I did everything I could to not go to Mumford and Sons and I ended up at Mumford and Sons.
Oh boy, I hate doing cold opens for podcasts, but can we please just do that?
Hello and welcome to the Vergecast, the flagship podcast of PMX, a thing I suppose we have to talk about today. I'm your friend David Pierce, joining me from an increasingly fancy place, Nilay Patel.
Hey buddy, what's up? How's it going? Every time I see you, you seem to have moved up like one tax bracket in terms of where you're staying in the world. Where are you right now? What's going on?
I'm in Cannes in the south of France.
Oh, you've moved up several tax brackets.
I'm in what can only be described as an apartment at the Carlton Hotel. It is very lovely here. It is very hot. There's a heat wave all throughout Europe and all throughout France. And I didn't know this, but apparently there's been a culture war in France over air conditioning for like years and years and years. It is like a left-right partisan issue.
And that has just come to an end with this heat wave, as far as I can tell, because everyone from New York is at Cannes to talk about advertising and all the big tech platforms are here. It's basically America. I'm just in America, but everyone's drinking smaller, more potent cups of coffee. And then the air conditioning everywhere is just cranked to the max. It's wild.
For everyone listening to this and not watching, I want you to imagine Nilay in linen pants, oversized sunglasses, a shirt that is unbuttoned just like one button further than you would think Nilay would have his shirt unbuttoned.
Oh, I went too, buddy. Don't worry. I went, too.
Just one button at the bottom. Hanging on for dear life. That's all we got here.
The other thing to know is that we're on wildly different clocks. So, David sounds tired because I believe it's 8:30 in the morning for you.
It is in fact 8:30 in the morning. I sound tired because I was out until 2:00 in the morning. Just all the tech companies are here throwing just the most elaborate parties. So the first night, Tuesday night, your choice was: did you want to see Ray, the artist Ray, or did you want to see Ludacris? And then there was like, I saw Janelle Monáe gave a concert at a mansion for 100 people. Like it's just like all this is crazy.
Wait, Ray versus Ludacris is like the most perfect generational split of who would go to which party.
I went to Ray. Oh, I saw Ludacris do his corporate gig for AWS at CES and I was like, I've had this experience. Like, I have seen a bunch of excited polo shirts, you know, I don't need to do it. So, I went and saw Ray. And then last night it was Tiësto and Mumford and Sons. And I stood in line for Tiësto and it was really long. I was even in like the good line, the priority line that everyone wanted to go to Tiësto. And I went to, I saw DJ Dice at the TikTok party. Amazing.
Shout out to Patreon, my friends at Patreon for getting me into that one. And then I left and I got a text and it was like, 'We're at Mumford and Sons.' And I was like, 'Oh, crap.' And I went to Mumford and Sons.
It really happened. All this is happening within like feet of each other.
This reminds me of the experience of like when you're too old to do any of this stuff, but you go to a bachelor party and so you're like, 'All right, for 48 hours I'm going to be 23 again.' Like the weird thing is like the amount of money in Cannes. Like this is an advertising festival. Theoretically it is an advertising awards festival where they award the most creative advertising made around the world all year. That is gone. I didn't see one piece of creative this whole week.
I saw tech companies talking about platforms and data and scale and targeting. I saw everyone is just like, how do we hide the amount of surveillance we're doing on creators? And so then there's just like a group of hot people at every party who are the creators. And we all have to talk about the creator economy. Like it's not built on massive surveillance apparatus. But like the undercurrent of all this is just like companies you've never heard of talking about their ability to target you, the consumer. And Meta and TikTok and OpenAI all talking about how they will know so much about you that they will generate custom ads for you individually. And then somewhere next to that is creators are great and it's like, oh, you just need these people, like you just need some hot people to distract you from the thing you're actually doing.
Like dystopia but do it on the beach is basically the vibe.
You can get away with a lot if you put hot people on a beach.
That is, I mean, history has proven that over and over for centuries. Wait, before we, we shouldn't spend too much time on Cannes, although I do think it's going to make your week, is going to make a bunch of the other stuff we have to talk about here very interesting. But I do really want to know. So Matt Belloni, who works at Puck and has a great podcast called The Town that I really like. He's been on the show, friend of the broadcast, wrote a thing in his What I'm Hearing newsletter just ruthlessly making fun of Cannes. And this like kind of traveled all over the place. I'll just read you a snippet of it. He says, 'I shouldn't have to say this, but to everyone asking if I'll be at Cannes this year, Cannes is the festival. Cannes, a prestigious global film event where talented creative people display and sell their work and look glamorous doing so. Cannes Lions is not. It's a tacky business conference for selling advertising and announcing brand partnerships, populated mostly by paunchy middle managers and YouTubers.' The only response to this that I saw was Rich Greenfield, the analyst, standing with Evan Spiegel, the CEO of Snap, basically saying, look at us, the paunchy middle managers. But I wondered, like, are people at Cannes feeling sad about which Cannes they are at?
There is no self-awareness here. What are you talking about? Everyone is sweating their faces off. The amount of just like what's being nude because it's so hot is like off the charts. I've had so many conversations about what is appropriate for people to wear, men and women. Like you can make friends with anyone here by being like, is it appropriate for men to wear shorts to a business meeting? Because the answer in this environment, this moment in time has to be yes. And no one wants to admit it. Shout out to Dieter Bohn who would not wear shorts at Cannes. He would die first.
And there's just so much money here. This amount of money cannot be self-aware. Do you know what I mean? Like you can put enough GPUs in a data center and be like, I think that might be alive, right? Like it will gain consciousness. Maybe you put this much money on the beach and it loses intelligence like as fast as it can. Let me just give you one example of the kind of news that's being made here.
Spotify, you know, Spotify, they announced a partnership with Coach, the handbag company.
And the heart of the partnership, according to the press release, is a shared understanding of how Gen Z approaches identity and self-expression. And then like that was a panel that was like, that was like a full room of people believing this through handbags and Spotify. Yeah. Yeah, through Spotify handbags.
One of the things we learned about Gen Z consumers is they don't think about identity in terms of categories. So what they wear, what they listen to, the community they're a part of is part of the same personal story. And that's why the partnership between Spotify and Coach feels so natural. David, what...
I'm just saying Matt Belloni can say whatever he wants. You can't fight that. You can't body up against that and be like, do you feel bad? Because that is nothing. Someday I aspire to be the kind of person who just goes around to conferences being like, people just want to be together and everybody's like, 'Yay, it's great.' Oh, no. If you roll up to this conference with a British accent and you're like, 'Advertising is broken,' like, you will be the keynote speaker. Like, it's fine. But I'm just telling you that the thing about where I'm at right now, I had a bunch of great conversations. I did a Decoder interview with Amy Lindsay, who's the CEO of Digits. I think she's actually one of the smartest advertising executives in the game. She's not confused. She's a tech executive. She traffics in data and analytics and she tries to get the right product on the right shelf at Walmart at the right time and the creative is somewhere downstream of that, but she knows what her business is. I also interviewed Allie Beerman and Raina Pachensky who are like fancy agents for creators like Alex Earle and Jake Shane and you know, they're like, we are here to make money, like we build businesses for these creators. We find people who have audiences and we build them businesses and they talked about money with me the whole time. So there's no confusion here about what everyone's trying to do.
Right. This is about the creators who are on panels here call themselves marketers.
They know what they're doing. They're here to move product. So the idea that like it's that they have some feeling about the film industry. They're like, whatever, man. Everyone's watching Instagram. We're going to move product.
Yeah. Yeah. That's fair. Actually, this is a useful pivot into some of the news that we should talk about. But first, we've been getting a lot of questions about some corporate Verge news. Do you just want to talk this out for a minute? The...
This is the second turn in the Vox Media corporate changes. Do you want to just talk through what's happening here?
Yes. Our company is killing itself. And then one part of the company is being reborn as Vox Media 2.0 and James Murdoch will own that company like the phoenix from the ashes. The other part of the company, part of the company that we're in with Eater, that is being rolled up into a holding company called PMX, which is Penske Media Plus Fox. That's the name of the company, and it is like BMX and DMX.
The notion here that everyone keeps saying to me is that no one should ever think about that brand. It is a holding company. Penske Media owns Variety, Billboard, The Hollywood Reporter, on and on and on. They own the Golden Globes. They own South by Southwest. That it's just a big media holding company. All of those things operate as little independent companies. Like they really do. And so Penske Media, all their publishing stuff, not like the Golden Globes, but like the magazines and all the Vox stuff is coming together in one holding company. It's a joint venture between the stuff at Vox Media and the Penske publishing stuff. And it's going to be run by the president of Vox Media, Ryan Pauly. So, there's a lot of coverage of this and I think the funniest part of it is Penske's own trades covered it and they did note that they are the ones getting a new boss, which I think is very funny. Like, we woke up and it's like the same guy that we've been reporting to for years, right? Who we both started this company with as babies 15 years ago, little children. And I stood next to Ryan at the Mumford and Sons concert last night and we're both like, 'How did we end up here?' So there's a lot of shared history there. I'm, you know, reasonably excited about this. There's a lot of work to be done. The deal isn't closed. We got to figure out some structures, but Penske Media Company has a lot of resources. Those are big fancy magazines that do great journalism. They fight off the lawsuits, which is a thing that I promise you I have to think about all the time that never comes to the surface, but it's a capability that like we need and that I depend on in my job as editor-in-chief. And then you know, the opportunity to invest more heavily in The Verge is like right there in front of us. And the conversations we're having now are about how to make The Verge feel even smaller, how to be our own little company with our own little product team. You know, Jay has been on our board for a long time. He's the largest shareholder in Vox Media or what was Vox Media. I go to our board meetings and I say wild things about federation. That's like my role at this company. And he listens intently and is curious about them. So, that's a relationship. We're the same age, which is really weird. So that feels like a pure relationship in another weird way. So I'm hopeful. There's more to come on this, but today it's we woke up and we had the same boss we had yesterday, and everyone should just take a breath. I think it's going to be fine.
Yeah, I think that's right. We got a bunch of, as with the last one, a bunch of very well-meaning people worried that this meant bad things.
An important thing to say when I say we're the same age, Jay Penske has come up reading The Verge. Like he is a reader of our website. He is a fan of tech. Like he pays a lot of attention to us. Again, he was the largest shareholder of the company. So if he was mad at our coverage, I would know. And that's just not the case.
Yeah. If he wanted to kill us, he could have done it by now. It's the...
It could have happened a long time ago, but that's just not how it goes. So I think he's intent on making sure he doesn't ruin it. And in fact making it better. That is the conversation we have had.
There's yet more to come. Like this deal has to close. We have to, a new holding company called PMX has to come into existence. It has to operate. Luckily the person in charge of that is the guy that we have known for years and years and years. I think it'll be fun.
Yeah. And I think a thing you and I talk about and we've been talking about with our team a lot is that in the best case scenario, hardly anybody ever thinks about the corporate structure that enables our newsroom. We just get to go do the work and that remains the goal.
I will say the same thing to the audience that I say to our team and to our corporate overlords. Just give me the money and leave us alone.
That's my pitch. It's been a good pitch for 15 years. So we're...
I'm sure a really good pitch at Cannes Lions. No, the money here has a lot of ideas. If you're not moving Coach handbags, it doesn't want anything to do with you.
That's a fair point. So actually, let's, I wanted to talk about gadgets first, but you've now made me want to talk about Meta because while you've been at Cannes Lions, a place I'm confident there are a lot of Meta people running around telling you about all of these things. You're talking about the creator future of everything, the advertising future of everything, the AI future of everything. Meta sort of publicly appears to be a company that is in like complete turmoil and is desperately flailing to figure out what's going on. Can I just run you through a bunch of things that have happened this week while you've been gone?
Yeah, this is very funny because that is not how it feels here. But yeah, I'm dying to know. Yeah, this is what I want to talk about because I think this disconnect we're about to get into has been true of Meta for a very long time and I think at this moment might be truer than it has ever been in complicated ways. But so here are just a bunch of news bits from Meta this week. One, Meta announced that the Instagram TV app is getting a big overhaul. It's coming to new platforms, but also they're starting to experiment with a lot of the stuff that has worked for YouTube on televisions, like the episodic series, things that feel more like shows. They're doing horizontal video. Like they are making the same push into the living room that YouTube has very successfully made over the last several years. That's one thing. Will Cathcart, the head of WhatsApp, is leaving and he's being replaced by somebody who built a fintech company that's very successful in India that Meta invested a huge amount of money in and is making this guy the global CEO of WhatsApp. Weird and fascinating.
Meta revived the Facebook Creator Studio app as an AI companion app for creators that will basically, I believe the phrase was, tell you exactly how to grow on Facebook with AI. Like we'll draft comments for you. Again, this is all the stuff that like YouTube and others have been doing for a while, but the idea is like how to grow your audience on Facebook in the most ruthless AI optimized way. Mark Zuckerberg has apparently tasked his team with creating a Polymarket clone. Sure. Like the idea is apparently not to do it with real money at first. This product is at least codenamed Arena, which is a very funny name for Mark Zuckerberg, the like Brazilian jiu-jitsu fighter in a bunch of funny ways. But there's this big idea about eventually letting people play with money after letting people play with credits at first. This is like a company doing everybody else's ideas about how to make money, right? Like you look at all of these things and every one of these is what is a new way we can make money that somebody else is already making a tremendous amount of money.
Next to this there is an incredible amount of reporting being done particularly by our friends at Wired and Business Insider on this like disastrous morale problem at Meta. They had this thing on Monday, I think, where they had to roll back the tool they had installed on everybody's computers that tracked all of their keystrokes and all of their mouse movements in order to train AI because a lot of the data that it was collecting was accessible to people across the company, which bad.
Andrew Bosworth, the CTO of Meta, had to basically put out a memo acknowledging that the AI reorg at the company has been, I believe the word was, atrocious and that they've created a huge morale problem. They think they're going to fix it with a snack budget. Like this company just appears to be a mess and twisting in all directions having no idea what's going on.
And then like you're saying they just have all the money in the universe. Like I cannot, Meta is the company I understand the least because it just continues to seem like it's winning and also to have absolutely no idea what it's doing.
Yeah. If you're here, it is obvious that Instagram and Meta are the load-bearing pillars of the internet economy.
If you want to talk about creators, there is not really a creator economy without Instagram and YouTube. Like TikTok is here and certainly they're, you know, big lucrative TikTokers, but they all have to pivot to other platforms.
That's just a thing TikTokers have to do because TikTok doesn't really have a follow graph and all the other platforms do. And so like you just see like okay where are the two load-bearing pillars of the creator economy as it's being expressed here at Cannes and it is absolutely Instagram and it's absolutely YouTube and they know it, they're acting like it and then Meta's advertising tools are so lucrative and so powerful that they are here surrounded by advertising executives basically saying out loud we're going to kill you.
Just directly saying it. Like their big announcements here are all about finding new audiences, generating custom content for those audiences, guardrails around the AI tools to make sure the AI generated creative is brand safe, new tools for targeting where you know you can put more money into the Meta ad manager to find new audience but only up to a certain budget and then curve it back to make sure you still find qualified audiences that want to buy your like really boring ad tech stuff that is printing money for them. And you look at all that and how much energy that is being directed at that and how wildly successful it is. Everyone depends on it and needs it. And you look at the creator economy, which I've said this a million times on this show, but Instagram does not pay creators anything. They are just a distribution platform for creators and they monetize. It doesn't matter what happens on Instagram because Meta is making money regardless.
The creators have to go hustle out their own brand deals. That's why they've all become ad agencies. So Meta is winning both ways, right? It doesn't really matter what the creator economy does because Meta makes money every time you open Instagram. And if you want to participate in sort of the larger internet economy, Meta is getting to the point, and Zuckerberg has said this out loud, they're getting to the point where they just want your money and the business results you desire and everything in the middle will be automated by Meta AI. And that looks like it might work. Like I have no idea if it will actually work, right? But they're so confident here in it. To come to an advertising festival and look at an ocean of executives from companies and say, 'We're going to put most of you out of a job' is wild. And everyone's like, 'Amazing.' Weird. And I can only look at the rest of what's going on at Meta and say, 'Oh, Mark Zuckerberg hates the business he's in. It's not fancy. It's not important. It's not cutting edge. That man sells ads.'
Yeah. It's also like wildly uncool. This is the part of like Cannes Lions is not the cool one. He sitting in San Francisco knows how not cool he is.
And how hard he's trying to be cool. Kylie Jenner is launching glasses with Mark Zuckerberg. Right. We're just trying to yank some cool back to this company. Meanwhile, the money printer is just here in Cannes just whirring away and he hates it.
I think he hates it. It's just not the thing that makes them cool. Whereas I think Google has no problem not being cool. Like Google also prints money and they're like here's like the robot's going to buy you the shoes and they're like everyone's like amazing and Google's like it's so nerdy we love ourselves and like they just don't care.
Google learned from the Plus thing that being culturally relevant is not all it's cracked up to be.
I mean they have YouTube. I just want to be clear they have YouTube but if you listen to Neal Mohan his whole approach to YouTube now is we have learned not to be prescriptive about the creator economy. Like when ASMR videos came out, everyone was like, 'What is this garbage?' And now they're a whole cultural category. This is a real quote from Neal this week. So they know, but they're pipes. That Google wants to be pipes. Also, I think importantly, Google owns two major platforms. They own Android. That is their platform. They control their destiny on that platform. And they own the web to like some huge extent. They own the web. They have Chrome on desktop. They have massive market share. And Google will contest this. They'll say the web is vibrant. And that is mostly true because mobile Safari exists and Apple has very strong opinions about what web browsers can do on the iPhone. But like Google has two platforms where it controls its destiny and Meta has none. And they've known this forever. And I think this drives Mark Zuckerberg crazy. And if he was the sort of person who would just be happy selling ads and having Ludacris come to his parties, I think he would be the happiest person alive because he's just the winner of this moment. But that man wants a platform of his own. I think he sees AI as one opportunity to do that. I think he sees his glasses as another opportunity and he is content tearing his company to shreds in like ferocious ambition to get to a platform of his own. But I think the fact that he's not cool and no one trusts him is always going to stand in his way.
Oh, I totally think that's right. I also think if you're Mark Zuckerberg even in a more sort of calculating headspace you look at these things and you realize that okay we have built what amounts to a perfect business model on top of this gigantic set of attention that we are able to deliver right that because so many people are on Instagram and because so many people are on Facebook because these are so central to people's online lives we make infinite money that that is just true it's also fragile and it feels more fragile all the time that the idea that actually maybe lots of people will pick up and leave your platform I think is a real and b increasingly inevitable right like Facebook's users are going down for the first time they would argue with you about that they would yeah that's there's like regulatory battles there's a war going on like sure they have reasons for those numbers wavering this time around I'm sure that they do but if those people go it doesn't matter the reason if those people go away. The business goes away. The business relies on I open Instagram 40 times a day whether it makes me happy or not. It just that that's it. It is it has to be that entrenched behavior or else this beautiful business model you've built on top of it collapses. It has nothing to do. And so what I wonder is like all that stuff that you're saying about like being cool and being culturally relevant, that's also sort of centrally tied up in this company's business in a way that if I'm Mark Zuckerberg causes me to lose a lot of sleep because like the minute Instagram stops being cool, and I think Instagram is still cool. It's not what it once was, but it is a load-bearing pillar of the creator economy conversation here. And it is like glitzy and flashy in a way that like even TikTok isn't. Instagram is like...
I would say ever since Oracle bought TikTok something has changed. You can just feel it. That company has lost its aggression in a lot of ways and it has become more of an infomercial driving you to the TikTok Shop.
They had the smallest party here. That's what I'll tell you.
Interesting. I'm before we leave the Facebook flavor of Flav at the TikTok party. I will say that was very cool.
Did he have a big clock on? He was wearing a chain. I don't know if it was a big clock. It wasn't like the clock. You know what I mean?
It wasn't. Okay. I just I feel like if I saw Flavor Flav and he wasn't wearing the clock, I'm not 100% sure I would know it was Flavor Flav. Do you know what I mean?
No, it was he was wearing the glasses. It was very obvious.
All right. Okay, cool. Don't worry.
Can I tell you one more story about this? I tried to get a selfie with Flavor Flav at the end. So, like, hi, whatever. Try to get a selfie. And he's like, I got to get out of here. Like he was just trying to get through a hallway at the end of the party and the person I was with, I won't say their name, but it was just the funniest moment was like, 'Flav!' And he turned around and he saw that it was still us, he was like, I'm good you guys, like I'm out of here.
So that implies that Flav is Flavor Flav's first name, which is a thing I've never... like desperate call to Flav and he'd obviously reacted to it. He's like, 'Someone needs me.' And then he's like, 'You don't. This isn't important at all.'
That's really good. I'm going to start yelling Flav at people as they walk away from me from now on. I really like that. I do want to know what you think about this idea of Facebook doing a sort of fake and then maybe real Polymarket clone.
I mean, Facebook doesn't have ideas. Meta doesn't have ideas. Famously, Evan Spiegel is the head of product at Meta, right? He talk about middle managers. And so the idea that there's something, there's some attention mechanic that will keep you engaged. That's Zuck. Yeah. Famously when he was buying Instagram, you know, we have emails from all these antitrust cases where his point of view was every generation there's another engagement mechanic that emerges and it disrupts the old one. And so photo sharing was that mechanic for Facebook. So he needed to buy Instagram. I think they wisely understood that buying TikTok was out of the cards in the middle of all that antitrust litigation and whatever and they just brought TikTok to Instagram in the form of Reels but they understand, I think Zuck particularly understands that these new engagement mechanics do come and take time away from his apps and so he's very good at like launching fast follows he's very bad at launching new ideas which is why I think the AI glasses and the interaction paradigms, the hiring of Alan Dy to build a new interaction UI for the Meta glasses is like there's something about that that requires a ton of invention like user experience invention that Meta historically has shown no competence in.
I just want to say the implication in what you just said is that the next big time spent mechanic is gambling like straightforwardly the implication in this decision is it's gambling.
But I think he probably sees it, he probably has enough data to see like people move from their DMs on Instagram during a game to a gambling mechanic.
That's a thing that happens all the time. That's a real thing. We had a CEO of Yahoo on Decoder a while back, Jim Lanzone, who you know, he's a really smart guy. And I was like, Yahoo has private equity ownership. It's like Apollo, they own Caesars Palace. I was like, this is coming to Yahoo Sports, right? You're going to do gambling in sports and finance. And he was like, no, but we know that once you're done in Yahoo Finance, you go to your stocks app. Once you're done in Yahoo Sports, you go to one of the prediction markets. Like we see the mechanic. It is the most natural evolution the data would suggest. They haven't done it yet. I'm not sure if they're going to do it, but I think Zuck sees that too, right? It's the night before the Super Bowl and everyone on Instagram and WhatsApp is talking about the odds. Like you can just slide it in there. You can just shove it in the big blue app like everything else. So I understand why he would do it. Do I love that everything is becoming gambling? I think that's pretty bad.
Yeah. Yeah. No, it is as ruthlessly correct a decision I think as you could make. But boy does it feel bad for Threads. Like Threads has an oddly, I wouldn't say odd. Threads has, how to describe Threads in its diffuse way, in its sort of hazy way. Threads is like we should do sports, right? They have like a partnership with the NBA. They're growing in communities or however they define communities. Very natural if you think real time Twitter-like post app is good for sports which I tend to think it is that you would add the gambling mechanic to that.
Sure. Very natural, deeply terrifying. By the way, I think gambling is bad and I think it's legal and my personal view is that when you go to Las Vegas you should find out how much all of your friends are going to spend on gambling and spend that amount of money on limousines because that's the only place in the world where you can just demand a limousine arrive and one shows up. I'm in the south of France. So, I go outside. I'm like, 'Bring me a limo.' And they're like, 'Uh-huh.' And it's not going to happen for me. But you can do that in Vegas. That's my hot take on gambling. Buy limousines instead.
I have been in your presence for this enough to know that you always end up being the one who has the best time, too, because I'm the one with the biggest limo.
It's the Nilay Patel way.
Everyone remembers me. No one remembers how much your dumbass lost at blackjack.
Exactly right. All right. All right, we should take a quick break and then I do want to talk gadgets because there's an interesting thing happening in gadgets right now and I want to talk about it. But let's take a break.
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All right, we're back. There's a bunch of gadget news this week and my theory of the case is that we are seeing the effects of RAMageddon on the products that we buy and use in the most clean way as possible. Now, just to give you a preview, Microsoft put out new Surfaces with less memory. You can now buy an 8 GB of RAM Microsoft Surface. It's to make it affordable, right? Like it is so expensive to buy RAM that they're giving you less so that you can actually buy a product. The Steam Machine is out. I want to talk about the Steam Machine in a minute. We talked about it with Sean on the show earlier this week, but I'm curious what you think. The vast majority of the story of this thing has been that it costs $1,499, which is a lot more than I think anyone, including Valve, hoped. And there's been this big kerfuffle about is it one RAM stick or two? Like, this has been a news story. But the most immediate thing is that as promised, Apple just raised its prices.
Tim Cook said this was coming. I wanted to preview it for people, but Apple just took its store down, put it back up, and everything is more expensive.
Can I read you some of the prices?
Apple store is down of all time.
Truly, like really truly. Yes. Can I read you some of the prices?
The HomePod Mini is now $30 more expensive. The iPad Air is now $150 more expensive.
The iPad Pro is up $200. The MacBook Neo is up $100. The MacBook Air is up $200. The MacBook Pro is up $300. The iMac is up $200. The Mac Studio M4 Max is up $500. The Mac Studio with the M3 Ultra is up $1,300. No way.
The Vision Pro is up $200. Like, meaningful across the board price increase for essentially every Apple product.
I would just like to congratulate myself for buying a Mac Studio for no reason earlier this year.
I really, we have been on this show all of 2026 being like, if you need a gadget, buy it now. It's only going to get worse. And here we go. I don't even think we're at the top of it. I really don't.
And yeah, the MacBook Neo I bought for no reason also seems like a smart purchase now.
Yeah, you sell it for more than you bought it for.
It's working out. But do you agree with my overall thesis here that it feels like we are sort of at the product cycle into the RAMageddon experience where the world in which there is no RAM is starting to settle in to both what gadgets cost and even what they are.
Yeah. Wasn't there reports this week that like the new Nothing phone just won't come out?
Yep. Because the CMF Phone 2 Pro successor, they just canceled it because they're like, 'We can't make it what we want under the current circumstances.'
Yeah. I think we're just seeing like Apple's solution is we have price elasticity. People will pay the prices, right? Like if you're going to buy a Vision Pro, the $200 is not going to deter you because you have conviction in your heart that wearing a headset is a good idea. If you need a Mac Studio that's probably for work, you're going to absorb the cost. Maybe you'll pass the cost off. Like, you can see how they're playing the game, right? The smaller price increases are the consumer products and the bigger ones are the ones that tend to be used for work because you can absorb the cost in all kinds of ways. But I think a lot of other companies can't just play the game the way that Apple's playing it.
Yeah, Apple has like famously huge margins in this industry in a way that's I think they swallowed some of their margins to see what would happen. And this Tim Cook line that this isn't tenable was in fact a preview for prices being raised and a signal that their margins would go back up. And if Apple can't get pricing power in this market, like no one can.
So yeah, I mean I think the Steam Machine is probably a better example. Oh, what is this drama about one stick of RAM versus two?
So that's the most Steam Machine drama you can come up with.
It's very good. As I understand it, Gabe Newell, the CEO of Valve, gave an interview in which he said there was going to be two 8 GB sticks of RAM in the Steam Machine. And in reality, what they're shipping is one 16 GB stick of RAM in the Steam Machine. And if you were to say, David, what's the difference? I genuinely could not sit here and tell you. I'm sure there is one. This is I am just out of my own technical depth in understanding why it matters which one of these things you're getting. The implication seems to be that it's going to ship with one stick of RAM and an empty slot. And that I think is sort of fascinating for a thing that is more PC than not.
Yeah. But this has become a bit of a kerfuffle. And again, like everything Valve has said indicates that this device is probably $300 or $400 more expensive than they wanted it to be and maybe even $300 or $400 more expensive than it was when they started making this product. And that just over time, this is just what the price has become. And at some point they like we've even specced it out. Morrow on our team did a great job of basically going and building a gaming PC to rival this thing and this is just what it costs. Like it's rough out there. And I think Dom Preston, who writes our daily newsletter, pulled a comment that I really liked that was basically like this thing is both fairly priced and way too expensive. And it's like buddies welcome to the future of gadgets. Fairly priced and way too expensive is just what we are in and headed towards.
I'm feeling like the big repairability wave of the past two years is about to pay its dividends.
Interesting. What do you mean?
I mean, people are just going to hold on to things longer and they're going to demand that they last a lot longer as they get more expensive. So, it's interesting. It's these past few years repairability has been sure about durability, about, you know, fighting planned obsolescence. I think now it's going to we're going to add value for dollar to that mix.
You buy something big and expensive, it cannot only last three years, right? It has to have a much longer shelf life. And I that this we have been in what you would call an era of disposable gadgets for quite a while.
And I just all that repairability work like a lot of products are more repairable now than they were before. And I'm just hopeful like maybe all these market forces actually result in a good outcome which is okay. It's going to be more expensive that means it needs to last twice as long, right? Which means replace the battery. I hadn't really thought about it, but it like basically for two decades since smartphones really became mainstream, we have just been on this relentless path of every single part becoming cheaper and more available all the time to the point where like as we've talked about, everybody just puts smartphone chips in anything they can find because smartphone chips are so readily available and so cheap that it's like we'll figure out what to do with this later. We're just going to put it in your dishwasher and see what happens. It never really turned until now.
And it's just the RAM. I don't think it's the rest of the supply chain. It's...
None of it matters except right the RAM. The RAM drives the thing at this point right that you can't do any of it without memory and if you can't get memory you're nowhere. So, but I think truly for the first time it seems like the idea that you can count on this stuff being consistently cheaper and more readily available and higher quality as every generation turns over. Maybe that's going to change this industry even more than we've realized that like right you can make the products cheaper if you account for the higher price of the RAM and use cheaper components elsewhere.
Will people accept that? I don't know.
But like you can play different games here. It just seems like the industry is still doing what you are describing which is they're pushing every component to the edge all the time instead of being like how do we actually make a holistic product based on the prices we have in front of us and maybe this will be the thing that changes it and that whole supply chain is like oh you can't make a cheap Nothing phone anymore.
Right and what's the first thing to go is going to be the things that don't have that price elasticity like cheap phones that if you take a phone that was $200 and you make it $400 that phone ceases to have a reason to exist and the people who could afford it can't anymore and you just shouldn't make it. And we're going to see a lot of things like that. And all of the fun little like gadgety knickknacks that have been coming out I think are going to start to die because they just don't have that we can raise the price by $200 and get away with it because this is essential to your work life that a couple of companies and not many others do.
Yeah. Like if I'm a Kickstarter sized startup right now, this has got to be terrifying.
Oh yeah, we should do I mean we did a bunch of tariff coverage with these smaller companies. I feel like we should do some RAMageddon.
We should. I've been talking to Eric Migicovsky from Pebble about coming back on the show to talk about some of this stuff and we should do a couple of these. I think if you're a small hardware vendor, reach out. I would love to hear what's going on.
Yeah, get at us for sure. Let me just read I want to read you just one thing from this is an interview that Valve did with Gamers Nexus about the Steam Machine. Gamers Nexus asked them, 'Were you able to lock in contracts for memory with the suppliers directly or did you have to jump through a bunch of hoops?' And this is Pierre, a software developer at Valve. He says, 'Look, there's no contracts, there's nothing. Those guys, they give us a price every month or something and they say you can buy that many and it's yes or no. And if we say no, then they never talk to us again. This is the state of things.' Do you know what this made me think of is I bought a car in 2021. Like peak pandemic chaos year. Cars were the most expensive they've ever been. Used cars were going through the roof. We totaled our car and got more money for it than we paid for it used 7 years earlier. Like insanity. And we wanted a Hyundai Tucson. We wanted a hybrid. We wanted an SUV. We picked this car and the people at the dealership put our name on a list of people and when they got a car they would start at the top of that list and they would call and they say I have this car in this color at this price do you want it and they would say yes or no and if they said no they would go to the next person on the list and they would just call until somebody said yes and the first time we got a call they were like it's this one it's this color.
It has all these bells and whistles you don't want. Do you want the car? And Anna, my wife, who was on the phone with them, was like, 'Well, we don't really want all these other things.' And the guy was like, 'I'm going to be real with you. If you don't say yes to this, I'm almost certainly never going to call you again.' And so, we bought the damn car.
And it's like, it was insane. And this is the world that we live in with computer memory now, that it is run by this set of companies that have essentially all the power and leverage you could possibly imagine.
It's wild. All that power and leverage comes from having a handful of data center and chip vendor clients building data. Like, it will come to some sort of conclusion.
Yes. I am increasingly pessimistic about how long that's going to take.
Oh yeah, I agree with that.
But it will end. I just don't think it's going to end as soon as we would like, and I think it's going to get way messier before it ends.
Here's what I want you to imagine before we move on. At some point, like regular non-tech media is going to notice Ramageddon. Just imagine how those headlines are going to go when people are protesting data center prices and more expensive iPhones.
Yep. I mean, that's coming in September, man. Like, can you imagine what this next run of iPhones, potentially including a foldable iPhone, is going to cost in this world?
Yeah.
Real quick, one other thing we should talk about. I want to know your thoughts on the Slate Truck. Speaking of things with prices that are important, they announced the Slate Truck, $24,950. Ronnie Mola, Verge contributor, went and took it for a ride, seems to like it. Where do you stand on the Slate Truck at this moment in time?
I love it. I think it... I mean, when was the last time you saw an affordable product like this? And I love the fact that they, you know, if you're a car person, you know, people are just wrapping their cars left and right. Like, fine, we're not going to paint it. You can wrap it however you want. I love the modularity. I love the fact that you can turn it into an SUV and the airbags have little connectors so the car knows when you've put the SUV roof on it and engages the airbags and the pillars. Like, I think that's all so neat. Like, that's a lot of engineering.
Cool. Like, I think all that is great. I think the range is troublesome to people. I think Americans just want to see 300 next to a range estimate.
But that's maybe not what this truck is for. Like, most of the people who are going to buy this kind of truck to do this kind of thing, to have a toy or use it for work, they're not traveling hundreds of miles in a go. So I think that's the one question mark I have on it. I'm dying to try one out. I think they're just so neat.
So what I wonder about you specifically, because you are like, I would say you're sort of lightly a truck guy, if that makes sense.
I want to, like, aspire to be a truck guy.
I had one. It was great. I think about it every day.
Yeah. Does this satisfy the truck guy in you? Because like the line in Ronnie's story that keeps sticking out to me is that it drives more like a crossover SUV than a pickup, which I think is intended as a compliment, but is not what a lot of, like, you know, Ford F-150 truck guys are going to want to hear. But maybe this isn't for them anyway. So for you as a light truck guy, how does this thing strike you? I mean, do you want to get into a long discussion of body and frame construction principles and why the Ford Raptor in particular sells so well because of its suspension that makes it drive like an SUV? Like, the truck market is vast. It's complicated. I don't think the people buying this one are going to give one ounce of thought to ride quality in that way. If it's more forgiving, then I think they will. But you drive like a regular pickup truck that doesn't have, like, an independent rear suspension, it bounces over a bump, like, that's a weird feeling.
Sure. So I suspect this thing is going to appeal to a lot of people that the Ford Maverick appeals to. Like, there is a market for smaller pickup trucks. The thing that's going to make or break the Slate Truck is how much people actually take to customizing it. This entire thing is a bet on you. They literally, the base model is called the Blank Slate. The whole thing is a bet on actually you want to customize this truck. We are going to limit the options we put in front of you. All the way down to there's no infotainment. Just put your phone in a dash like all of you are doing anyway. And I think that's just incredibly smart.
The part about that I don't like is it makes the very cheap price seem sort of fake, right? In the sense that, like, yes, $24,950 is slightly more, I think, than Slate wanted this thing to be, in part because the giant tax break that you get for buying a car like this has gone away. But still, it is, I think, by a wide margin the cheapest electric car and the cheapest pickup you're going to find pretty much anywhere. But then we're in a Ramageddon world where now I have to go source a bunch of other parts that might be more expensive for a bunch of supply chain and, like, war in the Middle East reasons. Am I potentially signing myself up for a headache that I didn't even know I was getting into? Like, the sort of DIY car economy feels a lot scarier right now than it did a couple of years ago.
Yeah. I mean, that's a flip side of what I'm saying, right? It's going to be make or break depending on how much people want to customize their truck.
True. And maybe they want it less than they did, right? Like, I really don't think we know. I do think people stare at new cars which are getting increasingly more expensive. Like, we're closing in on the median price being like $40,000 or $50,000 for a new car.
And then you look at those cars and they are just chock full of tech. Like, the new Mercedes electric C-Class, like, the interior is basically a Korean nightclub. Like, there's no other way to describe what is happening in that car. Like, what do you want me to do?
Google this while you're talking.
