All-In PodcastE34: Wuhan lab leak theory, India's traceability law, Coinbase fact check, Big Tech takes Hollywood
EVERY SPOKEN WORD
145 min read · 28,871 words- 0:00 – 6:47
Friedberg recaps Sacks' birthday party
- JCJason Calacanis
Okay. So Jason, you're gonna send a Zoom link. Uh, great. I'm gonna make love to Nat. That'll take 70 minutes-
- DSDavid Sacks
(laughs)
- JCJason Calacanis
... and then I'm gonna stretch and shower.
- DSDavid Sacks
(laughs) Okay.
- JCJason Calacanis
Have lunch. I'll be ready at 1:15.
- DSDavid Sacks
Okay. Awesome. Thanks. I just puked in my coffee a little bit, but okay.
- CPChamath Palihapitiya
(laughs)
- DFDavid Friedberg
I said-
- DSDavid Sacks
I got all-
- DFDavid Friedberg
... 70 minutes, it's just that he does... He gets seconds and minutes mixed up, you know. It's-
- DSDavid Sacks
Oh, got it.
- CPChamath Palihapitiya
Yeah. Exactly.
- DSDavid Sacks
Seven seconds in heaven, got it. Seven seconds, got it.
- DFDavid Friedberg
(laughs)
- CPChamath Palihapitiya
(laughs)
- DSDavid Sacks
(laughs) Thank you for tuning into the All-In Podcast.
- CPChamath Palihapitiya
Yeah.
- DSDavid Sacks
We got our cold open. Somebody screen record this.
- DFDavid Friedberg
That's gonna be a highlight. That's gonna be a highlight.
- CPChamath Palihapitiya
That's the... No, that's... That should be the cold open.
- DSDavid Sacks
Cold open.
- CPChamath Palihapitiya
That should be the cold open. That should be the cold open.
- DSDavid Sacks
70 seconds in paradise.
- DFDavid Friedberg
(laughs)
- CPChamath Palihapitiya
Oh my God.
- JCJason Calacanis
By the way, that 70 seconds includes Chamath brushing his teeth.
- DFDavid Friedberg
(laughs)
- CPChamath Palihapitiya
(laughs) Fuck you.
- DFDavid Friedberg
I'm going all in. So let your winners ride.
- JCJason Calacanis
Rain Man David Sachs.
- 6:47 – 26:09
"Wuhan Lab Leak" theory, did COVID come from a lab? Plus China's fentanyl production
- CPChamath Palihapitiya
and, uh, lots of stuff going on. The thing I think I'm most interested in hearing from, uh, Friedberg about is the Lab Leak Theory. Um, and I think that this touches on a little bit of the politicization of, um, science, I guess? We- There's a lab in Wuhan. I think it's more Trump derangement syndrome. Or- It didn't allow us to see the f- forest from the trees and the same words just said by a different president, all of the sudden invokes a- an investigation.
- JCJason Calacanis
Yeah, so I mean, there's a COVID laboratory in Wuhan. It is the only (laughs) one in China and that's where the-
- CPChamath Palihapitiya
It's a virology lab. It's where they study viruses and, um-
- JCJason Calacanis
Yes, but-
- CPChamath Palihapitiya
... um-
- JCJason Calacanis
... specifically they've studied COVID viruses.
- CPChamath Palihapitiya
Uh, they have. Yeah, that's- I mean, that's a big class of virus, so-
- JCJason Calacanis
And it's the only-
- CPChamath Palihapitiya
... yeah, it is.
- JCJason Calacanis
... one in China and it's funded by America and China and the World.
- CPChamath Palihapitiya
The Wuhan- I think. ... Institute of Virology. I mean, this is, this is, I mean, this is a-
- JCJason Calacanis
The-
- CPChamath Palihapitiya
... their- their- their-
- JCJason Calacanis
... their Chinese- Their Wuhan Institute of Virology was posting job, uh, reqs two years ago for, uh, specifically for researchers of bat viruses. We know they were studying bat viruses at this place. And Wuhan just happens to be the place where a novel coronavirus that seems derived from a bat virus, you know, it like em- emerges. I mean, what are the odds, right? I mean, this was such an obvious theory, the idea that, you know, COVID might have leaked from, from this particular lab and yet we were forbidden from talking about it, I guess, till Donald Trump was out of office. I mean, I think there's really two stories here. One is Chinese culpability, you know, i- i- in the spread of the virus. The other one is the media story. Why were we not allowed to have this discussion? Why did the media brand anybody who discussed this leak theory as being some sort of conspiracy theorist or a racist? Why were big tech companies censoring or removing any user-generated content from their sites that were putting forward this theory? Um, you know, why, why was the media and big tech doing this? I mean, is it somehow-
- CPChamath Palihapitiya
I can, I can tell you why-
- JCJason Calacanis
More, more, but, but somehow they were telling us it was more racist to talk about a lab accident than to-
- CPChamath Palihapitiya
David, because the person who could have explained it in a deescalated, factual way, chose to escalate it and be emotional and superficial and that was Donald Trump. And so I, I don't, I don't think that you could point to us and say we could have changed how the narrative is exploited. All of us are just normal, average people on the ground. But there probably is sort of, you know, a hierarchy of, like, information and there probably isn't a single individuan- individual beyond the president that- who has access to more information. And so-
- JCJason Calacanis
Right, but-
- CPChamath Palihapitiya
... if he was, if he was just more moderate and normal and basically said, "Hey, guys, there is a legitimate risk that we need to investigate," because fast forward basically, uh, 18 months later and this president, who is moderate, you can like him or not like him, but he's kind of moderate and unoffensive, says basically that, and now we have this news cycle about investigating something we should have been investigating 18 months ago, just at least to get to the bottom of it. What was going on? But Trump had to make it such a big deal and about himself. And I think that's the takeaway.
- JCJason Calacanis
But just because Trump says something doesn't mean it's not true. I mean, he is occasionally going to say things that are true and, and, and, an-
- CPChamath Palihapitiya
That's not what my point is. My point is, is that-
- JCJason Calacanis
Well, you're- you're right-
- CPChamath Palihapitiya
... as the president of the United States, you just have to have more discipline.
- JCJason Calacanis
Well, but, but I think you're right in the sense that the reason this became a forbidden topic is because the media had to act like anything Trump said is, is untrue or crazy or racist or conspiracies-
- CPChamath Palihapitiya
It's a failure on both sides then, David. I mean, the, the media is failing to be independent critical thinkers and Trump is failing to be a good leader and be clear. And that means you have to be an independent critical thinker.
- JCJason Calacanis
The media's first obligation here is to the truth. They're not supposed to distort the truth or push forward a false narrative because of the political consequences and, and that they didn't want to be seen as helping Trump in any way, and that's really what their motivation was. But I find it equally disturbing that big tech was censoring the truth on this issue. The whole point of having a free marketplace of ideas is so that we can arrive at the truth and how is that going to be possible when Big Tech is censoring?
- CPChamath Palihapitiya
I'm sorry, I, I really disagree with you. I think that the, the Big Tech's decision to censor this information was a, was a derivative of the first two things. Like, I don't think that decision would have happened had Trump been normal and then, you know, media would have just listened and said, "Okay, maybe there's a chance this guy is right. He's saying and acting in a normal way. Let's go investigate." And then Big Tech would have basically said, "We don't know the truth one way or the other, but it seems legitimate, sane people are on both sides of this."
- JCJason Calacanis
So because Donald Trump published mean tweets, it was okay for Big Tech, or rather the media, to basically portray the correct theory as a lie and a conspiracy and it was okay for Big Tech to engage in censorship on that basis?
- CPChamath Palihapitiya
What I'm saying is the following. The president of the United States, independent and whoever it is, has a very specific responsibility to be measured, to be unemotional, and to be about the bigger picture. That's what the president of the United States' responsibility is, no matter who holds the office. And then the media's job is to fact check that and hold that person accountable and call that person in a transparent manner. Friedberg-
- JCJason Calacanis
... yes or no? Is it a viable theory? And then let's get to odds and percentages. I mean, as a scientist, do you think that this is bec- came from a wet market or some accidental exposure, somebody eating bad or some cross-contamination, a bat, and a pig, and then somebody eats the pig? Or do you think somebody from the lot, from the lab accidentally brought it home with them?
- 26:09 – 33:11
India's new "traceability" law
- DSDavid Sacks
- JCJason Calacanis
All right. Uh, India versus WhatsApp.
- CPChamath Palihapitiya
Um, well, I'll, I'll give you the rundown, um, on the India thing. So basically, you know, there, there is, um, a right to, you know, free speech effectively in the Indian constitution. Um, but then India passed a law, es- effectively, I'll just, I'll just, um, summarize it as traceability, which basically means that if you have an online network and you post something in the network, if an Indian censor or an Indian regulator or authority basically says, "Hey, hold on. This is an issue." They have the right to basically have this, the, the network or whoever owns that network, trace it down to its originating source. Now, that's a really important distinction because there are certain products. So for example, take WhatsApp, where a feature of the product is, uh, end-to-end encryption, right? So it's hopping around in ways that are very difficult and, and near to impossible for anybody to really figure out. And now all of a sudden that, that, that element, which used to be a feature, is now a bug because if the Indian government says, "Hey, hold on. That statement, I have an issue with. I need you to figure out who said that." They'll essentially have to undo all their end-to-end encryption to figure out. So then WhatsApp filed, um, uh, a court case in New Delhi, uh, this week, essentially, I think asking for an injunction. And so I think this is gonna go to a head. But you, you have this now state of affairs, which I think is really interesting, which is so, you know, we talk about how we have an issue with Chinese censors. Well, now here's a different, more complicated example because this is the largest democracy in the world. And what they're effectively saying is, "We need to have an equivalent red button and a set of levers so that we can figure out what's going on when we choose." And there's gonna be a lot of implications because inside of India, what's different than America as a democracy is, it has lower average incomes, it has lower health, it has lower literacy rates, it has more, uh, religious sort of tension. Um, and it's got, you know, uh, many, many more young people who are more prone theoretically to get, you know, um, bamboozled by misinformation and disinformation. And so, you know, India sees those facts on the ground and probably wrote this law with those intentions in mind, right? And it's had a bunch of these issues, by the way, particularly between Muslims and Hindus. And so what do you do? Um, you know, what is Facebook and WhatsApp supposed to do? What is Google supposed to do? Um, what does it mean for internet rights? I think it's a super, super complicated problem. And do you prioritize misinformation and disinformation above the right for people's privacy? And you're gonna see it unfold in the largest democracy in the world over the next couple months. I don't really know how I feel about it, to be honest, except I do think that Indian government has a right to set the rules of their own country.
- JCJason Calacanis
Well, and, and set the rules they are. I mean, remember, they also banned TikTok in an instant and hundreds of other apps. I think 60 apps from China have been banned permanently in India. So India obviously has a different approach to China, which is, "We're gonna put our foot down." Now, of course they're involved in some skirmishes on their border. But yeah, it does seem, Sax, what do you ... What's your thought? You have personal right to privacy, end-to-end decryption, and then you have, you know, the ability to run-
- CPChamath Palihapitiya
Backdoor, a backdoor to it.
- JCJason Calacanis
Yeah.
This is another, uh, major, uh, sledgehammer to, to globalization. You know, in the, in the mid to late '90s, we had this beautiful dream that we're gonna create a single internet for the whole world. It would create a single common market, uh, a single place for people to interact and go, and that all these barriers, these geographic barriers, tribal barriers would come down over time. And now what we see is the trade barriers have come up, and now instead of having one internet for the whole world, it's fragmenting into a bunch of different internets governed by local laws. Um, you know, it started with the, the great firewall of China creating sort of a separate Chinese internet. Now you're starting to see country by country regulations. And I just think it's, it's sort of an inevitable reaction that, uh, the power of governments and sovereignties comes before the, the power of corporations and they're reimposing their will. And I think the question for all these companies is gonna be where they decide they're willing to play. And, you know, I think y- now i- I do think it's a very different choice whether you wanna play in India or whether you want to play in China because in China when the government tells you to hand over information on dissidents, you really are aiding and abetting what could be political oppression. Um, whereas India being a democracy, I don't think the choice is quite the same at all. And so...You know, I do think these tech companies are gonna have to decide which countries they wanna sort of play ball with and ultimately, I think they're probably gonna have to make a determination based on working with the democratic ones, and they're probably gonna have to exit the ones that engage in political repression.
- CPChamath Palihapitiya
In my, um... First of all, I think that's really well said, what you said. I... In my, in my annual letter last year, I kind of wrote like, "Here's the white paper on how to dismantle big tech." And there were two frames. One was around taxation, which we're also seeing, but the second was on this regulator- regulatory point, David, that you're bringing up. That's the simplest way to sort of break these companies down, which is if you have to engineer now, instead of one monolithic code base, multiple instantiations where you can't even get the leverage of like, you know, cross-border data centers... I mean, by the way, there- there- there's a really interesting thing that the Biden tax bill also proposes on this dimension, right? It's gonna prevent you from sending IP, you know, into places like, um, like Ireland and keeping it there, right? So you can't have all of a sudden, you know, code that's running in Ireland that executes something that makes money so that you can pay Irish tax versus something, code that runs in America that's largely, you know, user oriented. That's not gonna happen. That's not gonna be allowed anymore. Right? So all of these things are happening at the same time, essentially to reign big tech in, making it almost a whack-a-mole problem inside these companies where you're fighting a tax thing. For example, Google's fighting antitrust in France. Then you're fighting antitrust at the EU level. Then you're fighting, you know, traceability and encryption in India. Then you're fighting, you know, inversion of, uh, an IP in America. Wow.
- JCJason Calacanis
Yeah.
- CPChamath Palihapitiya
Like, it's like all of a sudden the lawyers inside of these companies will outnumber the engineers.
- JCJason Calacanis
And I think a lot of this is the downstream consequences of what happened back in January when Twitter and all the other big tech companies deplatformed Trump. Remember, at the time, it wasn't just, you know, conservatives or, in the US who raised alarm bells. It was Angela Merkel in, in, um, Germany. It was the finance minister in France. I think India, you know, uh, talked about it. I think Modi had a statement about it. They all woke up and said, "Whoa, a head of state can be deplatformed by Jack Dorsey? He's more powerful than the President of the United States?" And countries all around the world started looking at the power of big tech and realized that they're subordinate to all of these tech billionaires
- 33:11 – 41:17
Coinbase & Brian Armstrong debut fact checking blog
- JCJason Calacanis
and oligarchs.
- CPChamath Palihapitiya
Tell me about Coinbase and Fact Check. I think this thing is incredible. I mean, I have to say, by the way, the first thing I'll say about... And this is, this is the exact opposite of what I said the last time Bryan Armstrong wrote a memo. This memo is excellent and if you haven't had a chance to read it, we'll put it in the show notes. But Bryan's essay is super. I think there have been a couple of CEO memos in the last two months that I think honestly should be in the hall of fame in the Smithsonian. One is the Toby Lutke memo, the, the internal email he wrote, and the second one is this one that Bryan wrote because I think this-
- JCJason Calacanis
All right.
- CPChamath Palihapitiya
... this thing is probably one of the most important things, in my opinion, that has been written by a CEO which has the potential to lead to huge systemic changes.
- JCJason Calacanis
Well, he echoed... He echoed a lot of the things we- we've been saying on this pod about-
- CPChamath Palihapitiya
Yeah.
- JCJason Calacanis
... going direct. Don't let the press tell your story. Go direct. Get, get the truth out. Um, they're ba- basically what the, what the blog said is they're gonna start using the Coinbase blog as a forum, basically as a media publication for, for crypto-related things. And the fact check part is that when the popular press gets crypto wrong, which they do frequently in Coinbase's view, Coinbase is gonna call them out and correct them. Um, they're gonna do it respectfully.
Yeah, so basically here's what he says. "The increased awareness has been great. Unfortunately, we also see misinformation published frequently as well, whether in traditional media, social media or by public figures. This doesn't always come from negative intentions. Our business and crypto can be difficult to understand and often people are rushed to post first impressions online, making mistakes in the process. At other times, misinformation comes from people publishing their own agenda or from people who have a conflict of interest. This is not unique to our business or industry, of course. So how should, uh, companies respond? One, turn the other cheek. Two, fight, and three, publish the truth. I believe there is a reasonable middle ground between these first two options," uh, turning the other cheek and fighting, "which is to simply publish the truth in a thoughtful and respectful way."
Well, two and three are the same. The, the way you fight back is you publish the truth.
Right.
So to me, that's not a choice. Those are the same thing, is you can either remain silent, take the high road, which always results in people believing whatever, you know, lies are, are being said, or you fight back by telling the truth.
"Fact check approach is not about antagonizing or embarrassing others..." That's Bryan Armstrong. "... but simply sharing what happened through our own channels. It also means sharing the good along with the bad, with radical transparency."
- CPChamath Palihapitiya
I, I just want to say that I w- I wish him all the success in the world because I think if, if, if and as this works, which I, which I think it will, because people in the crypto universe are more prone to actually get their own information and do their own due diligence, I think the spillover effects to other companies can be really positive. All of this is going to the same place, which is the intermediate layer of traditional media is basically getting whittled down, right? There was a, there was a different thing that happened in those last few weeks, which was, um, the Tribune Company, I think it was, um, basically got taken private by some hedge fund. And in it, um, they talked about what has happened in the industry. And the most incredible thing was the amount of revenue that has disappeared from newspapers, and literally from the tens of billions of dollars to basically single digit billions today over the last 20 years, which effectively means traditional media's revenue source is going away. And if then all of a sudden, if you take that media, um, model away and there are no more economic incentives, then it stands to reason that the overarching incentives that remain are around reputation, which is then about facts. And so the fact that Coinbase will have a place that says, "Here are the facts and we're gonna put it on chain permanently on the record."... that's, I think, a really powerful idea. Andreessen Horowitz, by the way, same situation. They're doing it in venture capital, you know, one of the largest and most prolific and important sources of funding the future. They're on the record on chain in their own way, right, with their own media and, and they're now helping to tell the stories of other folks through it. David Sacks. You know, Sacks has put so much content, um, in terms of teaching people about the business that he knows really well, but at the same time, he's also been able to write about what he thinks about certain things. And then eventually, on behalf of his companies, he'll be able to say things and do things as well. So all of a sudden... Not all of a sudden. I guess we've seen it, but if we had to put a label on this, this is the dismantling of traditional media. It is happening in real time. A- and it's accelerating.
- JCJason Calacanis
It turns out, you know, as a subject being interpreted as you're being through the New Yorker right now (laughs) in your story, Chamath, and I am through my Business Insider profile, you know, all these profiles that they do, they're interpreting your life when people could just tune into the podcast and hear us talk about it, right? And it's like you can go direct to the source and listen to 34 episodes of All-In or you could read some interpretation from somebody trying to get page views.
- CPChamath Palihapitiya
Well, here's my, here's my observation. The thing is that people who create artifacts on a real-time basis... So, in many ways, we have all collectively now started to create a weekly artifact of who we are as people. It leaves very little left over for interpretation. And so then, unfortunately, what happens is journalists trying to write content have to introduce some form of flourish to stand out.
- JCJason Calacanis
Yeah.
- CPChamath Palihapitiya
Because if you're just repeating something that was said on the podcast or something that we said in a, in a-
- JCJason Calacanis
That's a good point. Yeah.
- CPChamath Palihapitiya
... tweet, there's nothing left to talk about. It's kind of already been said. And so that's what creates boundary conditions for lying, and it's what creates boundary conditions for mistruths. And we've seen a handful of reporters back in the day fall- you know, fall into that trap. We, you know... There was a couple writers in the New York Times that got pinched for lying. It's gonna be harder and harder to lie. So in many, in some ways, I'm actually pretty optimistic that, um, that reputation management and truth will be easier to do in the future when this intermediary layer doesn't exist. But it'll take many other companies to do what Coinbase is doing, Andreessen, us in this podcast, us with our tweets and our memos and our posts. I think it's, it's all in the good, positive direction.
- JCJason Calacanis
Yeah. And, and, and, and Armstrong in his... in this blog, uh, talks about the Gelman amnesia effect, which we've talked about on this pod before, which is-
- CPChamath Palihapitiya
Yeah, I saw that. Yeah.
- JCJason Calacanis
Yeah, which is great. I love that-
- CPChamath Palihapitiya
Yeah.
- JCJason Calacanis
... um, because, you know, the Gelman amnesia is you read the newspaper about a topic you know something about, you see that 50% of it is just wrong, then you turn the page to some other part of the newspaper, say, you know, world affairs you don't know as much about, and you just assume it's true.
- CPChamath Palihapitiya
Right.
- JCJason Calacanis
And we all know that the media is maybe 50% right about everything. And so, yeah, I mean, so this is why we have to hear from experts directly. I think it's why... It's the decentralization of media. It's why I think this, like, heavy-handed, uh, centralized censorship by big tech is so offensive and anachronistic. It's to try and control what everyone can say, especially when it later turns out that, you know, big media gets so many things wrong, like the lab leak theory. Um, so it- it's, it's... This is definitely the way things are headed.
- CPChamath Palihapitiya
I would like to invest some money to basically have Friedberg a platform to explain science.
- JCJason Calacanis
(laughs) Well, that's right here. Friedberg, tell us about the science of, uh, NBA games and large gatherings-
- CPChamath Palihapitiya
(laughs)
- JCJason Calacanis
... in the age of vaccination.
- 41:17 – 45:06
Friedberg's science corner: groundbreaking gene therapies
- JCJason Calacanis
the tiger here.
- CPChamath Palihapitiya
Friedenberg, why don't you tell... This is something I thought was incredible. Amgen, um, this week, at the end of this week, got approval for this really incredible drug that basically targets KRAS mutations, uh, in lung cancer, which has been this body of cancer that has basically been somewhat intractable for a really long time. And these guys have cracked the code, it looks like. And now the drug is 18,000 a month, I think, but, uh, you know, that's for insurance to take care of, but, um, pretty incredible breakthrough that people are talking a lot about. I don't know if you, if you were tracking it.
- DSDavid Sacks
No, but, um, I think that there were several other gene therapies. There, there were several, um, uh, drugs that got approval in the last, like, month, um, one of which is this... Or actually it was about two months ago, this drug that, um, uh, uses targeted CAR T therapy. Um, basically, you know, we all have T cells and, um, we can edit our own T cells now, uh, using this CAR T therapy. It's a series of techniques where you basically reprogram your T cells genetically to go after a specific target in your body. And so there are now a whole series of CAR T therapies that are coming to market that are actually in market. You can go down and go get treatment, uh, today for several of these CAR T therapies that, you know, not too long ago were really difficult to kind of understand, uh, you know, being real. Um, they take your T cells out of your blood. You know, so you go in, you get your blood drawn. A couple weeks later, you come back to the doctor, they've taken the T cells out of your blood, they re-engineer them. The way they re-engineer them is really interesting. They basically use this technique where they zap them with electricity and it gets this gene editing in there and then they get edited. And then they put those T cells back into your, into your body.... uh, it takes about an hour to get them re-injected back into your body, and then they do their job. And they... in, in many cases, they're being used to target cancer cells. It's very specific receptors. So now the T-cell has been programmed to go find that cancer cell receptor. They hit the cancer cell receptor, bind to it, and then eliminate that cancer cell.
- JCJason Calacanis
So essentially, in, in, in plain English, you're putting this super T-cell back in the body. It goes through the blood, and then it finds something far in that shouldn't be there, like a virus or cancer-
- DSDavid Sacks
It can find anything you want it to go find.
- JCJason Calacanis
... bacteria, whatever you want it to find, and it snipes it.
- DSDavid Sacks
But yeah, what it does... Remember, it's, it's looking for a specific protein. And that protein, for example, can be expressed only on the surface of specific cancer cells. So if you found certain cancer cells, that you have a cancer, and we know that there's a specific protein that shows up on the surface of that cancer, which is common in many cancers because they all follow very similar kind of, you know, mutations, you can end up targeting that cancer cell and only that cancer cell, and your, your T-cells go to work and they go and wipe it out.
- CPChamath Palihapitiya
I think the breakthrough this week was in multiple myeloma and thyroid cancer.
- DSDavid Sacks
Yeah, there was a multiple myeloma one, which was a bluebird bio product.
- CPChamath Palihapitiya
Yeah.
- DSDavid Sacks
And then I think it got picked up by, um, uh, uh, Bristol, uh, or, or someone else picked it up. So they, they basically paid the fee and they run their own good manufacturing practice, uh, facility where your blood is shipped to them. They do all the gene editing with your own T-cells in this facility and they ship it back to your doctor and it gets re-injected back into you. And so there are several of these-
- JCJason Calacanis
There are 600 CAR T-cell... Is that what it's called? CAR space T-cell?
- DSDavid Sacks
Yeah.
- CPChamath Palihapitiya
Yeah.
- DSDavid Sacks
So CAR stands for chimeric antigen receptor and that is the little co-... Think about it as like a seeker that's on the outside of your T-cell. It goes and it finds a specific thing it's trying to bind to. And so you're reprogramming your T-cell to have a specific, um, uh, receptor. And then it... As soon as it finds that, that, that... As soon as that receptor binds to the correct protein that it's looking for, boom, that, that cell that it binds to gets wiped out.
- 45:06 – 1:04:45
Amazon's MGM acquisition, media consolidation
- DSDavid Sacks
Are we gonna talk about the crazy media mergers and spinouts that are happening? Because it seems like just in the last 90 days, the entire industry is rewiring itself and it's kind of a pretty significant set of, uh, transactions that are underway.
- JCJason Calacanis
Amazon is buying MGM, which owns most importantly James Bond. James Bond has done $20 billion in adjusted, uh, revenue for their movies. And you can obviously see many different backstories and television shows around the James Bond. So this is kind of, in my mind, of that eight or nine billion, they spent six billions on the franchise for James Bond so that Bezos can play James Bond, obviously, while he retired.
- DSDavid Sacks
(laughs) If you take a zoom out, you know, um, several years ago, you guys may remember, you know, early 2000s into the mid- you know, uh, aughts, um, all the telcos started freaking out, uh-
- JCJason Calacanis
Yep.
- DSDavid Sacks
... because they were... or sorry, all the media companies were freaking out because their controlled points of distribution, which were network television and then their cable television stations and then movie theaters were getting disintermediated by the internet. So all these internet companies showed up like YouTube and Netflix and were going direct to consumer where consumers were now getting access to content directly without the controlled channels that the media companies controlled. At the same time, the telcos were freaking out because it turns out people didn't need cell phones anymore or need phone lines anymore. What they needed was internet access and internet access was quickly commoditizing. So the telcos were like, "Holy crap, being in the business of providing internet service, not a great business. We need to be making more value per user per year than we're gonna be able to make charging them for internet access." So the telcos started buying up media companies. This is what Verizon and others did. And the media companies-
- JCJason Calacanis
AT&T as well. Yeah.
- DSDavid Sacks
And AT&T and the media co-... So remember Verizon bought AOL and Yahoo. Uh, AT&T bought Time Warner. And then the media companies, the old school media companies that were kind of like still... decided not to sell and to stay on their own, they decided, "Well, we gotta go internet, right?" (laughs) And so we gotta figure out how to be on the internet and compete in this world where companies like Netflix and Amazon are going direct to consumers. And, um, you know, they all, uh, started building their own internet services. And so now you got-
- JCJason Calacanis
HBO Max, Hulu.
- DSDavid Sacks
... Paramount+, HBO Max, yeah.
- JCJason Calacanis
Yep.
- DSDavid Sacks
Hulu. And then... You know, Hulu was a big one. And meanwhile, the tech companies that went direct to consumers, they're realizing, "You know what, if these media companies aren't gonna play ball, we better get our own media. We gotta get our own content."
- JCJason Calacanis
Apple TV. Yep.
- DSDavid Sacks
And so then they started licensing-
- JCJason Calacanis
Amazon.
- DSDavid Sacks
... buying, funding and, and building their own media companies. And so there's a total reorientation that's underway. Now, what's interesting in the last couple weeks is Verizon decided, "You know what? We can't be in the media business. We're not very good at it." And they spun it out and they're selling AOL Yahoo. And then meanwhile, this really interesting deal is AT&T gave up on owning Time Warner. And so it turns out that the telcos who thought that they could own the media and monetize it, "You know what? It's just a pain in the butt. It's another business. We can't really figure out how to add value to our subscriber base with these products. They're gonna have to exist on their own. We don't know how to run them 'cause we're not media guys," and they're spinning out. So now the telcos, the interesting question to ask is, what are they gonna do next? What's the next move for them? 'Cause they gotta keep growing. Meanwhile, the, the tech companies and the media companies are just like this. And there's 50 subscription services each with their own silo and balkanization of content. And we're all gonna have to choose as consumers, do I want HBO Max or Paramount+ or, you know, the, the bundle I get from Comcast? And it's gonna be a nasty battle for the next 10 years where you... an- and where you want content, you're gonna have to go pick and choose who do you wanna buy content from. Uh, and so it... Yeah.
- CPChamath Palihapitiya
I have a theory. I think consolidation happens when markets don't matter anymore and are getting commoditized. And what I would say about all of this, what it shows me is that we're now transferring to the phase of the market where it's all about cost of capital. And right now, the only person that actually understood that was Netflix. And Netflix issued billions of dollars of debt, and they've started to finance every piece of content under the sun. And being small and trying to compete against Netflix was not possible. And now we're in that part of the market where content is actually not that important because there is an enormous diversity of it. So no one single person can really corner that market. And so then it becomes how much can you make and how cheaply can you make it? And there, scale matters. So-... I could think, like, what this shows me, back to sort of what we talked about before on the other part about, like, facts and truth is, this is part of a much broader, you know, media puzzle that's becoming more obvious, which is, um, traditional outlets that push top-down content is kind of yesterday's news. And, um, what it's being replaced by is more and better forms of user-generated content and, uh, highly commoditized professional content. And in all of that, the economics are going away. So, I don't... If you, if you, if you are not sure, go and look inside of TikTok. The content that individual people create inside of TikTok is unbelievably good and they are training an entire generation of kids to consume content 15 seconds, 30 seconds at a time, which has huge implications, by the way, for how they consume music. So for example, if you guys, like, look inside of TikTok and then go to YouTube and look at the most popular-
- JCJason Calacanis
It's exactly-
- CPChamath Palihapitiya
... videos.
- JCJason Calacanis
... the same. And same thing with Spotify. Yeah.
- CPChamath Palihapitiya
It's 15-second clips now. No, you know, these kids wanna listen to the hook of a song and then they won't listen to it. I, I see how my kids use it and it's crazy because, like, they get addicted to a hook on TikTok, they try to go to YouTube to learn the lyrics. They only wanna learn the lyrics for the part that's in the TikTok-
- JCJason Calacanis
Buss it.
- CPChamath Palihapitiya
... clip and then they move on.
- JCJason Calacanis
Buss it challenge, yes. Whatever it is.
- CPChamath Palihapitiya
And so the, the point of all of that is that content costs are gonna continue to go down, which means the economics are gonna go down. The margins are not that good. Um, and so it's all just a commodity that almost doesn't matter anymore.
- JCJason Calacanis
Well, I don't know about that. I think for the top-tier IP, like, you can't displace a Disney, um, in their growing portfolio of IP and those things are high margin. And, you know, having 250 to-
- CPChamath Palihapitiya
I don't know.
- JCJason Calacanis
Having 250 to 500,000... 500 million people paying you monthly has never existed in the history of humanity. There's never been a, at-scale service like this before. The closest was Verizon and AT&T when they hit 100 million members.
- CPChamath Palihapitiya
No, I'm not, I'm not disputing that people won't pay $9.99. What I'm disputing is, the denominator of what they're paying for is increasing so fast that no one piece of content matters, Jason.
- JCJason Calacanis
No, the idea... I agree with that. Collections-
- CPChamath Palihapitiya
Yeah.
- 1:04:45 – 1:08:22
Biden's $6T infrastructure, Democrat's feeling the inflation pressure & responding
- CPChamath Palihapitiya
be. One last thing for you guys, on a market check. Uh, my 10-year breakevens, remember.
- JCJason Calacanis
(laughs)
- CPChamath Palihapitiya
Uh, we're now down to 242. It's been, uh, 18 days.
- JCJason Calacanis
What is he talking about?
- CPChamath Palihapitiya
And, uh, uh, my little inflation check. My little inflation check. And seems like things are trending in the right direction.
- JCJason Calacanis
Hm.
- CPChamath Palihapitiya
So, we-
- JCJason Calacanis
The markets are back. The market's back a little.
- CPChamath Palihapitiya
There may... I'll go out on a limb and say, um, we're, we're, uh, we're in the sort of the, the August of their, um, supremacy. So, and again, I would just say, David, if on the one hand it's a whack-a-mole problem with governments on taxation and regulation, and on the other hand, you have a way where you can have distributed social currency and value, wow, I mean, these big tech companies are getting bombarded on every single side. Um, and I think that's just a hard place to be. One last thing for you guys. On a market check, uh, my 10-year breakevens, remember-
- JCJason Calacanis
(laughs)
- CPChamath Palihapitiya
... uh, we're now down to 242. It's been, uh, 18 days.
- JCJason Calacanis
What is he talking about?
- CPChamath Palihapitiya
And, uh, uh, my little inflation check. My little inflation check. And seems like things are trending in the right direction.
- JCJason Calacanis
Hm.
- CPChamath Palihapitiya
So, we-
- JCJason Calacanis
The markets are back. The market's back a little.
- CPChamath Palihapitiya
There may not be inflation. There certainly was a point where I said, "Look, I'm going all in."
- JCJason Calacanis
Well, I think what happened, Chamath, is you, you put it well, I think, a couple of pods ago. The market sent a signal to Biden that, "Look, this is too much taxing, too much spending. It's too inflationary." And I don't know if Biden heard the message, but several Democratic senators did-
- CPChamath Palihapitiya
Pumped the brakes.
- JCJason Calacanis
... and they pumped, put on the brakes, they reduced the size of the package. They're now talking about maybe the capital gains rate going to 25. The infrastructure bill is, you know, been chopped in half. So, I think there's less inflationary pressure coming out of Washington, hopefully.
- CPChamath Palihapitiya
Yeah, what I, what I heard last week, I sp- I spoke to s- some folks in Washington. What they said was exactly what you said, David. They're not gonna... At best, they're gonna get the cap gains r- uh, th- sorry. No movement on cap gains. They don't think it can happen at all, so that's not gonna move.
- JCJason Calacanis
Oh, good.
- CPChamath Palihapitiya
Uh, number one. Number two is that corporate will go to 25 and not to 28. And then number three, they're gonna really tighten the IP loophole, um, which will prevent American companies from shipping IP to places like Ireland to not pay tax. They're gonna make it impossible to do things like conversions, all this kinda stuff, and then scope that down. That's actually, to your point, a very, very good, uh, outcome for the markets.
- JCJason Calacanis
So, this was actually productive, if this happens. If the infrastructure bill gets... I think the Republicans now, they, they first, McConnell said 600 to 800 billion. Now, I think they're, they're at 900 billion. I think the Democrats started at 2.3 billion. Now, I think they're at 1.7. So, hopefully it's being brought down to a more reasonable number that's not gonna bust the, the budget.
- CPChamath Palihapitiya
1.2, 1.3 and everybody will have something that they can take with them.
- JCJason Calacanis
But he, but here's the crazy thing. I mean, the US government debt is now at 100% of GDP. We owe our entire economy. Uh, and it's pretty crazy. And- Yeah, there's still other countries that are 1.5, right, and double, like Japan and others, yeah. S- m-
- CPChamath Palihapitiya
It's not a precedent.
- JCJason Calacanis
B- bu- bu- but Biden, Biden's $6 trillion budget would increase our budget debt, uh, our debt from 100% of GDP to 117%.
- CPChamath Palihapitiya
Too much.
- JCJason Calacanis
If he gets his way. Too much. It's a World War II level of spending, but what is the benefit equivalent to World War II that we're getting out of this thing? Well, also, w- we have a surplus in so many states that we're doing lotteries. Thank you, Queen of Quinoa, Rain Man, and The Dictator. Uh, I'm Jason Calacanis. We'll see you next time on the All In podcast. Bye, bye. (instrumental music plays)
Episode duration: 1:08:22
Install uListen for AI-powered chat & search across the full episode — Get Full Transcript
Transcript of episode eoZG89pDzzY
Get more out of YouTube videos.
High quality summaries for YouTube videos. Accurate transcripts to search & find moments. Powered by ChatGPT & Claude AI.
Add to Chrome