This Week in Tech 555
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Leo Laporte: Bandwidth for This Week in Tech is provided by CacheFly at cachefly.com. This is TWiT, This Week in Tech, episode 55, recorded Sunday, March 27, 2016.
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It's time for TWiT, This Week in Tech, Easter edition. I'm wearing bunny ears as you can tell. Very distinguished bunny ears. They're blue sequined bunny ears. We're joined today by Jason Snell who is taking time from his family, much to their dismay, and I'm sorry.
Jason Snell: I didn't say they were dismayed. They had a thing and I'm not there.
Leo: Jason has many moons as editor in chief at MacWorld Magazine and IDG executive editor. He's now at sixcolors.com, which is his own thing, which is great. The incomprable and many other wonderful podcasts. Nice to have you and an iPad Pro today.
Jason: The big kind of iPad pro.
Leo: Weirdly enough with the full size Apple keyboard, the BlueTooth refridgerator. Why not? Why wouldn't you? Jason was at the event. Right? We will get some details on the new iPad pro, the new iPhone. Also with us from Engadget, Devindra Hardawar. Good to see you, Devindra.
Devindra Hardawar: Hey! Always glad to be here, Leo.
Leo: Love having you on. Devindra is also the podcast film host. We were talking earlier, both you and Jason talk about movies on your various podcasts about Superman versus Batman and you were quick to say don't go see it. By the way, 170 million dollars opening weekend. I guess nobody is listening to you.
Devindra: Never. I wish they were watching Midnight Special instead of Batman Versus Superman.
Leo: What's Midnight Special?
Devindra: It's a low budget indie movie from Jeff Nichols. He did Mudd and Take Shelter a couple years ago.
Leo: You're a hipster. I'm sorry, I didn't realize it. Senior editor from Engadget and also joining us, really thrilled to have Katie Benner from the New York Times. Hey Katie, nice to see you! How's your Easter been?
Katie Benner: Fantastic, thanks for asking.
Leo: Did the bunny come visit you?
Katie: Yes. There's been a lot of sugar and chocolate consumed.
Leo: Excellent. Did you go to the Apple event, Katie?
Katie: No. I decided to go down to Riverside. We split the duties. Some of my colleagues went to the event and I opted to go down to the courthouse in anticipation of the big Apple versus DOJ hearing.
Leo: Where you were much disappointed.
Katie: Not as disappointed as the Politico reporter who flew all the way down from DC.
Leo: Oh dear. I've been reading with great interest your coverage of the Apple encryption debate in the New York Times. You've been doing a great job keeping us up on what's going on. In fact you had an interesting dialog about what might happen on Wednesday, none of which happened because at the last minute, 5:00 on Monday, the Department of Justice said hold on, wait a minute your honor. I guess we'll find out April 5 if the technique they've learned to break the iPhone 5C owned by the terrorists in the San Bernardino shootings will work. Somebody came forward and said, "I can help?"
Katie: The timeline is that on Sunday somebody approached the FBI and gave them a demonstration of a method and the FBI thought it was promising enough that on Monday they called the DOJ and spent all morning having these phone calls and meetings and then they alerted Apple and they filed to the court saying we'd like to postpone the hearing and they got on the phone and told them what was going on.
Leo: Some have said that the company that came to them on Sunday was an Israeli firm called Cellebrite. Is that credible? That's the rumor.
Katie: The reason I am not quite sure I would jump onto that wholeheartedly is that if you look through all the court filings in this case, the DoJ actually filed a brief from one of the FBI's own technology specialists saying that they'd already tried using tools made by Cellebrite and that they didn't work. Unless Cellebrite has come out with something completely new, I don't see it happening. Cellebrite is used by the Government. They're used by the DEA all the time. There was a filing that came out last February showing that the DEA was using Cellebrite to open up several phones, so it would be really strange if Cellebrite is just now coming into this months after they've attempted to open the phone. The shooting happened in September and they still tried to open up that phone the next day. That Cellebrite wouldn't enter the picture until March seems odd, given the fact that the DEA contract had them open phones in February.
Leo: Cellebrite on its website says "We can crack IOS 8 phones, but this was an iOS 9, updated 5C.
Katie: This has been great advertising for Cellebrite. Did they leek this themselves to the Israeli media? Nobody in the US has confirmed it. Everybody has only been citing this Israeli report again and again saying that it's Cellebrite.
Leo: Cellebrite made a physical hardware device that was widely used by law enforcement for years. If you got pulled over by a police officer with probable cause, he could request your phone, plug it into the Cellebrite device, it would draw all the data off the phone in a minute and give it back to you. This is something they've been doing since the late 90's.
Katie: It seems strange that they would just remember this company.
Leo: Maybe they said we didn't have a way to do it in iOS 9, let's get our team working on it. Maybe they discovered something on Saturday. That's not an impossible scenario. It's hard for me to talk about this with bunny ears on. It's a little more serious than that. Katie, you wrote an article in the Times suggesting that it's Apple's policy on bugs that explains why instead of going to Apple a company like Cellebrite might go to the FBI. Apple doesn't pay for bugs.
Katie: They don't pay at all. It's tricky. I don't want to overstate that. Even the top bounty right now is only 100,000 dollars, which is not very much money in the grand scheme of things, given how much people will pay on the black market for Bugs, because there's so many people always looking for possible exploits in Android and other systems. There are more eyeballs on the problem, so the value of the exploits are lower. Supply and demand. Because Apple wasn't encouraging people with money to come out and say find whatever it is in our operating system, and we'll pay you and reward you, a really robust black market sprung up around Apple.
Leo: I understand Apple's point of view, you don't negotiate with terrorists. You don't pay hackers for bugs, but Google and Facebook do it, they opened up their pocket book quite wide. As you pointed out in your article, last fall Zirodium offered a million dollar bounty for an IOS 9 exploit.
Katie: Apple can't even compete at this point. They could.
Leo: They got more money than Bill Gates, but I could see why they don't want to get in this escalating marketplace of bugs, because a million bucks is a lot of money.
Katie: The FBI, the Government will pay for bugs. The head of the NSA has talked about how the Government does buy these exploits and they don't have to reveal all of them after they've purchased them.
Leo: That's the problem, right? If Apple finds out, they'll fix it. If the NSA finds out, they'll make sure Apple never fixes it, because that's a great tool. What happens April 5?
Katie: They have until April 5 to say whether or not the FBI has been able to open up the phone. If they have been able to open up the phone, the Government is going to move to classify what they did, so that we can never know how it happened and they will drop this order, and say no need to order Apple to do anything for us, we don't need them anymore. It's a great outcome if you want the phone opened, and it's a great outcome if you don't want Apple to be forced to build something against its will to help weaken its own security system. It's a terrible outcome if you want to know what the flaw was, and it's a terrible outcome because it delays a fight that's inevitably going to happen between the Government and some large technology company over what the Government can force a private corporation to do in order to help with a private investigation.
Leo: Devindra, does the Department of Justice putting this on the back burner give lie to the notion that this wasn't about that phone at all but was about establishing a precedent that they could go to Apple or some other company and demand revised firmware? That's what I thought. They hand-picked this case for a precedent.
Devindra: It's a big case, it's a high profile case just seeing what happened with everything. There are conspiracy theories going around that yeah, maybe the FBI could have delayed this or announced this potential fix a long time ago, maybe not wait until the last minute, because there's a lot of value in being able to force Apple to do what they wanted. We don't have anything to prove that. Right now, there's so much we don't know, there's so much subterfuge going on here.
Leo: Those holes lend themselves to conspiracy theories. You think of news scenarios where perhaps the DOJ realized their case was weak, that CALEA would case the judge to say there's a law against Apple writing its custom firmware for you, so no. I'm going to deny your case. Maybe she hinted to the DOJ that I'm going to rule against you tomorrow, so guys, maybe you don't want this ruling. That's another, conspiracy theory, because we have no information at all...
Devindra: Snowden did talk about, a couple weeks before this happened, Edward Snowden mentioned there is other ways the FBI could do this and they're not being truthful about it right now. It's fun to see him being proven right on Twitter for once.
Leo: You saw the letter to the editor that James Comey wrote to the FBI and the Wall Street Journal. You are simply wrong to assert that the FBI and the Justice department lied about the ability to access the San Bernardino killer's phone. They thought that you as advocates of Market forces would realize the impact of the San Bernardino litigation. This is the funniest thing that I've ever read. It stimulated creative people around the world to see what they might be able to do to unlock the phone. I'm not embarrassed to admit that all technical creativity does not reside in Government. Lots of folks came to us with ideas, including John Mcafee.
Katie: I love that line because it's like if anybody that all the creative technological talent existed within the Government... what is he talking about? He wasn't wrong... so usually these cases are filed under SEAL and we don't know that they're happening.
Leo: Apple wanted it to be filed under SEAL. For some reason, the DOJ said we're doing this in public.
Katie: Often these cases are filed under SEAL and the ACLU has a request out asking for all the docket numbers where the Government has under seal asked a technology company to do something for it so we can figure out what's going on, I think that if this had been filed under SEAL we wouldn't have known, and these companies wouldn't have come out of the woodwork to help the FBI.
Leo: We just wouldn't know. Enough about that. We'll find out April 5... and the FBI said it wasn't Cellebrite. For all we know, it could have been John Mcafee. He was lying about lying, maybe he was telling the truth all along. The double bluff, The bluff within a bluff.
Jason: He's crazy like a fox. He's also crazy.
Devindra: I ran into him at CES this year. That was crazy.
Leo: Did you? Was he wearing his shirt?
Devindra: He was wearing a shirt. No booze, no guns from what I could see. He's backing this startup that has this little key dongle that will unlock your phone, your computer if it's near it. It's the dumbest idea, because it's super insecure, but Mcafee is backing it.
Leo: If you're a bad guy, just wave your phone at the guy you stole a phone from before you run away.
Devindra: I got to do a video interview with John Mcafee, and that was kind of terrifying because I just saw him get increasingly angry as I pushed him, because he has crazy libertarian beliefs. He is running for president also, which nobody will take seriously.
Leo: I think he's pulling a double Mcafee. Conspiracy theories, this is the nature of them. They fill the gaps, when you know nothing, you can say almost anything. None of it is provable or disprovable. The smartest thing to do would be to say nothing and wait and see.
Jason: That's our show for today.
Leo: Thank you everybody. Good night. We're going to take a break. When we come back, let's talk about Apple's event. Not the most inspiring event. You saw it. We'll talk about it. Maybe what we didn't see as well. This show brought to you by GoToMeeting. It's that time of year, I don't want to cast aspersions. It's that time of year where maybe you're spending less time at the office, more time watching a certain basketball tournament. That's why GoToMeeting comes in handy right about now. Let's you collaborate with clients/colleagues from anywhere, including a local sports bar. Be a meeting MVP, get your work done, then get back to your bracket with GoToMeeting. So easy to start a meeting with one click, makes it easy to meet with your team anywhere, any time. Hold a meeting from your iPad, what's great is you're all on the same page, so they can see your presentation, you can collaborate on documents with them, you can use your webcam, they can see you in HD, you can see them. It's like being in the same room. Share your screen and get on the same page. Pass off presenter duties with ease. You can send private chats and video links. It's like a meeting where you can pass notes, it's awesome. GoToMeeting. It'll help you step up your meeting game and get back to your bracket. So easy to set up right now you can get your free account for 30 days you can go to GoToMeeting.com, you'll be able to have your first meeting in minutes. The nice thing for your clients and colleagues, they don't have to have GoToMeeting installed, it's very easy for them to click that link in the email. And they're up and running in 30 seconds. See them, they'll see you, see their screen, you'll see theirs. It's awesome. Gotomeeting free for 30 days at gotomeeting.com. Apple's event, 60 minutes on the dot. Run like clockwork. Tim Cook, master of ceremonies, didn't do a lot... He did do as we expected, make a statement about the Apple DOJ case. I thought quite a good statement. We didn't expect to be in a position of fighting our Government, but we think for our nation, note the difference, this is the best thing for our customers and our nation. It's our responsibility to fight this. I can't disagree with him.
Jason: They could have tossed it off a bit, could have made a joke about privacy and security and the audience would laugh and they can move on, and they decided we're not going to do that.
Leo: That's not Tim.
Jason: I think that might have been a Steve Jobs move to do that head fake and then move on, but Tim Cook laid it out there.
Leo: I really see Tim Cook in this event. It started with that, then they immediately talk about Healthkit, actually before that they had recycling, they got a woman executive on the stage.
Jason: Lisa Jackson.
Leo: Former EPA official, in fact director of the EPA for quite some time in 2013, she runs their environmental initatives, they talked about the star of the show, Liam the recycling robot. Loved Liam.
Jason: I wonder what your job interview at Apple is like when they're like we'd love you to work at Apple, and you're like I finally made it, and they're like we want you to build a robot that disassembles phones.
Leo: Don't you think it could easily re-assemble or build phones?
Jason: That's some of the speculation that I've heard. What is Apple doing? We know things like Apple builds its own chips, they don't take something off the shelf. Is it that far to speculate that they might at some point build machinery to build their products and control that part of their business too? It's not unreasonable.
Leo: Ian Thompson pointed out yesterday, you don't need suicide nets for robots. It would solve all these issues.
Jason: It would create new issues just in the same way that the robots in the auto industry created issues that changed what the jobs were and there were fewer of them. It could certainly change the nature of factory jobs in China if there were more automated assembly of the products.
Leo: Apple makes one product in the US, it's Mac Pro. That's a robotic factory, isn't it?
Jason: All of these things are less robot than you think they're going to be. There's more handcrafting, hand tooling of tech products when they're being assembled than you might thing. People imagine, I always imagine that it's just all robots and it's put in a box. That's not the case. Even in the US factories that's not the case.
Leo: Put Iron ore in one end of the factory and iPhones come out at the other end of the factory. That was Henry Ford's dream. He built a plant, the whole idea was that boxcars would arrive with lumber and ironing goods and the Model T would come out the other end. I don't think we're anywhere near that with these kinds of products. After that they talked about Healthkit and the new care kit. I feel like these are marginal products for the iPhone, but Tim Cook cares products.
Jason: They're more about what Apple wants you to see as their corporate values than they are about directly selling products. In the end, it's all PR. It's a PR event, but I do believe that these are things Apple considers to be important and part of its corporate values. Every so often, they want to take the time at an event like this to highlight some of this stuff, like what they did last year with research kit and what they're doing this year with Care Kit.
Leo: It's great stuff. Care kit is great because it's a way for your physician to supervise your care or use the iPhone to monitor your condition. I would love to see that. Again, a lot of this stuff isn't going to happen right away. The FDA has to approve it, it's got to get into the market, there's other companies making these things. Not Apple, Apple is just providing a hub for them, right?
Jason: I think as a platform owner it's on Apple and google and any platform owner to do some of this groundwork because maybe it'll never happen. Good for them to take the reins here and do it.
Leo: Then they announced a new iPhone, much like the old iPhone. iPhone 5 shape and size.
Jason: There were lots of rumors about it maybe having iPhone six style curve glass on the front and the most recent rumors right before the event was that it was going to be a dead ringer for the iPhone 5S. I brought my iPhone 5S with me to the event and I took some pictures. They are identical. If you are Sherlock Holmes of technology, you can look at the little edges, which are those little side carved out things, and they're matte on the SE and shiny on the 5S. The screen on the back that says iPhone says iPhone SE on the new one. Otherwise, it's the same.
Leo: I feel like Johnny Ive took the year off.
Jason: I could make the argument that the iPhone 5 is a good design and why create some kind of half one half another phone if the iPhone 5 design is nice? I do wonder if this was a decision made because somebody said the iPhone 5S is pretty. Let's leave it there. Was it more like, it's cheap?
Leo: We already got a bunch of them. We know how to make them.
Jason: All the cases will fit. It's identical. The cases will fit. It's no different than the iPhone 5S--other than those tiny touches on the outside. On the inside it's the iPhone 6S, not even a six. It's what is currently the top of the line, the processor is top of the line, the camera is top of the line, the rear facing camera. I think we all thought it would be a step back. Ultimately it will, they probably won't update this phone for a couple years, but for the moment if you get this, with the exception of the first generation touch ID sensor and the fact that it doesn't have any 3D touch, but otherwise it's basically an iPhone 6S.
Leo: Was it you or Renee Ritchie who said it would almost certainly have to have 3D touch. That’s part of the user interface going forward?
Jason: Yet it's not there. I had a good conversation with a couple of people. We were talking about 3D touch and the feeling that nobody uses it enough and what Apple needs to do is make it a more central part. Commit to the fact that a long press and a 3D touch are exactly the same. Right now you can't make things count on 3D touch because so many iOS devices don't have them.
Leo: You don't know what's going to happen, as a developer you don't know what your users are going to be using.
Jason: It's more out of these left field applications instead of being central to the product.
Devindra: It would have been tough for them to fit into the 3D touch hardware into that case, right? We saw what happened with the iPhone 6S. It got a little bit thicker and heavier because of all the stuff they had to put in there, and this is an upgrade with the least amount of effort and work put in. We got the cases, we got the hardware, let's put it together.
Jason: That's a deal breaker. You are going to have to do more work to get 3D touch in there, let's not do it.
Leo: It is a better screen than the 5S though.
Jason: It's the same screen as the 5S. It's not as bright and doesn't have as much color range as the 6S.
Leo: This is old parts.
Jason: Old parts on the outside and new parts on the inside. If you think about it, Apple always wanted to have a 4 inch phone in their lineup, and the 5S is too old. You got one that does Apple pay, and it's not being priced higher than the 5S. It is actually taking the spot in the product line as the iPhone 5S and it has the same price, so this is not a brand new iPhone at a premium price. This is brand new guts in a product that is essentially priced like the two year phone was priced.
Leo: They've always had, and it's important that they have a low-cost entry level.
Jason: Free with two year contract is what this used to be priced.
Leo: 400 bucks. I think a lot of... sell quite well.
Jason: I did the math. It's somewhere between ten and fifteen percent of iPhones they sold in the last year were the four inch phones, the 5S.
Devindra: Something like 30 million.
Jason: If you think about it that way, if almost 15% of the phones they sold was a 2.5 year old phone, what are they going to do with that in the next year? Probably 15 or 20% of the iPhones they sell this year will be this phone. It's not going to be their biggest selling phone, but that's a bit market. In more price sensitive countries, they talked about this being a good phone for China, a good phone for India, but throughout the world, there is a segment of people who want an iPhone, but dont want to spend on the super high-end and people want a smaller phone because they don't like the size.
Leo: Devindra, at Engadget this is what you cover, is gadgets. Maybe our minds are twisted by our desire to have the latest and the greatest. Is it your sense that the general populous doesn't like these giant phones and at least some percentage wants a small phone?
Devindra: I definitely hear from a lot of people that are never going to upgrade to an iPhone 6 or 6S because it's so much bigger than the 5 was. Honestly, after using a 6 and 6S for a couple years, I miss that feeling of the 5S. It feels really good in your hand, it's so small. To me the idea of having technology that's smaller that's more powerful, that's where cellphones were going before the iPhone and Galaxy Note made screens bigger. I remember I had Sony Erikson's that were getting smaller and smaller and I was amazed by that, so there's definitely a segment of the population that would be into this.
Jason: Tech nerds have locked onto this idea that bigger is better for Smartphones and I think that a lot of the general population doesn't think that way.
Leo: Katie, didn't you lose your iPhone? Did you replace your iPhone yet?
Katie: That whole story is fantastic. I think a lot of the general population hasn't left the iPhone 5S. There are a lot of people still using the iPhone 5S. For me, I'm using my iPhone 6 that I'm borrowing from Apple and they're going to take back the minute I stop covering them. Which is fine, because they wanted me to learn how to use 3D touch. Thank you, Apple.
Leo: That's a 6S.
Katie: This is a 6S and it's fantastic, but I still have the 5S that's my personal phone.
Leo: It's so funny. I sent my son, he's in Barcelona, first day in town he gets off the plane, he's wearing his jammies on the plane, and instead of going to the hotel like any sensible person, he goes out and parties and his phone falls out of his pocket. The first day, he was so embarrassed, he called me up and said he got rolled by some gypsies, but then I found out the truth was he was dancing and it fell out of his pocket. I sent him a new one, a 6S, and he doesn't want to use it. He says I think I have a 4S in the house can you find it and send it to me? He wants the old phone. Katie, I don't know how big or small you are, but in general women don't want these phones that us big old fat guys want.
Katie: I'd like to not think of it as a small lady versus big fat guy market, I just don't think that's right. It seems unfair.
Leo: As a big fat guy, I represent the large guy segment. This doesn't look big against my head because I have a massive head.
Katie: In New York I was always a commuter, and I took the subway. This phone, I don't like that I can't hold the bar. I want a one handed phone I can use when I'm commuting. I still take public transportation in San Francisco. People think it's blasphemy because of Uber, the bus does work fine for me, again, if I'm standing and it's crowded, I can't use my phone. I can't do anything.
Leo: You got an iPhone SE in your future.
Katie: Also, it's very affordable.
Leo: Apple has never made a "cheap" iPhone, but there's a lot to be said for a 400$ iPhone. I think more than the size, that's the market.
Jason: It used to be where they sold the two year old phone, but now they have a brand new phone that's filling that slot.
Devindra: It's the only phone that size with premium hardware. The newest hardware. Sony has an Android phone from last year, a small version, it's nice. That was your only option up until this point. Phones are getting too big. I'm tired of giant phones, I don't like fablets. The iPhone, I'd like to go up to 5 inches and stay there if they can refine the case. Yeah, we got to get smaller phones better.
Katie: Somebody was saying the smaller phone makes them use their iPad more and a larger phone makes them use their iPad less. Once I got the larger phone I could watch TV very comfortably, things I didn't do with my old phone, so that might help the company in larger ways as well.
Leo: For sure. There's no doubt that larger phones have cannibalized the iPad market. We'll talk about the iPad. There's a new iPad. Also not a big breakthrough product.
Jason: It's four different products being shuffled around.
Leo: Johnny Ive took a sabbatical and no one told us. I swear to god.
Devindra: Maybe he's working on the iPhone 7.
Leo: Or if you read Ming Chi Quo, the iPhone 8. We'll talk about that rumor in a minute, but first I want to talk about my Ding Dong doorbell. Everybody ought to have a good doorbell. Usually you don't. You notice that? You get a new house, everything has been replaced except the old doorbell which is hanging off two wires in the door jam, it's yellowed with age, you press it, the chime in the house goes donk and you can barely hear it. I can never hear my doorbell. So when Ring came along with this, I jumped on it. i was really happy to get my Ring video doorbell. By the way, they also sell a chime that ties into the doorbell via Wifi and can plug in anywhere. The thing that was great to me about it was the Ring. You replace your old doorbell, it not only rings the official chime in your house, but it rings your phone and your tablet, whatever else you installed the Ring software on. Even better than that it does it wherever you are across the world even. In fact, I always have to remember when I get to the studio to turn off my phone because the Ring Chime goes off as people go in and out of my house. It isn't just ringing the doorbell, but when people do ring the doorbell, there's an HD camera in here, so you can see the person at your door and you can talk to them. Hey I'm in the bathtub, can you leave the package there, or whatever. Also, it has a motion detector. You can completely control its sensitivity and where it's aimed. So you can see when somebody comes up on your step whether they ring your doorbell or not. You can talk to them, it's got a great home security system. Turns out 95% of home robberies happen during the day when you're at work, burglers come, ring the doorbell, if you don't answer they go out back and break in. Now you'll answer, even if you are at work. And even if you don't answer, you have a nice, crysta clear video of them. It's lovely. With a Ring video doorbell, you can talk to delivery people, you can keep an eye on the package when they leave it there, if somebody tries to mess with it, you get an instant alert, an HD video of the whole thing. I love my Ring Video Doorbell. By the way, if you've got teenagers, there's nothing like hey I see you came home at 3AM. I've got the video to prove it. It's easy to install. The ring kit comes with everything you need, the drill bit, screwdriver, you probably won't need the drill bit. Most cases you just take off the old doorbell and attach it. They come in a variety of finishes to match your house, and this has a battery in it, so even if you don't have a wired doorbell you can use the Ring video doorbell, or put it in places where you'd like a doorbell but none exists, like your bedroom door. That's my next project. You never knock, now you have to ring the doorbell. Ring.com/twit, you'll get free expodited FedEx shipping, try the doorbell. Time magazine named it one of the top ten gadgets of the year. Ring.com/twit. With Ring you're always home! Katie Benner is our guest from the New York Times. She used to write for the Bits blog, but now you're just technology, right? They just took everything and moved it over, right?
Katie: That's right.
Leo: Fine with me. I read it anyway. You've been doing a great job covering the Apple DOJ case among other things. Also hear from Engadget, senior editor Devindra Hardawar. Always a pleasure, thanks for joining us Devindra.
Devindra: Always great.
Leo: And in studio, because he lives down the road, Mr. Jason Snell from sixcolors.com.
Jason: It's nice to be in the studio. If it was awful here, I would be at home in my pajamas.
Leo: I wish I could get everybody to come in. We serve booze, we do all sorts of things. Today we're having mimosas for Easter. Would you like a mimosa?
Jason: I got to drive home though.
Leo: I ride my Segway. Drunk driving on a Segway isn't exactly dangerous. Well maybe it is.
Jason: You're going to get letters now.
Leo: All right. iPad. Apple announces the new iPad pro, which is exactly same as the old iPad pro except it's ten.7 inches.
Jason: It's like a mixture of the iPad air, instead it's the 9.7 inch iPad pro, which is not a catchy name.
Leo: I wish they'd call it something, like the baby iPad. Does this replace the iPad Air?
Jason: I don't think so. I think what they're doing is moving to something that's more laptop-like naming system for the iPad. Just like you've got a 13 inch Macbook pro, I wish the numbers were better. You could call them the ten and the 13 iPad.
Leo: Do we even need the name pro anymore?
Jason: I assume at some point the cheaper models of iPad are going to either be iPad Air and iPad mini, or they'll just call them iPad and have a small iPad and a medium iPad.
Leo: Maybe the mini will be the small.
Jason: The mini and the air will be the iPads and these will be the iPad pros.
Devindra: I don't see the point of the airline any more. This is the same length, weight, width and everything. It's not physically more of an iPad. It's all about the hardware. I don't see how they could do an iPad Air 3.
Leo: What would be the difference?
Jason: I think the difference is that it'll be a couple hundred dollars less than the iPad Pro.
Leo: This is a hundred bucks more than the air.
Jason: The way Apple differentiates iPads on price is they roll down the old models. Although now we've got the SE. On Macs they don't do that. They differentiate on specs, so I feel like that's where they're going with the iPad, there's going to be a cheaper iPad line, and its' going to be the older hardware and it's going to be updated less frequently but it's going to be cheaper and then the iPad pro line is where all the cutting edge stuff is going to be. That's where they're going with this, but they're in transition right now. We haven't seen what happens next for the cheaper old iPads.
Leo: I'm glad they did this new one, because I feel like the iPad Pro is too big. I like using a keyboard with the iPad and I like using a pencil. 9.7 inches is probably going to work for me.
Jason: This is the sweet spot. This is the classic iPad size. The original iPad was 9.7, all the air models were 9.7 models. This picks up all the features of the 12.9 inch iPad Pro and actually has two features not in the iPad pro which is kind of weird. If you imagine rich money bags walking into an Apple store and saying give me your finest iPad with all the finest features, they wouldn't be able to do it. The little one has pencil support, and support for the smart connector, its own little cover that comes with its own fold out keyboard, although it can't be full sized like on the 13 inch model.
Leo: Did you try the new keyboard? Did it feel OK?
Jason: All the keys are a little bit smaller, so if you're a super finnicky touch typist, you'll have some problems probably because all the keys are smaller, but for most people it's fine. It's a lot less bulky because it's smaller.
Leo: I was thinking this might be the sweet spot. It has a better camera, which is weird.
Jason: It's got the true tone feature which has not been in any iOS device before, which dynamically changes the color of your screen based on the lighting in your room.
Leo: I asked Alex Lindsay who uses good quality screens for photography and video. He liked it, but I feel like Pros are as much concerned about color accuracy and the lighting in the room, that's more important to them then a screen that might change its color depending on the lighting in the room.
Jason: If you uncover stability, you turn off the lighting feature.
Leo: Who is this for then?
Jason: The Pro comes in different styles; You're not always using it for Pro video editing.
Leo: Who wants it to adjust color in the room?
Jason: I've experienced this. Late at night I'm sitting, reading on my iPad in incandescent light, everything is warmly lit and the white point on my iPad screen is super blue and bright. Instead the light would match the light in my room and my vision. This is a bigger feature than the night shift feature, which is a similar thing, but it shifts all the colors automatically, but this is going to shift the color temperature based on where you are and what the light is like.
Leo: You convinced me. The camera is very similar to the iPhone 6s camera.
Jason: It may be the same right down to the fact that it's got a little bump.
Leo: They're acknowledging something they don't want to acknowledge which is people use their iPads to take pictures.
Jason: You've got to embrace it because everybody is going to do it anyway.
Leo: I hate it. It's really annoying, somebody is taking a picture with their freaking iPad, but at the same time, you understand why. It's a great view finder. You see the picture like it's real size. It can do 4K now.
Jason: The color Gammut on the screen is amazing. I was talking to somebody who was a video hobbyist, and they said they could imagine the iPad pro being used on camera rigs, because this shoots 4k video and it's a huge right there you can see it. Nice and bright. What it doesn't have is the 4 Gigs of ram that the iPad pro has. The processors are not quite as fast.
Leo: This bothers me. It is true that it has two gigs of ram? What the what?
Devindra: iPad semi pro.
Leo: what a stupid way to save money!
Jason: It may be that... it could be the cost, it could be the size of the screen, there's less oomph that it needs. It is disappointing. I wish that it had 4...
Leo: It has shared Graphics memory. The display would use some ram. You're freeing up a little bit.
Jason: Keeping in mind the iPad air two when it first came out was the first IOS device to have two instead of one. Two helps a lot. A four is awfully nice.
The iPhone SE has 2 gigs of Ram as well.
Jason: All the iPhone 6 has it as well. The big pro model has 4. It's disappointing. That's one of those top of the line features that you can't get on the 9.7 inches...
Leo: How much does a couple gigs of memory cost? It's not a huge amount. You're charging a hundred bucks more for this iPad. It bothers me that they did that. It was almost a deal breaker for me.
Jason: I think the killer feature is the pencil.
Jason: It's a smaller thing, not everybody wants a huge thing, but a lot of people wanted an iPad that would use a pencil.
Leo: 15 bucks minimum for a 2 gig, plus a hundred bucks for the pencil, plus a hundred fifty bucks for the keyboard. SMH.
Devindra: I think you said it right before, Leo, about the lighting feature. Who is this iPad for? I don't quite know. Somebody who just wants to have a light iPad that they can take around and type occasionally on? They can get an iPad air 2 now for four hundred bucks. A lot of tech makes great keyboards for less than apple does. a real pro user would want that bigger screen and faster processor, so they're going to go to the bigger model. I don't know who would want the smaller one.
Katie: Have any apps come out yet that would... This is the way I thought of it. They're waiting for app makers to use this as a business product. They want this to be a product for hospitals and Apple is not going to make that software that's going to be... have we seen any apps come out that make this iPad so essential? That's the question.
Jason: There's lots of niches. I hear the art stuff on the iPad pro has gotten a boost. I imagine because this is cheaper and more portable and more familiar in terms of size, I think it's going to be very popular with people who want to draw on their iPad or take notes on their iPad. It's a much more realistic size than the big iPad pro for a lot of people. You can hold it in one hand and draw with the other, which you can't with the big iPad pro.
Leo: The size and weight of the Pro may be because it wasn't really a laptop replacement. If you had a MacBook, you'd be better off using the MacBook than bundling a big keyboard and pencil and you're iPad pro in your backpack.
Jason: You can't pop the keyboard off the MacBook. I'm loving my 13 inch iPad pro.
Leo: I can't wait to downsize. We'll see. Katie, do you use an iPad?
Katie: No. I was only using it for video anyway, and now that I have that bigger size phone, I can just use that phone.
Leo: The real question for Apple is if this is going to be enough to stimulate iPad sales, which are tumbling?
Jason: It's a good question. I think they'll get a little bit of a boost because I think one of the reasons iPad sales have been flat down is you don't need to replace them every year or two. They're fine, they last a long time. There's a group of people, and I've heard from them, waiting for a new regular sized iPad, and there hasn't been one since the fall of 2014, and now there is. Those people will be happy and they'll sell a lot of... this will be the best selling iPad of all the models in the price list.
Devindra: It's more expensive than the last iPad.
Jason: A hundred dollars more. I think it will do OK, but I don't think it's going to change the fortunes of the iPad as a whole. I think it's a real mystery about where iPad sales are going to end up.
Leo: Unlike Phil Schiller, you don't feel sorry for those 600 million people using five year old Windows PCs?
Jason: he really stepped in it there, didn't he?
Leo: Oh lord, Phil. It's sad. It's really sad that people are using old PCs.
Jason: Part of this is Apple being sad for everybody who uses a PC.
Leo: They should spend 1200 plus dollars on an iPad pro. Do you think that was tone deaf? Or what? By the way, Paul Thurott's answer was 600 million happy Windows users.
Jason: I think that's a joke that totally makes sense if you understand the way Apple thinks. Nobody inside said wait a second. I know we get what you mean by that, but people on the outside world are not going to get it. Sad you couldn't afford a new computer.
Leo: You poor people.
Devindra: It's a little harsh, especially coming from a guy who wears giant oversize dress shirts. Come on, don't start criticizing other people before people start criticizing your fashion sense.
Katie: So you think he should spend money on a stylist.
Leo: He's a little old to be wearing the blue jeans.
Jason: Never too old to wear the blue jeans. I get the point is that old PCs can be replaced. A lot of people who bought a computer are not needing it for super technical or powerful things, they just want web and email. My mom gave up her laptop and went to an iPad, because that's all she wanted to do was web and email. She didn't need a whole big computer for that. I get where this comes from, but it comes across as Apple egging people on. Buy more things and get said if you don't buy more computers. It's not cool.
Leo: Why upgrade that PC when you can buy an un-upgradable product that will be obsolete in two years. Why? I also... I feel bad because Phil, he's like the VP. He's given the job of saying the nasty things. The toxic hell stew comments.
Jason: That was Tim, wasn't it? Toxic hell stew. His persona onstage has always been that he takes shots at Microsoft, and I think that's where this is coming from.
Leo: Innovate my ass, when they announced the Mac Pro, which as far as I can tell is a horiffic flop.
Jason: It's not even the fastest mac at this point because they haven't updated in two years.
Leo: What a terrible piece of hardware.
Devindra: He really wishes Apple had hardware that would run VR.
Jason: I'm sure the people doing DNA sequencing are happy with the Mac pro because it was designed for them but not for anybody else.
Leo: Maybe, or they're using a Dell. I don't mean to be bitter and cynical. I immediately through money at Apple and bought the new iPad.
Jason: You touted the shopping list of now I bought the keyboard, cover, and the ram, I upgraded the storage. That's a perception of Apple that is true. They don't sell cheap products and they sell lots of accessories and you end up spending a lot of money with them, but when you have that perception, it's a lot harder to stand on stage and say it's so sad that people buy a computer and hold onto it for five whole years... it's not good.
Leo: No wonder people are throwing old tomatoes at the...
Jason: I just updated the MacBook Pro that's 9 years old. I put an SSD in it and it's great. It works fantastic.
Leo: Four year old MacBook Pro, it's fine. Good news. Something happy. OS X is 15 years old. It's kind of hard to believe, isn't it?
Jason: We're getting to the point where OS X will have been the Mac OS as long as the original Mac OS was the OS. We're in the interim right now.
Leo: Do you think we'll ever see a new OS? Now it's just update update. I don't think Apple or Microsoft... Linux just updates the kernel. Where are the new OS's coming from?
Devindra: With all the mistakes Microsoft made with Windows 10 and Vista, what they're doing with Windows 10 is actually pretty interesting even though it looks a lot like older Windows. The idea of unified apps is finally happening. Maybe it will have a mobile platform. At least Windows on tablets is really interesting. It's weird to be looking at OS X right now, it doesn't look much different than it did 15 years ago. I know the features are better, I know certain things are better; but you look at it and you don't see that progress. It's weird.
Leo: I'm going to say something a little bit controversial with you iPhone users, but frankly IOS hasn't changed much since 2007. It's long in the tooth.
Jason: You forget all the people screaming bloody murder when iOS 6 came out.
Leo: For instance, they added folders finally, but you can't have multiple copies of the same icon in the same folder. You get one and only one.
Jason: The springboard is largely unchanged since 2007. It's clear too that Apple's OS efforts are about IOS right now. Mac comes along for the ride and they do some things there, but is there going to be a replacement for OS ten? Yeah there is, it's IOS. They're going to keep developing it, but it seems unlikely that they would do a new project to do a third generation of fundamental OS ten interface.
Leo: This is the end of the line for desktop operating systems.
Jason: Windows and Mac will kick around for a long time, but you'll end up with Android/Chrome.
Leo: Even more than that, Cloud is a platform and is agnostic. What about something like the Amazon Echo? Isn't that a new OS? Kind of. We're starting to see. Amazon did a new interesting thing. They've released the Echo software. I think they put it on GitHub and so you can take a raspberry pie and turn it into an Echo. Just add a Microphone. The only thing you can't do is it doesn't have the always on thing. But that wouldn't be so hard to create a trigger system of some kind. Very interesting. What that shows is Amazon isn't intending to make the Echo be a product. This is a platform if you ask me. A global, universal interface.
Devindra: Every week there's news from companies, oh yeah, we've just integrated with the Echo, we're doing this thing. It's interesting, but it's weird that google or Microsoft or Apple didn't do this first.
Leo: Sam Lesson, who I'm sure all of you know, he did a company called drop.io, got bought by Facebook, was responsible for Facebook Timeline, left Facebook, his wife Jessica Lesson knows the information. She worked at the Wall Street Journal for a long time. He's got a new startup called Fin.com and it's about a voice interface primarily for the Echo. They're saying about fix your phone, but really this is an echo skill that you add to your echo and allows you to make calendar appointments, answer questions, do all sorts of interesting things.
Katie: I think the idea is to use the Echo to create something like the operating system that we saw in the movie "Her." This is where we're going. It's not the end of the desktop operating system as we know it. It's the idea of using bots to create a more naturalistic way to react with machines. If you think about all the things you do with your laptop or on your computer or even on your phone, if you could just talk to your phone and say, hey could you schedule me a lunch on Thursday with Sara and remind me to pick up milk tonight after work and can you send me a quick text message with all the things I need to do in the next three hours? The typing goes away. Amazon, and I know it's shocking that they created this hardware, because all their hardware has been so terrible, but they have so much consumer behavior data. They know everything from, because i use Amazon Prime for so many things. I'll just use myself as an example. They know when I need paper towels, and they know the sorts of things that I shop for, they can already make all the connections that my brain has made, if I'm searching for X product, I jump to the next three things. They kind of have a profile of me already. If the last thing they need to understand me is my voice interaction and voice command for the music I want or the podcasts or the times that I'm in the kitchen using the timer, they have a more complete picture of me as Apple does, and they just happen to have that bigger vision right for how we're going to interact with machines in the future. They've got the voice technology right, and Apple couldn't.
Leo: What's interesting is that they're opening it, so somebody like Sam could come a long and say I'll make Finn be an Echo skill and now it's in there. You want to get scared? I love this article from Business Insider from Eugene Kim. Scary time. Hide your bunny ears. 17 charts that show you just how scary Amazon's 275 billion dollar business really is. Once you see these charts you say, "Oh." First of all when they went public in 97, their stock was 18 dollars a share. 675 dollars a share. What's really interesting, and the stock market has grasped this, is that income is as close to zero as you can get. If you look at this graph, the orange line is net, the money they take home and put in their pocket. It turns a knob as the revenue has skyrocketed. Last year, 107 billion dollars in revenue.
Jason: Their expenses are also skyrocketing.
Leo: You say expenses but I say spend. The differences between the blue and the orange dot, while massive, is the bankroll that Amazon has to throw into things, like Fulfillment centers, which they built like crazy for years. They've stepped back on that. Who knows? Drones, Echo, Same day delivery.
Katie: AWS. Everyone keeps forgetting how much...
Leo: Multi-million dollar business. We'll get to that. Amazon is now bigger than Walmart. Amazon is the purple line on this. Walmart is the green. Walmart has gone down in the last year, but that's probably coinciding with Amazon's growth which has been very steady. Amazon is the most popular e-commerce destination for every day products. People do their shopping increasingly at Amazon, more than double Walmart, triple Target and Safeway Kroger, Super Value, Albertson's trailing off. That's groceries! That's Staples. Also for personal care and beauty products, completely dominant. In the holiday shopping season, totally dominant, more than half of US consumers plan to do most of their online shopping on Amazon. But the really amazing thing is, as dominant as they are in e-commerce, e-commerce is only 6% of total retail sales now. So the growth potential in e-commerce is massive if Amazon maintains this share.
Jason: I do wonder about Amazon’s long term plan for international because here in the US we talk a lot about a lot of these products.
Leo: They own the US.
Jason: But like I think the Echo does not work outside of the US.
Jason: And a lot of their digital products are in one or two countries. We can say the Echo’s better.
Leo: It seems like a strategy.
Jason: It’s an interesting, different strategy right now because Siri and Ok Google do a lot of languages and are in a lot of countries. And the Echo is English in the United States. And that’s what it does. And maybe that’s their strategy is we’re going to work on getting this really, really great--
Leo: Yea, let’s own the US market.
Jason: -- here rather than being sort of ok everywhere. But it is, they unlike Google and Apple, Amazon chooses a lot of the time to turn their back on the rest of the world. That provides opportunities for competitors to succeed in the rest of the world.
Leo: It’s possible that Amazon is looking across the sea to Ali Baba and thinking it’s going to be like Spain and Portugal and we’re just going to divide the world at some point. So they’re avoiding a head to head—maybe, I don’t know. I would not underplay Jeff Bezos’ strategic command. He seems to understand what he’s doing, right? And as you mentioned, Katie, Amazon Web Services is huge and growing all the time.
Katie: And that could be a global business just fine.
Leo: Yes. That’s absolutely true. They’re beating everybody including Microsoft, IBM and Google and Rackspace. Companies that you think of as owning cloud. Not even close.
Jason: Well we heard that, you know we hear about Apple doing their own cloud stuff but they have a huge amount that’s been AWS and they’re doing some things on Google and they’ve got some things on Azure too. But you know, it AWS runs huge portions of the web. It’s shocking.
Leo: Didn’t Apple just go to Google and buy hundreds of millions of dollars of cloud services?
Jason: They did.
Leo: For a cloud platform? That was, that must have been a buy that Amazon was desperate to get or was very interested to get. But really—
Jason: While Apple’s also building data centers but it’s just not enough. For most companies it doesn’t make sense. You just buy some time at AWS instead.
Leo: According to McCreary Capital analysts in the US nearly have of all US households will be Prime members by 2020 (laughing).
Leo: That’s power. So you talk about the 5 horsemen of the internet, you know, Apple and Google and Microsoft and Facebook and Amazon but I think Amazon’s the one to watch. And I think when you talk about operating systems, it’s not desktop. You know 15 years in, that’s how we started this conversation, OS10 it’s just going to kind of coast along. Windows is just going to kind of coast along. That’s not the future.
Katie: Amazon’s in our physical space and they’ve always been in our physical space. And so we’re used to depending on them. Like you can order an Uber now through the Echo. And you can order physical goods. And I think that it would take longer for Microsoft to get there, for us to be comfortable with this idea of like, oh Microsoft is going to just be something that we interact with every day to get groceries. It’s just – Amazon got there first.
Leo: You said before this show began because we’re asking about bandwidth, that you don’t have devices that spy on you like a Nest Thermostat in your house. Do you have an Echo in there?
Katie: So I just—but here’s the thing. So I just ordered an Echo. I broke down. Because I’ve been using other people’s enough that I can understand the utility. And then I really feel like the potential privacy trade-off is enough for that utility. Whereas with Nest, I was like, you know I can push that button on my own. I’m good. Thanks.
Leo: Yea, there’s no real gain.
Katie: Dropcam, I don’t feel the need to know what’s happening in my house in that way. I feel pretty secure. But with the Echo, I was at a friend’s house the other day. I was like, “Echo, play Abby Road. Turn up the volume. Can you set a timer for 10 minutes?” And we were like playing a game and it was like nobody could remember who like the 7th president was. It was just like sort of, it felt like having just a very helpful person in the room which again, I understand how creepy that sounds.
Katie: But it was also really great and helpful.
Katie: And so I thought, “Ok, this would be fantastic to have in my kitchen. This is exactly where I would use it.” I’d listen to a podcast and I would cook. Then I would clean up and I would need it for recipes. And I would be able to depend on it, like having a helper in the kitchen.
Leo: I don’t think, I realize I know have by the way four Echoes and I have—
Katie: Oh my God, I should have just borrowed one of yours.
Leo: (Laughing) I have 2 Dots on the way. But I realize that it’s not, the device is not what you’re talking to. You’re talking to the house.
Jason: Right and you’re talking to the air. I tried to explain to people who say, “Well you can just use Siri to do that because it’s always on.” It’s like, no, Siri’s in my pocket or it’s laying being charged somewhere and with Echo you’re talking to the air in your house. You can sort of be anywhere, not even pointed in the right direction. And it’s funny. I think Amazon’s failure with its phones has actually turned into this great success because Google and Apple keep sticking their assistants into their phones. And it works better with this little tower.
Leo: Which would you rather do, talk to the air or talk to your pocket?
Jason: Well and that’s the answer. I talk to the air and it’s much better. I think when we’re talking about the future of computer interfaces I think there’s something to that. And if you can imagine a time when people are sticking a little thing in their ear and talking to their smart assistant like in her, that makes it like Apple’s lack of progress with Siri, a little more questionable and concerning. And Google, you know the rumor is there was a report this week that they are working on an Echo version. And Apple needs to do that too. Because the Echo really showed us all there is great value in having that little friend, like you said that friend who’s just hanging around in the background you can ask questions to and ask for favors.
Leo: It would be interesting.
Katie: I’m really surprised that Apple TV didn’t go in this direction. I’m really curious as to what you guys think. I was surprised that when Apple TV came out I wasn’t able to be more interactive with it. I wasn’t able to ask it for stuff. And I guess it’s not like—Amazon has a huge store appended to it so you can ask it for groceries or paper towels or for whatever. But I was surprised they didn’t do something better to integrate even like Wikipedia so you could have that like, oh, set a timer or oh, who was the 7th president. You know what I mean? Like you could ask it questions and could interact.
Jason: Well it’s stuck on the TV too. That’s the problem. You’ve got to turn on your TV in order to ask your friend a question and that’s the great thing about the Echo is that it’s just always hanging out there. It’s not in my pocket on my phone. It’s also not on my TV which is turned off at the moment. I think that’s the problem with Apple’s strategy is they’ve embedded Siri into the remote on the Apple TV and they’ve embedded it into your phone. But it doesn’t get it in the air. It doesn’t get it in your house.
Leo: I do have to say though to be able to talk to your TV and say, “Skip back 30 seconds” or “What did he just say?” is phenomenal.
Jason: It is a great feature.
Leo: But I just feel like—Katie, you nailed it. The ability to interact with your environment while you’re doing stuff is huge. And that is really so much better than what a phone or a desktop can do. It’s just there listening to you and I love that. I really do. All right, let’s take a little break. We’ll come back with more. Katie Benner is here from the New York Times. Jason Snell, Sixcolors.com. Devindra Hardawar from Engadget. As always, really great conversation. We had a good week. I wasn’t here this week. I went to New York City to see Hamilton. By the way, you can ask the Echo to play Hamilton and it will.
Jason: It will?
Leo: I listen to that.
Jason: It’s in Prime music.
Leo: I love it about that. But we did have a good week even in my absence. Maybe I should be watching what you’re about to see. A little movie about this week on TWiT.
Narrator: Previously on TWiT:
Father Robert Ballacer: Hey you know what? This thing, this costs probably 3 cents. I am drone. I am professional. This works. I flew with this.
Narrator: Home Theater Geeks.
Tyll Hertsens: There was never a lot of money in headphones until Beats came along and smartphones came along. Headphones are just getting off the ground. There’s another thing coming along, immersive audio and the ability to create 3 dimensional soundscapes that seem like they’re coming from outside of your head.
Narrator: Windows Weekly.
Fr. Robert: But is there something that Microsoft Maps you think does better than the others?
Paul Thurrott: No.
Fr. Robert: Ok, that was easy.
Paul: It’s not terrible. I’m not really crazy about it.
Mary Jo Foley: You’re selling it well.
Fr. Robert: If anyone from Microsoft is listening, Paul Thurrott just came out with the perfect slogan for the Build Conference: It’s not terrible!
Narrator: The New Screen Savers.
Leo: I’m sure you took some joy in Microsoft’s Tay AI.
Iain Thomson: They were thinking to capitalize on the fallout from the Go game last week. There’s been an awful lot of talk about AI.
Leo: You’re getting scooped here, guys.
Iain: Oh, no, we need some publicity for our AI system. Let’s put it online. What could go wrong? And well, it went wrong.
Narrator: TWiT. Live from Petaluma. Here, have an egg.
Fr. Robert: How many times have you had to repeat yourself to your phone and then you end up yelling at it?
Paul: Oh yea, I yell at computers and phones and my neighbors and people I don’t know in the street, on Twitter (Laughing). I’m kind of a disaster.
Leo: We call him Ol’ Yeller I think. That’s his nickname. What’s ahead? Let’s find out. Megan Morrone, the week ahead, please.
Megan Morrone: Thanks, Leo. Microsoft Build starts this week. We will be covering it all week and there will be a special Windows Weekly on Friday. Lots of new products are scheduled to ship this week if you order them on time. The new baby iPad Pro and the teeny tiny iPhone SE will ship. Also if you ordered an Oculus Rift you might be getting that this week.
Megan: PlayStation VR will be available for Pre-Order this week. Plus Becky Worley will be in the studio hosting the show on Wednesday and Thursday. We’ll see a lot of baby tech news next week. Back to you, Leo.
Leo: And Jason Snell will be doing iOS Today with me. Is it this week or next week.
Jason: It’s on my calendar. It’s soon, soon.
Leo: (Laughing) I don’t know either. That’s going to be a lot of fun. I’m sure we’ll talk about that new iPad hardware and software as well as Apple TV stuff. You know I am a Kickstarter Oculus Rift owner so I think we might get our Oculus Rift soon. I’m hoping. Palmer Lucky flew to Alaska to deliver the first Oculus Rift. Irony is the guy who got it didn’t have enough computer to use it. So he just put it on and looked around and that was it (laughing). We are not going to have that problem. We are building a $5,000 dollar ultimate virtual reality gaming machine. And we’re almost done on The New Screen Savers. We just put the hard drive in. I think there’s—we’re going to put the water cooling system in. Keyboard, mouse, we’re almost ready. So if the Rift comes we could hurry things along a little bit. I’m excited. We’ll talk about that. VR and lots more. The Build Conference in just a little bit as we continue with This Week in Tech.
But first a word from Stamps.com. You don’t want to go to the post office. You don’t need to go to the post office. If you’re in a business where you’re mailing stuff a lot, if you sell on Etsy or EBay or Amazon, if you send out brochures or bills, you need to know about Stamps.com. It eliminates the need to visit the post office because you can do everything you would do at the post office right from your desk, including buy and print real US postage from your computer with your printer for any kind of letter or package or anything. In fact, they’ll even make suggestions. They’ll say, “Are you mailing a book? Well you should do this media mail. You could save a lot of money.” And then the mail carrier comes and picks it up. No more time wasted driving to the post office, finding parking. Instead, spend that time on growing your business. And by the way, looking more professional because you know one of the things I love buying stuff on Etsy and from EBay but some of the packaging sometimes you know, the brown paper with the twine and hand licked stamps going all the way around the edge, that doesn’t convey professionalism. This does. Stamps.com, you print your logo right on the mailing label. The addressee comes right from the website or your address book. It understands all the address books and QuickBooks. They’ll calculate the postage using that USB scale so there’s always the right postage and not a penny more or less. You even get discounts you can’t get at the post office on insurance. It will automatically send out an email to your recipient if you’re doing certified mail. Free USPS address verification. It will fill out your forms for customs or certified mail just automatically. I can go on and on but what I want you to do is try it. We got a special offer. Go right to the top of the page of Stamps.com and click that microphone and use our offer code TWIT. You’re going to get $110 dollar bonus offer. It includes $55 dollars in free postage. You get the USB Scale. You get a 4 week trial. It’s a great deal. Stamps.com. If you’re doing mailing right now, if you’re going to the post office ever, get off that treadmill and get to Stamps.com. Click the microphone, the upper right hand corner and use the offer code TWIT for our special offer. Stamps.com. People say we should do an Echo show. You know what? I think if it was a platform I think maybe we should do an Echo show.
Jason: An audio podcast only, right?
Leo: No, opposite. Video only because every time we say the word Echo, peoples’ Echoes wake up and we can’t do it. So there’d be no audio at all.
Jason: You’d have to a simile. On my podcast for Siri we call ahoy telephone so you came up with something that’s not—
Leo: Ahoy telephone.
Jason: You know, come up with a nickname for Alexa that is not Alexa.
Devindra Hardawar: Has Amazon also ruined the name Alexa for children?
Leo: Children cannot be named Alexa.
Devindra: You can’t do it.
Leo: That’s sad. I didn’t even think about that.
Devindra: This is the power these types of things have.
Katie: I want to be able to say, “Jeff Bezos, set a timer for ten minutes.”
Leo: Wouldn’t it be funny? You should have that option. It should sound like him. And occasionally it will bray his braying laugh, that (braying laugh). It would be funny. That would be good. I want Jeff in my kitchen.
Devindra: Custom voices will be a great thing actually. I cannot wait until that happens. It will be just like your GPS or whatever.
Leo: I can’t wait until Her happens.
Devindra: Oh yea.
Leo: I want Scarlett Johansson in my ear. I don’t care if I fall in love with her. I don’t care at all.
Katie: I just want her to organize all my emails.
Leo: Yes. Wasn’t it awesome? And if she goes and runs off with some other AI and starts a new nation, that’s fine.
Jason: Totally fine.
Leo: It’s ok.
Devindra: But I love how subtle that movie is just in terms of like it’s representation of the interfaces, right? They never make a big deal of it. It’s not like, “Oh, man, no more keyboards. No more mice.” It’s just people talking to their tech so it’s kind of cool.
Leo: Yea. I’m going to have to watch that again come to think of it. Let’s see. What else could we talk about? There’s so many things. I feel like I have tons of material for this week. Too much.
Devindra: I think this should be VR week. You guys, yea.
Leo: All right, let’s do VR and then we’ll do Tay (laughing). Ok, so now we’ve got Rift, that’s the Facebook product, HTC did a deal with Steam to make the Vive. That looks interesting. A lot of people love that. Sony coming out of nowhere with its PlayStation VR that will work on the widest range of hardware. 33 million Sony gamers out there that could be in the market for that.
Devindra: But with the lowest resolution, the lowest presence for VR basically.
Leo: You think so? Have you tried all of them?
Devindra: I’ve tried, I actually have the HTC Vive pre right here. The development unit that they sent out for testing. It’s super cool.
Leo: People love that one.
Devindra: Let me just tell you guys, like the geekiest thing, this is like I’ve had many geek milestones but having VR just sitting here in my office and being able to like jack in every day and like do whatever is tremendous. So yea, the Vive is interesting. The PlayStation, just because it’s using console hardware, older hardware, it’s even though it comes with a little break out box, it’s not going to really push the hardware much forward. So it just can’t look as good as PC VR basically.
Leo: Joanna Stern of The Wall Street Journal wrote an article on why you should try VR. This is going to be the biggest challenge of course. And I should reload the article because it was so awesome. It starts off with a video of you putting on the VR and suddenly you’re in this virtual world. This is going to be the problem is you can’t communicate the experience at all. You just have to do it. Not everybody will have access to this hardware that you need to do it. It does take a significant amount of hardware to do it. And some portion of the audience is going to get nauseous or nauseated. They’ll get sick. So all and all I think this may be a hard sell. I’m as bullish as you are, Devindra. But it may be a hard sell.
Devindra: We have like, so that video showed the Google Cardboard stuff. We have entry points along many different price ranges and kids, anybody can really get access to Google Cardboard super easily because you just stick your phone in there and you have a semi, like cheap virtual reality experience. And it’s pretty good for like The New York Times 360 degree videos. Then there’s Gear VR which is Samsung phones only right now but it’s $100 bucks for existing Samsung customers and they’re also giving it away with the Galaxy S7. And that’s, it’s better than Cardboard, it’s not as good as the Vive or the Oculus but it is Oculus hardware so—
Leo: It at least gives you some experience. I worry that people may experience Cardboard or Gear VR and say, “Well, eh.”
Leo: Is the Vive that much better?
Devindra: Yea. For sure. It is, because what the Vive does, it’s room scale VR. You have two sensors that you put up in different corners of your room. So it knows like the mapping of your floor. You can get up. It comes with two motion controllers. You can move around. You can interact with things. There’s a virtual mini-golf game that kind of, it sounds like the dumbest thing but you put it on and you’re just in this weird, like the craziest mini-golf environment you’ve ever seen. The motion controlling for the stick is like perfect. And these are just like the early demos. So I am really interested in seeing where a lot of these things go. I’ve tried the Oculus, you know the latest hardware too. You’ll be hearing a lot about that stuff this week for sure.
Leo: It’s coming out March 28th. People are going to start getting them, so I’m hopeful we’ll get ours soon. We are going to do something interesting. On Tuesday on MacBreak Weekly, turns out one of our contributors, Alex Lindsay, bought a $60,000 dollar VR camera, the Nokia OZO.
Leo: What? Why? Because I guess he’ll have clients who will pay a lot of money, a premium to have immersive video of their event. We are going to have the—
Devindra: So that’s what’s keeping Nokia in business. Like that part of Nokia.
Leo: Exactly so this little thing, this doohickey will be sitting on our desk on Tuesday. You want to come for MacBreak Weekly? You should be part of this.
Jason: I’m intrigued now.
Leo: This is going to be historic.
Jason: Will it steal my soul?
Leo: It will suck it right into that little multi-eyed ball.
Jason Cleanthes: It’s the 500th episode so we might as well do it right.
Leo: It’s the 500th episode. So that is a good point. We can’t do it live. It can’t be done in real time apparently.
Jason C.: And only in 45 bit increments.
Leo: Well, we’ll do a couple of, maybe 4.
Jason C: If you scroll down the little cartridge that goes in the back is a—
Leo: That’s what it records to?
Jason C: The battery and the recorder is all in that little back part.
Leo: And it does surround audio as well, right?
Jason C: Yea. A little tour of your studio, Leo. Just like being able to walk around and see it. That would be great.
Leo: All right we’ll do that. It’s the Toy Store.
Jason C: You can always go to Google Maps and check us out.
Leo: We are on Google Maps 300 3D rendering of the studio.
Jason C: Right but I can’t look at that in VR, so I want to put on my headset.
Leo: I can’t believe, did Alex buy this? I can’t believe he bought this. He is insane. That’s a thousand Alex’s.
Jason C: He didn’t expand on why he has it. He just says he has it.
Devindra: You have to see the hardware that’s out there at some point.
Leo: He spends so much money on this stuff that we actually have a unit of measure for dollars called an Alex. An Alex is $700 dollars. It’s one Photoshop I think was the—so we don’t talk about how much stuff costs. We talk about how many Alex’s it is as a different thing.
Jason C: Our MacBreak Weekly audience is well aware of how expensive his choices are.
Leo: He spends multiple Alex’s but this has got to be the most expensive. Anyway, we will the show on Tuesday in 3D and you’ll be able to download an immersive version of this. That will work on Cardboard or it actually plays fine on a 2D screen, you just use your mouse to move around.
Devindra: Stick your face close up to the screen. It’s almost like it.
Leo: It can make you sick. We have a heck of a week. So we’re going to do the OZO on Tuesday for MacBreak Weekly and tomorrow, on Monday, I wanted to talk to this guy for some time, Craig Richardson will join us. He’s written a great book, Learning to Program with Minecraft. We’ll talk about getting your Minecraft up and running with Python. What a great way to get your kids programming. Learning to program with Python tomorrow on Triangulation. All right let’s talk about Tay which was really stupid I must say. Microsoft got a bit of a black eye. They released a chatbot. And you know, I think it’s very generous to say this was artificial intelligence. This was artificial stupidity maybe. They said, “Hey we did this in China and we never had a problem.” Tay was a chatbot that was supposed to simulate a millennial. You could tweet at it @Tayandyou. And within 24 hours it became a hate spewing racist anti-semite.
Devindra: Just like everyone on the internet.
Jason C: Do I want to show this?
Leo: You can show it. It’s terrible. I mean everybody’s probably seen it by now. The thing is, like I said I just think Microsoft didn’t get that Twitter’s a little different than whatever they were, I don’t know if it was Weibo or whatever they were putting on it in China. The Chinese were well behaved and Microsoft said, “We were stunned. Everybody enjoyed listening to stories and talking to the bot. We just never thought that this would happen.” Obviously they’d never been on Twitter.
Devindra: Or Reddit or anything.
Leo: Or Reddit or Fortune or etcetera, etcetera, etcetera. In any event one of the mistakes they made was they put in a command, “Tay, repeat after me.” So most of the really awful stuff is just people saying, “Hey repeat after me” and saying something terrible. Not clear and it’s been taken down, it was taken down almost immediately, it’s not clear whether Tay was then learning something from that or if all of those tweets was just Tay, you know, parroting something somebody else said.
Devindra: Even for like a chatbot it seems like it would be tough to train it to say those specific phrases.
Leo: Yea, I think it’s just repeating. Certainly not within 24 hours.
Devindra: How do you even let that feature get out there? Like, come on.
Leo: Dumb. You know what it is? I think they were feeling a little spooked. In fact Microsoft’s always had this, not always, but in the last ten years has had this, “We’re Microsoft. Why is everybody? They’re so. We got to.” So it’s always catchup. Always like they’re rushing stuff. And this is an example. This is just I think they felt scooped by—
Devindra: It is weird to be calling chatbots AI though.
Leo: It’s not. It’s like ELIZA. Remember ELIZA? You’re probably not old enough to remember her. Do you remember ELIZA?
Jason: Do you have any psychological problems?
Leo: Yea, exactly. ELIZA was a chat therapist.
Jason: I don’t know what you mean by chat therapist. Tell me more.
Leo: There’s probably an ELIZA online. It was very dumb. But it didn’t seem like it was any less dumb than Tay. Oh God, they’re all over the place. Here’s one from—
Devindra: They’re pretty dumb.
Devindra: They’re pretty dumb.
Leo: Talk to ELIZA, the Rogerian Therapist. Hello, I’m ELIZA. Hello, ELIZA. You having a nice day? You can do this at phsyc.fullerton.edu. Would you prefer if I were not having a nice day. No, not at all. I was just inquiring. I’m trying to give it a lot of words to work with, right? Because if you just say no it gets kind of dopey. And then she says, “Why not?” Oh, dear. She really is Rogerian. Because I like you. Let’s see. When the original ELIZA first appeared in the 60s, some people actually mistook her for human. Not for very long. “We were discussing you, not me.” (laughing) That’s a classic ELIZA. Just turn it right around. That’s ELIZA Java script. Not much, frankly, not much more primitive than Tay if you ask me. Microsoft did lose a significant court case. Actually it wasn’t even in court. It was an interpartis appeal or review of a patent that Microsoft paid millions of dollars for. It’s one of the oldest and most profitable patent trolls, Uniloc, claimed he owned the concept of product activation on software. And of course, if you own such a thing you go around asking people for big money to license it and if you don’t get it you sue them. Sega of America, Ubisoft, Cambian Learning Group and Perfect World Entertainment decided, “This is—enough is enough.” And they pursued what is called an interpartis review. They went to the patent office. Actually this was the same technique used to overturn the podcast patent. Instead of going to court, fighting in court, we had consul from, when the podcast patent was going around and they asked us for $2.5 million dollars, we sought legal consul. And we had a very good attorney who had a lot of practice in this in Tyler, Texas. And she said the risk of going to the patent office for the interpartis review is if you lose it just bolsters their case in court. So it’s a risky play. But Sega said, “No, we’re going to take a chance.” And yea, they overturned the patent. Uniloc has sued 75 companies, one third of them just said, “Ok, here. Take some money.” In Uniloc’s case against Microsoft, they said, they lost, I’m sorry, they won, $388 million dollars. And in fact the appeals court upheld the win. Microsoft settled for an undisclosed amount. But that patent has now been overturned. It was used to sue Minecraft, Mojang as well. Wow. Love those kinds of stories.
Devindra: Good news. They got greedy.
Leo: Yea, they got greedy. I guess, or something. Or somebody stood up to them. I think that’s really the lesson in this is as expensive as it is, it really, the more people stand up to patent trolls the better. And Adam, we thank very much Adam Carolla who did fight the podcast patent troll and raised a lot of money, spent a lot of money. But it was ultimately the EFF who got that podcast patent overturned by going to the US PTO and doing an interpartis.
Jason: Yea, I know a bunch of app developers who have been bitten by the Lodsys one.
Leo: Oh the Lodsys one is terrible.
Jason: These are small developers where basically they can’t afford to fight it so they just pay them off. And it’s like extortion. It is extortion but they have no other place to go.
Leo: You wrote about on Six Colors speaking of podcasting that this new adapter that Apple’s doing for the iPad Pro, the Lightning USB 3 adapter. $39 bucks. It’s a camera adapter. But it will help podcasters.
Jason: Yea, they still call it the camera adapter which is funny because Phil Schiller stood on stage and said, “Oh, you can also use this to connect to your corporate Ethernet network and podcasters can use it with microphones.” And it’s true. It’s powered. So this new adapter for iOS devices has a lightning cord on the outside for power and then a USB plug. It used to be you could like maybe find a powered USB hub and attach it and all that. But now it’s sort of an approved feature. And the other nice thing about it is you can do this for a while because it will also power your iPad. So it used to be if you wanted to use this adapter you had to make sure you had enough battery to get through whatever you wanted to do because it was draining power from your device and this one will actually charge your iPad while it’s attaching you to anything by USB. A microphone or an Ethernet adapter or whatever. A camera.
Leo: I want them though to move to Type-C. Because this is the kind of thing Type-C does so well and it would be an easy thing. But what this adapter does it plugs into the lightning port on your iPad and adds a lightning port so you can charge and then a USB port so you can connect Ethernet if you wanted or, which is kind of funny. I guess there’s drivers for Ethernet now.
Jason: You know, it’s kind of invisible, but if you—I turned off Wi-Fi and suddenly I was still on the internet.
Jason: So obviously it was working but there was no way to see anywhere in the settings.
Leo: You couldn’t tell. Interesting!
Jason: There was nothing set. But I guess, yay.
Leo: And you’re saying if you had a microphone that had a USB interface.
Jason: Yea, like the Blue Yeti is a good example of a common microphone that does not, that draws too much power. And the iPad alone could never support it. But iPhones and iPads using this adapter can use that. It doesn’t solve like all the podcasting using an iOS device problems but it does solve one of them which is that it was hard to even attach a device because it wanted BUS power that wasn’t available.
Leo: While I was in New York I actually recorded a commercial. It was on my iPhone, using Shure makes a lightning based microphone.
Leo: I got, then put the covers over my head to get a nice soundproof room and I recorded commercials. And then I transferred them to Dropbox. Because there really is no easy way to do this. And then from Dropbox I sent them to the station. And then what I did, I realized, “Oh, I can do this for audio blogging.” And so I created an If This Than That that would watch my Dropbox folder and then as soon as I uploaded a new audio track to the Motif Dropbox folder, which is built into the recorder, would then send it to SoundCloud and then it’s a podcast.
Jason: Yea, we’re going to get there. It’s going to be very soon it’s going to be very easy for people to just be anywhere that’s quiet with their phone and record a podcast. We’re not quite there yet.
Leo: Yea. Getting there.
Jason: But it’s cool now that somebody on stage who represents Apple says, “Yea, it’s not just for cameras. You can plug any USB device into it and it will work.”
Leo: I’m going to buy one. For sure. We started a little bit on this, Katie, but we were talking about platforms and the Echo but really I think a lot of what we’re seeing is people using messaging as a platform. And I wonder that in a way the same platform. The idea of kind of an interactive back and fort whether it’s by voice or by typing in your messaging platform. Facebook is now going to do, aren’t they doing a messaging app store for bots? Very interesting what’s happening here. I think this is in some ways the future of platforms. Is not tied to an operating system. It’s something you can do while you’re walking around. As long as Tay’s not there, it’s ok. It’s ok.
Katie: Yea, Tay’s a little violent.
Leo: Yea. Netflix has admitted- well, we throttle video streams for Verizon and AT&T. They didn’t say exactly. They were talking to The Wall Street Journal,. They didn’t say exactly whether this was something AT&T and Verizon had demanded. They did say, “We don’t have to do it for the others, Sprint and T-Mobile because they treat customers better.” Ooo. Ow.
Leo: This is an issue of course of data caps. We’ve been talking a lot about net neutrality. We’ve talked about Binge On from T-Mobile which it turns out, does something similar although they only throw it down to 1.5MB which is much better quality than this. What is it, 600KB that Netflix was offering AT&T and Verizon customers. Has anybody complained about how bad Netflix looks on Verizon and AT&T? I think people don’t even notice.
Devindra: I mean on phone’s 600K is not much but it may be just hard for people to notice. It’s not crystal clear to any HDTV. But it’s, I guess it makes sense for Netflix to do this because, yea, if people can stream more things that’s better for them overall. It’s just a shame. Like basically this is the world we live in right now, right? So they have to work around the limitations of the cellular companies. It’s kind of shame.
Leo: Here’s AT&T’s response. “We’re outraged to learn that Netflix is apparently throttling video for our customers without their knowledge or consent.”
Devindra: They want them to pay for all that.
Leo: We’re outraged (laughing). That’s why we put bandwidth caps in place. It does point out that when you’re talking about net neutrality, it’s hard to know who the villains are and who’s—I mean it really is hard to figure all that out.
Devindra: The system is kind of broken, so, yes, it’s tough.
Leo: Yes. Andy Grove passed away this week at the age of 79. A really amazing fellow who powered Intel. He was a Hungarian refugee. Came to the United States after the Hungarian revolt of 1956 was crushed by Soviet tanks. I remember him telling me the story of crawling on his belly through a mine field and barbed wire in Hungary to get to Austria, to get over the border into Austria. He was probably around 20 at the time. Young man, came to the United States, studied chemical engineering and got a job at a little company called Fairchild Semiconductor where he worked with Charles Moore and then later CEO and chairman of Intel and really had a lot to do with the success of Intel in the 80s and 90s. And I really liked the guy. He was a tough competitor but a brilliant engineer. But more importantly a great leader. Famous for not having an office. He had a cubicle.
Jason: I saw that cubicle once. To be fair it was a very large cubicle with an assistant’s cubicle in front of it.
Leo: It was a nice cubicle. And he had assistants.
Jason: But it was still a cubicle. It’s true.
Leo: It’s nice. He was—I really liked Andy and very sorry to see him pass.
Jason: As they say in Hamilton, immigrants, they get the job done.
Leo: They get the job done.
Jason: What a great story, his life story is just amazing.
Leo: Yea, isn’t it?
Leo: By the way that was a huge applause line.
Jason: I’m sure.
Leo: Yea. They sing that and the show stops for a minute while everybody goes, “Yea!”
Jason: Apparently that’s the biggest thing they had to do when the opened on Broadway is that everybody knows the songs now so they have to insert all these pauses while everybody cheers for their favorites.
Leo: All right. So I’ll do a little Hamilton. I wasn’t going to do this but it was the greatest show I’ve ever seen. It was incredible. I saw it on Thursday night. But what was interesting, it was full, I’ve never, I’ve been in, I’ve seen many, many Broadway shows including huge hits. I remember seeing Rent when it first came to Broadway. But seeing this was unique. First of all, no empty seats 10 minutes before the show begins, the house is full which is unusual. And it’s buzzing. There is electricity. People are very excited to be at the show. It’s impossible to get a ticket. It’s sold out through the rest of the year. And when the show begins, they introduce Alexander Hamilton, Lin Manual Miranda, and he makes his appearance on the stage. And it’s like the Beatles. The screams and the whole show just stops as—and I think it wasn’t just girls screaming. I was screaming. People are screaming. I haven’t seen anything like this. It’s like Elvis. It’s like the Beatles.
Jason: It’s tremendous, yea.
Leo: It’s really a wonderful show. Have you seen it, Devindra?
Devindra: I have. I took my wife to see it last year. Yea, everything was sold out but you can still get like 2nd run tickets from SeatGeek and those types of sites. So I paid way too much for it but I honestly like, totally worth it. And I hope to get back this year because I wanted to see it before any of the cast goes away too.
Leo: Yea. Well that’s part of the problem is their contracts run out in the next couple of months and they are going to do a tour of course. They’re going to Chicago and they’ll be in San Francisco in March. And I’ve already bought tickets for when they’re in San Francisco because I can’t wait to see it again. I want to see it again and again. It’s an amazing show. But yes, good line in there. Immigrants, they get the job done.
Jason: I was thinking about Andy Grove, yea.
Leo: Yea. Wow, he’s remarkable.
Jason: Great immigrant story.
Jason: 20 years old, crawling on his belly under wire.
Leo: Good we didn’t build a wall between us and Austria. Let’s take a break. We’ve got some final thoughts including a wild site called VNC Roulette. Have you seen this yet?
Jason: It sounds terrifying.
Leo: It doesn’t sound good. But first a word from our folks at Braintree. We love Braintree. And everybody who does mobile app development loves Braintree because it is the way to add mobile payments to your app or your website that your users will love, that you will love. And all I have to tell you is who uses Braintree? Uber uses Braintree. AirBNB uses Braintree. GitHub uses Braintree. StubHub uses Braintree. You’ve used Braintree. It’s the easiest way. What is the secret of Uber? What is so great about Uber? Because when the ride’s over you get out of the car and it’s done. You paid for it. That’s Braintree making mobile payments fast, easy, seamless. You can add it to your app with 10 lines of code and boom. You are ready to accept whatever payment form your customer want. Apple Pay, Android Pay, PayPal, Venmo, credit cards, even Bit Coin. And if another way to pay comes along you’re going to be able to do that with a check of the box in your control panel. Braintree will support that too. I spoke with my good buddy Harper Reid. His company, Modest, was all about kind of seamless transactions. Braintree acquired him not so long ago. And I asked about how Braintree’s powering this new PayPal Commerce tool. And why it’s important. When it comes to contextual commerce. Listen.
Harper Reid: As a developer we built a lot of these tools to be easy to use for developers so thinking about APIs, really it’s just about building blocks. So if you look at, you know, huge companies like Facebook and Uber, they’re able to use these building blocks to do really neat integrations for their transportation services. But at the same time the small business developers are able to use these to bring retail customers their own businesses into this contextual commerce world.
Leo: Braintree’s fast payouts, their continuous support mean you’re going to be ready no matter what. Whether a—and they’ll be ready for you whether you’re earning your first dollar or your billionth dollar, you’ll see fewer abandoned carts, more sales. Braintree is amazing. If you haven’t checked it out, go to Braintreepayments.com/twit. You can play in the sandbox. You can see how easy it is. You can see how their fast payouts, their superior fraud protection make life better for you and your customers. And by the way, if you don’t have time to do the integration, they can do it for you. They powered the Pinterest Buyable Pins. That’s the Modest technology through Braintree. Braintreepayments.com/twit and as a little incentive, your first $50,000 dollars in transactions fee free. Braintreepayments.com/twit. I found this on—I love Hacker News. Always great stuff on Hacker News. It’s called VNC Roulette. Somebody wrote a little script to go out and look at unsecured VNC connections. And as you go through them what surprises you is occasionally you run into things like hydro power installations, the grid. It’s kind of an interesting revelation here. This is a whole category of tools that are great, that allow you to search for flaws, exploits.
Jason: I used to have a screen saver that was webcams that had never been taken off their default settings and it was like a bunch of puppies and then a river and then traffic in a city somewhere and you got to recognize and there was a bar in Russia. And you could see when it was closing time at the bar in Russia. It was great. It was amazing.
Leo: What is that—there’s a search that Steve Gibson uses all the time that will find all sorts of flaws and holes and exploits. I can’t remember. He often refers to it. It’s a great way to find issues out there. Anyway, VNCroulette.com. If you want to—a little fun browsing. Shodan that’s it. Shodan’s kind of amazing. It’s the world’s first search engine for internet connected devices. That’s how the bill themselves but of course, as soon as you hears about an exploit you just go to Shodan and you can find it. Turns out that the music business isn’t doing so hot. Here’s a surprise. In shift to streaming, they’ve lost billions of dollars. US music sales in this graph going from 19, I’m sorry, 2006 to 2015. The big drop, right about 2008 just boom and then flat as physical media disappeared and digital media increased. This is the music industry’s sales report which came out this week. Streaming is up. Vinyl sales a little bit still increasing. But record sales in general way down. The number has hovered around $7 billion dollars a year since 2010. Very little growth.
Jason: This articles says that according to this report it’s about half a cent per play per song on streaming. And I did the math. And that means, so if you take an average length album, because you think, when you buy the CD you get it forever or you do the download on iTunes, you get it forever, as many listens as you want. How many listens would it take for it to be equivalent revenue on streaming. And it’s like hundreds or thousands of listens to an album. And even my favorites I don’t listen to as much. So it’s just, yea, the money is, it doesn’t work. It’s not comparable.
Leo: You know, maybe that era is over basically, right? Maybe that was a brief interlude much to the benefit of musicians and rock bands. But I mean that was, it wasn’t even a hundred years. 50 years and maybe that era is just over.
Devindra: It’s sad. It sort of feels like yea, just giving up. I hear stories from people who used to work in print media and I would hear about their free lancing rates. And when they would be sad about like oh what they’re getting paid now, I’d be like, “Guys, I used to write blog posts for $5 dollars top.” And yea, I would never see that sort of world. You’ve got independent music production now. You’ve got all sorts of different ways for people to get their stuff out there. We’ll have to see what this means for like Spotify and stuff.
Leo: That’s the positive. The positive of it is democratized. But it also means that the small number of people who are making millions aren’t going to do that anymore. I mean that’s sad. I worry more about journalism frankly.
Devindra: Yea. Yea, yea, yea.
Leo: Than I worry about the music industry. Katie, sorry.
Katie: No, I think that once musicians—so musicians stop working through record companies and start going to streaming services directly for example.
Katie: It’s not going to happen tomorrow or anytime soon. I think the problem with streaming services is that the payments don’t make sense. I mean you’re still an artist. You’re still producing something whether you’re huge. You know you love The Weekend, you love Taylor Swift or you love somebody who’s not as well known, those people should get paid for the work they do. And right now we’re in a system where it’s still really easy to find all the stuff for free which is not fair. I mean as a journalist, even though we don’t make people pay for stories, the stories are going out because the advertising’s backing it. So it’s not free. It’s not free. There’s no free journalism. There’s advertising everywhere. So I do think that there will have to be something that makes these economics work where the money that Spotify has to pay per stream is more than half of a cent. And again, does that mean only Apple can subsidize? Only YouTube can subsidize music? Maybe but I mean it’s half a cent is not enough. I think most people would agree.
Leo: I have to though wonder where the money’s going because—
Katie: It’s going to the middlemen.
Leo: I guess, but that’s been historically the story of the record industry. It’s not like the artist really ever got the lion’s share of money. But part of the pitch of these streaming services was to the record companies was, “Well wouldn’t you rather get $10 a month every month from a user. That’s the equivalent of buying a CD a month. Isn’t that better than the alternative?” Even if they were buying CDs, do they buy a CD a month? You pay, don’t you, Jason?
Leo: I pay. I have two, you know, Google and iTunes accounts.
Jason: But if the average subscriber now pays the equivalent of one CD a month and they’re a music fan or they wouldn’t be subscribing. And they probably bought two or three albums a month before. There you go. You’ve lost half or two thirds of your revenue just right there regardless of how badly the artists are getting taken in by the middlemen. The pool of money is way down at that point.
Katie: I think it will decimate them. In a perfect world this would either force the record companies to get some sort of religion and understand that they have to redo their business and start distributing the cash.
Leo: Yea, good luck with that.
Katie: Or it just decimates them and they get taken out altogether which is what is happening. That’s the thing that’s happening. Those numbers show that these guys, most of these companies are run by marketing people, not by businessmen. That these guys don’t understand what’s happening to them and they don’t understand that they’re going to be pushed into extinction and eventually somebody would be able to—I mean Spotify’s already trying to do this. Like ok, well, we’re going to do video and we’re going to do music. We’re going to have people come play at our headquarters and record music just for us. And soon it’s going to be better if you can work your way out of your 10 year contract with Sony to then just work directly with Spotify.
Devindra: I mean subscription pricing is really cheap too. Spotify is what, like $10 or $12 bucks now? I could see those things getting higher and not like maybe losing subscribers.
Leo: Should I feel guilty that I pay $10 bucks a month and I listen to the Hamilton soundtrack on Google Play Music instead of buying it?
Devindra: That’s like a moral dilemma we’re all kind of dealing with. But yea, when I really like something I try to go out and like buy it. But mainly for the like the independent producers, maybe for Hamilton but also I have a lot of smaller bands that I like. I buy their stuff, yea. But for a bigger band? No, no.
Leo: Well that speaks to Katie’s point which was you should go independent or maybe it was Jason.
Jason: Well the vinyl thing is funny because we all kind of turn our heads as tech people at the rise of vinyl but vinyl stuff is priced high. It’s often sold direct from the artist to their hardest core fans and that story says that vinyl revenue was more than artists made from YouTube revenue last year.
Leo: That’s sad. Well, YouTube is another problem, right? I look at my 21 year old and he doesn’t buy music. He listens to YouTube, music on YouTube. And that’s free.
Devindra: That makes me super sad too because YouTube’s reception’s terrible, sounds awful. But nobody cares.
Leo: But kids today, they don’t care. All right, I think we’re going to wrap this up. And we’ll wrap it up from our chatroom with our VNC Roulette image of the day. I don’t know how you found this image but it looks like it’s a toilet that’s asking you to rate it. Please rate our toilet, excellent, good, satisfactory, poor or very poor. And I love the tagline at the bottom, don’t worry, this screen is sanitized regularly.
Leo: There you go, ladies and gentlemen. Thank god for VNC Roulette. Please, rate your hosts. Thank you, Katie Benner. Always a joy. Thank you. And you know what? We were all worried about your connection and it was rock solid and you sounded great.
Katie: (Laughing). Great.
Leo: So I apologize. I apologize. You’ll find Katie at The New York Times, nytimes.com and on Twitter @kbenner right? It’s kbenner?
Leo: K-T. Of course, I left out the T. Always a pleasure. What are you working on this week? Any stories you’re excited about?
Katie: You know I think it’s going to be more Apple stories. It’s a big shock, I’m sure.
Leo: I think so, yep. Also Jason Snell. I know what you’re working on. You’re working on Sixcolors.com and The Incomparable and what else?
Jason: So many things. Those are the big things. Loads of podcasts and Theincomparble.com and I’ve got a few like RelayFM and yea, all the writing mostly goes on, mostly on Six Colors, occasionally I write weekly for MacWorld still, my old stomping grounds, but most are on sixcolors.com.
Leo: Speaking of journalism, I really feel like these blogs that have voice and persona and really good content, and that’s kind of sometimes missing from blogs that are all about voice. But yours has both. And I really think that that’s—gosh, I hope you can survive and make it in this world because it’s really exactly how it should be.
Jason: I’m not getting the half a cent per play for my stories but I’ve got some sponsors and I’ve got a membership program and it’s all good.
Leo: Yea. I really, I’m always thrilled to hear about people like you and Ben Thompson who are really able to make it in the tough world of blogs. Devindra Hardawar also great to have you, senior editor at Engadget. What are you working this week?
Devindra: You can expect a lot of VR content. A lot of us talking about VR this week. I’m also going to be writing an editorial about 4DX that stupid theatre technology because I hated it so much. I want it to die, so.
Leo: (laughing) 4DX must die.
Devindra: It’s so bad.
Leo: Yea, we always do the—so this has wind, rain, fog, lights and it punches you.
Devindra: Punches you in the back. And the seats move. You’re moving all over the place.
Leo: It sounds horrible. Can you turn the effects up and down or off?
Devindra: You can turn off the water. There’s like a little dial pad.
Leo: Yea, I don’t want water in my face.
Devindra: Yea, the water thing I could just never get used to.
Leo: How often does that happen in a movie?
Devindra: Like for Batman Versus Superman it was like whenever it rained I would just get a little sprinkle. And that’s a rainy, dark movie, so.
Leo: (Laughing) I would hate that.
Devindra: It’s just awful.
Leo: I do not need that.
Devindra: It’s in the New York theatre too so you don’t know if somebody’s just like making a spit tape for something. Like you don’t know if this is safe water coming at you. When you’re in public space, you don’t want that coming at you.
Leo: Slash film casts. I’m sure we’ll be hearing a little bit about it on Devindra’s podcast as well. Thank you all for being here. Thanks to those of you in our studio audience. We love having a live studio audience. You can always be here. Tickest@twit.tv just email us and we’ll make sure we’ll set a seat out for you. If you want to watch or listen live and be in the chatroom, we do the show 3:00 PM Pacific Time every Sunday afternoon, that’s 6:00 PM Eastern Time, 2200 UTC. Stop by, join us, be in the chatroom at irc.twit.tv. But of course, as always, on demand audio and video is available for all of our shows. We put them up on our website in this case twit.tv/ I don’t know, This Week in Tech? That one’s a little weird because it’s the original show. We can’t figure out exactly what the URL should be for it. But you can also podcast it, you know, get it on Overcast or Stitch or there are great TWiT apps on every platform including 5 now, count them, 5 Apple TV apps, Roku, iOS, Android, Windows Phone. We’re everywhere. And I hope you will subscribe because we want to be with you each and every week. I hope you have a, if you celebrate Easter, have a great Easter, or Purim, if you celebrate Purim or whatever it is you’re celebrating on this weekend. Have a great weekend! We’ll see you next time. Another TWiT is in the can.