This Week in Tech 594
Leo Laporte: Well happy holidays, everybody! It's time for TWiT's special holiday episode. We had so much fun last year for a New Year's Eve show bringing some of our hosts from different shows together as they never do appear during the year, and we thought we'd do it again. So joining me, Denise Howell from This Week in Law, Steve Gibson from Security Now, Renee Ritchie from MacBreak weekly, and what we're going to do is look back at the year 2016. The highs, the lows, the big tech stories, it's a very special TWiT: coming up next.
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Leo: This is TWiT, This Week in Tech, episode 594, recorded Thursday, December 1st, 2016 for air on Christmas 2016.
What a Year!
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It's time for TWiT, A special holiday episode. This is the TWiT for Christmas day, December 2016. We are not recording this... I did not make anybody work on the Holiday, we recorded this earlier in the month. I've got Santa coming out of my head. To my right, Steve Gibson is joining us. What we used to do is have people come in and get drunk. I thought we'd do what we did how many years?
Steve Gibson: 2015.
Leo: For New Year's Eve, you, Rene,
Steve: Jeff Jarvis.
Leo: I was not. I was taking a break.
Steve: Everything is being aired live. We had a spontaneous discussion.
Leo: You know who was missing from that is this person right here. Denise Howell from This Week in Law. Good to see you. This is the beginning of a new tradition. We want to bring everybody up. We'll rotate shows obviously. We'll bring hosts from other shows in. You don't get to talk to each other. You guys had breakfast together.
Steve: Some guy with a mask walked up and had been listening to our entire conversation, and he had several critiques...
Leo: That's scary. That's weird. He corrected you?
Rene Ritchie: He said he was happy to talk about technology.
Leo: What we're going to do, our production team has put together a list of some of the big stories of 2016, and I hope you will all... you each have your own beat. Security, law, and The Mac, come up with stories you thought were important this year. What do we think was the big story? I think I know what the big story of 2016 was. It was the election. And while that's a political story, it was also very much a technology story. Facebook and Twitter were used to great effect by the candidates. By one candidate.
Rene: Steven and I talked about that this morning. It was an amazing social engineering attack.
Leo: Trump's use of Twitter was effective. Also, the big story that we talked a lot about was fake news on Facebook. I'm one of the people not too worried about that. What is fake news after all? Who decides that? But more to the point, I think the dark advertising I've been learning about, Trump's team led by Jared Kusnner was able to use Cambridge Analytica from the UK to profile 222 million Facebook users in the US, in particular using Facebook quizzes to more than just... gauge sentiment. Then could target ads. Not just ads for people who would be voting for President elect Trump, but people who would be voting for Hillary Clinton or the others. They were using it to suppress voting. It won't matter, don't vote. Text in your vote. It was really interesting, and I think back to I'm old enough to remember, you might be too, Steve. When Richard Nixon won the Presidency in 1968, people said it was the first time ads had been brought in to run a campaign, and fast forward to 2016. This is more than ads now. This is the very effective use of social media. So I'm going to nominate that for my biggest story. What do you think is the biggest story, Steven??
Steve: Well, I agree. In general in our world, this crazy election dominated our time and thinking. To a somewhat lesser degree, this question of can a private email server be secure is something we talked about. For good or bad, it did factor heavily into forming a lot of people's opinions about security and trustworthiness and so forth. So that was leverage to great effect. I said a number of times on our podcast, without knowing anything about the technology because as they say, the devil is in the details, so to make any kind of actual judgment about the security of a piece of technology, you have to know everything about it. None of the rest of the world outside of some inner circle had any details, but what we did hear was that at one point, while the server was in use, it was physically insecure. It was in a small ISP office building where you could not guarantee physical security. That was my point. If you don't at least have physical security, you can't have data security.
Leo: This is also the third year of the Snowden era.
Steve: Good point. Everything has changed. We're seeing the ongoing effects of the revelations that he woke us up to. As I said on the podcast, independent of how you feel about him, was he a traitor? Was he a patriot? The question I propose is can you imagine an alternate timeline where he didn't do this? Where we didn't know today what we now know. I think knowledge is better than ignorance independent of that. What we've seen is we've gone from a world where you would create a secure connection of a server only briefly to send your credit card information or login credentials over, then it would drop you back to HTTP for your regular interaction with the server. The problem is as the hack showed, it is trivial to hijack somebody's logon session and to watch their traffic. That's what we knew the NSA was doing, because at the beginning of this, most of the traffic were encrypted and not easily seen.
Leo: Denise, what do you think the legal story of 2016 was?
Denise Howell: Probably the dispute over whether the FBI could compel Apple...
Leo: San Bernadino.
Denise: I think that speaks to a larger story of 2016 being the year that not just geeky people, ordinary people started to realize that their data on all of these devices is not unique to themselves. It's readily available to the Government, and we can wrangle over what circumstance that happens in, or advertisers or other corporate interests who are leveraging that data not necessarily to everybody's benefit.
Leo: We spent weeks talking about Apple.
Rene: Could you imagine a future where your phone enjoys privilege the way your spouse does?
Leo: It can't testify against you.
Rene: It knows more personal information about you than a spouse does.
Leo: Isn't that what court debate over a fingerprint versus password is? You can't feel compelled to give your password because that would be self-incriminating.
Denise: Exactly.
Leo: Your finger print like your hair or DNA or an actual finger print is not.
Denise: It's not any sort of knowledge in your head.
Leo: Is that strong?
Denise: It's split. The courts have wrestled with this over the years. We've had courts in different parts of the country say that passwords can be compelled, I don't think. By and large the take away for our viewers, the password is going to be the way to go.
Rene: They had one where they said they couldn't make you tell them your password, but they could give you your phone and you had to enter it and give them back your phone.
Leo: In October there was the big story where this actually Forbes found a filing at the department of justice that sought a warrant that would compel everybody in a building to hand over their fingerprint.
Denise: This was down in Southern California, actually, and we don't know much about it at all, because it was all under seal. So, kudos to Thomas Fox Brewster at Forbes, who he and his minions unearthed the fact that this had happened.
Leo: Kind of an amazing story. But it's not passwords. It's still fingerprints. But to get a warrant, it's a phishing expedition. To walk in and say everyone on this premises must give me their fingerprint.
Denise: It's going to vary from judge to judge. Judges are the people who decide whether search warrants should issue. Unfortunately, there's no uniformity between them. Some of them are going to grant warrants that seem over broad, and some of them are going to be more circumspect about it. It comes down to who the judges are in our country.
Steve: In the case of compelling a password, if the individual refuses, and we've seen instances where for example hard drives have been encrypted, and the individual makes the decision that they'll be in worse shape if they see inside this hard drive than if I refuse, then they're in contempt of court, and they're put in jail until they produce the evidence, which the Judge is compelling them to produce.
Leo: It's no question in my mind that the hackers gained ground in 2016. I wonder if it's safe to say the Government gained ground in 2016. For instance, we're recording this early in December. Congress neglected to stop a rule that would allow law enforcement to hack computers in any jurisdiction in the pursuit of a crime. This was much battled, but it went through. What happened is they weren't able to say stop.
Rene: While they're paralyzed, everyone else is still moving.
Denise: This is frightening that it happened this way as an administrative amendment to the rules of criminal procedure rather than any kind of law.
Leo: I might argue on the other side of it, which is that technology has outpaced this notion that you get a warrant in the district of the crime, particularly with hacking. There is no jurisdiction.
Steve: We've broken those borders.
Leo: I think you could make the argument that this rule 41 had to be changed for the 21st century.
Denise: The other component of it, where judges can issue warrants now that allow basically the government to hack computers, unidentified people. I don't know how you show probable cause if you're entering machines where you're not disclosing who the individual is.
Leo: That may be one of the most shameful stories of 2016 that the FBI was running more than half of the child porn sites at one point in the United States as honey pots for pederast. That baffles me that the FBI was doing that and was allowed to do that. According to one researcher, the FBI was likely running about half of all the child porn sites on the Internet.
Rene: they had a major bust last week. They took down a huge rink.
Leo: That was the playpen bust I think. Government has gained ground, they gained ground in the UK this year. The snooper's charter. Teresa Mayhood proposed that before she was prime minister three years ago. Had been fighting to get that through. She was able to get the votes and that passed in the UK. According to Edward Snowden, the most broad powers to a non-autocratic Government ever. Extreme surveillance. Cory Doctorow called it. Remember the fifth of November. I imagine the same thing will happen in other Western nations including here. We did talk a little bit though on how it effects encryption. It seems it might mandate back doors in encryption, but I'm not sure. I don't see that explicitly in the snooper's charter.
Steve: It's not clear how it's going to get implemented. One of the reasons this recent presidential election was important was we know the next President was going to be nominating for appointment at least several supreme court justices over the course of the probable tenure. As we're seeing now, the Supreme Court has become more involved in figuring out where these lines are.
Leo: I understand, times change. Technology was not envisioned by the founding fathers.
Steve: We're trying to interpret this constitutional document, which knows about grain, and doesn't speak of the problems we have today directly.
Rene: They're making laws, they're not doing it illegally.
Leo: That's one of the justifications for this, isn't it? It's now explicitly.
Steve: At least a law can be challenged and overturned, but when you're doing it illegally... that was why our Patriot act was so controversial. One of the things we learned was that things were being done under that legislation that the people who established it didn't ever intend. It was pushed quietly and secretly, and then all of the letters, which companies are receiving, the National security letters under the cloak of we're asking for this and you can't tell anybody. Now we have warrant canaries.
Leo: Nobody wanted your data. I agree with you, Denise, one of the biggest stories was Apple versus the FBI. Now that the smoke has cleared, the FBI dropped the case and said they found a way to get in, which was disturbing. Now that the smoke has cleared, what is the upshot of that case? It appeared the FBI was waiting for the perfect conditions to pursue this. Apple took an unprecedented strong stand against it, but in the long run, if the courts rule against Apple, they're going to have to do what the courts say. Now as we look back, was that a tempest in a teapot? Or is this the beginning of a first skirmish in a long war?
Denise: I think it's a skirmish. Apple drew a line in the sand, and there has been a political shift in the country towards helping law enforcement.
Leo: It was controversial then, and it's less controversial now.
Denise: Companies are going to be dependent on customers to make it clear what services they demand and expect. If the Government says sorry, encryption is a deal breaker for us, things are going to come to a head.
Steve: WE have a notion of things being normalized. The idea that this was a big issue this year, it won't be such a big issue in the future. The social side will adapt to this.
Leo: If there's a consensus though, among the American people that we want to air on the side of security...?
Rene: Let's say this goes through and they put backdoors in and they discover them. Suddenly millions of people have their bank accounts compromised.
Leo: That was Tim Cook's...
Steve: Is this the American people?
Leo: I think it's the American people. I think most people, in fact we've seen this worldwide, the move towards authoritarianism. That when you get really scared, you let the strong man in and say "protect us."
Rene: The people who didn't mind military government any more were mind boggling.
Leo: I just say some graphs worldwide by age demographic of people who thought Democracy was important, and it's us old folks you and me, Steve, that are clinging to Democracy. Millennials thought Democracy was not important.
Steve: And we've also seen studies where you say to someone, here's an ice cream cone, I'll trade you for your password. They go OK.
Leo: Different sense of what your password is. This is a grim topic. You know what I think the big story of 2016 was? Pokémon Go. I didn't ask you what yours was, I apologize.
Rene: Not at all. It's not exactly Apple news, but that's part of the appeal is it was both Apple and Android and it hit all at once. I remember seeing their presentation where they showed this is what we expected in terms of traffic, this is the maximum we expected, this is what happened. So you had a perfect confluence of a platform that was beyond any specific hardware vendor, you had location services, you had gamification, and you had this massive appeal where you could play together and people were going out to parks and families were discovering...
Leo: It was amazing! You couldn't move without people playing Pokémon Go on the street.
Steve: I remember the first day it happened in the restaurant where I was eating, one of the servers came outside and she said I hate this Pokémon thing! All of her tables, they weren't talking. She didn't know what was going on.
Rene: That first weekend I went to the park and I ran into this elderly gentleman, and he said my daughter is catching Pokémon with me. She doesn't want to spend a minute with me normally.
Leo: I thought this was going to be a flash in the pan; it was a flash in the pan. It was the fastest selling game in history, in five days outsold every other game. Google Play at the end of the year did name it the top game of 2016, but it's also... I don't see anybody playing it any more. I see you play.
Rene: They had a huge problem because they couldn't scale. Scaling turned out to be non-trivial for them, and that put the brakes on new features. They had to work so hard. They just added China, which was a huge market for them, and only last week did we see the Ditto creature, and then Generation two...
Leo: Is that why everybody... I saw this purple blob.
Rene: Yes. Their problem is they're at 10%, maybe they would have subsisted at 20%. Can they grow again? Can they do generation 2 and get some sort of ongoing audience?
Steve: There was probably in initial fad value. We know what the shape of that curve is. Even if they had been able to scale, the curve would have still come down to where it is now. There were people who were going to screw around with it a couple weeks and then go OK. Back to my life.
Rene: It's augmented reality, it's geo location. They've done everything they can to make sure you can't play from a car. They're making an Apple watch app, it's going to be a workout app on Apple watch. It's not going to be a game.
Steve: It will become part of the culture.
Rene: They're going to do a Harry Potter Beasts version, so you go out and catch magical beasts.
Leo: Some said this is the first camel's nose under the tent of Augmented reality. Wait a minute. We have to pause for a minute here, because the hot buttered rums are here. Happy Holidays. We are enjoying our special Christmas edition of This Week in Tech. Since you take Pokémon Go, I have another biggest story of 2016. We'll talk about that as you get whipped cream on your nose. First a word from Rocket Mortgage our sponsor for the show. It's nice that Rocket Mortgage doesn't take time off for the Holidays, because they're always there. If you're looking around and you say I think I see a house in our future and you want to get a mortgage, or maybe you refi, you're watching this show, you're probably pretty geeky. I can imagine that you don't want to go back in time to 1956 and bring a banker's buck full of papers to the loan office, where the guy has a clip board where he says let me see what loan it will be, and it's the finest print you ever saw. Right here it seems to be based on the... forget that! Go to Rocket Mortgage, and you answer a few questions. You can send them your statements, your pay stubs, all the information they need with a push of a button. Actually the touch of a thumb, ‘cause you can do it with your phone. You can do it with an open house. This couple gets the itch, we should buy this. Before they leave the open house, they got the Rocket Mortgage screen that says you're approved. Approved in minutes not for just any loan, but a loan that is tailored for you. Rocket Mortgage comes to you from Quicken Loans, the premier mortgage lender in the country. Rocket Mortgage, if you want to find out more. Get ready. Put this on a post it note. You never know when you're going to be at that open house and want to buy. Quickenloans.com/twit2. Quickenloans.com/twit2. Rocket Mortgage: an equal housing lender, licensed in all 50 states, and MLS consumer access.org number 30. Rocket Mortgage from Quicken Loans. We thank them so much for their support of our Holiday special. We've got hosts from various shows here. This is a lot of fun. We asked a bunch of hosts; you guys were the first to respond. Lucky you. Smart you. It's perfect because the TWiT holiday party is tonight. By the way, that's the other big story of the year. Anthony Nielson, who is one of our great creative editors also happens to be an amazing mixologist. Thursday? Wednesday night we leave early and apparently a party breaks out. Like all good pushers, Anthony doesn't drink his own concoctions, but he makes everybody else. What is this? Is this hot buttered rum? wow. Thank you, Anthony. The show will be getting more interesting progressively as it goes by. Nice job. Oh my. Ryan Burnett, you dressed up for the show. Nice to see you as well. That was another story for us. Brand new studio, we moved out of the brick house studio. You're seeing it for the first time, all three of you. Rene Ritchie from iMore, Denise Howell from TWiL, Steve Gibson from Security Now. I should introduce you once again. Nice to have you here. This is our first holiday in the new studio. Parking is better. That's a for sure. It was hard to park in the old place. It's a little smaller, but doesn't this look the same? What do you need?
Rene: If Lisa and I are yelling outside, it doesn't bother you here.
Leo: That's a big improvement. The real reason we moved was because the rest of the staff hated that they had to whisper all the time while we were doing shows. They're drinking now. Burke hooked up a police light and a horn. He pushed the button and it was too noisy down the hall. You got burked. OK. I think one of the big stories; there is some relation to the Pokémon Go story. Virtual reality. It was a flash in the pan this year. This is the year the Oculus Rift was sold to the Public, then HTC followed shortly thereafter. Sony towards the end of the year released its Playstation VR. For the first time, people were able to in their homes play VR. Everybody got excited about it.
Rene: I can be Batman, Leo. I started off with the Vive, it was the first one I tried. Then Georgia stole my Oculus. It's great because it's got the different cameras in different areas, and you can actually move through the room and it doesn't feel like a Holodeck. You put it on, and if you have to walk a plank my brain will not let me do it. It feels too real.
Leo: You were talking about that plank game.
Rene: It's called Ritchie's plank, ironically. Georgia put it out there, I was supposed to walk on it, and my entire body system shut down. There is no way I'm walking out on this.
Steve: As an old timer, there's a pattern that I've seen often. There was a first round of home computers that were too soon and too early and they died. There was also something called a Newton once that was too soon. Even laptops, I remember luggables. It kind of works, but do you have an extension cord? So now we just take them for granted. I think what generally happens is visionaries are out in front, and they're often right about what, but they're normally wrong about when. They see it too soon. Oftentimes they get arrows in their backs that are fatal. I'm interested in this. I think that Rene was talking about this. If you put goggles on that shows you a narrow plank over a gorge, you're scared. You can't walk across it. We're creatures that take the environment that our senses deliver to us literally. I think essentially this means that this kind of technology that can create an artificial environment would be incredibly powerful. I think I'm not in a hurry. We've got a lot of time left.
Rene: You start playing Batman Archam VR, and you put it on, and you look down, you are Batman.
Leo: Do you think you'll keep playing it though?
Rene: Georgia plays paintball, her husband plays pool. He hates pool, but he plays VR Pool. It's the weirdest experience, you can be almost anything. It's the holodeck.
Leo: My take on it is opposite of yours. We have them all. I've played with them all. I've played with them to the point where I go I get it. You make an excellent point, it could be too early. Early days. It could also be like 3D. There is precedent for it. There's two trends happening here. There's the one trend where we're trying to make computer reality more immersive, more real. Of course the end game is from Neuromancer, the snow crash. Where we are indistinguishable from reality. Certainly I would love to get there, if we get there...
Steve: Something that appeared in your visual field without looking like a goon from some strange...
Leo: I think we might get there. I think VR, that's what 3D was supposed to be, and it's just more annoying. At least to me.
Rene: For the Vive or the Oculus you need a powerful PC.
Leo: I think at some point we will get to some sort of immersive technology. I personally don't think it will be screens three inches from your eyes.
Denise: When you say 3D, do you mean when in the 50's people went to movies and it was kind of hokey..
Leo: Three years ago. Nobody makes 3D TVs. None of the companies that forced 3D TVs on you two years ago makes them anymore.
Denise: But the movies are good. We're going to go see Rogue One 3D.
Steve: I have two good friends who are exactly opposite. Jenny will not go see a movie not in 3D.
Leo: We went to see Fantastic Beasts and there was a choice of 3D or 2D and I wanted to go to 2D. Lisa preferred 2D. Doctor Strange in 3D was cool. The jury is still out on VR that it could be the 3D, or it could be the matterverse. The other trend right alongside it is this trend towards new user interfaces for computing. I do think there is something there. I think augmented reality; AR. Look at what I'm playing here. This is the Surface Studio from Microsoft, and if you'd asked me a couple years ago if you think you'll ever have a giant screen computer, this would have been science fiction. It really works quite well. It's an amazing thing. New user interfaces are... VR would be one of my votes for a story that may or may not be a flash in the pan. AR related, but voice technology. look at the Amazon Echo and the Google Home. And Siri and Cortana. Huge.
Rene: Samsung a spot.
Leo: The guys who created Siri, after they sold it to Apple created a new company called Viv and Samsung acquired them. It's table stakes, if you're going to be a player in the mobile category, you've got to.
Steve: Maybe one way to frame what you're suggesting, Leo, is we also need to recognize that just because you can do something doesn't mean you should!
Leo: Silicon Valley will do it if they can. Because they don't know any more than we do what the next thing is. They're throwing spaghetti on the wall!
Steve: That ties in the AI.
Leo: These are all huge stories; we're talking about massive trends here. I think this is the year that we're going to look back and say machine learning became an important goal for these companies.
Rene: They never talked about AI, they never talked about machine learning. Never talked about computer vision. Google put it on stage, and after that everyone had to talk about it.
Leo: That was October 4, when Google had its event. Sundar Picai, the CEO of Google, talked about, very cogently, the various stages of computing. Personal computing, and what were they? There was personal computing and then there was mobile computing. I must have left something. Then there was Cloud, but now there's Artificial intelligence. I remember talking with we did it on triangulation, Kevin Kelly, who wrote a new book about the future, and one of the things he said is what happens with these technologies, and you can talk about computing as being an example, big data being another example, is you take something you already had and you add a layer of this new technology. HE uses the example of when electrification became big at the turn of the last century. A farmer would look at, what have I got? I've got a pump to get water. I wonder what an electric motor would do to change that. Whole new Industries were born. He said that happens every time. Industrial era, information era. Now what you're going to see and the opportunity that lies, people are going to look back and say, "You were alive in 2016! You were around when the information age turned into the machine learning age?"
Rene: What's the culpability of that? IF your AI accepts an invitation for that or makes a car decision and there's a bad result, is it your fault or the company's fault?
Leo: That was another big story this year is self-driving cars and what was the decision? This is the year the first Tesla driver was killed in a crash.
Denise: It wasn't a self-driving car technically.
Leo: As it turns out, neither he nor the Tesla saw the truck across the road. He was speeding and he plowed into it and passed away. Nevertheless it brought up this whole fear of self-driving cars.
Steve: They were driving themselves last year! I remember when this sort of happened, it's like when did cars learn to drive?
Leo: this is also the year that Tesla said we're going to put all the hardware in our Teslas starting right now to do self-driving. But we still have to work on the software a bit.
Rene: AI was a big thing with assistance, but you saw Tim Cook talking about how Apple uses AI in their devices for battery life because it can intelligently figure out what you're going to do next and pre-cash things for you. So this technology has been doing this for years and now they're talking about it, and it's not just a thing that helps you make an appointment, but something that preserves your battery life adjusts your phone performance, does all of these things for you behind the scenes.
Leo: Wasn't this the year a court decided who is responsible if your self-driving car causes a crash?
Denise: I think the National Highway safety folks decided that the driver of a self-driving car is the whatever system is driving the car.
Leo: The driver is a software.
Denise: How does that play out?
Rene: There's a grandmother in that car, but there's two kids in this one, so the cars are going to talk?
Denise: That's what they're trying to figure out is they build out the AIs. MIT has this interesting project called the moral machine that we've talked about on TWiL a couple times where you go and help them answer scenarios. They're trying to get human intelligence to help answer those hard questions. How would the average person resolve these conflicts? It's a fascinating exercise to go through. It's a strange exercise. They bring some moral judgments into it where the scenarios tell you the person the car is about to hit, if you don't swerve and hit something else is a criminal. They try to bring moral values into your decision making.
Leo: Should we do one?
Denise: Sure.
Leo: What would the self-driving car do? Here's the choice. This is terrible. You could either plow into four pedestrians and kill them, or you could swerve and plow into a barricade and kill the passengers. Here's another one. If you swerve into...
Denise: They give you some context. I'm not seeing it on your screen right now.
Leo: This self-driving car with sudden break failure will continue ahead and drive into the Pedestrians ahead. One male athlete, one homeless person, one girl, one criminal. Here's what I think about this. The car doesn't know that. The car is going to do what you would do and I would do, which is the best it can. It's not going to make a calculus that says this guy should survive. It will attempt to avoid the accident as best it can, just as you would do, without doing the calculus of that guy is an athlete and that's a grandmother. Let's kill the grandmother. That's a stupid question.
Steve: The ambulance chasing attorneys are just salivating.
Rene: The robot chasing attorneys are just salivating.
Denise: I think we're in a situation where we think it's weird because we're not used to self-driving cars, but as this all gets worked out, I think you're right, Leo. I think people are going to look back and say... those human drivers were far more dangerous. The most interesting wrinkle I've seen on this, a study out of UC Santa Cruz that wonders how Pedestrians are going to react knowing that self-driving cars are programmed to avoid them.
Leo: Bully the self-driving cars.
Denise: Having visited New York for the first time last summer, I can totally see this playing out where you get some pretty gutsy Pedestrians... come and get me.
Leo: This was the year the Google car got in an accident. It plowed into a bus. An autonomous vehicle driving down mountain view in city traffic, which is notoriously difficult for these cars, and it would normally be in the lane to turn right, but it turned out there was construction going on. It got to the end of that lane, there were barriers, it couldn't... it needed to merge back into traffic to go around the barrier. It saw the bus. And it plowed into the bus, because the software assumed that the bus will see me and let me in. It was a slow speed accident. Nobody was hurt, I should point out. What Google said is yay that's good. What we realize is what a human would do is look at a bus driver, see if the bus driver sees the eye contact and understands I'm going to get in. The software didn't do that, the software assumed. It's going to improve because of that. Pedestrians know that drivers don't want to run them over, so why not just step out into the street and assert their right of way? There's always a possibility that drivers are inattentive, drunk, a sociopath, or can't stop in time. On the other hand, if it's an autonomous vehicle, I know it's going to stop. So crosswalk chicken, from now on, pedestrians go I'm walking in the street.
Rene: Give the car a random number generator, and one out of a million times it doesn't stop, and that keeps pedestrians on edge.
Steve: To Denise's point, we often hear the argument that air travel is so much safer than freeway travel. Yes. If automated cars do a better job than people, that's a strong defense.
Leo: This also is the year, last year was the year that fatalities on the highway went up after many years of decline because of distracted driving. The National Highway traffic safety administration, HTSA, suggested that it would be a good idea if Apple and Google, we're not going to make you, it would be a good idea if you had software in your operating system that would prevent the driver from using the phone. So they actually said block the driver, but not the passenger?
Rene: I was reading the article and it was like you have navigation software and you have passengers and you have kids. Same thing with Pokémon. It says I'm a passenger. Supposedly if you get in an accident and you hit I'm a passenger button, then you lied. It's definitely your fault. I used to commute to work, and there were people reading newspapers on their steering wheels, putting on makeup. Turning around and yelling at the kids.
Leo: You can't debate the statistic that highway deaths were declining until this last year. We're up 10% in 2015, and in the first half of 2016, they're up 15%.
Steve: Who hasn't seen a car stopped at a green light? The light turns green, nothing happens.
Rene: I'm trying to find that emoji, Steve. I need a sarcastic face.
Leo: The person in the driver's seat is going like this, they're playing Pokémon Go. I know that for sure. Actually, Pokémon Go won't work past ten miles an hour. But that didn't solve anything because people just slow down.
Rene: It's a whole big debate, because there are people in rural areas who can't play at that point. There's five miles in between Pokémon.
Leo: I didn't play Ingress, because at the time Petaluma was not a hip village. There was very little Ingress going on. If you were in San Francisco you could play Ingress. Then Niantic, and something that made Petaluma interesting. You couldn't move. I remember Lisa and I were in San Diego, and there's one median strip where there were three Pokestops and a gym in one small area. We're driving down this street and it looks like Woodstock.
Rene: They had incidences in Montreal where a rare Pokémon spawned and hundreds of people flooded the area and police were there. I have to catch my Snarlax.
Leo: It's lucky the Ditto came out now.
Rene: Ditto is hard. You have to catch a normal Pokémon and it can transform into a Ditto. so you got to catch everything in case there's a Ditto. When you look at the psychology on how to get people to play, there must be tons of scientists working on this stuff.
Leo: That's Rene Ritchie imore.com, Denise Howell from This Week in Law, and I love your Grinch stole Christmas hat. It's cute. I have an elf that has somehow got submerged in my cerebral cortex. This is weird. I should take this off. Steve Gibson is also here from Security Now.
Denise: We have a halo here for you too.
Leo: We thought you might wear the halo, Denise. But since you've recused yourself.
Denise: There you go.
Leo: I should be a Victoria's Secret fashion show. This was the 40th anniversary this year of Apple computer. 40 years. Talk about old timers. We're not celebrating the 40th anniversary of Commodore. Atari. Radio shack.
Rene: Even IBM is a completely different company than it was 40 years ago.
Leo: Apple decided you don't need a contract. So this was the year at the beginning of the year, it was the first story we covered in 2016 was a consumer petition because of the rumor that Apple would be dumping the headphone jack. 200,000 people from the first TWiT of the year petitioned Apple to not ditch the headphone jack. Here we are, they did. They shipped the iPhone seven headphone jack in September. You've got one, I've got one. They promised air pods. You have some, but they're not the official ones. Wow. Did you drill that in your iPhone? Here we are a year later. It didn't seem to effect the sales of the iPhone seven. 21,000 people changed their mind.
Rene: It turns out it's not an issue for people who never used headphones, or who always used them. People who always use them just put the adaptor on. If you were an occasional user, you wouldn't remember. You'd get on the plane and it's too late. There's no hope for you.
Leo: That's a nightmare. Air pods, somebody wrote to Tim Cook, we don't know if this is a real email. They wrote to Tim Cook saying Tim! I want to be able to charge my iPhone and listen to music, when are you coming out with the Air pods? Tim supposedly said in the next few weeks. Sometime before Christmas? Maybe by the time you're watching this, Rene will be holding an air pod in your little hand.
Steve: They look so alien.
Leo: It will go well with your Santa Hat.
Denise: Are you a runner?
Rene: I do hiking. I did a bunch of things... because the chords don't pull.
Leo; It doesn't look as weird as I thought it would.
Steve: Can you get flesh toned? Anything other than white?
Leo: You can't get any color.
Rene: As long as it's iPod white. The speakers are fantastic, people think I'm on my phone.
Leo: 160 bucks.
Rene: There's dual noise cancelling.
Leo: I had 160 bucks, there's certainly pent up demand. I am no longer second guessing Apple fans. They will buy anything.
Rene: There was this great tweet from Neil Cybart two days ago, he said The Amazon Echo has sold ten or twenty percent of what the Apple watch has sold, but the Amazon Echo was a smash success and the Apple watch is doomed. It's a totally different metric.
Leo: It is, and I'm wearing an Apple Watch, but in terms of impact, the Echo has a larger impact than the Apple Watch. It isn't just units sold that makes something a success.
Ritchie: Its availability in America.
Leo: Says the Canadian.
Steve: Buy six, get one free.
Rene: Now you're supposed to get one with a screen on it.
Leo: Amazon this year said they were going to get someone to double down on the Echo. They now have their 5,000 Echo tasks. That's a lot to remember. You have to search to find one. Just this month, they opened an API that will allow a more complete weather interaction in the native mode. They've added new words. There is a rumor they're going to do a kitchen Echo that has a screen in it. I think that Jeff Bezos has indicated that the Echo...
Steve: It's like the fourth major offering of Amazon.
Leo: Yeah. The fourth horseman.
Denise: As long as they get over recording you all the time, I'll be happy.
Leo: do you think they are?
Denise: I don't know. That's how I understand it works.
Leo: We've got the guy. Let's get Steve to explain. Here's my thinking on this. There are three words the Echo can respond to. I won't say them. But in the Echo, they have wave forms for those three words. The Echo is always on, but all it's really doing is gathering every wave form that goes on and comparing it to that template. It's not sending anything back to Amazon until it matches that template.
Steve: Think of it like a time occupying buffer. Audio is coming in, fills this buffer, and then it falls off the end. The depth of that buffer is the period of time that the local processor looks at what it has heard and can figure out what it wants to do.
Leo: It's not a sophisticated process. That's the limit of what it can do.
Steve: the point is if it hears a trigger word, then it's able to go online, to take it seriously, and then save the buffer plus what follows. That gets shot up to the cloud for AI level interpretation and action.
Rene: I believe you, but I think Edward Snowden would disassemble it if it came into your house.
Denise: How do you know this?
Steve: Because by looking at the traffic of the Dot and the Echo, there is no communication going on until she triggers. Then there's a spurt.
Leo: I have to say, if they were sending back all that traffic, you would see a significant amount of traffic constantly going back to the servers. I am sure, although I haven't fired it up, I was searching and there are some people who have done this, I am sure that some material is being sent to Amazon, some small amount. I would also bet it's encrypted, so we don't know what it is. If you really wanted a conspiracy theory, the one thing that could be provably possible, is that the echo may have other words it's looking for. Let's say product categories, like suitcases or baby strollers. If it does hear those words, it sends a ping back saying they're interested in baby strollers. I find that hard to believe, but it's conceivable.
Denise: If law enforcement wanted to get involved and say let's have Echo in this house listen for these words...
Steve: to your point, it's not open source. We don't know everything it does, and we don't know as Denise says, that Amazon couldn't be compelled to turn an individual, a specific home's Echo into microphones. We don't have any control over that. We just assume it would be so damaging to Amazon that they would resist with every ability that they have and design it so that it doesn't have that ability. That they cannot be compelled to switch it on and stream.
Leo: I found one article from Champlain college that it is doing forensics on the Amazon Echo, using wire shark to analyze traffic. At this point, I don't see any evidence in here. I think if they were, there would be howls of protest. There's plenty of people out there who can use Wire Shark who can watch Amazon's traffic. If that kind of volume of traffic were sent back, we'd have known that by now. I think we can say safely we don't know is if in individual cases a law enforcement agency hasn't said to Amazon that they'll turn onto Denise Howell's Echo.
Rene: By the way, same thing with X Box.
Leo: How many things... your phone! They can do that with your phone. It's got a microphone.
Denise: I haven't delved too deeply into terms of service. Governing these things, but they're going to say that they have the obligation to comply with Government requests. That puts you on notice.
Rene: That's just America. These things are sold in many countries that have different forms of Government.
Leo: I feel like that horse has left the barn, because we all carry Smartphones with built in microphones, cameras, GPS's, speakers. We're talking about Jason Bourne movies. Every one of those movies, at some point, somebody is calling me. Somebody has a smart phone that Jason Bourne takes the battery out and crunches the phone up in little pieces and throws out the car window. Everybody by now knows.
Rene: Some countries on diplomatic missions, they would take them apart their phones and leave them on the plane.
Leo: This was the year Blackberry died. Or not?
Rene: They're investigating self-driving cars.
Leo: They own Q and X. WE had heard that they announced they were not going to make any more hardware, but I heard another rumor that they are. I don't know if Blackberry is... do we care? That's a better question.
Rene: Very few companies made their own operating systems, Canada had two of them. The BBOS, and UNIX. They merged.
Leo: It's the last Canadian operating system. Somebody should make that movie. And, this is the year Gawker died. Not many tears shed there, although the occasion, the situation of its demise was chilling, because it was a lawsuit by wrestler Hulk Hogan, a defamation suit. He won a massive amount. It was over $110-million dollars. Then they found after he won that case in Florida that he was bankrolled by Silicon Valley venture capitalist Peter Thiel.
Rene: Former PayPal, Facebook investor.
Leo: Who didn't like Gawker because they outed him as a gay man so many years ago. I have reasons to hate Gawker too. I just don't have the deep pockets. I would have given Hulk some money if he had asked. But it is chilling, right, to have some billionaire say, "I don't like this media outlet. Let's put this out of business."
Denise: Well yes. And Gawker had some excellent legal arguments to make in its favor and they never really got to be made because they never got the chance to take it up on appeal.
Leo: Well, they lost in Florida. Did they not appeal? Or could they not afford to appeal?
Denise: They settled.
Leo: They settled.
Denise: Yea.
Leo: And then were sold. And essentially that was the end of Gawker.
Steve Gibson: Speaking of sold, nobody wants to buy Twitter.
Leo: (Laughing) This is another big story of the year.
Rene: Can we all chip in at the table right here?
Leo: As the stock price—actually, you know it's interesting because this of course, Twitter was in play. Apparently nobody wanted to sell it. Jack Dorsey the CEO did not want to sell it but the board always wins in battles like that. They prepared it for sale. They talked to a lot of people including Marc Benioff of Salesforce.com and even Google. A number of other, Disney. Everybody said, "Yea, no."
Steve: And Google would have been like a patron saint. Just buy it because you're Google.
Leo: I spent a lot of time, I'm sorry, everybody, I apologize over this past year talking about this. I'm not a big fan of Twitter. It's kind of starting to look like Reddit and 4chan as just kind of a cesspool. And yet it had huge importance during the presidential election, if no other time.
Rene: During disasters.
Leo: During disasters. There's some—Twitter's a really interesting case of being both, simultaneously, amazingly useful and horrendously—
Rene: Best and worst of the internet.
Leo: Yea. The best and worst of the internet.
Denise: Right, I forget which Twitter representative it was who said this, but in response to queries about whether President Elect Trump is going to be able to keep his account because he may from time to time be in violation of their fake news policy. They have not come out with any sort of definitive statement but they have made it clear that all users must comply with that policy (laughing).
Leo: They said if it violates our terms of service we'll suspend his account. Facebook said they would not because it has importance over and above its policies, that this is—and I do hope they don't quell the real Donald Trump because that is a fun, that is a fun feed. You just never know what he's going to say.
Rene: And actually it's real. It's not a parody account.
Leo: It's him.
Rene: It's real, yes.
Leo: In fact there was data research done early this year during the campaign and there were two kinds of tweets on Trump's Twitter feed. One set was very normal, campaign promotional tweets. Those all came from and Apple phone.
Rene: Yea, the sent from iPhone ones are the campaign staff.
Leo: And then the late night tweets—
Steve: Android.
Leo: All came from Android.
Rene: An American made Android phone.
Leo: And we had learned that President Elect Trump had after the San Bernardino case decided to hand in his iPhone and get a Samsung Galaxy phone, not a Note.
Steve: Galaxy 7?
Leo: A Galaxy S7. And continues apparently to use that. And I haven't had any iPhone tweets of late. It's all been Android tweets. He also on January 20th will gain the @POTUS account. I don't—Twitter can't shut down the @POTUS account for hate speech because that would just be—(laughing).
Rene: They actually shut down @Jack last week.
Leo: They shut down Jack's account. And then also we found out will have access to the Emergency Alert system which is unblockable.
Rene: At 3:00 AM.
Leo: Do you have that in Canada where you can—
Rene: We don't. I mean there is one. People in America, if you go to iOS or Android in the alerts there's an option for Merchants Alerts. We have a—
Leo: There's Amber Alerts, there's emergency alerts.
Rene: We have those. They're just not on our mobile devices.
Leo: And there's a 3rd category that—
Rene: Presidential.
Leo: Presidential that doesn't show up on the iPhone because you can't disable it. It does show up on Google but it's still grayed out. You can't disable it. Those alerts will go through. Now we, I've had people email me after we talked about this. You know, in tornado country these are very helpful, these alerts. They sound a very high pitched tone 6 or 7 times. We've had them here. We had a flood alert during heavy rains earlier this year. And we get Amber Alerts from time to time, child abduction alerts and they're—its' a piercing tone but you can disable those. You will not be able to disable presidential—
Rene: So at 3 in the morning you're hear beep, beep, beep, wrong.
Leo: (Laughing).
Rene: And that's it? You're going to go back to sleep?
Leo: All bets are off.
Steve: It's uncharted territory.
Leo: We are in uncharted territory and I find it fascinating. All right. What else, what else happened? Minecraft topped 100-million sales this year. What a great acquisition by Microsoft of all people. They bought the Minecraft from Mojang making Notch, the creator of Minecraft a billionaire and a recluse. Poor Notch. There's another guy tweeting things like, "I'm so lonely." (Laughing). "You can have all the money in the world but no friends." He later said, "Oh, I was just depressed. I feel better now." He did buy a mansion, stole it out from under Kanye, I think it was Kanye and Kim, an $81-million dollar Hollywood mansion. You probably live nearby.
Denise: Too far south, near Steve.
Leo: With its very own candy room. So—
Steve: That's what you need.
Rene: I wouldn't—if I had $20-billion dollars in my 20s I would not have survived. I would have like tried to pilot my own 747 and would have hit a mountain or something.
Leo: Can you imagine?
Rene: It wouldn't have gone well for me.
Leo: The candy room valued by itself at $200,000. Well, it's a $70-million dollar mansion. I mean look at this mansion. It's gorgeous. It also, to be fair, it also has a wine cellar. But here's the candy room.
Denise: Oh my.
Rene: Is that Tony Stark's house?
Denise: Yea.
Leo: It has those bins that you see in the candy stores filled with all different kinds of candy.
Denise: I visited Google before. It kind of looks like that.
Leo: It's like Google.
Steve: And the M&M guys.
Leo: And knowing, Notch, he didn't—
Rene: Those are actual chocolate M&Ms!
Leo: You can eat those M&Ms. Well, no they're on wheels. What are they on wheels for?
Rene: They're Segway's I bet.
Leo: They can skate around. So this—I'm sorry, I over estimated. It was only a $70-million-dollar—
Rene: Ah. It's a steal at half the price.
Leo: It's a steal. The realtor, I guess I remembered this, said the house is worth $85-million-dollars all day long. That's the realtor talking.
Steve: He stole it for 70.
Denise: And didn't have to pay any Herobrine in the basement.
Leo: No. Herobrine was removed before he was allowed. You obviously have a young son who plays Minecraft as do I.
Denise: Yes.
Leo: We know all about Herobrine. Ok, what else? Let's see. Oh, Theranos. There's an interesting story. We began the year, Theranos was worth $4.5-billion-dollars. Was well on its way to becoming a massive success under Elizabeth Holmes.
Steve: Changing the whole economic model of blood testing.
Leo: Without having to draw a vial of blood, just a single drop they could do all the tests you need except it turns out you couldn't.
Rene: Not so much.
Leo: Not so much. She had some of the biggest names on her board but unfortunately none of them had any idea how biotech worked, including Henry Kissinger and George Schultz, generals and so forth. She, Elizabeth Holmes apparently is now under investigation and it's I think, the sense I get is the whole thing is a fraud. It all broke out with a tipster to The Wall Street Journal and a series of Wall Street Journal articles this year.
Steve: The point being that they also, they Theranos also knew.
Leo: They knew and for faking the test results.
Steve: Yes.
Rene: Oh, but we'll get there. By the time they find out we will have already fixed this.
Leo: Yea, I'm not sure it was intentional fraud. It could very well have been self-deception, right? Oh no, this—
Steve: Wishful thinking we call that.
Leo: Wishful thinking.
Rene: Weren't they buying their own product at the stores to increase demand for the product and then they were trying—
Leo: It was that mayonnaise—
Rene: Yea, the vegan mayonnaise.
Leo: Yea, the vegan mayonnaise.
Rene: No, but we'll get the sales. We just need a little bit of time. That's all we need.
Steve: It's called bootstrapping.
Leo: It was called Just Mayo, right? Just Mayo. No just as in just only, just as in justice mayo. Another fine mess you've got us into.
Denise: Creamy Corn Cob in IRC keeps bringing up the big DDoS attack.
Leo: We haven't mentioned that.
Denise: And my question for Steve is, how are we still having DDoS attacks? How are people's computers getting—
Steve: Lightbulbs.
Denise: Lightbulbs.
Leo: IoT.
Steve: Yes. Our favorite slogan of this year is the S in IoT stands for security.
Denise: (Laughing).
Leo: (Laughing). So DynDNS which is, I didn't realize this. I've used DynDNS as dynamic DNS redirectors. So if you don't have a static IP address, you want to have a server, you'll register with DynDNS and anytime you're—
Steve: They're a major DNS provider.
Leo: Turns out they also provide DNS for some of the biggest companies on the internet including Spotify and Twitter.
Steve: It's not a sexy service as we know. So it makes sense that major—and DynDNS also has a huge infrastructure. So it makes sense that that is something that major cloud providers would outsource because it's just sort of like, "Oh, someone else can do our DNS." There's no value to be added to it. And so, they got attacked and created a massive outage that surprised people in its size.
Leo: Attacked by it turns out DVRs.
Steve: The Mirai Botnet was millions of Internet of Things devices, DVRs and—
Rene: Cameras right?
Steve: And webcams.
Leo: All made by a Chinese company called XiongMai.
Steve: Right.
Leo: Which had sold them to other companies for relabeling. XiongMai of course would make these devices and go, "Thanks. Enjoy yourself." And never update it, never fix it. In fact these had hardwired passwords which was what it made it easy to hack them.
Steve: Yep.
Leo: Although interesting, a couple of—the upshot after all of this, DynDNS just sold to Oracle for many millions of dollars so there must be money. And XiongMai recalled all of its devices for updates. And I'm sure that every one of you watching who has a XiongMai device will send yours—
Denise: I wouldn't even know (laughing).
Leo: You wouldn't know.
Steve: Exactly. Because it doesn't say that on the front.
Denise: Right.
Steve: It says Cox.
Leo: Yea.
Rene: Remember through the whole beginning of the year, where is HomeKit? Why is Apple delaying it? Why are they being so mean to 3rd party accessory makers? Why are they insisting on secure Wi-Fi and encrypted communications? It was a whole string of articles and turns out security is important, even on your—
Steve: And well, this is something we spent a lot of time on Security Now this year is—I mean this adds a whole new wrinkle. The idea, the problem is the manufacturers of the devices have demonstrated it doesn't matter to the consumer. The consumers have demonstrated they're oblivious. They want to be able to look at their driveway when they're 100 miles away from home. So they plug these little miracles in and oh look, I can do this now. And we also know that convenience and security are at odds. And so the manufacturers want to make them easy to use, sacrificing security which unfortunately its only market pressure. I mean for example, you were talking about Apple and Apple's demonstrated commitment to security. That's—and that was one of the FBI's major points in attacking Apple, saying Apple has created this strong encryption as a marketing benefit. They're selling security. Well, so, what we've seen is Apple has worked hard to minimize the impact to the consumer of offering the security. It's much easier not to worry about it. And the problem is, when people screw electronic lightbulbs and webcams in, they just—you know, people who listen to TWiT Network understand that there's more to it than that. But the consumer just buys them from Walmart and hooks them up and oh look.
Denise: And what they don't realize is all it takes is one call by many devices to one server to constitute a DDoS attack. This whole discussion is reminding me of my favorite moment of television from 2016 which came from—I think it aired in 2016. I certainly watched it in 2016, which came from Mr. Robot. It was the first episode of season 2 when the hackers decide to take over Evil Corp's general counsel's home.
Leo: Yes.
Denise: Yes (laughing).
Steve: The arms are going crazy.
Denise: Because they wanted it. They wanted it as home base.
Steve: So they drive her out.
Denise: Yes. Yes.
Leo: Nice. I haven't seen it yet.
Denise: Oh, it's awesome.
Leo: I'll save it. I like to binge watch my shows. I wait until they're all out.
Steve: The sink backs up and the lights don't work and the stereo's blasting and blaring.
Denise: Very loud, yes. Alarms are on.
Steve: And she's on the phone, "Can you fix this?" And they go, "Uh, no." "Ok, I'll go to a hotel."
Leo: Actually TV is one of the stories this year. This was a very good year, not for the broadcast networks so much, but for Netflix and Amazon and HBO and television in general. We saw really kind of a power shift.
Steve: Quality content, too.
Leo: There's some people that called it the platinum age of television.
Rene: There are obviously issues we could talk about when it comes to net neutrality and you know, what do you call it, zero, zero—
Leo: Zero rating.
Rene: Zero rating. But we saw, in Canada, Bell Fiber now is IP based. You get an Apple TV. In the US they're DirecTV Now is IP Based. You get an Apple TV or another product to use it. Netflix started allowing downloads this week for the first time and it really is what you said. They were saying for years that we can't negotiate Microsoft and Apple and Google. They were fighting Google TV. They were fighting Xbox. They were fighting Apple. They said, "Well just wait. Time is on our side." And finally at the end of 2016—
Leo: It's happening.
Rene: The dominoes are falling.
Leo: AT&T announced in December its DirecTV Now which is an over the top streaming service that is zero-rating, doesn't count against your AT&T bandwidth limits. Ok, so here's what's going to happen. The FCC has decided to stop all work until January 20th when President Trump comes in and appoints new US FCC commissioners. So immediately net neutrality is under assault. This whole—AT&T is effectively saying and is very clear, "We're not worried about zero rating anymore," which is considered by many to be against net neutrality.
Rene: It's controversial.
Leo: Very controversial. T-Mobile's been doing it like crazy. AT&T is blatantly, they're not even burying it, saying yea.
Rene: Zero rating appeals to people because it sounds like they're not going to pay anything.
Leo: Customers love it.
Rene: But the opposite side of that is promoted content. So like they zero rate their network and then they say, "Netflix, you've got to pay us." And at the end, we're paying them.
Leo: You don't want AT&T and T-Mobile to pick the winners in television. You want, if somebody wants to do a TWiT coming up and wants to compete and they can't because it counts against your bandwidth cap and all the current incumbents don't have to worry about that, you don't want that. But it is very hard to explain that to consumers.
Rene: Because they just think it's free and they don't realize that now Netflix costs twice as much and HBO costs twice as much because that's not zero rated.
Leo: Another blow, a new FCC will probably cause to this category is it looked like we were getting very close to the FCC mandating opening up the set top boxes, that cable companies would be required to let Apple and Google and other companies make set top boxes that in other words, break that monopoly which is—and the FCC was moving in that direction. But now that's stopped completely and probably will be reversed.
Rene: Was it Pasadena that wanted to start taxing?
Denise: Yes, it was Pasadena.
Leo: Now that's going to be something we're going to watch. It's not just Pasadena. A number of municipalities in the state of California. What's the story there? How can they tax Netflix?
Denise: My mother just told me about this the other day. I haven't looked at it too closely yet but I Have it in the rundown for TWiL tomorrow.
Leo: I do a radio show in these areas, right? You live in these areas.
Steve: Yea.
Leo: The city councils are looking for money and they have decided that they already have the right to tax Netflix because it's a utility. So they're proposing a not insignificant tax on your Netflix bill. It will go from $10-dollars to $12-dollars. And $2-dollars will go in the—it's not just Pasadena.
Denise: Is the logic that it's a cable company?
Rene: They're losing money because people are switching away from cable and they were taxing that. And they want that money.
Leo: That's what they're saying but it's 40 cities in California are thinking about this. It's not just Pasadena.
Rene: Isn't it illegal to tax the internet?
Leo: Well, that's what they're saying is that this isn't an internet tax. It is illegal in the United States.
Steve: It's a utility tax.
Leo: It is a utility tax. And we don't even have to get permission to apply this. So there's a company called MuniServices that consults local government on taxes. There's a business. Hey, did you know you could charge people for Netflix.
Rene: Sorry, my horns are on crooked. Let me fix those.
Leo: Glendale, Stockton, Santa Barbara, Pasadena, Sacramento all considering this tax on Netflix.
Steve: You know when we were earlier this year, there was the fights. Or maybe it was late last year. But we've covered the peering agreement fights where there were problems with Netflix because so much bandwidth was going in one direction.
Leo: Remember that? Yea.
Steve: And what we learned was that ¾ of the internet traffic at night is Netflix. That's insane.
Leo: (Laughing).
Rene: Not YouTube, not HBO.
Steve: ¾'s of the entire traffic on the globe is like one service.
Rene: House of Cards.
Steve: It's like people, this is how people are consuming their video entertainment now.
Leo: Well and it's not just Netflix. Pasadena wants to charge a 9.4% tax on Netflix but they also want to charge it on other streaming services. So your cable bill, how many streaming services do you get? Your cable bill could go up a significant amount.
Denise: You're right. You're ISP whatever that might be.
Leo: I guess your bill to Netflix.
Denise: Yea.
Leo: But if you have Netflix and Showtime anywhere and HBO Now and pretty soon you're talking $10, $15, $20 bucks going to the city. I suspect that's not going to be a—
Denise: I need to look more at the underpinnings of it, how they're—you know, what sort of legal they're putting on there and see if that's proper.
Leo: It doesn't seem so and there is in fact a law against internet taxation in the United States.
Denise: Right. Before we leave the issue of AT&T and zero rating and all that, it occurred to me just to mention that part of the solution to the problem is for more cellular carriers to do what AT&T is going and offer unlimited—
Leo: Well T-Mobile already does.
Rene: Binge on.
Denise: Right. So once you have unlimited data that's capped at a high level, it's—
Rene: They want to meter, they want to zero rate their services and meter you on everyone else's.
Leo: Well first of all, AT&T does not offer unlimited service but T-Mobile does. T-Mobile which does says they'll throttle you I think at 28GB. So it probably is something that people are going to pay attention to. If I start watching Netflix full time and it's going to cost me on my bandwidth bill, I better watch AT&T & DirecTV Now.
Rene: Leo, you can watch our stuff for free. And that's their message, they're asking why. You guys want this. Why would you punish them?
Denise: It starts to become an anti-trust issue because the way you get your unlimited data with AT&T is your DirectTV. Yes.
Leo: However, T-Mobile doesn't have a Spotify or Apple Music or any of these, but they're still doing the same thing with those guys. And it has the same impact on new services. They don't have the advantages that these incumbent services have and that's the real problem.
Rene: Well we've done this for a long time. Rogers and Bell own the networks in Canada so we've never had this sort of disparity. We're becoming the same thing in the US.
Leo: Well, you know, I was starting to worry at the beginning of the show that this was a terrible year.
Steve: Nothing to talk about.
Leo: We did lose, we lost quite a few—
Rene: I figured it out, Leo. We didn't lose them. They fled. They saw what was happening and—
Leo: The saw what was coming.
Denise: We lost Shepherd Book.
Leo: Shepherd Book and I'm said to say, Ron Glass, that's right, from Barney Miller and of course Firefly. We lost so many people this year.
Rene: Leonard Cohen.
Leo Leonard Cohen. But, so that was sad. The security story is kind of sad. We don't know what's going to happen with the FCC and net neutrality. But then there's always Pokémon Go. Plenty of shiny stuff, the new iPhone. The new Google phone.
Rene: The new Surface Studio.
Leo: And the new Surface Studio. And actually I think we can wrap things up by just asking you guys what you think next year is going to bring. What do you think the stories we'll be covering on Security Now?
Steve: Boy, I think we're going to see an increase of IoT issues. My theory is that we're going to see a separation in the market. I think Apple and Google are going to expand their focus and they'll be the higher priced security focused solution. And then people who don't want to pay for security will still be able to buy, you know, XiongMai.
Leo: Cheap Android phones.
Steve: Yea, exactly.
Leo: And we're seeing that, aren't we, with the cheap Android phones are a huge security risk and not being patched.
Steve: Right. And so for example if you want Android and you can afford a Pixel, that's going to be a phone that Google will fix immediately. In fact we just covered a couple weeks ago that there was one of the hacking contests. It took 90 seconds to take over a brand new Pixel. It only took 24 hours for that to get patched. And so what we're learning is, is security is porous and so it's impossible arguably with the complexity that we have today, with the complexity that users want, to actually create bullet proof security given that what then matters is that the companies understand that and arrange as Google just demonstrated that when a problem is found, and they will exist, that they get fixed quickly. That's the best we can ask for. So I think we're on a continuum. And it's going to be a great ride in 2017.
Leo: What do you think, Denise Howell, on This Week in Law? What are your stories for 2017 going to look like?
Denise: I hope that we're going to see the fake news problem solved by a number of means. Watching this all unfold has reminded me that back in the early 2000s the bloggers had sort of dubbed themselves the truth police.
Leo: And you were an early blogger.
Denise: Yea. They were going to fact check you're a double—
Leo: They were the future of journalism.
Denise: Well, I don't know if they were the future of journalism, but what you sort of saw was a dissatisfaction with the completeness and context that mainstream news sources were providing people which I think has led to things like the TWiT Network. People giving—
Leo: We're all context all the time (laughing).
Denise: Right, exactly. Which is great. So I think that we saw this progression from there's not enough to now like everyone can have a voice and we can have lots of really good voices but there is this problem where there's a bunch of trash out there too. And you know, how are we going to take out the trash? I hope that it will be attacked in the same way that people jumped into it in the early 2000s and say we're just not going to let this slide. This shall not pass.
Leo: That saddens me a little bit too because we had such hopes for the democratizing effects of the internet, that everybody would get a voice. But it turns out that yea, everybody got a voice. And some small percentages of humans are so horrific that giving them a voice has turned out to be a very bad idea. The problem is we can't agree on what percentage is the bad percentage. We know it's 2% but we don't know—
Rene: Then you get the lowest common denominator across the board.
Leo: Well, I also think, we talked about this on a TWiG a couple of weeks ago, the other thing that happened, we saw this coming. I saw this coming but I didn't realize what the impact would be, is facts were at a much higher value pre-internet. Right? If you wanted to know something, you had to work to get it. If you were lucky you had an encyclopedia. If you weren't you had to go to the library. But the possession of a fact was a valuable thing. The internet commoditized facts. It made facts so commonplace, it eliminated their value and as a result, it eliminated, it devalued the word fact. So what is a fact and what isn't a fact is no longer meaningless. And I didn't expect that. I thought that with the plentitude of facts, we would all have the opportunity to be smarter, to make better decisions. You know, a perfect kind of microcosm of this is the internet review. You know, with everybody reviewing stuff on Amazon and Yelp, we'll all have perfect information. We'll always get the best price and the best product. But it got junked up so quickly that we can longer trust internet reviews. And I think the same thing's happened with truth.
Steve: Moral relativism has now become a factual relativism.
Leo: Exactly. There is no—it seems as if, at least in some circumstances, there is no such thing as a true fact.
Rene: People in positions of power have said on television that they don't care about facts, they care about feelings. And that, I think that plays out. Like we've seen, and that's not just politics. That's electronics too. We have seen things happen this year that previously CEOs would make one mistake and they were out. Like one mistake was—
Leo: Not anymore.
Rene: Now you can screw up every day and—
Leo: And it's good, baby.
Rene: Well the Tylenol recall. I mean Tylenol had to go to extraordinary lengths to save their brand.
Leo: That's right.
Rene: We did a survey on Android Central and people are like, "I would still have a Galaxy Note 7 if I could."
Leo: By the way, that was another big story that we missed. The Note 7 story. God knows we've spent a lot of time on that this year.
Steve: Well and we've also seen in terms of like what the internet has become, is unfortunately also a big marketing machine. And I think it was early this year that ad blockers were a big deal.
Leo: Thanks to Apple, this was the year that they turned on ad blockers.
Steve: Yes, iOS allowed that to happen and suddenly it went mainstream.
Leo: Very good point.
Steve: And so, and so this is consumers with technology pushing back against the fact that websites were just jumping around and I mean they were comic books. It's like hard to focus.
Leo: But that gives us hope that, Denise, that your hope is possible. We were with ad blockers able to kind of even, rebalance the equation. Maybe we can with technology rebalance the fact equation.
Denise: I think so. And I think the more people look at things like onerous terms of service too. I mean this comes up all the time on This Week in Law. Reviews aren't completely worthwhile or not worthwhile. They're, you know, you still can get a feel for—
Leo: You have to learn how to use them.
Denise: Yea, you have to learn how to use them. You have to learn how to use terms of service. You have to learn how to use news I guess.
Leo: And that's what I've been saying all along is well, once facts are plentiful, now critical thinking becomes the coin of the realm except it's kind of hard when you're inundated with so many facts, and it's so difficult to find out, whether one is—
Rene: We have to teach internet literacy. We need to teach media literacy.
Leo: Well we clearly have to do that. We clearly have to do that. Rene, what do you think we'll be covering on MacBreak Weekly and you'll be covering on iMore in 2017?
Rene: I think according to rumors, this is the year that Apple starts deleting bezels.
Leo: (Laughing) It will be a bezel-less year.
Rene: I don't think that, but I think the ratio of screen to device will—
Steve: You'll hold your pad from the underneath.
Rene: A handle on the back, right?
Leo: This was towards the end of the year, there really started to be this feeling that Apple has lost its way. You think Apple hasn't lost its way? And in fact in 2017 we'll see a reinvigorated Apple as we used to?
Rene: I think we have way more access to information than we used to. Like for example if we had what we have now and they were making the iPhone, Apple is working on a secret tablet project. Tablet project cancelled. Apple now working on phone. Employees stuck in pizza smelling office building. Not allowed vacation time. Like it would have been a mess. But now we see that all unfolding in real time in front of us so it will be the perception is skewed.
Leo: Apple Car Project is a perfect example. A project Apple never announced. Never talked about. We spent hours talking about it and then hours talking about how it had gone away.
Steve: Looking at the buildings where they were leasing in order to do the cars.
Rene: Like the Purple Project which became the iPhone. And it would have been are we going to use, they were going to use Safari as the interface. No, they're not anymore. They're not using Web Kit. They're creating, what is this Y Kit thing? I mean like it would have been—
Leo: It's kind of back to that fact story. We know too much stuff.
Rene: No, we totally do. And I think one of the biggest questions we have going into next year is that Apple's been hugely constrained on the Mac side by Intel and to some degree AMD because as much as people want it, those chips still haven't shipped. So Apple can't use them. The desktop chips, they don't make them for the smaller iMac anymore and you know, Apple controls their own destiny on iOS. What's going to happen to the Mac and their increased dependency on companies? And Steve and I were talking about this earlier. They're not—the chips aren't evolving as fast anymore. So what's that going to be? But I think spring, we'll start to see the iPads and the Mac desktops will be happier.
Leo: Well one thing I know is we will be here with Rene Ritchie for MacBreak Weekly every Tuesday, with This Week in Law and Rene—Rene, I'm sorry. With Denise Howell every Friday, with Steve Gibson on Security now every Tuesday. And all week long and every Sunday of course for This Week in Tech. I hope you had a great holiday. And I hope you'll be back on January 2nd, we'll have all new shows for you. And a lot of great excitement. This week will be best ofs all week long. We've collated some of the best segments from years, or from this years' shows. And these are always fun. I always look forward to these. You're going to do something that we did a couple of years ago. You're going to bring back the portable dog killer, Steve.
Steve: Well, it's a fan favorite of all time. Back on Security Now on the occasion of the 50th anniversary of the invention of the laser, I used that opportunity, I thought, ok, I have a little story that very few people have heard before. And we have a lot of new listeners to the podcast since the last time we shared that.
Leo: We do.
Steve: And so I thought let's, you know, for some people, no one has ever heard you laugh as hard. I mean you—
Leo: (Laughing) It was pretty funny.
Steve: I mean you were on your ball then.
Leo: I was.
Steve: Or how you didn't manage to fall off because it caught—you didn't know where I was going with this because you didn't know the story either. So it was a lot of fun. So that's what we're going to do for this season's holiday on Security Now.
Leo: Denise, are you doing a best of for This Week in Law? What are you doing?
Denise: I think that we are. We've been asked to submit some clips, so.
Leo: I always, I love that show. And Rene, I can tell you that MacBreak Weekly will have a best of as well, so you get the week off and we'll see everybody in the new year. I'm Leo Laporte. Thank you for your support, your patronage, your queries, your comments, your criticisms all year long. It's been a great year and we really appreciate your help making TWiT what it is. We wouldn't be able to do this without your support, so thank you. I hope you have a wonderful holiday season. And we'll see you all in 2016, 2017. I can't believe it's 2017.
Denise: I know. We're so old.
Leo: The future. Where's my flying car? Thanks for joining us! We'll see you next time. Another TWiT is in the can and another year is in the can. Bye-bye.
