We can’t quit electric cars — or robotaxis
01:16:38 Share

Welcome to the Vergecast, the flagship podcast of intra-protocol competition. I'm your friend David Pierce, and I am once again attempting to learn how to do a Rubik's Cube. So during the pandemic, the two sort of weirdest days I had were the day that I woke up and decided to learn how to juggle, which I successfully did. I'm not going to do it for you now, but I'm like a reasonably good juggler now. And then there was the day that I woke up and decided I was going to learn how to solve a Rubik's Cube and just

utterly failed. And so now I have this Rubik's Cube that just sits here on my desk and I sort of fidget with it during meetings. I like it for that, but mostly it just taunts me because it is unsolved and I don't know how to solve it. So I have a bunch of YouTube videos. I have a webpage that is just step-by-step instructions. I'm realizing this is less like a creative endeavor and more just sort of memorizing an algorithm, but I kind of like that. I'm ready for that. I'm going to try it. It's going to be great. I'll update you next week to see if I actually pull this off.

That is not what we're here to do on the show today. We're going to do two things today. First, we're going to talk to Andy Hawkins about what's going on in the car world. Because right now it seems like EVs are kind of going away and robo taxis are suddenly back. So we're going to talk about both those things. Then we're going to talk to Evan Perdomo, who is one of the people overseeing the activity pub protocol. We're going to talk about blue sky and threads and Mastodon and the whole world of social networking right now and where we're headed this year.

We also have a really fun hotline question about the iPhone 16E with some of the thoughts that we've heard from all of you since we talked about it on Friday. Lots to do, lots to talk about. But the first step in my Rubik's Cube, as I understand it, is to get one side solved. So I'm going to go do that and we will be right back. This is The Verge Cast. See you in a sec. What are your grand ambition? Your greatest goals? If you're someone who's always striving, always looking to reach the impossible, there's a vehicle for people like you.

It's called the Defender. The Defender has been reimagined for a new generation of explorers with a new, thoroughly modern design. With its tough, rigid body, you can explore with confidence, off-road and on, without sacrificing luxury. You can embrace the impossible with an icon of adventure, the Defender. Visit LandRoverUSA.com to learn more about the full Defender family.

It's time to review the highlights. I'm joined by my co-anchor, Snoop. Hey, what up, dog? Snoop, number one, has to be getting iPhone 16 with Apple Intelligence at T-Mobile. Yeah, you should hustle down at T-Mobile like a dog chasing a squirrel, chasing a nut. Number two, at T-Mobile, families can switch and save 20% on plans plus streaming services versus the other big guys.

What a deal. Y'all giving it away too fast, T-Mobile. Slow down. Head to T-Mobile.com and get iPhone 16 on them. Yeah, you can save on wireless and streaming versus the other big guys at T-Mobile.com slash switch. Apple intelligence requires iOS 18.1 or later.

Okay, business leaders, are you here to play or are you playing to win? If you're in it to win, meet your next MVP. NetSuite by Oracle. NetSuite is your full business management system in one convenient suite. With NetSuite, you're running your accounting, your finance, your HR, your e-commerce, and more, all from your online dashboard. Upgrade your playbook and make the switch to NetSuite, the number one cloud ERP. Get the CFO's Guide to AI and Machine Learning at netsuite.com slash vox.

Welcome back. I managed to get six out of nine blue things in the right place during the break.

I don't think that's very good, but it feels like a start. I will solve this thing if it kills me. Anyway, let's just get into it. First up, we're going to talk to Andy Hawkins, because following the transportation news the last few weeks, there's this strange momentum shift happening. On the one hand, electric vehicles, which I think have been not on the decline, but kind of out of fashion for the last little while, feel like they're going to be a little bit of a problem.

feel like they're falling further and further out of fashion really quickly, and that seems odd to me. Then on the flip side, you have companies like Uber and Lyft making a big deal out of robo-taxis again, like it's a decade ago and we're all pretending that robo-taxis are going to be a thing. The momentum shift here is just very odd to me, and Andy's been covering it a lot, so I think it's just time to get into it. Let's just call up Andy, see how we're doing.

Andy Hawkins, welcome back to the show. Hi, thanks for having me. It's been a minute. I feel like there is both. There's like so much car news that there's never a good moment to be like, let's let's just take a break and talk about car news. It just like it just keeps happening. It does. It never stops. So, OK, so I brought you here, I think, for like two and a half reasons and a half because

We're going to do as quickly and painlessly as possible. And that is we have to talk about Elon Musk and Tesla. Oh, God. All right. But we're going to do that so fast. And at the end, I promised at the top of this show that the Tuesday Verge cast is going to be a safe place from now on. And I intend to live up to that as best we can. The two things I really want to talk about are sort of this moment in the EV revolution, because we're sort of an odd.

moment in the EV landscape. And I just want to feel that out a little bit. And then I want to talk about robo taxis, which are both like closer than ever and still seem like a total pipe dream. And I just need you to make sense of those things to me. Does that all sound good? I'm happy to do that for you. Okay, good. Let's start with the EV stuff. And I think this is particularly on my mind because Nikola, this EV truck maker that I think

Has been somewhere between mostly a fraud and entirely a fraud for a pretty long time now. Finally declared bankruptcy. And it just feels like we're at this moment, and we've talked about this a few times on the show, where EVs were going to be the thing and everybody decided that EVs were going to be the thing. And this revolution in electric vehicles just keeps shooting itself in the foot every imaginable time.

So where are we right now in early 2025 in kind of the EV universe? Yeah, so I think you could say that even the biggest supporters and boosters of electric vehicles will admit that sales have kind of flatlined. And this is, you know, both in the U.S. and in Europe, but also in China as well. And China is sort of like the kind of the big X factor hanging over all this, and we can get to them in a minute. But

But yeah, it's sort of a, it's a weird place.

because we're coming off of four years of an extremely EV-friendly administration in the White House to whatever the opposite of that is now. The most hostile administration that we've ever seen towards electric vehicles to the point where a lot of these policy decisions seem to be being made just out of spite, is how I would describe it. And so on top of all that, you also have a lot of these kind of like mid- to low-tier startups that,

that came into prominence over the last decade or so on the promise of electrifying, you know, certain segments of the car market. So for Nicholas' case, it was going to be heavy-duty trucks, and they were going to be battery-powered, there were going to be some hydrogen-powered trucks,

in the mix. And this was going to be sort of a major push to get all the pollution out of the heavy trucking industry. But this is a company that had a lot of problems even before Trump came into office. I mean, like you mentioned, there was allegations of fraud. There was a real kind of like dramatic report from this short-selling group called Hindenburg that accused Nikola of staging a lot of its sort of hype videos showing its trucks driving

driving out in the desert. One of the videos apparently was shown the truck was just being rolled downhill. It was even operational. And so it's kind of amazing. I know it's like it's really it's like not even technically a lie. They're like, we didn't say the car was on. Like, it's just a truck moving. It was really it's just it's beautiful. Just put it in neutral and down a hill. Just if you assumed that it was driving, that's that's on you, not on us.

And, you know, amongst a lot of other things that they had promised, you know, that they had said that they were going to be, this is going to be a billion-dollar company, you know, multi-billions of dollars this company was going to eventually pull in. And so, yes, they filed for Chapter 11 bankruptcy protection. And this came...

I want to say maybe about seven or eight months after the original founder and first CEO of the company, Trevor Milton, was convicted of these frauds and jailed. He's currently in jail. I believe his sentence was for around four years.

And so the company was under different leadership at the time. And I think that they had sold around like 600. They eventually got around to actually making the trucks, and they sold around 600 of them. But the environment and sort of the market environment right now for EVs is just so upended now.

And is the lesson in all of this that this really has just been driven by the industry?

by politics and policy in both directions, that the reason everybody got excited about it was because we had a government that got excited about it. And then the reason it's falling apart is because we have a government that wants it to fall apart. That actually, if you just let the market decide, maybe there hasn't really been the EV market everyone sort of assumed was coming. I think that that plays a big role, but I think that there's also a lot of responsibility that's on the companies and the automakers themselves who were the ones that were out there out front saying,

saying that they were going to be, that electrification was the future and that they were going to be fully electric companies, like companies like GM, which, you know, is a huge global automaker, makes Cadillac and Chevy and Buick and all of these major brands.

And they said that they were going to be zero emission by 2030, that there was no equivocating about this decision. And all of the other automakers basically said something similar. Ford said that it was going to be zero emission and EV only in Europe by 2030. Mercedes said it. BMW. All of these major companies coming out and saying, you know, gas is the past and electric is the future. Right.

And they were fully convinced that they were going to be able to be selling these cars hand over fist and that customers were just going to eat it up, that they were going to love the experience of driving EVs, that they were going to love the ownership experience. The only problem is that the prices didn't really match what the expectations were, that they were selling a lot of cars that were

in the luxury segment at first. And then you got into like the heavy trucks, like your Hummers and your Ford F-150 Lightnings and your Chevy Silverados. And these are giant, heavy vehicles with big, heavy batteries that, yeah, they have some pretty decent range, over 300 miles. But the expense associated with getting these batteries in these vehicles was just so much

that customers just sort of balked at the prices that they were seeing. That, you know, you could buy a gas-powered F-150 for around $30,000, $40,000 at the base model. Why would you spend $70,000, $80,000 on an electric version of that? Yeah, you know, and when you start towing stuff and doing truck stuff with it,

All of a sudden, that range, that precious range starts to starts to drop precipitously. So it was, I think, a misstep on the part of the industry to prioritize the luxury and the heavy EV, heavy truck and SUV, assuming that customer preferences in the gas market were going to carry over to the electric market.

And then you had all of these sort of EV favorable policies from the Biden administration that, you know, were instrumental in getting all these factories spun up and getting a lot of regionalization companies bringing the production to the U.S. from overseas. It had a big effort in that. And also, you know,

funding the EV charging picture, which is another thing altogether. But seeing now how quickly all of that kind of stuff can be unwound and unspooled by the president administration, I think is giving a lot of these companies pause about sort of like banking too much on this certain technology when perhaps the customers aren't there and then the government help is not going to be there as well.

Yeah, you wrote this great story a couple of weeks ago about Ford that had, and I don't think I told you this at the time, but it had my favorite Verge headline of like the last 12 months that I feel like also like perfectly summed up the EV market. The headline is Ford lost $5 billion on EVs in 2024, teases new models. Which just to me, it just perfectly sums up the whole thing. And then there was news, I think,

around the same time as that, that VW was like, no, no, we're actually going to do the $20,000 EV that we've been promising that everybody holds up as this like mythical thing that someday when somebody does that, it'll change everything. These companies at some point should just look at themselves and be like, nevermind, this didn't work. Maybe it'll work someday. We'll like leave a team working on it over there.

Can they just not help themselves at this point? Like, why can't these companies quit EVs given that right now, if you're just being pragmatic, like if you're in pure shareholder value mode, it seems like the clear, obvious thing to do is spend a lot less time thinking about electric cars. I think fear is playing a big role in sort of why it is that they're not just giving up entirely. Yeah.

I think there is like an aspect of it that a lot of them do still believe that EVs are the future in that this is the right technology to be betting all of the money in the companies on that, you know, eventually we'll get to a point where we can bring battery costs down and EV charging infrastructure will get up to speed and will become something that you can actually rely on and that the prices will get right and the form factor will be spot on.

And obviously, you can have your cake and eat it too, because this will be an environmentally, more environmentally friendly technology to bet on, zero emission. If you can find a way to recycle the batteries and get this sort of supply chain built up that will encourage people that this is actually the technology of the future, that they will actually get there. And then there's the fear aspect, which is fear of China and Chinese EVs. And we're already sort of starting to see the effect of

less so in the U.S., but definitely in Europe, where, you know, Germany, this country

that has this storied auto sector with Mercedes and BMW and Audi and Volkswagen and all of these sort of major legacy brands are just in a free fall at the moment because of competition from China. The Chinese companies like BYD and NIO and Geely and others are just flooding the market with these cheap automakers

affordable and honestly pretty fucking cool EVs that like everyone that I've read sources that I trust that have driven these cars and seen them up close and been to China and toured the factories and tested the vehicles have said this is they cracked the code

Like, you know, say what you will about government subsidies and, you know, the Chinese government has got its thumb on the scale and is potentially, you know, cheating a little bit in terms of, like, how much money they're pouring into the industry. But it's certainly, you know, it's not coming at the expense of, like, good money.

fun cars to drive and decent technology. So that, you know, there are certain vehicles that are, you know, in the $12,000, $13,000 range that if you had a vehicle like that available here in the U.S., like it would just eat Ford and GM's lunch. Like there's just no question. And Ford CEO Jim Farley has, you know, he had a Xiaomi EV last year that he drove around for like a couple months, I think.

And he saw like the demise of his own company, like basically in the future while driving this vehicle, that it was just such an impressive experience that he's like, there's we have to catch up to these guys because they have beat us. They've been at this for much longer than we have. And they have figured out a way to bring all the costs in line and and come up with these with these cars that are just amazing.

so technologically and design-wise above the rest. So I think that the rest of the industry, the Europeans and the big three here in the U.S., have really no choice. If they don't continue to pursue it, and, like, it may be, like, you know, the Trump administration puts in some policies in place that will, like, actively make it, like, detrimental to their business to produce EVs, which I could see happening, they will have really no choice to just keep pursuing and keep trying to, like,

you know, throw everything that they've got at this problem because otherwise it's literally their own futures that are at stake. Interesting. Okay. I think the China piece of it, I think I have been underrating in all of this because I keep looking at this thinking, okay, the first mover advantage of this already happened, right? Like Tesla did that. And I think has pretty much ridden out its entire advantage on that front by being so far out in front of everybody else. Now we're at a point where it's like, okay, if this isn't going mainstream now,

tomorrow, what's actually the harm in waiting? And the harm in waiting is that when it goes mainstream, China will have already won. We will be so far behind at that point that it will just... China, it seems like, is just sitting there waiting to flood the market the minute the market is ready for it to do so. And that's pretty scary if you're a Volkswagen. Yeah, it was crazy. So I was in Brazil visiting some friends last year, and

you know, at first, you know, I saw like a lot of like Peugeot and Renault and like a lot of these like European brands out on the road. And then eventually I started to notice that like most of the cars that I saw and we were taking Ubers and, you know, ride share and all that kind of stuff. And they were all Chinese EVs. They were BYD, they were Neo. And it was just like, it was incredible how just like,

apparently, like, had come in and just, like, dominated, you know, these markets like Brazil and others. And I think, like, yeah, I think it's, like, it's certainly the case that you can slap tariffs on every single one. And Biden has done that. And now Trump's talking about doing the same or one-upping and trying to make it sort of financially prohibitive for these Chinese companies. But the cars are so inexpensive. Yeah.

and so cheap that they literally can absorb the cost of a tariff and still come into the market. Like, I don't see how you can eventually stop that. And that's something that I think a lot of these companies are in the U.S. are deeply afraid of. Yeah, I mean, at $20,000,

a $12,000 car plus a 25% tariff is still going to win the price worse in a lot of these cases. Yeah, absolutely. That's really interesting. Okay. And so on the other hand, as we talk about, you know, things happening sort of slowly and all at once and maybe not and going back and forth a million times, robo-taxis, which kind of seem to be having another moment. I think...

Joanna Stern on the show at the end of last year predicted that this was going to be kind of the year of Waymo. Seems like that might be kind of coming true, but also like Lyft and Uber are back in this game. Like it's like it's 2016 all over again in the robo taxi world. What is happening here? Yeah, it's a it's a weird situation because I think what you've seen is that the the major automakers, you know, like a good seven, eight years ago were like, oh, we need to be all in on this.

Part on autonomous vehicles, the same way that they missed the boat on EVs. It was going to be by 2020. They were all like, by 2020, we'll be taxiing everywhere. It was always by 2020. And I seem to recall 2020 being kind of a different year. Yeah, I had a real different experience. I didn't take other taxis very much in 2020. So I guess that's something. People were buying a lot of e-bikes and scooters and not so much robo taxis.

Um, but yeah, so they were, they were all in on automation. They were like, this is going to be us. We're going to be the future of, of the auto industry is going to be full autonomy. Um, and now they are like, oh, this is just taking too long. And it's, it's really expensive actually. And, um, uh, our business is really precarious at this moment. So we cannot be so deeply invested in, in, uh, in these sort of like long-term, uh, like hyper expensive science experiments, uh,

So, yeah, just recently you had GM completely divesting itself from cruise. And that was after, you know, cruise having a pretty rough year, rough couple of years because of some of, you know, its cars were blocking traffic and were getting on people's nerves in San Francisco. And then, you know, a lady got ran over and that was bad. On that one, by the way, do you do you read the whole cruise thing as GM? Yeah.

wanting out of the robo taxi business and deciding that that whole idea was just not what it wanted or is that like a specific cruise problem oh no yeah it's it's the i would say it's it's a little bit of both it was it was a specific cruise problem cruise was known to be sort of pushing the envelope and going uh a bit too aggressive yeah um as compared to like waymo and others they were trying to like get you know up to speed and and and compete and they were sort of you know um

not being as buttoned up and safe, which is like with a, with a autonomous vehicle operation, you really have to be as cautious and conservative as you possibly can. And that's just, wasn't the ethos at cruise. They were really trying to, um,

just they were they were pushing the envelope yeah real like move fast and break things which is not a good idea in robo taxis the move fast and break thing ethos was just yeah it was at at odds with the uh the safety element and um they really kind of um screwed screwed themselves over with that one but then also yeah that was sort of like the big the big message when gm said that they were going to be getting out of cruise was that you know this was not part of our core business uh which is

because, you know, seven, eight years ago, GM said its core business was going to be zero. Zero deaths, zero emissions, all this stuff that they were sort of like betting the company on the future being, you know, sort of like no more car crashes, no more traffic fatalities, and also no more emissions. So autonomy and electrification. And now actually GM's doing pretty good with EVs. GM just like working backwards from a cool slogan was an interesting move there. Yeah.

So, yeah, so they divested and Cruise is dead now. They absorbed some of the engineers into their Super Cruise division, which is like their partial automation, their hands-off driving assist feature. And a lot of these companies now are going all in on like this sort of level three, like hands-off eyes

eyes off driving on highways or in like traffic situations. Um, and that's, you know, a huge bag of worms. I mean, like there's been so many safety assessments that show that that kind of stuff is extremely dangerous. Um, so I, I don't want to say that like there's, you know, there's a whole raft of liability concerns that are going to be coming up, I think, in, in, in smashing into these companies. Nope, no pun intended with that. But, uh, it, it, there, there is a lot of, um,

potential there as well. Obviously, it's short-term revenue. Like, you can sell options to customers that you have. So really, that kind of just leaves Waymo all alone in the robo-taxi space. And they're light years ahead of all the rest of the competition. Like, Zoox is still just sort of in beta phase and, like, Las Vegas and some others. That's Amazon's robo-taxi company. And there's obviously some Chinese robo-taxi companies that are operating Baidu and others.

in their country. So it seems like really Waymo is way ahead of the rest of the competition. And they've got operations in San Francisco and Phoenix and Los Angeles. And this year they're launching in Austin and Atlanta. And the interesting thing about those launches is that they're going to be done exclusively with Uber. So instead of using the Waymo app where you've done in previous markets,

you'll open up your Uber and potentially you'll get paired with a human driver or maybe a robot Waymo car will be the one to come and pick you up in those two cities. So I think that that's why you hear, you've been hearing a lot about robo-taxis, but also it's interesting because, you know, you have now Uber that is very much a part of the conversation. Lyft as well, but Uber obviously is the one that's really trying to make itself like the agnostic platform that will take anybody's,

autonomous vehicles. So whether it's Waymo or some of these other companies like AV Ride and some of the other ones that are putting out like sidewalk robots for Uber Eats deliveries and others, Uber just wants to be like the neutral party that is just like, we'll take anyone's robot. You got a robot? Put it on our platform. We'll take your robot. We'll send it out to a customer and we'll see how it works. Which strikes me as a real lesson learned from the last time around, right? Like the first time everybody thought robo taxis were right around the corner,

Right.

We changed our minds. We want to be a different thing. And I think, I mean, it's just been interesting to me, especially, like you said, watching Uber and Lyft get back into this because those companies were so...

wrong a decade ago and were so badly burned by how wrong they were and invested incorrectly so heavily in those directions for so long that I think it really set them back. And so to see them now come back and it was like it was Lyft saying again, like Lyft is a pretty careful company at this point. And so for Lyft to come out and be like,

robo-taxis, y'all. Like, we're ready. We're doing it. It was just so interesting to me. This company is, like, finally making money for the first time in its history. And they're like, so, robo-taxis? It's like, there must be something here. I think it's a couple things. So I think for one, it's that Uber and Lyft are now sort of, like, newly...

profitable. Uber is profitable. Lyft had just had its first profitable year. They're cash flow positive. They finally, after over a decade and a half, have figured out how to make money off of rideshare.

And so they've got like, you know, they're kind of like they're feeling themselves a little bit, I think, in one respect. And then the other respect is, I think, is the market and investors are really kind of pushing them towards this because every time Waymo makes a some sort of, you know, iterative announcement about like going into a new market or a new city, it's like we're going to be in Miami or we're going to be

in this city, you see that reflected in Uber's share price. Like Uber's stock starts to go down a little bit. So Uber feels a little bit like pressure to pair up with these companies as a way to keep them close to them so that they can be part of this conversation. They can be part of sort of how this technology rolls out. If they're the ones that are sort of like at the front line of being in between the customer and the robo-taxi,

they see that as like a benefit to them that they get like sort of like the positive vibe, you know, sort of like ricochet off of, you know, the experience of writing in a Waymo. Like, oh, this is so fun. I get to, you know, control my music and there's nobody in the front seat and it's,

It's so unique and different. Wow. And, you know, maybe you associate that all 100% with Waymo, but maybe you get like, you know, a little bit, a little nudge to Uber as well. And so Uber gets something out of that. So Waymo is really like the boogeyman of this whole industry. Like everybody who's doing any of this is just watching Waymo essentially have unlimited time and money and resources to do this.

And I assume anyone else working on any part of this is petrified of what's going on at Waymo. And yet they like operate at a like fraction of a fraction of the levels that Uber does. Like Waymo has got like less than a thousand cars on the road today. Oh, interesting. And Uber is doing like just recently did like it's like one millionth concurrent ride. Like it's like. Wow.

all over the world. It's taken in taxi cabs now. It's, you know, it's like fully eaten the ride share and like the vehicle transportation market. And Uber is just like so small. It's like, it boggles my mind somewhat too, because like, it's got like, it's got great, you know, sort of like brand value in the terms of like, yeah, people like associate are starting to like

you know, like fully associate, like a Waymo has become like the Xerox or like the Kleenex of like robo taxis. And that, that there's, there is certainly value involved in that, but yeah, given how, like how few cities are actually not and how slowly and conservatively, which they have to, they have to do that because they don't want to fall into the same pitfalls as cruise or as,

Uber did. They can also afford to, importantly. And they, I mean, maybe. I mean, I mean, like if you've seen. Also that certainly has the money. I know, but if you've seen like the other bets and stuff like that, like, you know, where they list like the losses there, like it's not, it's not looking good. Like they're still losing hundreds of millions of dollars on this project. Right. But they're, they're, they're, I suppose, at risk of,

running out of corporate patience. Yes. But they're not at risk of running out of money. Yeah, it's a very different situation than Cruise with GM, where GM was just like, our margins are so incredibly tight that we just cannot continue to fund this thing. Whereas Alphabet's like, sure, five more billion dollars for the next five years? Sure, why not? It's eight minutes of running Google. Like, it'll be fine. Yeah. Exactly.

So, yeah, it is. And I think like one could see the same with Amazon, too, right? Like Amazon can continue to fund like money losing operation like Zoox for us, which like Zoox is an interesting player because we just had a piece that ran where our freelancer, Abigail Bassett, wrote in one in Las Vegas during CES. They they're taking a different tack. They're like, it's actually purpose built vehicles. It's these vehicles that look kind of like weird toaster shaped things and they don't have wheels.

They don't have pedals and they don't have steering wheels and you sort of like sit on these bench seats facing each other. It's like the foursome seat on a train that faces each other made into a vehicle. Which are always the worst seats on the train. Yeah, they're awful. Like nobody ever wants to like when your knees bump up against the other person's knees and it's just like, ugh. Everybody wants that. I hate this. Perfect. Yeah, so that's what Zeus is going for.

And that was interestingly what Cruise was also going for at first until everything fell apart for them. So it's interesting because, you know, and Waymo's got, you know, its future platforms. They've got a deal with Geely to make these Zeekr vehicles, but that could get seriously compromised by the Chinese tariffs. They've got deals with Hyundai to use Hyundai's Ioniq 5 as a vehicle. And,

So, you know, everyone's placing their bets. And I think, interestingly, Waymo being the one so far out ahead on the technology is still like we need regular cars that we can just retrofit. We're not ready to go like the purpose-built direction quite yet, which I think is quite telling. Got it. Okay. All right. Before I let you go,

Let's do 90 seconds on Tesla because I think a lot of this, like a lot of everything we've talked about is Tesla is wrapped up in. But the company's in an odd place, right? The last quarter was fine, but not great. Sales are down year over the year for the first time in forever, maybe ever. Was it ever? I think it's like an over a decade, basically. It's like a long time. Definitely since they've been profitable. Yeah, it's the first time. Yeah, and I think also Tesla's have been sort of

political statements in a variety of ways for a long time now, but that has really escalated. Like what, what's your read on sort of the, the market vibes around Tesla right now? How, what, what's going on inside that company? So, yeah, I mean like stock price wise, it's not doing too great. It's definitely down. I think this year, year over year. And yeah, as you mentioned, sales, sales are down and the vibes are off.

You could say, I mean, you know, I feel like I've been like writing the same story for like five, six years now about the vibes being off at Tesla. But now the vibes are seriously off. And that's obviously due entirely to Elon Musk and his new found prominence as, you know, as Trump.

Trump's hatchet guy. So it's, it's, yeah, it's, it's like, you know, you once had, it was a brand that was once associated with like California liberals and as a, as sort of like a statement about like what you thought about like the environment and climate change and the future and technology. And, uh, and now it's like fully like a MAGA brand, but it's not though because MAGA people will not buy Teslas and they're not interested in buying Teslas. They still like their trucks and their SUVs.

So it's in a very leave sort of Tesla, the company, and like a very weird limbo space right now where, you know, it's it's sort of like unsure of what's going to what it's going to take in order to to sort of like reset the narrative, I guess. And I think one of the things is the cyber cab, which came out last year. And Musk has said that it's going to sort of start doing robo taxi rides in Austin starting this summer. Right.

Big year for Austin and robo-taxis. Yeah, it seems that way. But Tesla's approach to autonomy, very different than Waymo. It's a camera-only system. It relies on its full self-driving hardware and software. And there's a lot of concerns about the safety of that technology. Tesla, famously a company that does not like to accept liability for crashes that occur with its vehicles. That's going to be a really interesting thing to watch going forward as they start to take

drivers out from behind the steering wheel and offer rides to people as part of like a fleet service, very different business for them. It'll be really interesting to see how they navigate that. And then you've got like this promise for this next gen platform or this more mass market vehicle.

You know, there's been talk about, you know, a Model 2. Now it seems like that's being replaced by something called the Model Q. It's unclear exactly what that's going to look like if it's just like a Model 3 or a Model Y that's like a little bit cheaper and a little bit more expensive.

less kind of like technologically advanced. A little more car-ish. Yeah, than like the current models. So it's really unclear. And like the company is only sort of vaguely referenced, you know, keeps referencing like this new model that's going to be coming out sometime this year.

So that's going to be an opportunity for them also to kind of like reset things around, you know, affordability and availability. But yeah, as long as like Musk is out there, you know, throwing his salutes and, and being sort of like the very public face of like running roughshod over the government and taking people's Medicaid away from them. I,

I'm not too convinced that Tesla's actually... It's going to take more than just a new vehicle or a new service to really reset the conversation around this company. Fair enough. All right, Andy, thank you as always. You and I, this summer, are going to go to Austin and we're going to ride every robo-taxi we can find. Ooh, let's do it. And we're going to build a VergeCast for it. I can't wait. It's going to be great. That's a great idea. Let's do it. I'm all about it. Thanks, buddy. Thanks, man.

All right, we got to take a quick break and then we're going to come back and we're going to talk about social. We'll be right back. Save on Cox Internet when you add Cox Mobile and get fiber-powered internet at home and unbeatable 5G reliability on the go. So whether you're playing a game at home or attending one live,

You can do more without spending more. Learn how to save at Cox.com slash internet. Cox Internet is connected to the premises via coaxial cable. Cox Mobile runs on the network with unbeatable 5G reliability as measured by UCLA LLC in the U.S. to age 2023. Results may vary, not endorsement of the restrictions apply.

The PC gave us computing power at home, the internet connected us, and mobile let us do it pretty much anywhere. Now generative AI lets us communicate with technology in our own language, using our own senses. But figuring it all out when you're living through it is a totally different story. Welcome to Leading the Shift.

a new podcast from Microsoft Azure. I'm your host, Susan Etlinger. In each episode, leaders will share what they're learning to help you navigate all this change with confidence. Please join us. Listen and subscribe wherever you get your podcasts.

When you need mealtime inspiration, it's worth shopping Fries for thousands of appetizing ingredients that inspire countless mouth-watering meals. And no matter what tasty choice you make, you'll enjoy our everyday low prices. Plus, extra ways to save, like digital coupons worth over $600 each week and up to $1 off per gallon at the pump with points. So you can get big flavors and big savings. Fries, fresh for everyone. Fuel restrictions apply.

All right, we're back. Now I want to talk about ActivityPub because I cannot help myself from talking about the Fediverse and the open social web and all of the different ways that we might interact with each other.

Evan Prodromo is a person I've talked to before about this stuff because he is one of the people actually in charge of maintaining the activity pub protocol that underpins Mastodon and Flipboard Surf and a lot of this Fediverse stuff that we've been talking about for the last couple of years.

They're not quite the same, the Fediverse and ActivityPub, but a lot of what's happening on the Fediverse is happening because of ActivityPub. It's what Threads is invested in. It's what Medium has been working on. It's what Tumblr and WordPress are going to. This is kind of the protocol, the underlying infrastructure that might make all of this work. And Evan is not only in charge of helping make sure that the protocol works, he's trying to convince the world to use it. So

So I figured it'd be a fun time to catch up with him, see how all of it's going, and see where this is headed. Let's get into it. I think the place I want to start is...

sort of in the deep tech of ActivityPub. And we're going to sort of build out from the base of the technology out into taking over the world. Oh, boy. One of the things that you spend your time on is thinking about what this protocol is and how it's supposed to work and what is going on. What is new with ActivityPub? How is the protocol work going at like the deepest level these days?

Well, there is a lot that's new happening with ActivityPub. So just to like, you know, pull back for a second, ActivityPub is the protocol that lets the network of independent, heterogeneous social platforms that we call the Fediverse talk to each other. So it is the streams of activities and contents that go from one social platform to the other.

And when it was initially developed, it was developed for kind of a very straightforward idea of social networking, right? I create an image or some text. You reply to it, maybe like it or share it.

We had a fairly limited number of interesting objects and activities that you could share across this network. So actually, can I pause you on that really fast? Go ahead. This is a thing I've always wondered about ActivityPub and have never asked somebody, and you're the perfect person to ask this question. That focus, the idea that this thing should be essentially about social networking in a sort of Twitter posts kind of way. Yeah. Was that?

Was there a meeting at the very beginning that was like, let's keep this thing simple and focused and straightforward? Because now it's like you can look at ActivityPub and sort of make it anything. And I think there are people who kind of want to make it anything. And I want to talk about that. But like, how deliberate was the idea that it's like, let's keep this in a sort of box that we understand on the Internet? Yeah.

I think there's two sides to it, right? I think we wanted to at least be able to cover that very simple idea of like, you know, I post a lot of tweets and people can reply and like them.

But we wanted to also make it extensible so we could cover different kinds of social interactions. Right. And things that have changed, you know, in the time since ActivityPub was created are things like stories that we see in Snap or Instagram or Facebook or other kinds of interactions, geosocial interactions like Facebook.

swarm or four square is a is another one being able to do check-ins and so there are new kinds of interactions um that we send over that wire now but it's the same wire and it's the same uh kind of packets we've just like

an extensibility mechanism that makes it possible to define new kinds of packets. Okay. And in theory, as long as you can do one of those things well and reliably across that wire, building new ones shouldn't be as

Like you don't have to reinvent every wheel every time. Exactly. Absolutely. Yeah. So the idea is that you should be like 95 percent of the way there. And if you want to start defining new kinds of interactions, you don't have to start from the ground up. You can start at this very high level of like social interactions. Got it. OK, that's a good answer. So I derailed you from talking about what's what's been going on recently.

Yeah, so there are quite a few interesting things going on recently. I realize that these can be exciting for me, not necessarily exciting for everyone in the world. One of the ones that was recently announced is that Mastodon and other services are going to be supporting quote posts, right? So quote tweet-like posts.

Slightly controversial decision. Slightly controversial, right? A very interesting thing. And one of the things that, you know, the like Fediverse can be kind of Amish in the way that it approaches technology sometimes, right? Where it's like, hey, we're considering this new type of interaction. Is this actually good for our community, for our social benefits? So there were some concern about quote posts, whether they would be primarily for like,

Interesting. Okay.

And so I think that's a nice like kind of compromise that's come up there. So that's one that's really interesting. Well, it's interesting because it's going to have kind of broad use. But the W3C, the World Wide Web Consortium, which is the organization that established the ActivityPub standard, is working on a number of new types of interaction. So one that's very important is end-to-end encrypted messaging.

Messaging.

End-to-end encrypted messaging has become the default for DMs across systems. So if you use Facebook Messenger or WhatsApp or Signal, those are all end-to-end encrypted from my phone to your phone. I can read it on my phone. You can read it on your phone. Nobody in between can read it. And that is the type of topology that we want to see with end-to-end encrypted DMs.

So that's some work that started middle of last year. We're heading into doing like first implementations and definitions around it. And that's a really exciting space.

Because it lets people have a level of interaction and trust that they wouldn't otherwise have. Right. So people are starting off conversations on the Fediverse and moving to like a signal or a WhatsApp. And this would let them kind of have their DM interface happen right there.

I mentioned geosocial work, right? That's something that has kind of like in the early 2010s was very exciting. Yeah. And it was a...

an area of sociality that kind of fell by the wayside. You know, I think only like I still use Swarm. I use it all the time, but, you know, not a lot of other folks do. We do check-ins on Facebook, but it's not as big a deal as it once was. But there's some fun exploration of it going on at the W3C. So there's a task force that's just focused on geosocial work, doing check-ins, doing

collecting, you know, information around a geographical area. Another area that's being explored right now is groups. So it's been a little tough to do. Facebook-style groups are such an important part about how people...

have social interactions, you know, Facebook, specifically Facebook groups. I was going to say, it's the reason everyone I know is still on Facebook. Like it is, it is the single stickiest thing about the stickiest app in the world. Like it's, it's wild. It's really true. Yeah. Yeah. And people really love working with them. You get other kinds of groups. So like Reddit, Reddit subs, subreddits, and the idea is to have that kind of community. Pro.

process that crosses different social platforms. So people from Mastodon, from Threads, from Flipboard, from WordPress can all be in the same group, right? And still participating together, which is a really cool, interesting part, right? Like your choice of platform doesn't necessarily dictate which groups that you can be part of. And

so that work has started in December of last year and we're starting to spec that out. The activity pub spec actually included some group information in it, but there haven't been a lot of implementations. So getting to

Better definition and more implementations is kind of the big step there. Got it. Okay. That's more stuff than I thought you were going to say. I think, like, truthfully, I think one of the things I expected you to say is we are in a sort of

happy, optimistic-sounding maintenance mode. Like, we just have to keep hardening this thing and make it work and make sure it supports all the things that it needs to. And like, this is new and it's growing really fast. But you're out here being like, we're just attaching new stuff to this all the time. Like, it's a different kind of headspace. There is. I mean, those are some of the interesting things

parts of what's happening in terms of like new functionality, new stuff happening. I think there are other parts that are, um, also like coming up that are challenging that we're kind of dealing with as, as we go. Um,

Last, you know, last year was really the year that we started incorporating threads into the Fediverse. Threads being the big meta product that's, you know, shot up in terms, I think there are over 300 million people, 325, something like that. And that has put a lot of pressure on the rest of the Fediverse to be able to encompass having such a big node. Yeah.

largely it's worked pretty well because of the way that ActivityPub is defined. You make your subscriptions to a person, not a service. So if I follow...

POTUS at threads, which was a really great idea a few months ago and is less interesting now. But like if I follow POTUS at threads, I'm able to get just that one person's posts. You don't have to digest the whole threads database every time you want to pull for. I'm not. Yeah, exactly. Which is just too much for a little Mastodon server running on somebody's Raspberry Pi. So we're able to kind of make this make this work pretty well.

I think the other thing, and this has been more about implementation than about standards, has been the growth of Blue Sky, right? So Blue Sky really, after the election in November, has had this explosive growth. Blue Sky is part of the Fediverse, right? It is linked through a two-way bridge into the activity pub world. So

So there's a wonderful bridge that lets you follow

follow people on Blue Sky, like what they post, respond to them, et cetera. It very much puts them on an equal footing with other parts of the Fediverse. Let's talk about that, actually. Sure. I was going to ask you about Blue Sky later. No problem. No, we can talk about it now because I think it's a really interesting part of this story because I knew you were going to say it's terrific and everybody's so happy and it's all great. But there is a real world in which

Blue Sky and the the at protocol are like a threat competitor, whatever you want to call it, to what ActivityPub is trying to do. And I think in a sense of like open standards are better and we're trying to help everybody understand that I get that we're in sort of a rising tide lifts all boats moment.

But the idea that I have to build sort of brittle software on top of brittle software on top of brittle software to get all of this to work together. Yeah. Seems like not the answer anybody is looking for here. So like and especially threads is going to continue to work. It seems I find threads personally less interesting than I used to. But it's it's it's a booming platform. Blue Sky appears to have some real staying power in this space.

Is it a long term problem for you as somebody who A cares about the space, but B believes in Activity Pub in particular, that Blue Sky is not directly in that world?

Yeah, I will like I'll be straight on this one. I don't want to be like too Pollyannish, but, you know, they don't maintain the bridge. The bridge is maintained by a nonprofit called A New Social who are great guys, Ryan Barrett and Anuja.

And they're doing really great work, but they aren't supported by Blue Sky. Right. And the Blue Sky Corporation is really focused on their own network. They're not spending a lot of time engaging with the rest of the Fediverse. And that's OK. Yeah.

So I find it frustrating that Blue Sky exists, that there is an AT Proto, that it is kind of set up as a competitor to ActivityPub. But in a lot of ways, it's not a direct competitor. If I was going to say how I understand AT Proto, it's really a way to do...

say, a Facebook platform or a Twitter platform on a distributed blockchain-like storage system. So if you're familiar with like IPFS or some of the peer-to-peer networks, right? Unlike ActivityPub, which has this like connections between

independent services that have their own internal storage. They do their own, you know, structures, UIs, et cetera. Blue Sky is really about having this kind of one big network, and then you can build clients or filtering, et cetera, that works on it. So all of which is to say, like, I don't see a Tumblr moving to use HTML5.

AT Proto and Blue Sky, right? Sure. Tumblr is an existing network that has 100 million people on it, and they are working to implement ActivityPub because that gives them a chance to connect to the rest of this Fediverse

and still maintain their independence. Kind of Tumblr works its own way, right? And they've got that kind of maintenance. Does that make sense? I think that Blue Sky has some opportunities to pick up third-party developers. There are some interesting apps that are being built on top of that network and don't want to undercut that entirely. But at the same time, I don't think it represents the same kind of

networking between independent platforms that ActivityPup does. Yeah, that idea of the not needing to build a social graph just to build an app, I think is incredibly exciting. And it's the thing I hear from app developers all the time that I'm like, they're like, I don't even have to build a login system. You just come with your Mastodon account and all your friends are already here. There's something really powerful in that. I assume you're one of the people running around to companies like

YouTube and Facebook and others trying to get the big platforms to understand the value of this. And I think the part of me that is less optimistic about the sort of universal takeover of the Fediverse, which I would love to be the case.

thinks that there's really no compelling reason for any of these sort of sufficiently large networks to be part of this. How do you feel like it's going with the, you know, the YouTubes and LinkedIns and Facebooks of the world? Well, like, I can say that, like, we've had some really great...

you know, opportunities that are coming up. They're still like kind of working, working forward. I think the thing for say a Google, right, who are notoriously skeptical about in

engaging with social networks, right? They took like... They've been burned a few times. Yeah, they've been burned so much and they're like, never again, right? No more social. Even though they run one of the biggest social platforms, YouTube in the world, they really kind of think of themselves as like out of social. And being able to say like, you can have a product in the social space that doesn't have to

be a monopoly doesn't have to own the whole system right another company that's like famous for this is Apple who have made like a few tentative efforts in the social space and kind of again got burnt Apple is great at you

you know, deploying cloud services and iCloud, providing great interfaces that are easy for people to use and like owning the devices and end user operating systems where they can be incorporated. So like that is an opportunity. The Fediverse is an opportunity for Apple to get involved in social networks without necessarily having to be like the one and only social network in the world. Right. Or trying to build Facebook from scratch, which turns out to be pretty hard to do.

Yeah, yeah. You don't have to build for like 1.2 billion people. You can build for like one person and they can engage with all those billions of people, you know, across the Fediverse. And that's the really great part. You can start having value really early on.

Totally. How what are you hearing in the in the startup world? I feel like I've been waiting for a while for there to be kind of the thing that turns everybody on to the Fediverse. And it was like it was going to be Mastodon and it was going to be Threads.

But Threads is going kind of slowly. And I don't want to say haphazardly, but let's just say slowly. And I was gonna say, but I think the lesson of Blue Sky is that actually there's something about the simplicity of that that has been really productive for Blue Sky. Right? Like, Blue Sky explains itself much, much faster than the Fediverse does in a way that I think has been really...

helpful for blue sky. Like maybe, maybe in the course of time that becomes a limiting factor, but it's also like you could just sign up and type in a username and start using blue sky in a way that I think in that's the reason to me to have a killer app in the first place is just like, just to have the thing that gets you in the door. Yeah. Goes a long way. And I don't, maybe that doesn't matter in 20 years, but as somebody who would love everybody just like start using it right now, I feel like I want that to exist.

Yeah, no, absolutely. And I think that's one of the things that blue sky has done so well. Like if you are a Twitter refugee, right. And you're, you're washing up on the blue sky shores, like it looks very familiar. You know what you're doing, you know, limitations like on the number of characters or things like that are like, yeah, I love this. This is just what I know from Twitter. Right. Um, but you know, I think that if you are a startup who

who is working on making the next Foursquare or the next Tinder or whatever it is, and you want to build on top of a network where you already know that there are millions of people already participating, I think it's harder to build that on top of an AT proto than it is on top of an activity pub, right? Yeah, that makes sense. There's just more room to innovate and build interesting things.

How are the business conversations going on all sides of this? Because one of the things, I mean, you talk about the interesting feelings of people on Mastodon is that anytime you talk about money on the Fediverse, people get squirrely. And I think it's because there is something that feels pure about this thing that is being built and people have...

seen us go through that before and then it became corrupted by money and they're desperate for it not to be corrupted by money. But at some point for this thing to work, there has to be money in it. And I think to some extent there are obvious ways people make money, right? Like you can do lots of things on top of these services. You sell ads, like whatever. But to me, the biggest challenge is just going to be the convincing everybody involved that there is a business inside of this and that that's okay.

Strikes me as maybe one of the hardest parts of sort of evangelizing this whole space.

You know, I mean, when we talk about like business models for social content, right? I think we have some pretty decent ones that have, you know, been proven through the test of time, right? Ad supported and algorithmic feeds is like a great example that pretty much whatever half of tech runs off of, right? Depending on ad supported feeds, right?

I think another one that has been super positive for creators, for creative people has been subscription based business. So, you know, whether you're a Twitch broadcaster or a Substack publisher, you get to like establish these subscriptions and you're kind of maintaining a more direct relationship with your audience and develop.

and delivering premium content to them based on, you know, that direct relationship. And both of those are really awesome. You know, there are other business models that work, but, you know, I think that those are two that seem to work pretty well for different players in this in the social space.

I think the question that comes up and that's been really hard for people who are engaged in the Fediverse to deal with is, and I'm going to be like biting the hand of some of the big networks that have supported us so far. But, you know, when...

Twitter move to an advertising based model, they really clamp down on access to their API. Right. And your ability to say, resort the feed or filter or take parts out of the feed, um,

Because suddenly it's their business to have you on Twitter.com. Like, that's how it happens. Yeah, exactly. They only want you to see things in a certain way and a certain way of addressing it. Same with Facebook. Right. So they very much cut back on the ability of third party clients to interact with the Facebook data because they needed to maintain a very specific profile.

you know, way of delivering ads to the user. And I think that it's a lot harder to do in a Fediverse structure where, you know, I'm on Tumblr and you're on Threads and Threads pushes an ad into that network and Tumblr throws it away, right? Or my client throws it away because I don't want to see it. You don't have that same control in this kind of network.

So there are other ways to deliver ads, but that idea that like one company is going to control from one end to the other, how the stream of content is delivered and make sure that ads are included, that breaks down in the Fediverse. And I think that that means like,

A, it's a little bit, you know, tough for companies that have depended on that business model so far. But B, there's a lot of great opportunities to build new kinds of ad networks in that space, right? If you want to, like, that is something that can happen. And I think that, you know, I think that there's some real interesting opportunities there. Yeah, I mean, it's very funny. The, like, user in me

looks at that and is like, well, tough noogies, everybody. Now you have to compete on building great products, not on locking me into your social network. Yeah.

Oh, no. How awful. But then the part of me that is like, OK, these companies are full of business people making business decisions, worries that they just won't try because they know it might lead that way. And they'll have to, like, actually compete and try hard and do good work forever in order to keep winning. And boy, I hope they all sign up to do that. But I forever worry about how many are just going to run away from that opportunity because they're like, it's we're we're

Everybody loves a walled garden right now. This is the thing we've built. But like, you know, there was a moment in, I'm showing my age here, but like in the mid 90s where, you know, it was a question of like, oh, is MSN going to join the internet? Is AOL going to join the internet? And then at some point it became a tipping point. And it was like, why would you have...

any kind of online service that wasn't on the internet, it's meaningless. It doesn't make sense. And I think that we'll hit that kind of tipping point with the Fediverse too and social networks. That's a good comparison. I like that. Oh, thank you. And speaking of that, I'm going to let you go here, but this will be, let's see, it's 2025. So this will be the

third, maybe fourth year in a row that I have spent trying to convince people that this is the year of the Fediverse. Basically, since like, since since 2020, 2022, right? When Elon Musk started buying Twitter, I was like, all right, this is it. It's Mastodon, it's ActivityPub, it's the Fediverse. And I feel like what we've gotten instead is like slow and steady momentum, but not yet the year of the Fediverse. So, so Evan, I ask you, is 2025 the year of the Fediverse? Is this, is this it?

20, 25 is it? Yeah. Um, and let me, let me tell you what I really want to see happen this year. Right. Two, two, uh, big things. One thing is seeing increased, uh, volume from threads, right? Threads has been kind of taking a baby steps into the Fediverse. And I think we're going to see like full blown two way interaction from threads. And I think that that changes the game. That would be huge. Um, and then, um,

You know, I don't know who it's going to be. I don't have any inside information, but I think we're going to see another like multi hundred million,

network joining the fat averse this year. And I think as we start seeing those bigger players come in, it really changes the changes, the possibilities for the fat averse. So those are my two predictions. Let me, let me kind of put those in. Um, and I will like, I promise I will spend my time being like, I'm going to make sure that David Pierce is not wrong. I will, I will like dedicate myself to that.

Evan, thank you. This was really fun. I appreciate you doing this with us. David, thank you so much for having me. I love talking about the Fediverse. All right, we got to take one more break and then we're going to come back and do a question from the Vergecast hotline. We'll be right back.

Vox Media Podcasts are hitting the road and heading back to Austin, Texas for the South by Southwest Festival March 8th through 10th. Not only will Today Explained be there, I will be there, but there will also be special live episodes of hit shows including Where Should We Begin with Esther Perel, Pivot, and

with Kara Swish, a touch more with Sue Bird and Megan Rapinoe, not just football with Cam Hayward, and more presented by Smartsheet. Hello. The Vox Media podcast stage at South by Southwest is open to all South by Southwest badge holders. We hope to see you at the Austin Convention Center soon.

You can visit voxmedia.com slash S-X-S-W to learn more. That's voxmedia.com slash S-X-S-W. Thank you.

I'm Josh Muccio, host of The Pitch, where startup founders raise millions and listeners can invest. For Lucky Season 13, we looked at 2,000 companies and selected 12 of the very best founders to pitch in Miami. They flew in from all over the country and the world. My name is Mikel.

And I'm from Italy. I'm originally from Medellin, Colombia. I was born and raised in Maisel, Kentucky. I'm from Baltimore, Maryland. And I am from Finland. This season, we're diving even deeper into the human side of venture as these founders pitch the sharpest early stage VCs in the game. I normally don't like ed tech, but I really like you. I echo those sentiments. I do want to push back, though. Toughen up there, lady. That's healthcare.

I feel like I'm the lone dissenter. Ooh, Charles, spicy. So I'm out. I'm sure when they air this episode, they'll be like, Charles was really dumb. For those who can't see, my jaw is currently on the floor. Season 13 of The Pitch starts March 5th. Episodes are available to watch on YouTube or listen on your podcast player of choice. So subscribe to The Pitch right now.

All right, so here's the deal. Take a former world number one. That's me, Andy Roddick. Add in the journalist who knows everything about tennis and a producer who's still figuring out how to spell tennis. You get served with Andy Roddick, a weekly podcast where we break down the game we all love.

We cover the biggest stories, talk to the sport's biggest stars, and highlight the people changing tennis in ways you might not even realize. Whether it's grand slam predictions, coaching changes, off-court drama, or the moves shaping the future of the sport, we've got it all. This podcast is about having fun, sharing insights, and giving fans a real look at what makes tennis so great.

Catch Serve with Andy Roddick on Spotify, Apple Podcasts, wherever you listen, or watch us on YouTube. Like, subscribe, follow, all that good stuff. Let's get started. All right, we're back. Let's get into the VergeCast hotline. As always, you can call 866-VERGE-11. You can email VergeCast at theverge.com. We love all of your questions. It is truly the best thing hearing from everybody. We get an email and a Slack notification every time somebody calls in. It's the best.

Cannot recommend highly enough having a bunch of strangers call and ask you tech questions. Anyway, this week, instead of questions, I want to play you some feedback that we got. We talked a bunch about the iPhone 16E last week. And in particular, I had some strong feelings about the price of the thing. I think a $600 phone and an $800 phone are not actually that different in a meaningful way when you think of how people actually buy and use smartphones.

But we got a bunch of feedback from people saying, maybe I'm wrong about that. So let me just play you one voicemail that we got, and then we're gonna get into it.

Hi, this is Gautam from India. I've been listening to the podcast about the iPhone 16E, and I think you guys have just totally missed why Apple made the iPhone 16E, and it's definitely not for the U.S. market. It's definitely for the Indian market. They have been trying to penetrate into India for so long,

And this is the device I think they will be doing it with. Because usually the selling price, the best selling iPhone at sale time is usually the older iPhones, which is like iPhone 13 or iPhone 14, which is like $2.

two, three years ago, old iPhones, so which sell for around 60,000 to 70,000 rupees in India. This time they are releasing a new iPhone, which you can buy brand new, which is called iPhone 16E for 60,000 rupees.

Imagine the sales numbers that's going to bring for you. And when there is a sale on the iPhone 16E, it's going to come down even more. It's going to sell like hotcakes in India. Apple usually have a brand value in India, which a lot of other manufacturers don't have. So everything...

Everybody wants to buy an iPhone, and bringing the price down is like the best move they can do. And I'm telling you right now, it'll be the best-selling iPhone model of the year, hands down, in India.

This actually makes quite a lot of sense to me. I think I probably underrated the extent to which people around the world, especially outside of the U.S., where most of the cell phone market is much less carrier-dominated and post-paid and based on, like, multi-year contracts that you have with your carrier, a lot of people just buy a phone in a store and put a SIM card in and walk away. And in that case...

a $200 difference is super meaningful. And obviously, in many parts of the world, the price difference can even be bigger or feel bigger. So I think that's right. I buy that. And we heard this from a bunch of people, actually. I got an email from Mauricio in Brazil, who said that here in Brazil, I can't think of one single person who chooses a phone based on carrier deals. I really don't know anyone who buys this way. Considering that Apple sells to many other countries, it feels like you missed an important part of the conversation.

Totally fair. I still think the logic of why would you make it this cost and not the cost of the SE is complicated, right? I think if Apple had found a way to even split the difference, make this thing $499 instead of $599, I think that price delta becomes really powerful.

But Apple has always been happy selling to a smaller but more affluent group of phone buyers. I think maybe the thing that I'm reacting to above all else is that this is just such an unlike Apple move. If the thing that Apple is doing here...

is purely about price. And it seems like it's purely about price. But then again, this is the company that's also selling an M1 MacBook Air in Walmart now. So maybe Apple just is a price-conscious company in a way that it never really has been before and would still like you to not think that it is. We also got an email from Marcin who said, I found some data from 2022 that shows that 44% of the cellular user population in the US is on prepaid plans. I haven't checked that number, but if it's true, that's a higher number than I would have expected.

I'm guessing that this group is probably more cost-conscious and price-sensitive, and for them, the iPhone 16e makes a lot more sense. Also, I want to point out that the price difference between 16e and 16 isn't $200, but more like $250. He's talking about things like adding in taxes and taking away some of the carrier deals that you get to make these things cheaper. Again, all true. And I think the idea that people are walking into a store, putting down a credit card or cash, and buying a phone outright is certainly true.

I think that just hasn't really been Apple's clientele for many, many years now. That is not the group of people that Apple has typically served. Apple is typically interested in really high margins on really high prices for people who are much less price conscious. And so maybe what I need to do is just reframe my brain a little bit to think of Apple as a company interested in hitting all price points for the sake of hitting all price points. It

It makes perfect sense as a business move if you're Apple and you're increasingly a services business and actually what you want is to have your stuff in more people's hands. That's what Google has been doing forever, right? Google makes the majority of its money not when you buy an Android phone, but when you use the services on an Android phone. So Google has a huge incentive to put its phones in front of as many people as possible across price spectrums, across demographics. It's just a volume game for Google. And if Apple is a services company, it's

playing the same kind of volume game. So maybe that just is Apple now. Anyway, thank you to everybody who called in and emailed with feedback. These are good points. And I think the price of an iPhone is more interesting and more complicated maybe than I even realized.

Anyway, that is it for the show today. Thank you to everybody who came on and thank you as always so much for listening. As always, if you have thoughts, questions, feedbacks, or robo-taxi rides you want to tell me about, if you've like been in a Waymo or a Zoox and had an experience, I would love to hear that.

You can always call 866-VERGE-11, email vergecast at theverge.com. Hit us up. We love hearing from you all the time. This show is produced by Eric Gomez, Brandon Kiefer, and Will Poore. The Verge Cast is a Verge production, part of the Vox Media Podcast Network. Nila and I will be back on Friday. He's back from vacation this week, by the way. Thank you to everybody who was concerned and sad that you weren't hearing from Nila. Also, everybody thinks Nila is like quitting his job every time he goes on vacation. He's just on vacation. You're stuck with us forever, I think. Don't worry about it.

Anyway, we'll be back. Lots of news to talk about. Lots still happening. We will have the triumphant return, I'm sure, of America's favorite segment, Brendan Carr is a Dummy, on this Friday's show, plus lots more. We'll see you then. Rock and roll. ♪