know that they didn't look at YouTube ads because YouTube is a video destination site so 91% of those ads are viewed, so what they're really saying is, “If you wanna do video ads, put them on YouTube.”
Mathew: Are they viewed though? I mean does anybody not click “Skip this ad”?
Leo: I always skip it.
Jeff: Sometimes no. I will occasionally get one that either is A, compelling enough, or B, relevant enough that I will end up watching it.
Leo: The onus really is on the ad-buyer, because if you make an ad that's compelling - well you have four seconds? If you can make an ad that's - by the way, I guess that's where the four seconds come from that make it viewed. If you make an ad compelling enough that you don't hit “skip ad” that's good.
Jeff: Well, it's both, Leo. It's also on the server because it's relevance.
Jeff: You know, you show me an ad for a new Tesla, I'll watch it.
Leo: That's true, right. Something I want to watch.
Jeff: I won't buy it because I'm too poor, but I'll watch it.
Mathew: I've never watched a video ad except by accident.
Leo: Wow. And you know, the truth is, though-
Jeff: Oh come on, haven't you watched a Google ad? Google ads are compelling. Admit it Mathew, you've seen them. Come on. Ole grumpy-puss. Come on.
Leo: Come on. But isn't that why Facebook auto-plays the video now and -
Mathew: Yes. [crosstalk]
Leo: They want you to see them.
Jeff: Well also - but for Facebook, it's fascinating to me how much more video I watch because, “Oh what the heck, it's already playing, oh, that's interesting.” And the auto-play, which is so irritating when you go to a site for a different reason, the silent auto-play on Facebook I find to be a very good experience, I never -
Leo: Are those ever ads? Aren't they always content from - do they do video ads on Facebook?
Jeff: Not yet. I don't know that they'll ever do them, purely.
Leo: But that's what's coming.
Mathew: I don't think they auto-play.
Leo: Okay. Interesting.
Mathew: I mean I don't mind an auto-play video if it's a cute puppy but if it's an ad -
Jeff: Ah! Ah! There we go. There we go. Puppy ads. You can sell puppies to Mathew Ingram.
Leo: That's kind of cool. I just went to my Facebook. iJustine is hosting Price is Right. Price is Right is doing a “Socially Awesome” week with social media gurus, and iJustine is hosting this week - or today, or something. I just thought I'd pass that along.
Mathew: I think there's a huge, you know, whether it's auto-play or videos that skip ads or ads playing it tabs - there's just a vast, vast amount of wasted money. Like, the old saying used to be, you know, “50% of my AdSpend is wasted, I just don't know which 50.” It's probably 90%. It's 90%, particular with video. Nobody knows who the hell is actually watching them.
Leo: Shh, shh.
Mathew: I would bet 80-90% goes unwatched. Trillions of dollars.
Leo: Shh, shh.
Mathew: Not yours, obviously.
Jeff: That's Leo leaking money right now. Shh.
Leo: Everybody in media knows that ads - the measurement systems, all of this stuff is just made up, and, you know - [crosstalk]
Jeff: But it's relative BS and so you buy - and the advertisers know that too, and they buy on relative BS.
Leo: Right. Well -
Mathew: Well, you know, newspaper ads were BS too, right? Everybody reads the whole newspaper. Everybody reads every page of every newspaper! Right?
Leo: Of course. Those display ads may never get seen. But I guess -
Mathew: I find people that read every newspaper, that was my favorite -
Leo: If it didn't work for people they wouldn't do it, though, right? Or is it just they do it completely on faith – Coca Cola has no idea what would happen if it bought no ads versus buying a lot of ads.
Mathew: I think that -
Jeff: These days-
Mathew: They basically have a hunch. So you run an ad, more people buy Coke. So it must have worked right? Otherwise -
Leo: One of the reasons that almost all podcast advertisers are direct response advertisers because they can measure it.
Leo: They know we bought ads. Casper knows we bought ads on TWiG. And they don't pay us for sales, they just pay us for the impressions, but they know -
Jeff: One way or the other, they're accounting for the value - [crosstalk]
Leo: They're accounting for the value of it. They say, “Well, it cost us whatever, $10,000 in ads and we got $20,000 worth of mattress sales.” They're happy.
Mathew: And they can track a code that someone uses to come from your site. Like those things are measurable. It's the stuff that you can't measure -
Leo: It's brand advertising that's so - and that's one of the reasons why podcasts don't get brand advertising, because they don't have the - it's all done in faith, right? I mean, brand advertising is all done in faith whether it's NBC or TWiT, but they have more faith in NBC, that that Tide ad on NBC is working than they do that the Tide on TWiT is working.
Jeff: Well, you got it from Ford. That was brand advertising, from Ford.
Leo: You know what I think our biggest problem, really, is - correct me if I'm wrong, because I just made this up, but agencies that do the ad buying make money based on the amount of dollars spent. We're too cheap.
Leo: It's too much trouble to buy an ad on a podcast or a podcast network because it's such a small buy. They don't make enough money.
Jeff: Exactly. It's stupid. It's stupid!
Leo: So they're just going to go, “I want to make million dollar buys because I'll make more money.”
Jeff: And you know what, it's just cheaper to make the buy, and ad agencies are lazy, and it's absolutely stupid that most ad dollars go to the top, you know, three or four sites.
Leo: Efficiency is not the measure they use.
Mathew: Well, there's a corollary to the, you know, no one ever got fired for buying IBM. No one ever got fired for putting an ad in the New York Times or buying an ad on CNN.com, right? So everyone does that, regardless of whether or not it actually works or not.
Leo: That's why, in some ways, we're the secret sauce for the companies that do - The Atlantic, we just had an article with saying, “Why Squarespace is on every podcast you've ever heard.” And we love Squarespace, and I think, I'm pretty sure we're the first podcast they ever bought, and it was a huge success, and that's why Squarespace said, “These work!”
Jeff: Yes, the companies they're targeting -
Leo: So the companies that discover that this more efficient form works are - kind of have a secret ace in the hole. The problem is it's never going to be Grey or one of the big media buyers that discovered us.
Leo: It's going to be either an individual advertiser - some of our advertisers do their own buys - or a small network, in many cases devoted to new media advertising.
Jeff: How many RfPs do you deal with?
Leo: Lots. Most of them -
Jeff: Just to explain to the audience, when an agency puts out for call for proposal and says, “This is what we want, hey! Come sell yourself to us.”
Leo: A lot of them come from directs. Not agencies, but directs. We deal with number of - they're like agencies - some of them are agencies, some of them are ad brokers or ad buyers, but we deal with them a lot. We turn down more than half out of the box. In fact, it really annoys people when we say no. They go, “What, I'm not good enough for you?”
Jeff: Why do you usually say no?
Leo: No, they get insulted.
Jeff: Why do they usually say no? Because they're not good enough for you?
Leo: Because it's not a good fit for our network or I don't think we should be promoting a product, or, you know - part of the value of our advertising is that we, you know, it's not just random stuff.
Mathew: And that's why it works. That's why-
Leo: But it's unheard of, and advertisers don't get it. It's unheard of any media company to turn down money.
Mathew: To turn down - yes.
Leo: It's unheard of! When we say, “No, we don't want your money,” it's like, “But, but - what's wrong with me!?”
Mathew: But it's money. It's green.
Leo: It's money! But see, it would quickly devolve if I started taking ads for any ole damn thing, it would quickly devolve - you audience members would no longer - it would just be background noise again, like most ads are.
Jeff: Go ahead.
Mathew: The whole value of the ad is you saying, “I use this thing,” and I liked it and it worked.
Leo: Yes, and our selectivity, and our knowledge of who our audience is and what they might be interested in and so forth.
Jeff: Well, when I saw the heads of Casper and Harry's at the DLD conference in New York -
Leo: Both of them advertise on TWiT.
Jeff: They're like oddly in-the-family celebrities.
Jeff: You know? There was a relationship there. It does matter, it does work. Reading these matters.
Leo: That's the thing that's sometimes frustrating is that we do always hear from every one of our advertisers that we work much, you know, in orders of magnitude better than any other ads they buy, but that doesn't mean that - Ford is a good example. Doesn't mean that we keep the buy. We worked really well for Ford, they did - now of course Ford, because their brand, didn't have direct sales numbers, but they did research and we came out - I mean, I saw the research, I've never seen anything like it.
Jeff: But they get tired. You're the shiny thing, you know, just gets a little dust and move on. Yes.
Leo: It's such a small buy, and Ford does its own in-house - they have their own in-house agency so they do the buy. It's still such a small buy, “It's just too much work.” It's like, “Eh …” And they who spent more than a million dollars a year on TWiT, but it's like, that's nothing. Because they spent $500 million a year on network ads. This is nothing. So it's not - it's just not worth the energy. It's very interesting. I find it fascinating. I don't - I'm sorry, that's just all about me and not - enough about me.
Jeff: Enough about you.
Leo: Let's talk about our new newsstand. Jeff Jarvis says, “I, for one, welcome our new newsstand.” Meanwhile, Mathew Ingram says, “Is Facebook a partner or a competitor for media companies? Yes.” We're talking about this new Facebook program called -
Jeff: I can't - even though I slathered about it, I can't even frigging see it.
Mathew: Because it's not on Android.
Leo: So it's called Instant Articles. Some big publishers already in partnership, the New York Times, The Guardian, Buzzfeed, National Geographic. What happens? What is - by the way, it's only on the Facebook mobile app.
Mathew: Right. And only on iOS.
Leo: Well I got it right here, let me see what it - what does it look like?
Mathew: It's just a really well-formatted article. So Facebook works its magic on the article.
Leo: And it's in the News Feed?
Mathew: It's in the feed and you can read the whole thing in your feed, videos play automatically, it loads faster, and you don't have to click to open an in-app browser.
Leo: So I was just looking at my desktop at this so far looks the same, exactly. There's Gina Trapani's link.
Mathew: There's only a few of them, so the New York Times only put one on.
Leo: Oh. And I can't guarantee I'd see it, right?
Mathew: Right, but if you go to Facebook.com/instant, I think, there's a list of them.
Leo: But you can't just look in the Facebook app and expect to see it?
Mathew: If you follow the New York Times you'll see it.
Jeff: If you follow the New York Times - well The New York Times was the first one on. The other eight publishers - it's around the world so it includes The Guardian, BBC, Bild in Germany which is own by Axel Springer which was the leader of the war against Google.
Leo: Let me like The New York Times. Now I've liked them. And this is one of them, right? Marriage in India? Is that one of them?
Leo: All right. So maybe if I go back to my Home Feed now that I liked them will I see it? Here's Trey Ratcliff - by the way, Trey had the same thing happened to him that happened to you, Mathew.
Leo: His bag was stolen from under a train seat.
Mathew: No kidding.
Jeff: With lots of expensive cameras in it?
Leo: He had his entire collection of cellular cameras and, like, lenses in there.
Jeff: Ooh, ouch.
Mathew: Yes. I just had an old laptop and old iPad.
Leo: Yes. So I don't see anything yet. So like the New York Times, like The Guardian, like Buzzfeed, like National Geographic, and maybe you'll get -
Jeff: If you go to instantarticles.fb.com -
Leo: Okay. On the desktop?
Jeff: Yes, well, maybe there. Maybe it'll have a link to something to get a demo of it.
Leo: Okay. So tell me what you expect.
Mathew: It's not going to look that different really.
Leo: “A new way for publishers to create fast, interactive articles on Facebook.”
Jeff: You're not going to click off. That's what's different, right?
“Quest for a Superbee.” “Interactive and immersive.” Are there ads in there? “Auto-play video comes a live as you scroll through the article.” So this is that auto-play stuff that we - “Using existing production tools and standard mark-up you can publish any type of article -” that's good, it makes it easy for the publisher, right? And do you pay Facebook for this, or what?
Mathew: No, there's a rev share.
Jeff: Well it's more than a share. If you sell the ads yourself you keep 100% of the revenue.
Mathew: Right, you get 100%.
Jeff: If Facebook sells the ad -
Mathew: If Facebook sells the ad you get 70.
Jeff: 70%. And what that means is on an article per article basis you're even. If Facebook sells - if you choose to take the Facebook ads, it's probably because they had a higher value ad so you're probably up, and you're going to get new distribution off an incremental distribution for this, so you may be up.
Leo: So really, what you're saying, Jeff, is that this is a new medium for publishers to take advantage of.
Jeff: I'm saying we have no choice but to deal with this, we have to go where the users are. The idea that we vertically control every piece of a media chain is over, and we have to do this. And we see, I think, a golden opportunity right now between Google and Facebook, where Google, as we discussed last week, is trying to make nice and sign friendship pacts with eight publishers. I think Facebook probably went to nine just say “Nyah, nyah, Google.” But the Google pact is all, kind of, “We'll develop stuff and we'll give you a bribery front for innovation and we'll do some training and some fellowships and that kind of stuff.”
Facebook leapfrogs them, because it comes out and says, “Well actually, we're going to affect your business. We're going to improve the experience for the users, so the users will end up seeing more stories because they don't click off on stories because it's an awful experience and takes forever. When you publish here you will get new audience, they will see it institute, you get your brand, you get your comScore bragging rights, and you kept 100% of the revenue. What's not to love?” Well, here's the part I don't love. It doesn't hand over data that enables relationships. You know, my spiel these days is we've got to have relationships, we've got to give people greater relevance by knowing them as individuals. Facebook will still know our users as individuals and we still won't. Now, I've talked to people across many technology companies who've said, “Well okay, Jarvis, but we gave that data or if publishers had that data, they wouldn't know what to do with it.” True. Stipulated, Your Honor, we're idiots about that. But Facebook and Google could school us in that and help us improve our service, and our relevance, and our value which in turn would improve the content we put on these services and it's a win for both. So this is an important first step in my view.
Now the nay-sayers like Mathew Ingram will tell you in a minute that, “Uh-oh, Facebook is the spider and the fly, and come into my web here and when you're addicted, I'll pull the rug out from underneath you,” and yes, that could happen. We need a lot more discussions about trust, about the nature of the deal, and especially about Facebook's role now as not just a distributor but to some degree a gatekeeper and even an editor of the news that people see.
Leo: But what is the negative? What is the negative, Mathew? It seems to me - in IT, the benefit, as a publisher - so yes, Jeff says, “You don't get any information about your viewer.” Big deal, you don't know that much about who buys your newspaper at the newsstand either, and I get eyeballs, I get people sharing my content, I get some excitement around my content, it's done in a form that's easy for me to do. So what is the bad - and it doesn't cost me anything, right? I don't have to pay Facebook for this privilege.
Mathew: So there's two aspects, and when it comes to the negative aspects of Facebook controlling the News Feed and when the News Feed - this is not a theoretical thing. We have examples of when this has occurred. Zynga is one example - hitched its wagon to Facebook, got destroyed effectively because they changed the algorithm. That's billions of dollars. Not only that, we have an example from the media industry. The Guardian, The Washington Post created social reading apps, Facebook promoted them so that people could read them inside Facebook -
Jeff: Well, okay, but hold on Mathew.
Mathew: Just wait. Just wait.
Jeff: I'll come back to that one. All right, I'll put that on the checklist, okay.
Mathew: So Facebook promoted those heavily, right? And it was great. They got lots of readers, they got lots of people subscribing and downloading these apps or sharing them, whatever. And then Facebook changed the News Feed algorithm. Those things were hidden more and those readers disappeared. So - and Facebook said, “You know, sorry. We changed the algorithm, you know, for other reasons.” That's - so the risk - this is what I said in the thing I wrote for Fortune about it, it's not that Facebook -
Mathew: - is an evil - oh crap. It's that -
Jeff: This is my trick so I can say what I want to say.
Mathew: It's that they're going to do it accidentally. They're going to make decisions that benefit Facebook, and those decisions are going to impact these publishers who are getting 70-80% of their traffic from Facebook, and what strategy do you have then?
Leo: Well, one should not rely on Facebook, obviously, but if you're The New York Times, it's just one of-
Jeff: Well, that was just Mathew's point on Twitter the other day, but I'm not sure you can really move those dials as easily as you want and if suddenly you've got a flood of Facebook crap, what are you going to say, no? Yes you need to diversify elsewhere but Facebook is diversification, it's diversification from the old model and making people come to you.
Mathew: I know! I know that. This is why it is the, actually, the spider and the fly is not the best analogy, but this is why, it's like the scorpion and the frog. The frog has to get across the river, right?
Jeff: Picky, picky, picky, Mathew.
Mathew: Carry the scorpion. Scorpion stings the frog. Why? “Well, it's in my nature.”
Mathew: Facebook is going to do what benefits Facebook.
Leo: Of course.
Jeff: Well, now let me answer your point, let me answer that point about the earlier Guardian, Washington Post thing, and I had similar concerns and I talked to people on Facebook about this, and their point was that it was a really awful consumer experience. And I remember that, there were two problems with that app at the time. Number one, if you read - or if you were a Washington Post user and you read articles, without you knowing or asking, what you read was shared across your friends. Stupid! Wrong by Facebook, but that was one, so people were irritated by that. Second thing they were irritated by was they were getting spammed by these publications. There was too much stuff in the feed, papers were putting too much in, Facebook had too little control over it. It was a bad user experience, and I think we can all agree about that. It was.
Mathew: Right. No, I would totally agree.
Jeff: It seemed good for publishers. So it wasn't just a one day Facebook just said, “Oh, we don't like this now, we'll turn this down,” they said, “You know what, we tried this,” as Facebook often does, and said, “This didn't work.” But then, over time, they came back. They have an experience that I think, if I could only see it on my phone! In theory at least -
Mathew: It's a great experience.
Jeff: It's a better experience.
Mathew: It's a great experience, and that is not - that's actually a part of my point. So Facebook is going to make decisions based on what it wants for its users, and some of those decisions may benefit The New York Times-
Jeff: Well, whats wrong with that?
Mathew: And nothing is wrong with that. Some of those decisions may benefit the New York Times -
Jeff: What's to fear from that?
Jeff: And some wont.
Mathew: What if -
Leo: Here's the risk. Let me propose this -
Mathew: What if Facebook decides it doesn't want to show you news articles about Syria because it's depressing? Then it won't show you news articles about Syria.
Jeff: That's a different question.
Leo: But it happens all the time, Jeff.
Mathew: It happens all the time. Plus, so -
Jeff: Yes! Well, all right, but here's Facebook's own -
Mathew: Facebook has not shown that it cares at all about journalism. The New York Times presumably cares about journalism.
Jeff: Who said they must -
Leo: Well, but here's the risk. If you as a major media enterprise start doing this and you build Facebook, you're just giving Facebook more and more power.
Leo: You're, in effect, undermining your future because if you're moving everybody to this Facebook platform -
Jeff: No, but Leo, you're presuming - well, Leo, you're a bloody fool to put your stuff on YouTube then, then don't do it, you'll hand over benefits-
Leo: I am! I am. If in my -
Jeff: No you're not. No you're not.
Mathew: But you have to, right? But you have to, just the same way news companies have to use Facebook.
Leo: Yes, we put it there. It's not - we don't - it's a very small part of our revenue because the way YouTube works doesn't really impact us. It never would, even if YouTube became the dominant -
Mathew: But I think there's a really real risk here that Facebook becomes - is already, in fact - the source of news for large quantities of people.
Leo: Yes. That's what worries me.
Jeff: Let's talk about that in two ways.
Mathew: Facebook becomes the place where people get their news. They stop paying attention to who it comes from. How does that benefit news brands that have hitched their wagon to Facebook?
Jeff: Well, but Mathew, you're also presuming that people are going to still say, “I want to come to the news brand.” That idea of having a website and making people come to you, we know from Facebook traffic, is zilch. How do people discover our stuff? Because they were recommended. Where was it recommended? From Facebook. We were already there, whether you see it on Facebook or see it on our site, it's coming from Facebook not because it's coming from Facebook but because it comes from people. Now, the point you raised that I absolute you agree with -
Jeff: I'm going to agree with you now. I'm going to agree with you now, so give me a chance.
Mathew: Please do.
Jeff: The point where I'm going to agree with you, and this was an issue in Perusia, and I discussed this on the show afterwards, Andy Mitchell gave a talk and got asked by George Rock of City University of New York - no, I'm sorry, the other city university, the one in London - the second one - George said to him, “You've got to acknowledge your responsibility,” for exactly what Mathew was talking about, “You're a gatekeeper to news. You've got to deal with that.” And Facebook gave the Facebook corporate answer, which is, “Well, we don't really control what you see, the algorithm doesn't control it -
Mathew: It's user choice, right.
Jeff: “The users - it's what the users see.” Now there is some truth to that, a tiny bit of truth.
Mathew: And that's what they tried to argue with that study that came out, The Filter Bubble study.
Jeff: Let me finish agreeing with you.
Mathew: Okay. Please continue agreeing with me.
Jeff: There's some truth to that in a sense of when Eli Pariser in The Filter Bubble complained - the truth was Facebook said, “We don't show you any conservatives, Eli, because you never look at them!” And so he bears a responsibility, we bear a - if I never look at Syria stories, Facebook is not wrong to presume I don't want Syria. Facebook is not a newspaper. They say straight out, “Our first goal is connect friends and family.” And then news came along for the ride. No one should depend upon Facebook solely for their news, and I think we have to look at it a different way Mathew. I think we have to look at it and say that this is bonus for us.
The question is - this is why I push for the data - if I could make myself more relevant to you more often and get more engaged with you, and if I could get you to then, yes, come to my site and have a relationship with more or subscribe to my newsletter or do whatever, then I have benefit. But I think that where we also agree is that you can't just ignore this.
Mathew: No, of course not. Of course not.
Jeff: In the German magazine, Focus - all right, I'll finish, one second - the writer said that this was a - and you used the word too - a Faustian deal, and the problem with that is that acts as if Facebook or Google is just going to corrupt us. The Focus writer was talking about the Google deal, you were talking about the Facebook deal. Well, it's not the people who were there were reaching, “Don't corrupt us,” we don't have a choice but to figure out good ways to deal with this new business model, and so to me, the art of this is negotiation. What are the good business terms, not the emotional, “I don't like this” terms? So now I'll shut up.
Mathew: And I totally agree that news organizations whatever means they can to reach readers, and that includes Facebook, and that includes Snapchat and that includes Instagram. I would like to see a bit more that kind of thing than tying your business model to Facebook, because all the terms that matter are Facebook's to control. All of them. When people see your content, when people see your content, who sees your content, how much they charge for the ads, how much percentage they give you. Sure, they'll give you 70% now. What about a year from now? Two years from now?
Jeff: I went through the same discussion with my students in class where they said, “I don't like Facebook, I don't want to deal with Facebook.” I said you can end up walking away -
Leo: You can't not deal with them.
Jeff: Yes, you can end up walking away from the negotiation table, but the right way to have this discussion is, “What terms do you want?” What does Facebook have that you want? What do you have that they want? What would be mutually beneficial? And forget the fear factor, build that into the business. Long term contracts, other things.
Leo: Sometimes scorpions and frogs have to take boats together.
Jeff: Right. So Mathew, what's the deal - what's the deal you would like?
Mathew: And I think, you know, the newspapers have to get across the river, to use the scorpion and frog analogy. Newspapers have to get across the river.
Leo: Aren't they struggling? Aren't traditional media outlets struggling?
Mathew: Sure they are.
Leo: Especially to reach the younger audience that new medias -
Mathew: But it feels to me like lots of publications, and I'm not naming anyone here, are fixing the entire - they're hoping that Facebook is kind of the Holy Grail, like it is going to solve their problems. Just Facebook.
Jeff: Just like paywalls, tablets, and native advertising.
Mathew: Right, tablets -
Leo: Plenty of Holy Grails out there, all of them suck. But -
Mathew: Not that they shouldn't do it or work with Facebook, but I think you've got to be very, very clear-eyed about what Facebook wants versus what you want.
Jeff: Okay. Stipulated, your honor. Tell me what - tell me what are the business terms you were consider good. That's the way to have this discussion.
Mathew: And Facebook is not interested -
Jeff: What - no, no - what do you want? What do you want?
Leo: I don't think it matters, I think you brought the right - the analogy is excellent, that you brought up Jeff, of YouTube, because if you are relying on YouTube for your content business, which I'm not, but if you were that would be very risky and the power of YouTube is such that you don't really have any negotiation power with YouTube.
Jeff: Right, but here's my point. You do have - this goes back to the beginning - there is a small, slight window right now caused by the German publishers I've complained about, let's give them credit, that Facebook and Google want friends in publishing, in part because they fear government coming after them, in part because they're sick of this war. There is - and because they're leapfrogging each other. So Google will try to be nice, Facebook is nicer, now what can Google do? There is a negotiation position here, so I would argue very very strongly that the thing to do now is to sit down and say, with no emotion - none of this, “Oh, I don't like it, I don't trust it, what are they gonna do?” It's a matter of negotiation. If you deal in the cable business you can bet whoever you're dealing with is going to try to screw you every way to Sunday and then sell your corpse. You deal with people in that industry. No, fine - these people are nicer than cable by far, nicer than Verizon by far, we have to be able to figure out how to deal with them, so the answer I would ask you is the same one I ask my students. Without any of that, tell me what's a good deal with Facebook.
Mathew: But to me, it's more than that. You cannot deal with the Facebook algorithm. There's no deal you can cut where you can say -
Jeff: No, you can - yes you can.
Mathew: Facebook controls that algorithm and they will not promise you anything.
Jeff: Insurance. The New York Times - [crosstalk] Wait, Mathew. Wait, wait.
Mathew: So Facebook is saying, “We won't promote -”
Jeff: Imagine you sat down with Mark and you got him drunk. Mark said, “Okay, Mathew. What do you want?” What are you going to say?
Leo: But Jeff - I understand what you're saying.
Mathew: Tell me why you keep taking down pages and stories about the Syrian civil war. Tell me why you take down pictures and videos about stuff like that.
Leo: There's no incentive for Facebook to do that.
Mathew: Why should we trust you -
Jeff: Let me put it as a business term. The business term would be that if you're the New York Times, you say, “Listen. I'm a valued brand and if I walk away from you, that's not going to look good. So I want you to assure me that X times per day, if I say something that's important to someone who's subscribed to me, we will agree to a number that you will say - I will serve that to my readers because I think that's important.” That is a business term. That's not playing with the algorithm, it's a business term which you can negotiate.
Leo: If you can.
Jeff: If we don't go to the table with any business terms, we will never get anything.
Leo: If you could get Facebook to do it. We don't know what the terms are.
Jeff: We don't know if we don't try.
Leo: We don't know what the terms are that the New York Times and National Geographic got but I think you're giving a lot more credit to the value of the New York Times and National Geographic to Facebook than probably Facebook does.
Jeff: Listen. We're not going to put our entire - the New York Times is not going to put their entire business on the -
Mathew: Facebook does what it wants with the algorithm. That is the end. Facebook will do whatever is required and if New York Times stories about important news topics don't get clicked on, they will be hidden in the News Feed. Period.
Leo: I don't think - you can negotiate all you want, but -
Jeff: The New York Times shouldn't be - maybe that's the wrong thing to negotiate for, by the way. If I were the New York Times, I wouldn't negotiate for, “Show serious stories.” What I would negotiate for is saying this is a chance to have a relationship with an individual and give them greater relevance but I can't do that, Facebook, if you don't give me data. Now, can that be corrupting? I'll give you nothing but cats? Sure it could. But that's where I trust the New York Times is not going to do that because it would hurt their brand. So there is a negotiation that occurs that says, “I will give readers their greater relevance in value. What I want back is the assurance from Facebook that there's some amount of term on this, number one. Number two, after getting the data, we have mutual agreement on how to do it and how to do it well in privacy. Number three, you will not censor me, Facebook, according to your supposed community standards.” As we saw in Perusia -
Mathew: They're never going to agree to that.
Jeff: Mathew! You don't know until you try to negotiate. What you're saying, then, in the end is, “Don't even try.” Then why go on to Facebook? What you're really saying is, “We don't trust them, so don't go there.” And I'm saying that we have to go there and if you have to go there, you try to go there in a way - you try to negotiate something. We have a small window to negotiate. Not negotiating is irresponsible. It's immature.
Leo: We've got your point, Jeff. Mathew, I'm going to give you a chance to have a final word.
Mathew: I think - I'm not saying you should not put your stuff on Facebook. I'm not even saying the New York Times shouldn't experiment with Instant Articles. I think what should not happen is you shouldn't expect that Facebook has any interest in you, your journalism, your business model or whether you live or die. You are just content and so if your content works for them, then they're happy to keep you on board. I think the risk is that the central factor that determines your success is out of your control, and that is the algorithm. Facebook is the one that controls that. They move the levers. You have zero control over that and always will. I think that's a big risk.
Jeff: Let me ask a question.
Leo: No, no. We're not going to talk any more about this. We're moving on.
Jeff: Let me ask one last question. Why is Facebook doing it?
Mathew: Leo, if you need to -
Leo: I think we've heard both sides.
Jeff: All right, all right. I was just asking a legitimate question, I guess I'm curious. Why Mathew thinks Facebook is doing this at all, what's the benefit to them?
Mathew: I think there's a PR benefit that you mentioned. I think they want to be seen to be partnering with people, not crushing people under their boot heel and I think they believe some of that content, users will engage with it.
Leo: It's very simple to me. Facebook would love to own news, period. Right? How do you get to own news? Well, first you get the major existing incumbents to give you their content. Then, as you win viewers over, you can slowly push them out of the market and you've got news.
Jeff: Is news something they want to own?
Leo: Facebook wants attention, right? What they want is your attention. They want you to live in Facebook and so to the degree that it's users want a variety of content in there, they're going to do everything - all the content deals they can to get content in there. They're going to make it look very sweet and you could maybe make a great deal, right now. Maybe you can negotiate a great deal right now.
Mathew: It used to be what users wanted was Zynga games and then they didn't.
Leo: Zynga's mistake was, Facebook was their only platform. That's an obvious foolish mistake and it's a foolish mistake with Youtube, too. Nevertheless, I think the risk here is that Facebook - it's clear what Facebook wants. They want you to live in Facebook, period.
Mathew: It's interesting, to get back to Google - it would be interesting to me - what if Google tried to do something similar? What if Google said, “We'll host your articles and show them full length, give you a share of the ad revenue?” I'd be interested to see what the reaction would be.
Jeff: I'm curious to your reaction. What would you think about that?
Mathew: I think it would be better to have two places doing that than one.
Leo: Google, though - doesn't Google just - Google's business model is different. Facebook wants you to live within Facebook. Google wants you to live within the internet.
Jeff: That's the opportunity. I think what I will say in a post tomorrow - I think the way Google can leapfrog here is by saying, “That Facebook deal they gave you? That's wonderful. We're going to enable you to do that anywhere.”
Leo: I also should point out that if you're Mark Zuckerberg, you're living in paranoiac fear at all times that at some point, your user base, a billion and a half strong or whatever it is, might tire of you.
Leo: There isn't really much stickiness to Facebook. At this point, the only stickiness to Facebook is the network effect. It's where your family and friends are. Now, if it was the only place to get news, it might be more - isn't Mark's whole point to increase stickiness? That's what he needs to do because if he's going to survive, he has to make it very unpleasant for you to switch to some other network.
Jeff: That's all your friends and family, the switching cost. Content is not a switching cost.
Leo: That's a good point, then. Shouldn't he be doing everything he can to make sure your friends and family stick around? I'm sure Mark Zuckerberg doesn't go to bed at night content in the success that is Facebook. I'm sure that every day, he's worried and he should be because ultimately, the internet is a pretty friction-less environment.
Jeff: However, should he be worried about Facebook these days?
Leo: I hate it.
Mathew: He should be worried about antitrust too, with Google.
Leo: Yes, he's got a lot of worries. That's the sad thing and the same thing at Google. You get really successful in this country. It's hard to hold on. It's better to be slightly successful like me.
Mathew: The thing Facebook is doing is lots of stuff that's -
Leo: Don't stick your head up. Just stay in your gopher hole.
Mathew: Facebook is doing lots of stuff that is just as likely to draw antitrust attention as Google, if not more.
Leo: I agree.
Jeff: That's why it's very interesting that they got a deal with Axel Springer through Biltwhile Google's -
Leo: It's a daring game and Mark Zuckerberg didn't get where he is without walking that knife's edge and I think that's smart and fascinating and ultimately, Mark's got all the money he'd ever need for many, many lifetimes. Don't worry about that any more.
Jeff: No, never has been.
Mathew: I'll be interested to see if this venture, Instant Articles, last any longer than the social readers that Washington Post and the Guardian came up with.
Leo: If you look at Facebook and all of its initiatives over the last three years, how many have stuck around? Very few.
Mathew: Lots are gone.
Leo: Lots of failures, lots of abandonments.
Mathew: Lots of things they poured money into.
Leo: We can talk all the time about the things Google's abandoned. Facebook abandoned stuff right and left, constantly. So in fact, all of this may be a tempest in the teapot because in three months, Instant Articles may be (popping sound). What's next?
Jeff: Possible, if the users don't like it.
Leo: That's exactly what Matt's saying is that - as a content creator, you really have no say in the - that's -
Jeff: That's a slight difference in nuance there. If Facebook says - but Facebook always tries to make the best user. Facebook and Google both try to make the best user experience. The Washington Post, Guardian thing was not a good user experience. If this is a good user experience, Facebook will stick by it. If it's a bad user experience, no matter how good it is for publishers, it won't matter. So users are paramount in this.
Mathew: I will say that the reason why Facebook is in a position to do this and why it's such an appealing job - lots of news companies have done a terrible job of producing usable mobile apps, a good user experience - so Facebook, you know, by comparison looks fantastic.
Leo: All right, we're going to take a break. I think this is a good conversation and I'm glad we actually extended it a little bit.
Jeff: Sorry. I thought it was fun.
Leo: I think it's fascinating.
Jeff: It is.
Leo: It's what we talk about.
Jeff: I'm glad Mathew and I are on at the same time because I knew we would see this from different perspectives. I think that's good. Thank you, Mathew.
Leo: Let's talk mattresses.
Jeff: Let's lie down in peace.
Leo: Let's lie down in peace with Casper. You spend so much of your time lying on a mattress and yet how much time did you spend buying that mattress? Maybe five, ten minutes in a mattress store? I know because I did it recently. Casper is so much better. You know, in a way, this is an interesting - they made a necessity - a virtue out of a necessity. If you're going to sell mattresses on the internet, people are going to naturally say, “How do I know if I like it?” What Casper says is, you have 100 nights to decide. You don't have to lie down in a show room.
It has nothing to do with whether that mattress is going to work for you. I want you to order a Casper mattress right now. You could buy it online. It's easy to buy. It comes in a box, which is awesome and makes it very easy to get even a king-sized mattress into a little tiny space. We got a king size for my son who lives on the third floor and he loves it. Loves it! We're probably going to have to get him another one. I don't know if he's going to be able to get it out of his room, so we might have to - he's moving next semester.
Latex and memory foam come together to give you both the firmness you want, the sink and balance you need. Look at this - watch this. Here's an elderly man jumping on that mattress and man, does he like it. He loves it. The beauty of this is, if you don't like it, you have 100 days to decide. They'll take it back at no cost to you. I love Casper. You're going to love it too. An online retailer of premium mattresses at a fraction of the cost, made in the U.S. of A. $500 for a twin, $950 for a king size. Compare that to the premium mattress in your mattress store. You'll see it's a good deal. We're going to give you $50 off because you're listening to the show at casper.com/TWiG. I love my Casper and you will too.
That's an example of a - some people think we should only do tech ads and I guess internet companies sort of disintermediating the traditional brick and mortar store - that's a tech company in a way, but I just do stuff I like, pick out products I like.
The national - the House of Representatives has passed the USA Freedom Act today, minutes ago. 338 to 88 will head to the Senate where, of course, Mitch McConnell hates it because he hates freedom. So it may not pass the Senate but it has passed the house. This, of course, is the bill that would back up the recent court decision about bulk collection of telephone records. The USA Freedom Act would limit the bulk collection of telephone records and allow companies to challenge gag orders imposed by national security letters. This was the other side of that coin, if you got a national security letter, you wouldn't be able to tell anybody the data was being collected.
The bill replaces bulk collection with a system that requires actual court orders to search data on a case-by-case basis.
Jeff: Gosh, a Constitutional law.
Leo: Holy cow. Are these guys not?
Mathew: It's a great idea.
Leo: It's probably one of those - needs a super majority in the Senate which is, of course, going to be impossible. In fact, in November, they voted on this similar USA Freedom Act that got 58 votes in the Senate, which was too short of a super majority need. Open letter to the Senate urging them to pass the USA Freedom Act last year from Apple, Facebook, Google, Microsoft and Twitter. Of course, these are all the companies who get those national security letters and can't tell you. So we'll watch with interest. This is time to write your Congress and write your Senator. Especially if you're in Kentucky, write to Mitch McConnell and say, “You know what? We want this bill to pass and expect it to pass.” We've got this thing called the Fourth Amendment - ever hear of it?
No, sorry. I'm on my high horse but I thought everybody else was on a horse. I should ride along with you.
Mathew: Giddy up.
Leo: Giddy up! So I forgot to - I've been wearing the Apple Watch. Maybe I've defected, I don't know.
Mathew: Do you like it?
Leo: You know, they're all the same, really. The Apple Watch is a little prettier. I made the mistake of buying the LG Urbane. It looked good on the page and then everybody said, “What is that ugly watch? You get that under a bridge? Where did you get that, somebody selling it out of the trunk of his car?”
Mathew: That doesn't look so bad.
Leo: This is the Apple Watch. Of course it doesn't look bad, it's $700.
Jeff: That one's $700?
Leo: Stainless steel with a Milanese loop, $700. They're all about the same, seriously. They all do about the same thing.
Mathew: Do you look at your phone less?
Leo: No because a lot of the stuff you want to do is easier on your phone, even though you could do it on the watch? It's such a teensy-weensy - it's like a postage stamp.
Jeff: I look less. When work comes in and I can look at the - I say, “Oh, I don't need that.”
Leo: Actually, I prefer Android and I really like Android Wear, especially the new Android Wear on the Urbane. I really, really like it. But this watch is less offensive. I don't know.
Jeff: Do you have a watch, Mathew, this kind of watch?
Mathew: No, I have a Timex Ironman that was $39.95, I think, at Walmart.
Leo: He is an Iron Man. Google has a, I think, Apple Watch app, you know, Google News and Weather. Google rejects 70% of the quarter of a million right to be forgotten requests - 70%!
Jeff: I can't remember if that's a different number than the past.
Leo: It didn't seem like it was a majority in the past. I thought it, in the past, was -
Jeff: I don't know. It might have been.
Leo: Anyway, that's good news. They've received 253,617 requests. About 500 a day now, down from the original 1500 a day. I don't know if they'll be compelled to say yes - oh, initially Google was refusing just 43%.
Jeff: There you go.
Leo: According to the article in the Steamed IBT - IBT owns Newsweek. International Business Insider owns Newsweek, both of them have become rags. Did Newsweek ever retract the story about Bitcoin being created by a -
Leo: - guy in Southern California?
Jeff: I don't believe so.
Mathew: They just waited for people to forget.
Mathew: That was one of the worst cover stories in recent memory.
Leo: It was the relaunch of their paper version and it was wrong, wrong, wrong. It was a great story. I wanted to believe it.
Mathew: It was really well written and fascinating.
Leo: It fell apart.
Mathew: It was just totally wrong.
Jeff: They didn't hire Columbia University to check their voracity like Mike at Rolling Stone did.
Leo: Hey, speaking of which, Brian Williams - (cutting throat motion)
Jeff: What's the latest?
Leo: I thought he was. Is that not true? You know, if I were Brian, I would say, “Yes, I'm gone. Stop investigating.”
Mathew: They're going through his junior high transcripts now.
Leo: It's just getting worse and worse. Yes, I guess there's no final -
Jeff: I just listened to Brokaw on Fresh Air, on NPR, and I was pretty shocked that Terry Gross didn't ask - Brokaw's now saying, “I didn't have a word to say.” But at least ask him so you can hear him say, “I don't want to talk about that.”
Leo: Fox News asked him.
Mathew: I thought they did ask him.
Leo: He told Fox News, “Brian's at the point where he is, I gather, trying to decide how he's going to respond.” A little late for that. Now, after the probe, there was originally two or three allegations. Now there's ten. So … I always liked Brian, nice guy, told a great story. Isn't that what a news anchor's job is is to tell - isn't that our job? Tell me, professor of journalism as City University of New York Jeff Jarvis. Isn't journalism the job of telling a story? Look, you cannot reproduce the true.
Mathew: But it should be true, should it not?
Leo: Well, it shouldn't be a lie, but there's truth and there's truthiness. Isn't our job, everybody, to make sense of a random set of - almost seemingly random set of facts by telling a story around it that's compelling and kind of makes it make sense, helps us understand it? A story is how humans understand things and sometimes, a cleverly added, crafted non-fact will help the overall factualness. No?
Jeff: I don't think we are in essence storytellers. I think that's a form we took. If we truly look at how we serve communities with information, I think we're more than that. Stories are one of the tools we'll have but Brian Williams is special. When I listened to this Brokaw thing on Fresh Air - you're right, Mathew. Maybe it was cut down because it was pledge week, so maybe there was a longer version. But the version I heard - but Brokaw's a good guy. But the ego inherent in what he said as an anchor - he talked about 9/11 and he debated about what he should prepare the nation for this or that. The hubris in the anchor, oh, amazing.
Leo: Let me get - this is what I hear in my mind. A reporter's job is to gather facts and deliver them, period. Right?
Jeff: Explain things, sometimes. Find experts.
Leo: Less explain things, more just to gather facts. Obviously, in the reporter's mind, there has to be some side of overarching story but really, it's to gather and deliver facts. But an anchor maybe is like a meta-reporter who's job it is to interpret the facts and tell our story so the American people can understand.
Jeff: No, it's to read. To read a teleprompter.
Mathew: You could argue that Brian Williams - in fact, I have argued that Brian Williams and the entire concept of a celebrity anchor who sits there and kind of interprets the news is an antiquated - that worked in the '40s and '50s.
Leo: Yes, didn't Walter Cronkite, after going to Vietnam and assessing the story, end up saying, “This is a war we cannot win.” And changed overnight, American's opinion of Vietnam and LBJ?
Mathew: He certainly helped change but I think a guy like Brain Williams - he's a pleasant voice. He provides -
Leo: He's a talking head.
Mathew: Right. He's a very hairdo.
Leo: A hairdo with a mouth.
Mathew: To some extent, I thought it was odd that people were expecting him to somehow be a journalist. That was not my expectation at all.
Jeff: What's it like in Canada these days, Mathew?
Mathew: What do you mean?
Jeff: In terms of the add - you know, the anchors and the national view of anchors, what is it like? Is it the same as the U.S.?
Mathew: Well, we like Peter Mansbridge because he's been around for 100 years and refused to go to the U.S., stayed in Canada instead.
Leo: Is he like the nightly news on the CBC or something?
Mathew: Yes, he's kind of the [1:23:05.5?] of anchors. But that whole position to me is kind of farcical, in a way. It just makes no sense to have this one guy or even woman who sits there and kind of interprets the news. I can do that.
Leo: I don't think Walter Cronkite would have made up a story to underscore his opinion that Vietnam was un-winnable, right?
Mathew: I doubt it.
Leo: It doesn't seem like that would have happened and had it happened, it would have been just as scandalous then as it would be now.
Mathew: But I think Brian, it was all about the delivery, the story, the feeling and conveying the emotion, so it didn't really matter what the specific details were. You know?
Leo: I think he misread the American public. He thought that was his job. I bet if he speaks out on this, that's probably what he should say, which is, “I'm sorry. I thought I was supposed to do that.” That's what I'd say.
Mathew: I'm betting he's not going to say that.
Leo: “I misunderstood. I thought I saw in the memo that I was supposed to make up facts to substantiate my opinion. Was that not?”
Jeff: Here's the poignant part, though. Brian Williams, he seems like a nice guy -
Leo: I love Brian. I've met him, I think he's great. I've worked with him.
Jeff: He's destroyed. What's your - he's got plenty of money in the bank but his life was to be -
Mathew: He could be the host of all sorts of things.
Leo: America's Funniest Home Videos is looking.
Mathew: I think he's well liked. He's just not an upstanding journalist.
Leo: Nobody ever says, “Hey, Carson Daily, you made that up.” Nobody ever says, you know, “How come -” I mean, yes, he could be a TV host, which is really what he was and he just didn't understand.
Mathew: Right, exactly. It was a reality show.
Leo: He'll write a book. It was a reality show, he was the host. He misunderstood, I think.
Jeff: So you seriously think he could be hired for a show?
Leo: Good lord, Don Imus got rehired. Marv Alberg got rehired.
Mathew: Exactly. Sure.
Leo: America loves to forgive the sinner.
Mathew: Just not the news. He could have a talk show in a second. Give you $10, he's talking to five different people.
Leo: He could do the Tomorrow Show. You're right. What is this story in the Wall Street Journal, “How Google's Top Minds Decide What to Forget?”
Jeff: Right to be forgotten.
Leo: More right to be forgotten. So who is on this panel?
Mathew: Not personally. They don't decide to personally forget.
Leo: That's my thought. Never mind, I was all excited about the headline. Larry Page and Elon Musk meeting in -
Jeff: Yes, secret apartments on the moon.
Mathew: We picture that happening, right? We picture them meeting in some secret location, like a spaceship and they're talking about robot armies and stuff.
Leo: It's like a Jon le Carre novel. It's like a safe house. “I'll meet you in the secret apartment.”
Mathew: I imagine Tony Stark's lair with robots.
Leo: This is from Ashley Vance's new book on Elon Musk. Ashley's going to join us on Triangulation in a couple weeks to talk about his books. What a great revelation. Google even has its own chef on call to prepare food for people who are allowed to stay in “The Apartment.”
Jeff: I want to stay in the apartment.
Mathew: I want to see this apartment. Is it an apartment?
Leo: It's got to be gorgeous, right? If Elon Musk comes to town to meet with Larry, they're not going to put him up in the Sheridan. They've got to have a nice place for him. Greg Zachary, a venture capitalist and friend of Musk was at one of the meetings. He's ascribed it to Ashley Vance, saying, “I was there once and Elon was talking about building an electric jet plane that could take off and land vertically. Larry said the plane should be able to land on ski slopes. And Serge said it needs to be able to dock at a port in Manhattan. Then they started talking about building a commuter plane that was always circling the earth.” (mimics smoking) “Yeah, like you hop on to it and you'd get places incredibly fast.” Zachary said, “I thought everyone was kidding but at the end, I asked Elon, 'Are you really going to do that?' and he said, 'Yeah, dude.'”
Mathew: I think Elon watches too many of the Avengers and Iron Man movies and then comes up with ideas, like the jet taking off and landing, it's basically right out of Ultron.
Leo: Actually -
Jeff: Isn't he our Thomas Edison?
Leo: Depends on how you feel about Edison because there are some who quite rightly think that Edison was a poser. He was a patent troll.
Jeff: So who is he?
Leo: That's how he got started was -
Mathew: He's our Tesla!
Leo: He's our Tesla. Nikola Tesla was kooky.
Mathew: Tesla was kind of nuts but you know, Elon was a little -
Leo: We could go - we were talking about Elon's power wall on TWiT. Jason Calcanis, who happens to know Tesla - Tesla! Know Musk!
Jeff: I'm sure Jason knows him, too.
Leo: He owns the first Tesla, number one. 00001. He's building - Jason has invested in a company that's building a two-mile demo of the hyper loop but he was very bullish on his power wall. I think he might be right. “You don't understand. Elon Musk has just solved global warming, like this is that important.”
Jeff: What do you think?
Leo: I think it could be.
Mathew: I think it could be.
Jeff: I think it could be too.
Leo: He made a compelling case for it. I know I want one.
Mathew: Elon's a super smart guy but I think the most important thing about him is, he just comes up with these things and a normal person would say, “Obviously, we're not going to launch a rocket because that's super hard and super expensive. We're not going to build a completely new form of transportation called the hyper loop.” But Elon is like, “Why not?”
Leo: “I could do that.” It turns out this was good. Jason understood this better because he'd invested in it but really, the hyper loop's biggest benefit is not people but freight because we spend a huge amount of money and there's a huge amount of impact to trans shipping stuff from China to the United State in container ships. He says the real plan is to build an underwater hyper loop that ships - so what, the freight - if something goes wrong, you lost some Apple Watches. No humans die. So interesting.
Jeff: I think the hyper loop - I'm fascinated by it and I fantasize about going to California in 45 minutes but it's got to be a claustrophobic experience.
Leo: I don't think the hyper loop is a good idea for humans, not to mention the issues of acceleration. You're basically in a pneumatic tube. I don't want to do it. But again, it's $1 billion for people moving - look, our train system is falling apart because nobody takes trains. So it doesn't seem like a great idea but as a freight mover?
Mathew: That actually compares to - I was reading something the other day about self-driving trucks, so there's a prototype - the benefit of self-driving vehicles might be more on the freight and delivery side than on the human side.
Leo: The apartment is a high-rise in downtown Palo Alto with views of the surrounding Stanford campus. It is during such meeting at Google's secretive apartment - I got to talk to Ashley about this, that Musk, Page and Brin begin to brainstorm ideas that turn into projects. “It's kind of our recreation, I guess,” Page told Vance. “It's fun for the three of us to talk about kind of crazy things. We find stuff that eventually turns out to be real. We go through hundreds or thousands of possible things before arising at the ones that are most promising.”
Mathew: Is that your Wayne's World voice?
Leo: “Party on!”
Mathew: Party on, Elon.
Leo: Party on, Elon. By the way, the Google - you talked self-driving. The Google self-driving cars - 1.7 - I don't know, is this one of your numbers, Jeff? I hope not. 1.7 million miles, well, 11 accidents but in every case, it was humans that caused the accidents. The most common accidents were not on the highways, all on streets. Mostly like, fender benders, rear-endings. You can't stop somebody from rear-ending you.
Jeff: Plus, you know, this thing is a magnet for, “Oh my god, look what's there!” Bang.
Leo: “Look, Marge! Oops!” So according to -
Jeff: I heard the point made that they should have reported this number earlier.
Leo: I think it would have been widely misunderstood because you cannot control people plowing into you. They were T-boned once, rear-ended a bunch of times. It wasn't their fault although they say, “Hey, we're working on ways to avoid places where accidents are more likely to happen or to be more careful at intersections like that.” But look, they could see 600 yards in front of them. Here's the stat, 660 thousand people at any moment in the United States are behind the wheel and not looking at the road, checking their devices. I don't know where that number comes from, distraction.gov. That's got to be real.
Jeff: That's all government is, is distracted. That should be Congress' site.
Leo: I know, I like this. This is my site. This is my new site. If you're bored? Distraction.gov. 10% of all drivers under the age of 20 killed in fatal crashes reported as “distracted” at the time of the crash. Any given daily - this is from NOPUS. At any given daylight moment across the U.S., 660 thousand drivers are using cell phones or manipulating electronic devices while driving. 660 - this is from a report from National Highway Traffic Safety Administration. Driver electronic use in 2011 - we have the most recent year, we have these by gender, considerably more females than males. Driver handheld cell phone use by age, it goes down as you get older. Only about 1% of drivers over 70 use cell phones while driving although that number doubled in 2011 to 2%. 16-24, 7% and it's been as high as 10%.
Drivers holding phones to ears while driving -
Mathew: Was there ever a survey where they looked at the amount of accidents while people were fiddling with the radio?
Jeff: Or arguing with your husband?
Leo: Or thinking, or wool-gathering.
Jeff: Reaching behind you to pick up the kid's bottle.
Leo: The percentage of drivers visibly manipulating handheld devices while driving increased significantly - .9% in 2010, 1.3% in 2011. Still not a - 1%, that's why you get 660 thousand, I guess. I'll have to - this is a good bunch of statistics. NOPUS, what is NOPUS? Some sort of - I guess NOPUS is the National Occupant Protection Use Survey conducted annually by the National Center for Statistics and analysis of the National Highway Safety Administration. I guess they actually look, put observers out there and extrapolate. All right.
Mathew: I wonder how many there will be when people look at their watches.
Leo: Now that I can manipulate my watch, send a heartbeat as I die in a crash. “Oh my god, his heartbeat's died!”
Jeff: The problem is, when you have to use the watch, you have to go like this!
Leo: The Apple Watch doesn't require that much of a jerk, no. You know, it'd be hard to send a heartbeat while driving because it takes two hands. Hey, I'm thrilled that Ed Felton is now our deputy U.S. CTO. That is a stunner. Ed Felton, a Princeton professor that has done a lot of work - in fact, I think walked the line on copy protection, DRM, really smart guy. He's published more than 100 papers, two books on technology law and policy. Any -
Mathew: He's a great choice.
Leo: Boy, amazing. I mean, Ed was kind of one of the outlaws who really was pushing the research into things like DRM, encryption and wow. Couldn't be a better choice so now, they've got Megan as the CTO - is Megan Smith CTO? I can't remember.
Jeff: Yes, right?
Leo: And Ed Felton was the Robert E. Conn professor of computer science and computer affairs at Princeton. He used to work at the Federal Trade Commission and the DOJ, so I guess he has some experience in government.
Mathew: Somebody mentioned Ed Felton was Aaron Schwarz's suggestion as CTO.
Leo: Couldn't be better. I mean, it really couldn't. It's good news, somebody who understands what's going on has a place as the table. I'm very happy about that. There's some good news.
Jeff: I'm trying to remember how to use an iPhone.
Leo: I'm sitting here with one and I don't see the Facebook thing.
Jeff: It looks so ridiculous.
Leo: I know, it's so primitive, isn't it? Don't you feel like iPhone's are kind of primitive?
Mathew: I was using someone's the other day and it felt like I was using a Barbie phone, I swear to God. I could not fit it in my palms.
Jeff: I have the Ken phone.
Leo: That's very sexist of you.
Mathew: What phone? Oh, sorry. Barbie/Ken, I got it.
Leo: Do they have Ken in Canada or is he named Bruce or something?
Mathew: Pretty sure Ken is still around. I've been using the Nexus 6, actually.
Jeff: How do you like it?
Mathew: I love it.
Leo: You're getting ready for Google Fi, aren't you?
Mathew: When I first started using it, I thought, “This is way too big.” I thought I was never going to get comfortable with it and now, if I try to use the old Nexus 4 or an iPhone, I'm like, “What are these tiny phones?”
Leo: That's what you mean by Barbie phone, just precious and small.
Jeff: You didn't lose your phone in Italy, did you?
Mathew: No, I had the phone and my passport in my pocket, yes.
Jeff: What new computer -
Mathew: Actually, I was going to put it in my backpack and forgot.
Leo: Are you going to get a Chromebook Pixel?
Mathew: I'm thinking about it. You know who's got a Chromebook is my mom. The place she lives, the retirement home, is doing a trial of Chromebooks and so she's got one she's trying out. They've got WiFi throughout the place and have given out some Chromebooks. I'm not sure she's going to use it but it's a good idea.
Leo: I want to thank one of our viewers for sending me an email. He's a First trainer. First is the robotics competition done in high school. Steve Wozniak is a First coach. It's really cool seeing the championship is something high school students work all year towards. It's a great way to teach robotics and has been, up till now, using Lego Mindstorms, the NLX chip, as its controller. The announcement last March, they're going to start using Android. “The new platform for First features robot and driver station controls based on a Snapdragon processor. Handheld Android devices are going to be working on a Java platform.” So that's really good news because that means there will be a whole generation of kids who are expert Android programmers and the Android devices - you always need a smart device to control these things and it makes sense because an inexpensive smart phone - in fact, Microsoft announced something similar with its Windows 10 for the internet of things, a platform for not just the Raspberry Pi but also Windows Phones to be controlling the Raspberry Pi and others. So this is exciting, good news, frankly. Glad we stole it away from the Lego oligopoly.
So you haven't bought a computer yet to replace the stolen one?
Mathew: I have not. I just got a Fortune Macbook Pro, though.
Leo: It's got one of those inventory labels on the back. That kind of spoils the fun.
Mathew: It sure does. I'm thinking of putting my Iron Man sticker over the top of it.
Leo: You don't use Android on First robotics? Well, I think that's the new thing. The idea is, that's the new thing. Someone in chat room is saying you don't do that. Maybe I misunderstood but I'm looking at the First press release that says you do. I'm going to take a break. When we come back, we're going to have a back of the book matter, tools and tips -
Jeff: Feels like Windows Weekly!
Leo: I like the back of the book concept. Nobody really knows what I'm talking about because nobody really has read magazines in years, but -
Mathew: What's a book?
Leo: You remember in the old days, the computer magazines at the back of it would have the fun stuff.
Jeff: What's a page?
Mathew: They had the ads for the x-ray specs and -
Leo: Comic books it was the good stuff, yes.
Mathew: The one-man submarine.
Leo: You know, yes. The made out of cardboard -
Mathew: What were the little sea people?
Leo: Sea monkeys, yes.
Mathew: Brine shrimp.
Leo: Black soap, you'd wash with that and it would turn you black. It's a gag everybody loves.
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Jeff Jarvis is here, professor of journalism at the City University of New York, the author of What Would Google Do?, Public Parts, Geeks Bearing Gifts and of course, he blogs at buzzmachine.com and has a number for us. I'm sure.
Jeff: I first want to apologize to Mathew. I got all heated up in the discussion and I really enjoyed it but I think I got too heated up and interrupted you. You're a nice Canadian and you don't do that so I just want to make sure - I was, for the discussion and I always enjoy doing this with you.
Leo: Here's what I imagine is that this is kind of a mirror image of he discussion you have with your students and that was probably a fast, back and forth, early burly sort of thing.
Leo: So you just got excited.
Jeff: I do, I do, which is good but I just want to make sure.
Leo: We love the back and forth.
Jeff: Group hug, virtual hug.
Leo: (kissing noises) I've got a secret apartment at Palo Alto you guys are welcome to visit.
Jeff: Did you watch the Howard Stern/David Letterman kiss?
Leo: No. Was there tongue?
Jeff: No, Howard tried to kiss Letterman.
Leo: I can only imagine what Letterman - you do your number and I will find the video.
Jeff: I'm going to do - Sheryl Sandberg, who is amazingly back at work, just announced moments ago that Facebook is going to give its contractors $15/hour minimum, 15 days off and $4000 for parental benefits. So they are nice people. Better than being some poor schlub who gets absolutely no benefits.
Leo: Yes. Benefits are always good. Here's the Late Show, ladies and gentlemen. Here's Howard Stern in a three-piece suit. (video plays) Letterman's got a slurpie?
Jeff: They gave away milkshakes.
Leo: Oh no, this is where he tries to kiss him? Oh, he kisses his hand. I think he senses something unpleasant is about to happen. Oh, I think Letterman is kind of a misanthrope. He's one of those guys who doesn't like to be touched. He's laughing but crying on the inside.
Mathew: Plus Howard's like seven feet tall or something. He's a scary man.
Leo: Thank you, Jeff.
Jeff: The other number of the week is that every day this week is a palindrome.
Leo: That's right, only in the American way of things. It's 5/13/15, 51315, which is the same backwards and forwards. That is all week in America. Do you do date, month, year in the Canadian Rockies?
Mathew: Some people do, some people don't. It's a little like we're trapped.
Leo: It's a British-ism. I do - after reading Strunck and White where E.B. White encourages you to write dates in a sensible way where the numbers are separated so there's no confusion - so I do write my dates 13 May 2015. There's a good reason for that, because you're separating the numbers.
Mathew: Month, day, year makes no sense whatsoever.
Leo: Actually, computer geeks always write year, month, day.
Mathew: The fun thing about filling out online forms is sometimes they want it year, month, day. Sometimes they want it month, day, year.
Leo: It's very confusing for us Americans when we travel on those custom forms. You have to read it carefully but you know what's odd? I think the American custom forms are also day, month, year.
Jeff: One more here. Thanks to Vic Indotra [?] who linked to the Facebook thing, I just finally got Facebook working on this so you can see. There's an article here he recommends so I'm going to click on it.
Mathew: Wait, you got Facebook Instant Articles on your Android now?
Jeff: No, this is my very old iPhone.
Leo: Look how small that is.
Jeff: Leo, you do a one-one-thousand thing to see how fast it comes up.
Leo: One, two, three, four, five, six, seven, eight, nine - nine seconds.
Jeff: On the old phone, it ain't so buttery smooth. That's the old phone, I'm sure.
Leo: If I follow Vic Indotra, he put a link - oh, because you have to share one of these instant news stories, right?
Jeff: I guess so. I was hoping New York Times would come up but this is an NBC story.
Mathew: You can go to facebook.com/instant.
Leo: We did that but it didn't have the stories. Here's Vic. “The Trouble with Almonds,” from NBC news. This is the website, of course it came up. Oh, this is through Facebook.
Jeff: So mine is too old, I got a web.
Leo: That's interesting. You wouldn't know you're on Facebook here except for the Like button. There's even NBC News ads.
Jeff: That is buttery, nothing like what I saw thankfully. That's neat.
Mathew: And the videos auto-play as you scroll.
Leo: They do. This is actually, production-wise, very desirable. To me, Jeff, this is like using Medium. Are you going to -
Mathew: That's beautiful.
Leo: John Rogers, almond grower. Part of this story is that every almond - not bunch of almonds, not pound of almonds, every almond that you eat is something like six gallons of water.
Jeff: You know what? I think there's been a scourge of almonds. When I get on the airplane, I miss my peanuts. You never get peanuts any more. You get almonds and give me a break.
Leo: I was on a plane, a Virgin America plane where they recalled the peanuts. They were giving us nuts and they said, “No -” The pilot came on, “You have to give back your nuts. There's a kid on here that's allergic.”
Mathew: I usually get pretzels on lots of flights.
Leo: It's beautiful, Jeff.
Mathew: That's one good-looking spider, is it not? If that spider had a web, you would enter it.
Leo: You can join the conversation with NBC News' Haley Jackson. There she is, talking to me personally. Hi, Haley. She's doing a selfie.
Mathew: I think this Facebook thing is going to catch on.
Jason: In vertical video formatted for your phone.
Leo: I'm going to share this. I can write a post, copy the link, email, tweet it - which is interesting that Facebook allows me to tweet.
Mathew: The sharing menu, I have to give them credit. It's not just share on Facebook. I think they should have credit for that.
Leo: So I'm going to write - if you follow me and a lot of people do, I'm just going to write, “Here's an example of the new instant news feature from Facebook.”
Jeff: Josh Benton, who's a really good guy, just asked on Twitter if anybody knows the technology behind their speed. Is it pre-fetching or something else?
Leo: You saw, I loaded and it came up right away. Of course, it's pre-fetching.
Jeff: Would this work on an iPad, too?
Mathew: I don't believe so.
Jeff: What do you guys think about the big, giant huge Facebook with tons of resources not doing this on two platforms.
Leo: They will. Give them a break. They will. This is not going to be only on an iPhone.
Jeff: It kind of -
Leo: They don't want to roll it out too fast because then you wouldn't get the buttery experience.
Jeff: We never got Paper.
Leo: But you didn't miss anything. It's one way to control how many people use it, basically.
Jeff: Do you have any idea whether this was a new version of Facebook that's come down or if this was all built in?
Leo: I don't know. It's gorgeous. It's like butter.
Jeff: Can you go to the New York Times on your Facebook app?
Leo: I tried and it didn't - somebody has to share it with you, although I don't know if I'm following Vic or not. Let me see if there's - I think they tell you when there's stuff that's been updated recently. Recently updated, no. Google Sheets, Slides and Docs got updated. Doesn't look like that's a recent update. Facebook got updated May 8, so that's probably the update. Let's see what it says on West News - they don't say anything. Every update of Facebook app includes improvements for speed and reliability. They update to the - buttery.
Jeff: I didn't mean to add more time here but I'm glad we could demo that.
Leo: Mr. Mathew Ingram, anything you'd like to share as a pick of the week? You don't have to.
Mathew: I can't remember - did I freeze?
Jeff: I can offer you one.
Mathew: Have I mentioned Google Photos, uploading all my photos? I know that's not new.
Leo: We do love that, don't we, though?
Mathew: The search is great. I've got personal search turned on. I've tried things like, my photos of Kaitlyn, my daughter. It pulls them all up. It's fascinating and just for backup purposes, it's a great solution.
Leo: I've got to show you. Flickr, as you know, just updated this - significantly, its capabilities. One of the things Flickr does that's really interesting is this automatic tagging feature. You have to go to your Camera Roll - I'll do that right now on my Flickr. Let's see. So normally the default would be to sort by date taken. But you'll see this tab here that says “Magic View” and look how well this does. Animal - bird, here's two birds. Animal - cat, animal - dog. This is all done automatically. Animal - other. Sometimes there's some mistakes, although there is a donkey there. Architecture. So imagine uploading all your pictures to Flickr and these are all - buildings, cities, sculpture. Did a pretty good job of that. Towers, look at that.
Mathew: I've got to think Google can do that too, right?
Leo: Should do this, absolutely. Food - beverage, food - meal, food - vegetable, food - other, landscape - field. Yes, those are all fields. Forest, mountain - those are all mountains. Rock? Well, a pyramid isn't a rock but it's rock-like, rock-colored. Here's shore, snow, sunset. Pretty impressive if you use Flicker and Flickr is free up to a terabyte of storage. I think this is pretty darn impressive.
Mathew: I have to say, though, I was a big Flickr user and they changed the UI, which bothered me. Also, their mobile apps in my experience are terrible so if I want my phone to automatically upload things, which I do - I want to upload to Google, to Dropbox, it happens in the background. No problem. Every time I try to do that with Flickr, it takes forever and then something fails.
Leo: Yes, yes. I have - you know, everybody has free backup now. Everybody. So I back up everything, everywhere. Here's black and white photos.
Mathew: I've got everything in Google and Dropbox.
Leo: Anyway, I'm glad you mentioned that because I wanted to show people that. I think we showed people on the radio show - Chris Marquardt told me about it, our photo guy. Jeff, since you have an extra thing, go ahead and throw it in.
Jeff: I was just going to say that Tunnelbear has an app for Chrome.
Mathew: I saw that.
Leo: What is Tunnelbear?
Jeff: A VPN-ish thing so you can watch BBC from the U.S. or you, Mathew, can watch U.S. stuff from Canada.
Leo: In violation of every law known to man? This is why David Cameron - this is exactly why we have no free speech now is because of you, people who use Tunnelbear during FIFA, the World Cup. I know it was a very popular way to watch - it's VPN. Have you used it? I haven't used it.
Mathew: I've used it. It's great.
Leo: It's fast enough you could watch video?
Jeff: Yes, it's so easy. You get a decent amount free. The service is great for the company.
Leo: Here's the deal, the really good, legitimate use is at an open WiFi access spot. Put it in Chrome, turn it on, go to Starbucks and browse with impunity.
Mathew: Tunnelbear is also Canadian.
Leo: He looks Canadian. He's a nice guy.
Mathew: We have a lot of bears.
Leo: Oh, you have to create a Tunnelbear account.
Mathew: Have you ever used Hola? It's a Chrome plugin and effectively does the same thing. It's really nice, well done.
Jeff: It knows, kind of - it senses that you want to go be illegal right now and does it for you. Is that the one, Mathew?
Mathew: Right. You can say, “I want to pretend I'm in Britain or in the U.S.”
Leo: We don't condone this kind of behavior, but -
Mathew: I'm just saying, if you're the type of person, for personal reasons, who has to pretend to be from a different country.
Leo: Maybe you're a freedom fighter.
Mathew: Exactly. Doctors without borders, that kind of thing.
Leo: You're worried Idi Amin will find out where you live and track you down. All right, Tunnelbear and Hola with an H. I'm tunneling privately to the United States - okay, they give you a little data to get started. So don't use this until you need it, right?
Jeff: I use it when I'm out of the country and hotels aren't working, to get to things I actually do pay for.
Leo: “Start bear-owsing.” Oh, this is how you change countries, you get a little Tunnelbear button and could say, U.S., UK, Canada, Germany, Netherlands - you get a lot of countries. 250 gigabytes a month to 500 and if you want more, you can pay for it. But yes, for an emergency, that's good.
Thank you, Jeff Jarvis. City University of New York, buzzmachine.com. You the greatest, man. Love having you on the show. Thank you, also, Mathew Ingram. I feel the same way about you. I'm so glad to hear you're at Fortune.
Jeff: Great to have you on, Mathew.
Leo: I was never worried. We knew a premier, quality person like you would be working within moments. I bet it was kind of fun, you had all these offers to field.
Mathew: You know, once I got over the sort of grief of the way that things ended, it was nice to hear from lots of people I hadn't considered before. It was kind of like being around at your own funeral. It was nice.
Leo: You deserve to be validated. Fortune.com, @mathewi on the Twitter. Thank you all for watching. We do This Week in Google every Wednesday right after Windows Weekly. It's supposed to be 1 p.m. Pacific, 4 p.m. Eastern time, I'd say it's more like 1:30. You won't miss anything if you tune in at 1:30. Let's be honest and fair. That's 2030 UTC at TWiT.tv. If you can't watch live, on-demand audio and video are always available after the fact at TWiT.tv/TWiG or where you get your stuff.
I was foolishly going to say something about the t-shirt but it's gone now. I think it's gone. I should have said something yesterday, teespring.com/TWiT, it's sold out. Dagnabbit, I'm sorry.
Mathew: Dang it!
Leo: We'll do something else. We always do something cool. Just bookmark that and check it out every once in a while. That was the 10th anniversary TWiT shirt. The new Screen Savers is Saturday, 3 p.m. Pacific, 6 p.m. Eastern time, Father Robert hosting. If you've got a question for Father Robert, we do take calls on the show. It's a lot of fun and you just have to email us ahead of time to let us know you have a question. We'll call you to make sure Skype is working. The email address is .
Mathew: Are you going to bring back Call For Help?
Leo: You know, I thought about it briefly and then I thought, we don't need to because that's what we do with the radio show, the Tech Guys show. It's all calls, all the time. So that's unnecessary.
Mathew: That's one of the first times I was on your show was in the basement of the Omni TV building in Toronto.
Jeff: How many years ago was that?
Leo: Did you come in?
Mathew: I did, I came in. I was at the Globe and Amber MacArthur brought me in for a second.
Leo: That must be where we met. I'll be diggity-dang'ed. That's great.
Mathew: That was many, many decades ago in a galaxy far away.
Leo: 2004, 2005, something like that. Ten years ago. We're not bringing it back, this is a brand-new variety show for a new generation of tech enthusiasts. It's a lot of fun and I hope you'll watch. Thank you Mathew, Jeff and thank you for watching. We'll see you next time on This Week in Google. Bye, bye!
Jeff: I will be on the show next week and then the following week, I will be there.
Leo: Yay, Google IO! I didn't mention our Google IO coverage, 9:30 a.m. On a Thursday, May 28. It's going to be a long one.