posted about 8 hours ago on re/code
Plus: What does the “R” in iPhone XR stand for?; imagine being Jeff Bezos in a choose-your-own-adventure game; 100 websites that shaped the internet as we know it. “Davos in the Desert,” the Saudi economic summit that begins today, will be nothing like last year’s inaugural event. The sheen has worn off of the Future Investment Initiative (live stream here), which was visualized as a new kind of international finance conference that would take what has succeeded for decades in Davos as the World Economic Forum and bring it to the desert of Riyadh. But after the now-admitted killing of American resident and journalist Jamal Khashoggi earlier this month, the three-day event has transformed from a star-studded gala into a scarlet letter in the eyes of Silicon Valley, and has been close to decimated by cancellations from Western speakers, and most recently, SoftBank CEO Masayoshi Son, which could test his multi-billion-dollar partnership with Saudi Arabia.[Theodore Schleifer / Recode] [Want to get the Recode Daily in your inbox? Subscribe here.] Apple’s latest iPhone goes on sale this Friday: A month after the launch of the flagship XS and XS Max iPhones, here comes Apple’s “cheap” version, starting at $749, a device meant to blend some of Apple’s most sophisticated technology with a certain level of fiscal accessibility. And for millions waiting on an upgrade, the XR might be the right phone at the right time; Here’s a roundup of early reviews. The Verge says it’s “better than good enough” — “a no-brainer upgrade” if you don’t want to spend the $$$ for the iPhone XS’s better screen. [Nilay Patel / The Verge] Amazon’s version of a futuristic 7-Eleven is coming to New York City — its latest cashierless Amazon Go convenience store will to be located inside an upscale shopping and office complex across from the World Trade Center. Amazon Go stores use a combination of sensors, cameras and computer vision to automatically charge customers for the right items upon exit without them needing to stop and pay. Amazon has so far opened three Amazon Go locations in Seattle and two in Chicago, with another on the way in the Windy City. [Jason Del Rey / Recode] Facebook is losing yet another founder of one of its billion-dollar acquisitions. Brendan Iribe, the co-founder of virtual reality headset maker Oculus, announced that he is leaving. Facebook purchased Oculus for $3 billion in 2014, and Iribe’s departure means that the founders of all three of the social media giant’s largest acquisitions to date — Instagram, WhatsApp and Oculus — have all parted ways with Facebook, which was once viewed as a safe haven where founders could largely operate independently. Now Facebook is being criticized for its apparent heavy-handedness with founders at a time when it’s leaning more on subsidiary properties. [Seth Fiegerman and Laurie Segall / CNN Business] More than a third of U.S. adults patronize fast-food restaurants and pizza shops on any given day. According to data gathered from 2013 to 2016 in the National Health and Nutrition Examination Survey, 44 percent of those who eat fast food do so at lunch, and 42 percent at dinner. The percentage of adults who ate fast food rose with increasing income: About 32 percent of people who earn less than 130 percent of the federal poverty line — $32,630 a year for a family of four — ate fast food daily; 2 percent of people above 350 percent of the poverty line — $112,950 a year or more for that size family — were daily consumers. Meanwhile, here’s a look at the weird world of secret fast-food menus. [Nicholas Bakalar / The New York Times] “You Are Jeff Bezos” is a text-based, online choose-your-own-adventure game that illustrates in detail the appalling amount of wealth that people are allowed to amass and then just keep to themselves. For instance, as Jeff Bezos, you start with $156 billion, and maybe decide to repair Puerto Rico in full ($139 billion). That leaves $17 billion, which you, Jeff Bezos, can use to abolish the electoral college ($380 million), double every Amazon employee’s salary ($15.8 billion), pay back taxes to the EU ($293 million), and still have $527 million left over. Meanwhile, this Friday Rockstar launches its biggest, most ambitious game, Red Dead Redemption 2, but the achievement comes at a substantial cost for its human developers: Here’s a look at the treatment of workers in the video game industry.[Casey Johnston / The Outline] The world’s longest sea bridge — 34 miles — finally opens today.Connecting Hong Kong and Macau to the mainland Chinese city of Zhuhai, the $20 billion bridge is a key element of China’s plan for its own Greater Bay Area. [James Griffiths and Sarah Lazarus / CNN] Top stories from Recode Unlike some athletes, former NFL star Maurice Jones-Drew doesn’t want to be a venture capitalist. On the latest episode of Recode Decode, MJD tells Kurt Wagner that the low success rate in tech investing scares him: “I grew up with no money, so it’s like, I got money, I’m gonna try to keep it as long as I can.” [Kurt Wagner] This is cool Wired’s 25th anniversary is a peek into the past, present and future of magazine design. 100 websites that shaped the internet as we know it.

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MJD tells Recode’s Kurt Wagner that the low success rate in tech investing scares him: “I grew up with no money, so it’s like, I got money, I’m gonna try to keep it as long as I can.” When he moved home to the San Francisco Bay Area for his final season in the NFL, Maurice Jones-Drew was thinking about playing football in front of his family — not turning himself into a big investor after he retired from the League. “My grandpa always used to always tell me, ‘Dude, you’re a football player,’” Jones-Drew said on the latest episode of Recode Media. “‘You’re not an engineer. You’re not an investor. You’re none of this. Your whole life, you’ve played football. You went to college, let’s be honest, you went to UCLA, got a good education, but you went to play football, so be a football player.’” Jones-Drew has made some tech investments, including in a VR company based near where he grew up, but these days he devotes most of his energy to analyzing football on the NFL Network and providing color commentary for the Los Angeles Rams’ games. If he wanted to become a venture capitalist, though, he’d fit the profile. Several NBA players — including former Lakers star Kobe Bryant, current Houston Rockets player Carmelo Anthony and the Golden State Warriors’ Kevin Durant — have all started tech investing funds, as has former San Francisco 49ers coach Joe Montana. But for Jones-Drew, a visit to the offices of Sequoia Capital in Menlo Park convinced him that he’s not cut out for the VC life. “My concern with the investing is that it’s such a low hit rate that it scares me,” he told Recode’s Kurt Wagner. “I’m real soft when it comes to that. I grew up with no money, so it’s like, I got money, I’m gonna try to keep it as long as I can. But they were talking about how they try to hit it like a 20 percent, 30 percent rate. If they hit, then they’re happy.” You can listen to Recode Media wherever you get your podcasts — including Apple Podcasts, Spotify, Google Podcasts, Pocket Casts and Overcast. Below, we’ve shared a full transcript of Kurt’s conversation with Maurice. Kurt Wagner: We are here in LA at NFL Network studios. I’m with Maurice Jones-Drew, former Pro Bowler, NFL running back. Welcome to Recode Media. Maurice Jones-Drew: Thank you guys for having me. Yeah. MJD, I think you said is okay? It’s perfectly fine. Okay, good. We’re going to go with that. Welcome to the show. I was actually a little surprised that you were available now because it’s Monday and “Monday Night Football” starts in like less than three hours. I don’t know what a typical Monday is like around here, I imagine it’s kind of chaos these last couple days? What’s it like during the season? It’s really not too bad on Mondays, it’s more recap. Okay. Kind of looking over what happened on Sunday or Thursday. For me, it’s my longest day because I do fantasy. I tape early in the mornings at 8:00 and then go all the way to about noon, then I get a two-hour break and then I come back, write a couple articles and get ready to do Monday night end game. So you’re writing, on top of being on ... Oh yeah. You got to try to touch everything, do podcasts as well. So I try to do a little bit of everything. And respect because as someone who writes as well, I can tell you it can be very time-consuming. I didn’t say in the intro but you are now a network analyst for NFL Network. You also do the Los Angeles Rams play by play — or sorry, color commentary. Color, yes. Tell me if you will, obviously it’s kind of become common for ... Everyone who is a color analyst today is usually a former player. How does that process actually work? I think mine was much different. It’s weird, the Rams just called my agent and was like, “Hey, we want to try Maurice out. If he wants to do it, you know, come and do it.” I was like, “All right, cool, never did it before,” and they were like, “Oh don’t worry about it, we want ours to have a different flow to it than the normal, traditional way.” And if you listen to our broadcast, it has a little bit of slang in there, a little different, much more, I guess, millennial, where we try to reach a younger crowd. Because the Rams, they do have an older crowd, but we have a lot of younger people that are joining up. Youngest coach in the NFL, right? Head coach? Yeah. Much younger than me, which is nice. Yeah. He’s what 31, 32? I think he just turned 32, maybe. I don’t remember exactly but it’s just a different feel, and they wanted that because we’re in LA and LA is a different vibe than most cities. So it was nice. The first couple times, I was horrible. God awful, pretty much. Was that something that you figured out on your own or did someone pull you aside and be like, “Hey man, you’re pretty bad”? No, no. I knew I was bad and I kind of went in there like, I’m just trying to figure this out. But I have a great play-by-play guy, JB Long, who has done this a bunch and he’s worked with a ton of people and it was really just getting comfortable with him, understanding him, and knowing what he’s going to do and kind of learning him a little bit. After, I want to say maybe a couple weeks, six weeks or so, we were able to kind of find our groove and we just started to grow after that. It was funny, he took me to the side before one game and was like, “Let’s go work out together,” and we went and worked out and we talked about a lot of different things. Nothing about the game. And it made it easier for me because now this is not necessarily a coworker of mine, this is like a friend of mine. Sure. We were just trying to move forward and so it was nice to have a guy who’s been in this business, had done a ton of those things and to get advice from different people throughout the way. A lot of it, JB was just kind of like, “Be yourself, say what you say, if you ever get stuck look at me, I’ll coach you through it and then we’ll be good.” And from then on out, this is year three and we’ve been having a ball since. Yeah. It’s a tough job for sure, and people are supercritical online, as I’m sure you have learned. What is something that maybe surprised you as a former player, once you’re in the booth? Was there something that maybe you thought was going to be super easy or that was actually way harder than expected? Well, everything about broadcasting is about timing. So podcasts, you have hours and you can have sometimes you have segments that are minutes: Three, four, five minutes you can speak. When you’re doing play by play or color, it’s literally 15 seconds. Yeah. You form an idea or thought of what you just saw and then be able to spit it out quickly and then you have to get it out because then JB has to get in to describe the next play. That was all timing. And some of these teams, like you’ll play ... Our first game was on Monday night against the Niners and Chip Kelly. No pressure. Right. And then literally, they’re on the ball in two seconds and they’re just going fast. So it was crazy but it was a lot of fun learning and understanding it. And now I have kind of my flow on what I feel and what I’m comfortable with, as well as what JB’s comfortable with, and we’ve been able to kind of work together to make our own music, in a way. Yeah. And it works well for us. I think I read somewhere that in order to become even a TV personality ... There’s some kind of training I imagine that you go through, I think I read something ... am I making this up? No. My road was different, so let me say that. Okay, yeah. What was your road? Maybe that’s what I read about. So my road was, in college I had a teacher, we all kind of took remedial English when we first got there. You had to pass the class and they can move you on to different places. And this is at UCLA? At UCLA, yes. I went to all-boys Catholic [school] so I knew how to write and do all the different things. There were some kids that I went to school with that didn’t know some of the basic principles of writing. The teacher saw that I was kind of advanced in those situations and she was like, “Well, you know what? Let’s have you speak in front of your peers.” Learn to speak, right? You all play ball, you all have to be able to speak in front of the media and enunciate your words and not have this southern dialect. Sure. We had some guys from New Orleans with a different dialect that you could barely understand, some swamp people-type stuff. She told us that the hardest thing you can do was speak in front of your peers, like people that you know. Yeah. So every week, I’d have to write something and then be able to regurgitate it in front of my boys and they’d be throwing stuff at me or talking trash or laughing if I messed up. And it made me more comfortable because if I can do it in front of them, if I don’t know you it’s much easier. So when I got out of that, I actually got drafted to Jacksonville a couple years later. In Jacksonville, I had a radio show that I was able to practice and learn the arts of radio, which is completely different than TV. While you were playing, by the way. Yeah, while I was playing. Which is rare, right? I do not see a lot of players hold a regular radio show, TV show ... I have to give credit to my agent, Adisa Bakari, who kind of pushed me in that direction as well. So I had a radio ... and you have to answer the tough questions, which I felt comfortable answering those tough questions. There was a time where we were in the playoffs and a guy dropped a pass and people were like, “Oh if he didn’t ...” I’m like look, it’s easy to sit on your couch and say you would have caught that, right? Sure. But in the moment ... and I learned how to defend my teammates but also be critical in certain situations and still be honest. So doing TV and radio for two or three years, I did that. And then there was a play, we were playing the Jets, I took a knee on the goal line and thanked all my fantasy owners and then got a radio gig with the Sirius XM. Which for 10 years or eight years I had that, which went really well. Which also seems rare to me because I always feel like people or players, they don’t love the fantasy thing. They don’t love people coming up to them and being like, “Hey! You’re on my fantasy team!” but you’re kind of leaning into that whole thing. Yeah, it didn’t bother me. At the end of the day, it was a way for me and my buddies to still be able to communicate. Because I was on the east coast, they were on the west coast, right? So that was a way for us to keep our communication going and be able to talk and it forced us all to have a group chat and all this different stuff with it. It was nice. At the end of the day, people just want to compete anyway, so I saw it as such. Some guys didn’t like it which is understandable. So, you don’t have to. But I embraced it and enjoyed it and that’s what really opened the door to where I am now. I had Sirius XM for I want to say six years while I was playing, or seven years while I was playing and then a year or two after, and we just finished that up because I took the Rams job and so I couldn’t do both. It was just too much on my plate with NFL Network. Yeah. All those things are reps. Right. At the end of the day, just repping how to talk, how to do certain things, taking certain classes when I needed to, doing improv, which helps out a lot, right? Yeah. Be able to think on your toes, which helps out in some of these situations. Do you still do improv? Not as much. I just watch movies. Do you want to announce when your next improv show is ... Yeah, right. I wish. So all of us can come cheer you on. It would be funny. It was funny, a lot of people here didn’t know I did improv, well, I took a couple classes. And for the most part, I’ve always done improv because I’d go out with my boys and we’d always make stuff up that you have to kind of go with it. I did it for the network one time and people didn’t know I could do it. It worked out well but you always try and perfect your craft. I think that’s always a key, just like at running back, I always was training and watching and studying other people to figure out how to perfect my craft. I do the same here. Where I go to different classes, listen to different people speak, do a little public speaking sometimes which is pretty tough, and you just learn that each different type of speaking or broadcasting has a certain lane that you have to follow. I’ve just kind of taken that and followed those rules and just put my own spin on it and here I am. One of the things that I’m always both impressed by and also kind of makes me cringe is the former players who go out and have no problem being critical of your former teammates or current players. And I know that’s part of the job, right? You are there to analyze. But how do you get comfortable with the idea of criticizing people, since you’ve been in that scenario before? If you drop a pass, it’s simple to say, you have to catch that pass, right? Sure. And that’s where I kind of keep it. I don’t really go into the personal, or like “this guy is a bad person,” I don’t go there. I think when players do that, that’s more of someone, a producer or someone in their ear trying to rile them up to go try to get them to attack people. At the end of the day, we are about clicks and getting people to watch and ratings ... Yeah. It’s a media ... It’s a media deal. I try not to do that because I have relationships in the NFL that I hold in high regard and are dear to me. So the players that I do know, or like the Rams for example, I’m always on the bus with them, I always talk to them. If there’s a time where I need to be critical, I’ll be critical, but it won’t be like, “This guy is bad, oh this guy needs to make a play.” Yeah. It’s very simple, you could reword it. I think some guys, they just go out there and attack guys. For example, with the whole Le’Veon Bell situation ... Sure. There were some people that were like, “Oh he’s selfish, he’s this, he’s that.” And just for people who maybe aren’t familiar, he has a contract, but he’s holding out. Well that’s the paternal — He’s on the franchise tag, which unless you sign it, you have a contract. If you don’t sign it, you don’t have a contract. Correct. So right now he just doesn’t have a contract. The Steelers have his rights, so if he does decide to come back or when he decides to come back, he has to play for the Pittsburgh Steelers. But he doesn’t have a contract, so he’s not holding out, he’s just not working right now. Got it. So some players were calling him selfish and saying different things. And my response to that is, you know, Le’Veon Bell has been one of the top running backs in this league for the last four or five years, consistently. Yes he’s had some off-the-field issues, and young players, when you get money in your pockets, most do. But they need to compensate him a certain way, they need to pay him for his worth and what he’s been able to do. And for players to go out and speak on that, that’s selfish on their part because Le’Veon was all for you when it’s your turn to get paid, right, and those type of things. Some former guys came out and were like, “Oh if I was in the locker room, I would do this.” And I know them dudes, you wouldn’t do any of that, right? So stop trying to make yourself bigger than what it is. Just be honest. I think honesty is the key in the media. At the end of the day, if you’re honest and don’t try to fabricate and try to make, “Oh I would have said this in the locker room,” like no, you wouldn’t have. You’re talking about a guy and his money and his family, you’re not ever going to cross that line, period, if he’s there or he’s not there. I think that was one of the big issues that you see in the media. Some players, they may think a certain way, but in all actuality they wouldn’t do that in real life, right? They’re just saying what they think because they’re so far away from it. Do players ever come up to you if you do say something critical? Are they listening? Oh, yeah. They go back and listen to the broadcast or something? Yeah. So Le’Veon and I have the same agent and there was a time where I said, you know, he needs to pick his game up a little bit. And I got a text ... You got a phone call from ... I got a text and a phone call and I explained to him, you know, look, that’s my point of view. I’m looking outside-in. You know what’s going on inside the building, I don’t. Yeah. But I wasn’t too critical, I was like hey, he needs to do certain things, he needs to just do this and that. And I get it because I played and you don’t want people to tell you what you’re supposed to do. But I explained to him, look, I have a job to do and I always have what you’re doing in your best interest, I’m always in your best interest. I still have to do my job, right? Right. And if I see a play where I think you messed up, I’m going to say it, period. Yeah. I’m curious, given how not only your current role but how long you’ve been following the media industry, what do you think of, where are we headed right now with the NFL and television? I think it was last year or two years ago, the ratings were down and it was like oh, is it Trump or ... Don’t believe it. Well this year, they’re back up, right? Yeah, yeah. Don’t believe in none of that. When you’re the big dog and your business is worth close to 11, 12 billion dollars, whatever it is, and everyone’s trying to catch you, everyone’s going to do everything, right? Sure. Now, granted, the ratings were down and normally they’re down every year during an election year. Right. This was a big one because it was Trump and all that stuff. Yeah. It was Trump and Hillary and it was a lot of stuff going on, yeah, so that happens. But the money never changed. And that’s what people have to realize, the ratings can go down, but as long as the money is going up that’s all that matters. I think obviously with Colin Kaepernick and his situation and taking a knee and all that, America split. Some people aren’t watching because Colin’s still not playing. Some people aren’t watching because players are taking a knee. At the end of the day, stadiums are still being sold out. TV, the most-watched games are NFL on TV, period, right? Yeah. I’m a big “Game of Thrones” person, love it. They still have more people watch Sunday night games and Thursday night games when there’s a great matchup than they do anything else. And football will always be that way. It’s America’s pastime. It’s America’s game. And I think once people get out their feelings and quit taking stuff personal and just quit being emotional and understand the message from both sides — specifically, Colin Kaepernick’s message that people aren’t being treated fairly in this country and that needs to change — I think football will go back to being great and that’s what it’s about. What do you think about the kneeling thing? Do you have any strong opinion one way or the other? I protested when I played, over the same thing. We were in Green Bay, I was in Oakland, I scored and I did the hands up don’t shoot. And at the time, I was raising three black boys, where I’m going to have to tell them how to act when you get pulled over, and I don’t think that’s okay. The same conversation my grandfather had with my mother and my uncles, that my mother and uncles had with me, I’m going to have to have with my boys. That’s four generations of teaching people how to act when you get pulled over. A lot of people don’t have to do that. And so I’ve definitely spoken about that a ton when I was playing and I still do now, about how I have to raise my kids, regardless of where I live, right? Regardless of how much money I make, and we’ve seen that with Lebron, you still have to act a certain way because of the way I look. And I think that’s wrong. And obviously Trump has come out and said some things and done some things and people have reacted to it, but at the end of the day, innocent people are dying every day from people who are supposed to protect and serve us, and that’s not okay. We’re not saying that every person is wrong and we’re not saying that every police officer is bad, because they’re not. My brother-in-law is a cop and he’s a good one. I know a bunch of cops are on my ... I coach youth football, I have two cops on my coaching staff, they’re good cops. But there’s the few bad apples in those situations that make it bad for everybody. Yeah. And so those are the things that Colin Kaepernick and everyone that’s fighting this, this social injustice, are trying to fix. Like change, reform these things and make it different. And when you try to change a structure of a country that’s been running a certain way for a long time, you’re going to get a ton of backlash. And that was understood. It feels new, even though to your point, you were doing something similar when you were a player, different way of expressing it, but the same idea. I guess I’m curious, you mentioned how this can impact maybe people watching football or not watching football, do you see this as the kind of thing that we’re going to still be talking about in a couple years or is this going to be the norm? I don’t think it’ll be the norm. I think again it’s kind of changed a little bit, the narrative, because players were kneeling in the beginning — well, Colin was kneeling in the beginning — because he wanted to change some things. And those things are starting to happen, don’t get me wrong, they’re starting to happen. But now, players are kneeling because he’s not allowed to play the game anymore. He feels as if teams have — which I feel a certain way about it as well — but I feel like he’s better than a lot of quarterbacks that are starting right now in the NFL and he should be in there. But these owners and teams have a right to pick who they want to do, and he has a right to go after the league for that. I think that’s what the kneeling is about now. You still have players going out, going on police rides, trying to get the police and community to get back together. Those are important things that ... This is why it all started. Had nothing to do with the national anthem. Yeah. Had nothing to do with the veterans. Granted, that’s the narrative that people spin to, but Colin made it really clear in the very beginning, and rightfully so. At the end of the day, people just want to be able to live their life not with fear. And right now, we’re working towards that goal, but we still have a long ways to go. Yeah. What’d you think of the Nike campaign? I love the Nike campaign. I thought it was awesome. I feel like it showed that he is different and it’s okay to be different. It’s so funny. It’s easy for someone that’s not in your shoes to say, “I would do that,” or, “I wouldn’t do that,” right? Sure. But unless you’re in that position, you really don’t know what you would do. I feel it’s wrong for a lot of people to criticize players for not standing behind Colin Kaepernick, because they have families that they have to feed and that’s where they make money. It is what it is. Colin knew going into it that this was a possibility and he still did that, and I applaud him for that. Yeah. For Nike to jump on and stay with him throughout this whole process, who’s one of the bigger sponsors of the NFL, it’s huge to show that you know what, at the end of the day, we are going to be on the right side of history. I think that’s a statement that, for a company like Nike to step up, shows other companies that you can do it, which other companies have tried to follow off as well. I want to get your opinion about futuristic technologies. Where do you think we’re going to be watching a football game in five years? Is it still going to be traditional TV? It’s starting to change now where you’re watching on your phones and stuff, which is awesome, because everyone’s on the go. It’s weird the way things are starting to change. It’s a different dynamic now where Sundays used to be the day that you and your family would hang out and watch games together and do the family deal, where now most people are on the go, trying to go somewhere, are always on their phones, so you get a chance to consume it that way. There’s also a lot of football, and I’m a big football fan, but by Sunday evening ... You’re drained, yo. I could be very well drained from football, especially I also like college football, so it’s ... You’re getting everything. Add another day of the week in there. I had an opportunity to, a couple years ago when I first retired, to invest in a VR company. What’s it called? It was called RAD3. Okay. “It was called.” Does that mean it’s not around? I mean, I don’t know if it’s still called that or not. Yeah, got it. I know VR’s where they’re still in. I know they have a VR arcade in Walnut Creek, so if you wanted to go check it out, it’s pretty dope. Check it out, okay. Myself and a high school teammate of mine who played for the Patriots started a game with them called Dime Time, and it was a game to teach young kids how to play quarterback, without playing quarterback. Sure. So, teaching you how to go through your reads and teaching you different concepts and teaching you what coverages look like, by animation. It was like a video game. I could see the game going that way. I could see the whole ... They can experience ... that commercial they had where you put the thing on and you do what Michael ... I could see those things happening. But at the end of the day, it’ll be hard to consume it being in the game because the game is so fast. It’ll be crazy for people. Some people get nauseous from it. Some people just wouldn’t understand it. You always need that bird’s-eye view, and I think the television companies were doing a great job with that and then the production of it, so I think iPhones or Samsungs or whatever mobile device you have will be the way that people will ... You’ll still have TVs. You’ll still have Apple TV, all those different things, but I still think cable and DirecTV will still be around. Yeah. I have people telling me like, “In three years, DirecTV will never be around.” I’m like, “Mm, I don’t think so, bro.” I get a lot of young people don’t pay for cable and they use Amazon Prime or whatever it may be, but the avid football fan wants more, and you’re going to get that from watching TV and watching different things or on your phone and doing those type of deals. I think it may lean more towards the mobile devices, but it’ll still be a lot of TV being watched. I think the thing with VR, for me, and I’ve seen the different angles at which you can watch a game and look around, feels like you’re in the stands, whatever. I think the big thing, for me, is that I still consider watching sports a pretty social element of my life. I usually am with a friend or ... Sports bar. Yeah, sports bar with my wife and with whatever, so unless I’m home alone, I’m not probably going to throw on a VR headset. And even then, it’s got to be a better experience than TV, which is pretty good. That’s the thing that the NFL is having trouble with right now is that the TV experience is much better than in-game. It is, and in-game’s expensive too. It’s expensive. They’re trying to find ways to make it a little bit more fan-friendly. What does that mean? Is there a risk of ... We see with the LA Chargers, for example. They can barely sell out this small soccer stadium. Are people not going to go to games? Yeah, but they have their own issues, why they’re not selling out. True. For sure. It has nothing to do with … Them leaving San Diego is the main reason. A lot of people were upset with that. Sure. And they’ve been upset with the way their team has been run for years, right? That’s a bad example. That takes that one. But I could say, for example, when the Rams moved here... When the Rams moved here, it was weird. The first game was sold out. It was crazy because it was LA, they’re back, and they weren’t good. Are they playing in the Rose Bowl or at USC? They’re playing at USC, the Coliseum. Okay. Which is big, the Coliseum. Yeah, it’s a 98,000. It was sold out. Yeah, that’s a lot of fans. But they weren’t good. Yes. It was like, “ugh,” you know what I mean? You have to be good consistently to get people to come and watch. That’s the key. And in the league right now, you have like four or five teams that are really good, maybe eight that are really good, and the rest are either mediocre to bad. Teams are always rebuilding, always changing. There’s no real consistency, and that’s what hurts you more than anything. Everyone’s trying to find the next Sean McVay or the next Sean Payton. The next Bill Belichick. Everyone’s trying to find this guy, but you have to give your guys an opportunity. The thing about Bill Belichick is he’s been coaching the Patriots for 19 years or something crazy like that. Consistency, that’s the key. A lot of people are impatient, and a lot of fan bases are impatient. They want to win, so if you don’t win right away, that hurts ticket sales and it makes it easier for them to go and watch you on TV. Do you have any opinion about tech companies, like Amazon for example, or Facebook or Twitter, coming in and streaming a game versus a traditional TV network? No. Why not? I’m all for trying to get it out to as many people as possible. I remember doing a Yahoo ... The Jags played the Ravens last year in London. In London, yeah. We did the pre and post from here, but Yahoo streamed it. And I want to say it hit like 6.5 million people. That’s huge. At 6 AM on the West Coast, right? Right. 9 AM on the East Coast, you have a game that you can see on your phone if it wasn’t blacked out in your area. That’s big. You’re just trying to reach more and more people, and these people were global. It wasn’t DirecTV. It wasn’t your cable, whatever cable box you have. It was people across the world watching this game. I think the more the league can do that, the more fans they’ll draw in, and it’ll be better for this business. Yeah. It seems to be moving that way, for sure. I’m interested to see if it’ll survive on like a Netflix or Amazon Prime subscription, right? Right. That is something that we haven’t really seen, beyond just experiments at this point. It feels like we’re headed that direction, at least for maybe a handful of games. I’ll tell you this, the one thing I learned about the NFL: Money talks. Yeah. No matter what, they’ll find a way to make it work. Yes, they’re testing games and doing things because there’s always a bigger picture behind it. That’s big business. That’s the business of Facebook. That’s why Facebook is buying everything. They’re buying the Oculus, and they’re buying Instagram, and they’re buying this, and Google’s buying that. And Google has their own venture firm that’s investing. Everyone’s trying to buy and get as much content as possible, but the No. 1 content in the world ... well, in the world it’s soccer, but in America it’s football. Everyone’s trying to figure out a way to get that content because that’s what drives, obviously, viewers and subscribers and things like that. And live sports is one of the only things that still gets people to the couch at a specific time. Probably the only thing, right? Maybe politics? Politics, I think ... It’s weird, because when you bring in politics, mostly you’re with people that think the way you think. Sure. Otherwise it’s a very uncomfortable viewing experience. Yeah, it’s weird. I’ve never seen people say, “You know what? I’m a Republican. I’m going to go watch with Democrats.” No. It’s never that. Yeah, no. It’s like, “I’m going to go hang out with my buddies that think the same way I do.” Which is your prerogative. I’ve always been taught ... At De La Salle [High School], they had a debate team, and I did a little bit of it. I always want to know what the other side’s thinking, because you just never know. Like, my argument may be flawed. I don’t know. If I don’t know what the other side’s thinking ... So, I actually do try to hang out with people who think differently than me just to hear their arguments, because if we do end up getting into it, I want to know what you’re thinking or I want to make sure that I’m right in my thinking. But politics ... You should run. Are you going to run for office? Look, someone who actually wants to hear both sides, that’s like you’re a unicorn out there in the world of politics. You should always hear both sides. I think sometimes we lose our reason and we kind of let it be emotional. Sports is probably the only thing you can do when we watch with everyone. My brother-in-law is a Bengals fan, and this past weekend they played the Dolphins. And one of his best friends is a Dolphins fan, so him and his buddy, who are both Bengals fans, go to this Dolphins bar in Atlanta and they’re watching it. He said it was the best time ever. Yeah? He was like, they were yelling at them when the game was going, and then he was yelling at them at the end because they won. But it was all in good spirit. Sure. I think that’s what makes football, because everyone understands sports and they try to keep it lively. It can be a fine line sometimes. You mentioned investing. You said you invested in a VR company. Mm-hmm. And you live in the Bay Area right now. Yeah. I’m surrounded by tech. You’re surrounded by tech. What’s your status as an investor? Is it something you actively do? It’s tough because I have so many kids. I have three kids now, so I try not to lose a lot of money because they take a lot of it with youth sports, which I’m really big into that as well. There’s been opportunities that I’ve ... like you buy stock in Facebook when they come out, or different platforms like that, Twitter and different things. There’s actually a group led by Ryan Nece, who is Ronnie Lott’s son, I forget the name of it. It’s ... An investment group, though? It’s an investment group, yes. Okay. With this group, we’ve been working together trying to figure out a way to work together and do some investing. But he’s so connected and into tech. I got a chance to go to Google Ventures. Got a chance to go to Sand Hill, we were talking about before. Yeah, Sand Hill Road. The Rosewood Hotel. Rosewood Hotel. What is the big VC up there on Sand Hill Road? It’s a couple of them, but ... There’s a bunch of them. Sequoia? Sequoia! Okay. Went to Sequoia. Met with them. They were talking about some things where ... And my concern with the investing is that it’s such a low hit rate that it scares me. I’m real soft when it comes to that. You don’t like the risk. I grew up with no money, so it’s like: I got money, I’m gonna try to keep it as long as I can. But they were talking about how they try to hit it like a 20 percent, 30 percent rate. If they hit, then they’re happy. And they’re like the best in the biz, historically. Exactly. They told us a story about how they spent one-point-something billion dollars, and they invested in this molecule that ends up selling and that one molecule paid for the whole thing three times over, right? Sure. It’s a real dangerous game, and it’s kind of hard, especially now with everyone popping up with something. Snapchat is tough. My brother works at Snapchat. Oh, really? Yeah. He’s out here in LA, so he always talks about it. But it’s always something new coming up. You just don’t know if it’s going to hit or not, so that’s always the scary part. Like Uber, Lyft ... How do players deal with that while they’re still playing? I imagine they get tons of people throwing things at them. You always hear, “So-and-so lost their money. They invested in a bunch of car washes,” or “They invested in restaurants,” or whatever. What was it like as a player to have that happen? It was crazy. You always get hit with different things, but I had two great men that were surrounding me, my financial guy, who works for UBS, Stacy Oster. Great guy, really scrubs everything, real conservative, making sure everything’s good. Takes his time with it, too. Doesn’t rush it. A lot of times people be like, “I need it by tomorrow.” Like, we’re not going to get that, so chill out. Sure. Then, obviously, my agent, Adisa Bakari, who’s at the Sports Entertainment Group, was another one that I would like to run stuff by because he’s a lawyer. He would run it through his investment lawyers to make sure everything was good, do background checks, make sure that people were clean. And a lot of times, you do a background check, the person’s dirty that you’re dealing with so you usually get away from it. A couple of times, it ended up working out where it was a good investment. There were some times it was a good investment, we just took too long and we missed it. For me, my biggest investment when I was playing ball was in me. Sure. Your next contract. If I was healthy and I was doing things, I got endorsements, my next contract, so that’s what I was investing in more than anything else. A lot of players are so funny. My grandpa always used to always tell me, “Dude, you’re a football player. You’re not an engineer. You’re not an investor. You’re none of this. Your whole life, you’ve played football. You went to college, let’s be honest, you went to UCLA, got a good education, but you went to play football, so be a football player.” My agent used to say the same thing. Sometimes players come out and they feel like, “I’ve always wanted to do this,” but you never put in the amount of time and effort to do it. That’s why, like I told you in the very beginning of the show, I sucked as a broadcaster at the very beginning. Horrible. But I put those 10,000 hours in of watching tape, watching myself, making sure I’m critical of myself, being coached by different people, doing improv classes, different things to help me become a better person, to find my niche in what I want to do within the media. I think a lot of players need to understand that when they start investing is like, all right, dude. You have money, that’s great, but don’t be like, “I’m going to go open up a car wash.” You’ve never washed a car in your life! Right. What do you know about a car wash? What do you know about running something? Even now, like I opened a gym in the Bay Area, or a facility. It’s crazy, so many things have popped up in the last ... We opened it a year ago. I funded everything, and all my buddies come in and they train out of there. Great business. We went from 15 people to almost 600 in a year. Like members to the gym? Yeah. It’s not necessarily a membership gym. It’s more of people that come through. Gotcha. How we have it is like a salon. It’s made up like a salon because I’m not there every day. Okay. I had to do it where they’re independent contractors. We work ourselves throughout. But we created a baseball organization out of the facility. We created a basketball organization out of facility. We’re creating a track one out of the facility where we’re branching off to do different things. It’s crazy. The heads that come with it and the stuff that comes with it and things that break. I’m like, what am I doing? But, at the end of the day, it was my love for my community to help our kids have a place that they can train and be better. I trained in Miami. I trained in LA. I trained in all these different cities. There was nothing in the Bay Area, or the East Bay at least, that I can say, “This is where I trained.” Yeah. So we created this space for young athletes as well as adults to come and work out. And we’ve grown. We’ve done a great job with it. You always hear about, especially the players on the Warriors, oh they live in Silicon Valley and they have ownership group in the NBA who’s very connected to the Silicon Valley tech scene, so they’re cropping up investing. You finished your career, most of your career was in Jacksonville, but you finished your career in Oakland. You’re from Oakland originally. Yeah. Does playing in the Bay Area, is there a benefit to players actually playing out there and being close to all of this? Yeah, if you’re good. Yeah? I think if you’re a good team, yeah, no question. For me, going back home was more I just wanted to play in front of my family again. Growing up in the Bay Area, playing youth football in Antioch, to going to De La Salle, to going to UCLA and coming back and playing Stanford and playing Cal there and having that go. It’s just such a special place when you’re able to go back home and play, and you play well. In Jacksonville, we had a couple times we came out to the Bay Area. I think I came out two or three times, it wasn’t anything fun. To be able to wear the black and silver in front of my family members who were all Raiders fans for the most part — my wife’s family’s a Niners fan but, ehh ... Yeah. It’s all good. You can stare them down at Thanksgiving. They were Raider fans when I played. What about, sorry, but what about ... That’s what I was gonna tell you. That, when you, when you’re able to do those, you create relationships, right? So, the kids that I went to high school with may now work at such and such tech or may do this. It opens doors. Just like going to New York. If you played in New York, if you look at Michael Strahan, if Michael Strahan played for the Houston Texans he wouldn’t be Michael Strahan who he is today. Sure. Because of that market that New York provides. Well, the Bay Area is a little bit different where you get an opportunity to see tech every day. You talk about the Warriors’ owners, those are tech guys. They are able to open doors for you and different ventures that you may be able to ... if that interests you. I remember at the Raiders, we would have dinners or lunches, their player development guy would set up, I think his name is LaMonte, LaMonte Winston. LaMonte would set up dinners with CEOs and VCs and all these people and you’d meet them and you’d hang out and you’d talk and you’d be able to pass cards and email and do all those things. Still today, there are still people that I met at that that I keep in contact with, if its either through a fantasy league that we’re in or through whatever else it may be. Where I live now, in the city I live in now, my neighbors are all VC people, so again, it’s definitely a plus living in the Bay Area. Now, it’s expensive, don’t get my wrong, but the opportunity there is tremendous. There’s people that either I coached their kid in youth football or they’re my neighbor and there’s different opportunities that were presented to you because of how you carry yourself or because people want to have you around. Yeah. So you came out to the League, I believe, in 2006? Yes. Social media didn’t really exist in 2006. No, it didn’t. Good thing, right? Now, obviously, hard to imagine life without it. What was it like as player to basically come into the League with no social media and by the time you left what, nine seasons later, it was probably all anyone talked about? Well, I’ll say this much. UCLA was the third school with Facebook, I wanna say? Second or third. Sure. We were one of the first schools with Facebook and so, it was weird being able to have a site. It was kind of like Myspace in a way, right? Everyone had a Myspace or things like that. But to have Facebook, that was only for college kids in the very beginning, which was amazing right? So you remember signing up? Oh, no, no question. Signed up and was poking everybody and friending all my friends and all the stuff you’re supposed to do. But that was more like, intimate. It was more just for college kids. Now, when Facebook opened up to everybody, I was a little upset about it because I felt like that took away the special interaction that I had with people that were in college. When I got to the pros, I turned off my Facebook at that point. Just because you were too busy or because people were harassing you on it or? Nah, it just didn’t seem authentic to me anymore after that, ya know? It was for college kids and it should’ve been for college kids. Now, granted, at that point I was 20 years old. I didn’t understand the financial benefits of opening it up to everyone, which now I do and I see why they did it. But, at that point, it was just for me, personally. It was just like, “Ah well, it was fun for college, I’m in the pros now, let me leave it alone.” Which was not very smart. Why is that? Well, ‘cause I probably would’ve had a bigger following if I would’ve kept it. Sure. Once you delete it, you have to start it back up again and do all those different things. And as a football player, especially now, you get a lot of endorsements and things because of the followers you have. The reason Odell Beckham got a $25 million Nike shoe deal was because he has like 17 million people that follow him or something crazy, right? Sure. Your reach is much greater than, obviously, what mine was. It’s funny. Rashad Jennings was a guy who, we were in Miami training, I want to say, might’ve been 2008 or 2009. He’s a teammate of yours? A teammate of mine who now is doing acting in Hollywood. He came to me and was like, “Hey man, you need to try this Twitter thing.” I’m like, “I’m not doing anything with social media. I’m done. I just want to play football. I wanna train, play football, have fun, chill.” He’s like, “Man, listen, go get you a Twitter. Trust me. You’ll love it.” So I got it, started watching, kind of seeing/following people. I’ve always been interested in news and I used to read the newspaper all the time. That’s why he brought it to me. He was like, “Bro, this is like the newspaper, just on your phone.” Eventually I started tweeting these couple things out, you started getting responses and you started seeing people from different places. I fell in love with Twitter. You were managing your own Twitter account? I manage all my own stuff. Gotcha. I don’t do the whole publicist ... A lot of athletes or famous people have agents ... To me, that’s trash. If you’re gonna do it, do it. If you’re not gonna do it, don’t do it. It should be authentic if you’re gonna go out there. People know who I am. I’m always going to be me, I’m never going to be anyone else. I can’t have anyone be me. I have my own little corny jokes, or dry sense of humor that I throw out there; dad jokes or whatever it may be that people know it’s me. At least the people that know me know it’s me. And so, it’s funny, Twitter, I was ... 2010, I had hurt my knee. I’m out for the year and I’m watching the Chicago Bears game. The NFC Championship game against the Packers and I tweet something out about Jay Cutler, saying, “When the going gets tough, quit.” Quarterback for the Bears. Yeah, yeah, yeah. Jay Cutler, quarterback for the Bears. And so, there were a lot of Bears fans that weren’t really happy with that. Actually, it was a two-piece joke because it was like, “the Urban Meyer rule is in full effect.” And then “... when the going gets tough, quit.” Because he just did that in Florida. So a lot of Florida fans were upset with me; a lot of Bears fans were upset with me. It was all over the media. Everyone took it. That’s when I realized how powerful social media was. At that point I think I had 20,000 followers, the next morning I woke up with 500,000. Wow. That was your moment of viral social media. It was real. And it was one of the first things that ever happened. I then realized, okay, I have to be careful what I say on here, because not only are other people watching, there’s kids following, there’s different things. Even though I knew what I said wasn’t wrong, it was true, but... You’re still active on Twitter. Oh, always active on Twitter. I answer fantasy questions. I tweet at people sometimes. I always try to tweet out. I’m big into the high school recruiting scene, so I always retweet the kids that I train with or work with, helping them get recruits. I deal with a lot of coaches in that situation. I always tweet out certain news sites or whatever it may be that I feel like is more on my side of thinking, obviously. Every now and then I’ll tweet out the other side of thinking. I enjoy it because it gives you a platform to really express who you are. Now, there’s some times I may not use Twitter for a month, then I’ll just pop up. I may not use Instagram for a month, then I’ll just pop up. Is that the other site you use? Your brother’s at Snap. I have a Snapchat but I’m more of a looker than a Snapchat... That’s too much. I’m not that young. How do you deal with trolls? I’m sure you have, as a famous person, I’m sure people like to call you out for things or whatever. I’m okay with the trolls. It’s the death threats that you get a little upset with. I’m sure. I could see that. Right. Again, those are people ... I grew up in a rougher area, it doesn’t really bother me, the trolling. People are going to talk bad about you, that’s what some people do to make them feel better. But after the Chicago Bears situation, I had a couple death threats and I wasn’t too happy about it, to say the least. Yeah, I can imagine. But lot of that is people ... No one is going to really ... Yeah. Most people are just talking. They’re like, “I’ll do this to you when I see you.” And I’m like, “Well then, pull up. This is where I’ll be.” Or, another great example, I was with the Jags and a bunch of Raiders fans were like on my timeline talking crazy. That Super Bowl, I forgot where we were, but I was like, “This is where I am. I live in the Bay Area in the off season. This is the bar I go to every time. If you’re feeling froggy, just show up, I’ll be there on Tuesdays, just catch me there.” And again, you do it to quiet people down. Did you ever get scared someone might actually show up? No, no one’s gonna show up. Ain’t no one that bold in this day. People just talk. Yeah. Well, you’re also quite large. I handle my own. Right? You would be fine. Again, those are people expressing themselves. And that’s what we have to see it as. And so like after seeing it from the other side, I get it. People are passionate about their teams and their fan bases and so you always want to let them express themselves. As a father of three, how do you think about social or tech for your kids? When I told you I had three boys, one of them was my nephew. He’s moved out and lives with his mom now. Gotcha. My cousin. So you have ...? Two boys and a girl. Gotcha. They all have Snapchat. How old are they? 10, 8 and 7. Okay. But again, you just have to educate them on it. And that’s what I try to do. I’ve never been a parent to try and shield my kids from the world, because those kids end up doing bad things when they’re hit with adversity. I’ve always tried to be honest with my kids about questions they’ve asked. I’ve always tried to, you know, teach them how life is. My kids are pretty different. They watch the news. Oh, wow. Like Fox News and CNN News. It’s so funny. Like the real news. Like the real news. They’ll be up late at night watching certain channels. I’m like, “Yo, turn it off.” Wow. “I can’t help it.” “Yeah, turn it off.” So, they’re engaged. 2016, they were really big into politics. They had their own voice. Not my voice, their own voice, and we would speak on it. That’s how my family is. We can sit down and disagree over certain things and still be able to break bread and enjoy each other’s company. That’s just how we are. I’ve always wanted to raise my kids to be able to think for themselves and not push my views on them because my views are my views. My wife’s views are her views. Their views are their views. They should be able to hold an intellectual conversation with anyone at the age of 10 on anything. Yeah. So you don’t mind if they have a Twitter or ... They don’t have Twitter. They only have Snapchat. Snapchat. Little bit more intimate, that way. Yeah. And the more of it, you can kind of watch who’s following ‘em and those type of things. What do you feel about ... I know you said you’re big into youth sports, what do you think about the obvious, tackle football for kids? I love it. Yeah? Not worried about it? I think it’s the best thing going. Not at all. Why not? Because you can get hurt doing anything. And I’ll give you a great example. This year, I coached 10U [youth football]. It cracks me up. One of our players got hurt. Broke his foot and sprained his ankle. You would think it’s at practice. No. It was jumping on a trampoline. Another kid got a concussion. You think it was at practice? No, he was riding a scooter without a helmet. Yeah. If you’re gonna stop players from playing football, then don’t let them play at recess because a couple years ago my son had a team that had five kids get hurt. None got hurt on the football field. One got hurt playing tag at recess, ran into a pole. Another broke his arm skateboarding. The stuff that kids do. So how many concussions do kids get when they fall off something? Off a bike or they could fall off the swing set. We don’t quantify those. I think, for me, this is my analogy I tell people. When, let’s say you wanna have heart surgery. Do you want the guy fresh out of med school doing it? Or do you want the 20-year pro doing it? Everyone chooses the 20-year pro and that’s what it is for football. Yes, it is a very dangerous sport but if you have a kid that is playing at the age of 5 or 6; both my boys played at 5 and 6. The hits aren’t that hard. They are learning how to protect themselves. And if they do make a mistake, there’s no real risk at that given point. Because they’re not being hit hard enough. Yeah, because you’re talking about kids who aren’t coordinated. You’re talking about the pads being bigger than them the majority of the time. It’s like little bodies, big heads. Right. But they’re learning that, when I go across the middle, okay, this may hurt. Ah! Okay, I know how to protect myself. Then, instead of putting a kid at 12, who will then play against someone who has been playing for six years and their first year is at 12? You’re guaranteed that 12-year-old is going to get hurt. And then, let’s wait till high school? You’re guaranteed that 14-year-old is going to get hurt. Guess what? Now kids are lifting weights. They’re bigger, stronger, more coordinated, and your kid doesn’t know how to protect himself, where these other guys do. And then you get hurt. I always tell people, when they come and they ask me for my opinion, I always say play early. Play as early as you can. And flag is not football. Right? And don’t get me wrong. I think it’s a great sport and I think a lot of people do it. It’s a kind of a side dish to tackle. But the flag rules are completely different than the tackle rules and the reason being is that you have to be a much more physical person. And I have a lot of kids who have played flag for two or three, four years and now they’re coming to tackle football and, at the age of 10, it’s a big jump because they’ve never seen contact like that. The thought of, you have to run as fast as you can into the other person to protect yourself, they don’t understand it. And I always tell them, if you go 50 percent and he goes 100, you’re gonna get hurt. It’s been a great teaching point. A lot of parents have bought into what we’re doing at our organization and we’re going to try to continue to grow this thing because the game of football is special. I always tell people, I’m from a small town called Antioch, California. We’ve had five guys go pro out of this town. Or six. Maybe more, actually. Myself, Sterling Moore, Taiwan Jones, Jeremy Newberry, Anthony Trucks, TJ Ward, Terron Ward are the ones that I know about. There are probably more, but football allowed us to leave this small town in the Bay Area, East Bay. We’re the first city in the Bay Area, the delta where all that stuff is, to go see London, to go to New York City, to travel the world and do different things. Take care of our family, set up our families forever. Who am I to not allow my kids or anyone else’s kids that right to be able try and get that and get what football has done for me? I always tell people, it’s better off starting early than it is starting late. That seems like as good a spot as any to stop. All right. But this was awesome. MJD, thank you so much for your time. No problem. Next time, see you in the Bay Area. Let’s do it up north. All right.

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Here’s what to watch for as Davos in the Desert begins. The Saudi economic summit that begins on Tuesday will be nothing like last year’s inaugural Saudi summit. The sheen has worn off of the Future Investment Initiative, which was visualized as a new kind of international finance conference that would take what has succeeded for decades in Davos as the World Economic Forum and bring it to the desert of Riyadh. But after the now-admitted killing of American resident and journalist Jamal Khashoggi earlier this month, the event has transformed from a star-studded gala into a scarlet letter in the eyes of Silicon Valley. The three-day conference has been close to decimated by cancellations from Western speakers as details emerged about Khashoggi’s gruesome death. And now the Saudis will have to stomach global scrutiny that will be critical of too many all-is-fine smiles from attendees or too few mea culpas from government officials. Here’s what to watch for as “Davos in the Desert” begins: Who shows up? Remarkably, on the eve of the conference, we still do not have a final tally of which Silicon Valley names are still planning to appear. That’s probably the point. “The detailed program will be released shortly,” read the conference’s website as of Tuesday morning in Saudi Arabia. Controversial investor and Facebook board member Peter Thiel is still listed as sitting on the conference’s advisory board — even as other Silicon Valley members like media mogul Arianna Huffington have pulled their endorsement. The biggest unanswered question, though, is whether Masayoshi Son, the leader of SoftBank, will snub the event. Son is the Silicon Valley name with the most substantial business ties to the Saudis — $45 billion through their joint investing effort, the Vision Fund — and SoftBank has said very little about the unfolding situation in its backer’s borders. SoftBank has been mum about its executives’ plans — a spokesperson didn’t reply on Monday when asked about Son’s plans. But the business world will be closely watching what he says, and more importantly, if he appears at all. Will the Saudis acknowledge that they screwed up? The high-profile names attending a conference, though, are only really meaningful if they tell us something about whether the Saudis will be really hurt in the pocketbook. Unwinding past deals is close to impossible. But future deals? There are early signs that the Saudis are losing the U.S. business they have tried so hard to cultivate — from a $400 million investment into the Hollywood talent agency Endeavor to $1 billion into Richard Branson’s Virgin Group. I wonder whether the Saudis will pretend if all is normal, or will instead recognize that their brand in the deal community has been seriously tarnished. Will venture capitalists leave feeling that they can take Saudi money once again? It’s not only startups that take in mouthfuls of Saudi cash over the last few years — venture capital firms do, too. Everyone knows about how Saudi Arabia’s Public Investment Fund has backed companies like Uber. But Saudi funds are always trying to get access to top-tier funds. One that has been somewhat successful, for instance, is the King Abdullah University of Science and Technology, the $20 billion endowment that is an investor in a number of top funds, according to one person familiar with the arrangement. If you’re a Silicon Valley investor in October 2018, it’s hard to believe that you’d feel comfortable taking money from any Saudi-backed fund. “Not all money is the same. The people that come with it and who are behind it matter,” wrote venture capitalist Fred Wilson on his well-read blog this weekend. “That has always been the case and remains the case and we are reminded of it from time to time. Like right now.” The problem? In October 2020 or October 2022, when the Khashoggi scandal has faded into history, investors won’t be reminded of it. And the Saudi summits could get very popular again.

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posted about 19 hours ago on re/code
The company’s latest futuristic convenience shop is being built inside the Brookfield Place office and shopping complex. Amazon’s version of a futuristic 7-Eleven store is coming to New York City, and it’s going to be located inside a shopping and office complex across from the World Trade Center, Recode has learned. Amazon plans to unveil the cashierless convenience store inside Brookfield Place, formerly known as the World Financial Center, in Manhattan’s Battery Park City neighborhood. Brookfield Place has been the home of large corporations like American Express and Time Inc., as well as upscale stores such as Louis Vuitton, Gucci and Saks Fifth Avenue. It is situated along the Hudson River, directly across West Street from the World Trade Center. An Amazon spokeswoman declined to comment. Amazon Go stores utilize a combination of sensors, cameras and computer vision to automatically charge customers for items upon exit without them needing to stop and pay. Since the first Amazon Go store opened to the public on the ground floor of the company’s Seattle headquarters early this year, the concept has become the focus of much fascination in the retail industry, and the stores have even become a tourist destination. Amazon has so far opened three Amazon Go locations in Seattle and two in Chicago, with another on the way in the Windy City. The company had previously confirmed that it will open at least one location in San Francisco. Some of the stores, including the first Seattle location, feature prepared foods such as sandwiches and salads alongside a small selection of packaged groceries like soups and condiments. The original store also sells wine and beer. Jason Del Rey for Recode The wine section inside the Amazon Go store in Seattle. Amazon does employ a worker to check IDs. Others feature the prepared foods without the grocery selection, making them more akin to a sandwich chain like Pret a Manger. It is not known which format this New York City store will take. The Information previously reported that Amazon planned a Go store for New York City, but did not specify the location. Amazon believes that the convenience of the Amazon Go stores can differentiate them and make them destinations for busy working professionals during peak mealtimes. As such, it is not surprising that Amazon selected a New York City location that is at the center of several large office towers. This most recent development comes a month after Bloomberg reported that Amazon has discussed opening as many as 3,000 Amazon Go locations by 2021. Amazon executives have said repeatedly that they don’t have plans to use Amazon Go technology in the company’s Whole Foods stores but if they roll out thousands of standalone Go stores, the concept could revolutionize brick-and-mortar while disrupting one of the largest roles in the retail labor market: Cashiers. Recode previously reported that Amazon has also held talks with a top Los Angeles real estate developer about opening an Amazon Go store at the city’s The Grove outdoor shopping complex, The Grove. It is not clear if the two sides ever agreed to a deal. New York’s new Amazon Go store will sit adjacent to Brookfield Place’s Winter Garden atrium — a 10-story glass pavilion that was damaged in the terrorist attacks of September 11, 2011. The store will be positioned near the security desk in front of American Express’s office tower and near an Oliver Peoples eyewear store. Amazon already has an existing relationship with Brookfield Properties, the owner of Brookfield Place. The e-commerce giant announced last fall that it had signed a 15-year lease for 360,000 square feet of office space inside Brookfield’s 5 Manhattan West complex.

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posted about 19 hours ago on re/code
The company’s latest futuristic convenience shop is being built inside the Brookfield Place office and shopping complex. Amazon’s version of a futuristic 7-Eleven store is coming to New York City, and it’s going to be located inside a shopping and office complex across from the World Trade Center, Recode has learned. Amazon plans to unveil the cashierless convenience store inside Brookfield Place, formerly known as the World Financial Center, in Manhattan’s Battery Park City neighborhood. Brookfield Place has been the home of large corporations like American Express and Time Inc., as well as upscale stores such as Louis Vuitton, Gucci and Saks Fifth Avenue. It is situated along the Hudson River, directly across West Street from the World Trade Center. An Amazon spokeswoman declined to comment. Amazon Go stores utilize a combination of sensors, cameras and computer vision to automatically charge customers for items upon exit without them needing to stop and pay. Since the first Amazon Go store opened to the public on the ground floor of the company’s Seattle headquarters early this year, the concept has become the focus of much fascination in the retail industry, and the stores have even become a tourist destination. Amazon has so far opened three Amazon Go locations in Seattle and two in Chicago, with another on the way in the Windy City. The company had previously confirmed that it will open at least one location in San Francisco. Some of the stores, including the first Seattle location, feature prepared foods such as sandwiches and salads alongside a small selection of packaged groceries like soups and condiments. The original store also sells wine and beer. Jason Del Rey for Recode The wine section inside the Amazon Go store in Seattle. Amazon does employ a worker to check IDs. Others feature the prepared foods without the grocery selection, making them more akin to a sandwich chain like Pret a Manger. It is not known which format this New York City store will take. The Information previously reported that Amazon planned a Go store for New York City, but did not specify the location. Amazon believes that the convenience of the Amazon Go stores can differentiate them and make them destinations for busy working professionals during peak mealtimes. As such, it is not surprising that Amazon selected a New York City location that is at the center of several large office towers. This most recent development comes a month after Bloomberg reported that Amazon has discussed opening as many as 3,000 Amazon Go locations by 2021. Amazon executives have said repeatedly that they don’t have plans to use Amazon Go technology in the company’s Whole Foods stores but if they roll out thousands of standalone Go stores, the concept could revolutionize the brick-and-mortar world while disrupting one of the largest roles in the retail labor market: Cashiers. Recode previously reported that Amazon has also held talks with a top Los Angeles real estate developer about opening an Amazon Go store at the city’s outdoor shopping complex, The Grove. It is not clear if the two sides ever agreed to a deal. New York’s new Amazon Go store will sit adjacent to Brookfield Place’s Winter Garden atrium — a 10-story glass pavilion that was damaged in the terrorist attacks of September 11, 2011. The store will be positioned near the security desk in front of American Express’s office tower and near an Oliver Peoples eyewear store. Amazon already has an existing relationship with Brookfield Properties, the owner of Brookfield Place. The e-commerce giant announced last fall that it had signed a 15-year lease for 360,000 square feet of office space inside Brookfield’s 5 Manhattan West complex.

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posted 1 day ago on re/code
Plus, Fred Wilson and Kara Swisher have been thinking about ethics in the tech industry; Republicans are working around Facebook with their own apps; making the sound of “Housewives.” The apparent murder of Saudi journalist Jamal Khashoggi has exposed details of a broad online intimidation campaign ordered by Crown Prince Mohammed bin Salman to silence critics of his Saudi Arabian kingdom. Hundreds of people work at a so-called troll farm in Riyadh to smother the voices of dissidents like Khashoggi; the push also appears to include the grooming of a Saudi employee at Twitter whom Western intelligence officials suspected of spying on user accounts to help the Saudi leadership. Many Saudis had hoped that Twitter would democratize discourse by giving everyday citizens a voice, but Saudi Arabia has instead become an illustration of how authoritarian governments can manipulate social media to silence or drown out critical voices while spreading their own version of reality.[Katie Benner, Mark Mazzetti, Ben Hubbard and Mike Isaac / The New York Times] [Want to get the Recode Daily in your inbox? Subscribe here.] Recent news events spurred investor Fred Wilson to share some thoughts with his peers in the startup and VC sector: It’s time, he says, “to do a deep dive on our investor base and ask the question … Who are our investors and can we be proud of them? And do we want to work for them?” Wilson notes that the startup and venture community is coming to grip with a flood of money from bad actors that has found its way into the sector over the last decade — and not just money from rulers who turn out to be cold blooded killers. In her op-ed for The New York Times, Recode editor at large Kara Swisher considers the complex ethical problems the tech industry faces and wonders if the solution is for companies to hire a chief ethics officer. [Fred Wilson / AVC] Facebook has filled one of its most important executive roles with a rare outside hire: Nick Clegg, the former deputy prime minister in the U.K. under David Cameron, is joining Facebook to lead all communications and global policy. Clegg’s experience in British and European politics will be key, given that the European Union seems much more interested and capable of regulating Facebook than U.S. politicians; hiring a former British politician is also a sign that Facebook sees potential European regulation as a major concern moving forward. [Kurt Wagner / Recode] Republicans are finding a way to work around Facebook with their own apps. Developed by a Washington, D.C.-based startup called uCampaign, apps like Cruz Crew, N.R.A. and Great America are effectively private social media platforms that offer conservatives safe spaces free from the content guidelines of the big platforms. Amid a chorus of conservative complaints that Facebook and YouTube have become hostile to right-leaning views — and as those social media giants take steps to limit what they see as abusive or misleading viral content — a few Republican consultants have begun building a parallel digital universe where their political clients set the rules. [Natasha Singer and Nicholas Confessore / The New York Times] Will tech leave Detroit in the dust? As IPO proposals value Uber at an eye-popping $120 billion, traditional automakers are racing to gain ground on everything from car sharing to driverless technology, reimagining themselves as nimbler software-as-a-service companies. Toyota, for instance, says it’s evolving into an entirely different company, one that focuses more on services that move people around. Auto executives say they need to avoid the nightmare tech scenario of becoming the next “handset makers” — commodity suppliers of hardware, helplessly watching all the profits flow to software makers like Apple and Alphabet. [Mike Colias, Tim Higgins and William Boston / The Wall Street Journal] Here’s the story of the city that had too much money: Vancouver was the first major Western city to experience the tidal wave of Chinese cash — and its unforeseen aftermath. Now the Canadian city is leading efforts to stop it. [Matthew Campbell and Natalie Obiko Pearson / Bloomberg Businessweek] ELON WATCH: ”The first tunnel is almost done” TRUMP WATCH:”Facebook has just stated that they are setting up a system to ‘purge’ themselves of Fake News. Does that mean CNN will finally be put out of business?” Top stories from Recode Why no one really knows how many jobs automation will replace. Even the experts agree about exactly how much tech like AI will change our workforce.[Shirin Ghaffary] Full Q&A: ‘Will & Grace’ co-star Sean Hayes on Recode Decode. Hayes spoke to Recode’s Kara Swisher at a live event in Los Angeles last week. [Kara Swisher] Peter Thiel cut his largest check to the GOP since Trump’s 2016 win. Thiel is giving $1 million to the Club for Growth, a hardline conversative advocacy group.[Theodore Schleifer] Resy is winning newer, cooler restaurants away from OpenTable. The upstart is taking share. Can it build from there? [Sayer Devlin] 23andMe CEO Anne Wojcicki says “one of our biggest competitors” is fake science on sites like Goop. On the latest episode of Recode Decode, Wojcicki says of Gwyneth Paltrow: “Some of the things that she promotes don’t actually have the scientific validity that my team would be able to stand behind.” [Kara Swisher] This is cool Making the sound of “Shark Week,” “Puppy Bowl” — and “Housewives.”

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posted 1 day ago on re/code
Hayes spoke to Recode’s Kara Swisher at a live event in Los Angeles last week. On the latest episode of Recode Decode, hosted by Kara Swisher, “Will & Grace” actor Sean Hayes talked about how he became a producer after the show ended, why the cast reunited for multiple new seasons on NBC, and how the rise of digital platforms like Amazon and Netflix aren’t as different from traditional players as people might assume. “These are the new networks,” Hayes said. “That’s all. Everything is exactly the same. Everything is ... They make deals with people. People are going to these streaming companies because they can do with their creative freedom, the deals are better, there’s more ownership, you can swear, you can tell real stories. A network is a dinosaur business because they have to rely on the affiliate still and advertising and that they are limiting because you have to watch what you say and do.” This interview was recorded live at the Boomtown Brewery in Los Angeles, at a Recode event sponsored by ZipRecruiter. You can listen to Recode Decode wherever you get your podcasts, including Apple Podcasts, Spotify, Google Podcasts, Pocket Casts and Overcast. Below, we’ve shared a lightly edited full transcript of Kara’s conversation with Sean. Kara Swisher: But tonight, we have a really great guy I’ve known for quite a while and I think he’s one of the funniest people I know. But he’s also pretty ... He’s beyond what you think he is. He’s obviously famous from “Will and Grace” and he’s over there doing his emails because he’s also a Hollywood producer. Sean Hayes: No, I just find you fascinating. I find you fascinating. I know that, thank you. Sean is one of the smartest people in Hollywood, thinking about where things are going in the digital age too, and so we’re going to talk about the show. We’re going to talk about his career and a little bit about the things he’s doing, including he’s doing some investments and different things like that. So, Sean Hayes, get up here. Thanks. Thanks, everybody. Thank you so much. It’s such a pleasure to be here with you. Is it? Yeah, here. And you said you didn’t know how to get here to this part of town. Well, gay people wear glasses. Yes, I know, we do. We like them. And black, too. And what? Black outfits. Black, yeah. Exactly. Well, yeah. Something like that. Hi, everybody. Hi. So, you didn’t know this area of town, right? You were like, “What the hell is ...” I did, I never come down here, and you realize that when you drive downtown Los Angeles that it really is like a whole other cool vibe that I’m not nearly cool enough for. Right, so you stay over on the west side. I stay on the nerd side, yeah. The nerd side, okay. So, let me talk a little bit about a lot of things, including “Will and Grace” and other things like that. That works out perfect ... That works out perfect because you’re there on “Will and Grace.” ... because I’m here. But I do want to get into the idea of what you do because you do things well beyond. And I think I was surprised by how much producing you do and things. So, it’s really important. First let’s talk about your background because I ask everyone about their background. You came from Illinois. Illinois. Yeah, Illinois. And you grew up in a small town? Yeah, I grew up in Glen Ellyn, Illinois, it’s a suburb of Chicago. Dad left when I was 5. Mom raised five kids by herself. So ... And dad left? The reason, you mean? Yeah. Wanted to drink and wanted to party. And I was like, “That sounds like a great idea, but I’m 5.” Yes, right. Okay. ”Wish I could join you.” My mom was extraordinary, but she worked all the time, but she was still a great mom, as great as she could be. So, we kind of parented ourselves. What did she do? She had the option when my dad left to have a secretarial kind of position or start a nonprofit organization feeding the poor and the homeless with a nun friend of hers. Okay. And that’s what she chose. And all of us were like, “You didn’t take Door No. 2 which would’ve paid for food in our mouths.” Right, right. But we always got a couple ... We were one of those families that needed the food. Right. So, she did the right thing. For 25 years, she helped run a food bank called Northern Illinois Food Bank which is part of Second Harvest, which is the bigger thing. I don’t know if anybody’s heard of that. And then raised five kids at the same time. And then raised five kids, yeah. So, you’re saying you raised yourself. Well, we parented ourselves. We had to learn how to ... We kind of weren’t ... We didn’t treat each other great because we were hurting, so that we hurt sometimes. But we also laughed a whole lot. And then the older we got, there was a lot of drinking in our house. Our house was the cool house where all the kids came over to drink and hang out. And I just wanted to sleep and practice my piano. Okay, all right. And your brothers and sisters, what did they end up doing? My oldest brother, no idea what he does, something in a warehouse. My second-oldest brother, I have no clue. My third-oldest brother, no idea. And my sister ... Because they start talking over the phone, I’m like, “What are you doing?” “Well, we do this stuff in the warehouse where they keep track of ...” I’m like, “I can’t keep track, I can’t figure it out.” So, my sister was ... You speak to them still? I do, yeah. Yes. You know, we all have different relationships with everybody, but I’m probably closest with my sister. She’s the most emotionally available and so that’s where I lived as well, around the corner. In that emotionally available part of the corner, yeah. Yeah. Try to. And she was a cop in Glen Ellyn, where the scariest thing is somebody’s bike gets stolen. Right. And then she moved to Wisconsin and is now ... working at a place. It’s a waste of time. All right. Okay. We’ll ask her. I could tell you what it is if you really want to know. Yes, I really want to know! Okay. So, she works at a place, it does two things in the same office. They sell stationery and they sell the equipment that kills farm animals. Okay. Yeah. Same thing. Like they cut off the balls of, you know, cows and such. Really? That’s what she does? She doesn’t do that, she sells the equipment for it. How does the stationery get ... I understand that cutting off balls part, but how does the stationery become part of that? I have no idea. Okay, but they do. That’s what they do. The same company does that. All right. So how did you get out of this place? That’s really the question. Why? Why would you want to? I know, right? I was 5, 6 years old, I came home from school, my mom said, “There’s a woman across the street teaching piano, do you want to take piano lessons?” I said, “I’m not doing anything else.” So, I started taking piano lessons at 5, stuck with it. Started entering competitions. In high school, I got into theater because that’s where the funny people hung out and that made me laugh. So I was a concert pianist and I thought I was going to do that with my life and be a conductor. And ended up pursuing music, piano, and theater minor. Never really graduated and then got an honorary doctorate. Okay. Okay. I’m still not clear how you got to Hollywood, but go ahead. Oh, oh, sorry. Sorry. So, I ... So, you would do all this in Chicago? You were doing this in Chicago. I was in the middle of a sentence. All right, sorry. Kidding. I was a music director at a dinner theater in St. Charles, Illinois, called Pheasant Run Dinner Theater and we did a lot of great shows. And there, people started getting auditions and stuff as an actor, but I was in the little tiny pit, wishing I was... Because when you’re in the pit of a musical, night after night after night after show after show after show, you’re like ... It’s like watching the same movie over and you can’t really talk to anybody because you have to be quiet. I’m like, “This is living hell.” Right. But it was a great job. So, it’s a dinner theater. It’s like “Oklahoma.” Yeah. We did “Oklahoma,” “West Side Story,” “Evita.” And then you had to serve ... Yes, “Evita.” ”Evita.” But the actors didn’t do the waiting the tables or anything. Okay, all right. Okay. But it was legit. It was legit theater. The Sun-Times and the Chicago Tribune and everybody would come down and review the shows. They said our “Evita” upstaged the original. Oh, okay. It was really great shows. All right. Really amazing shows. Right. Anyway, so I got there ... So, you’re stuck in the theater pit in St. Charles, Illinois. Illinois, yeah. Okay. And then, but I start auditioning ... Sorry, back up to 5 or 6, 7 and 8 years old. My mom and dad, when we were all really little, had us audition for commercials and stuff, which I thought that was odd. Wow. So, like a man came over and interviewed us one by one. One second. You get it? If you’re listening, I posed for a picture. All right. Okay, good. And then the person came over and we talked. And I started going downtown, taking auditions for United Airlines commercials, whatever. Anyway, nothing happened with that. Then I started doing this Pheasant Run, and did some acting in high school and college. And then I was like, “It’s so much more fun to be up there than in the pit.” So, I started auditioning and just booking commercial, after commercial, after commercial, after commercial. Right. And then, I was like, “Well, this is all we get in Chicago.” Or, like, “We get commercial work.” Right, commercial. A lot of movies don’t come to town. Not at all. And if one does, you have 10,000 actors auditioning for one line. And you know ... Right, exactly. In a “Home Alone” setting. Yes, exactly. Right, right, “Home Alone.” Exactly. What was I auditioning for? “Now, he’s really mad.” I auditioned for “While You Were Sleeping” with Sandra Bullock. Oh, yes. Of course. I was like 19, maybe. That’s right. Still waiting to hear. Still waiting to hear. That’s a terrible movie. Yeah, yeah. And so, did that. And then ... The actors and the friends of mine started booking stuff, so it was like ... Anyway, so I started doing that. Did you do Second City or anything else? I did. I did the training program in Second City for a couple years. But I never performed onstage. Right. So, that happened. I’m catching you up and then ... Okay, good. I’m still waiting to get to Los Angeles. What? I know. Okay, so we’re still in Chicago. So then, I decided I’m just going to do it. I’m going to do it while I’m 24 years old. Right. Right. If I don’t look back, I’m young enough. If it doesn’t work out I can come back to this job, right? And so, Anna Chlumsky, who’s on “Veep” ... Right. … was in “Fiddler on the Roof” at Pheasant Run Dinner Theater at the same ... Okay. She was also in “Annie” right after “My Girl.” Remember that movie? “My Girl” with Anna Chlumsky. Yeah. Yeah. So then she did that and came because she lived in Chicago. Right. And I’ve been friends with her since she was 9 years old. Anyways, so she was in ... A child star who then became a regular, later came back to do “Veep.” Yes. Right. Right. And she’s on “Veep” now. And actually, Katrina Lenk who just won the Tony this year, she’s a Pheasant Run ... There’s a lot of people from Pheasant Run who are working. Clearly. Yeah, it was very cool. Wow. And so, anyways ... So, pack my car, I say goodbye to “Fiddler on the Roof” cast and I move to Beverly. “Sunrise, Sunset.” Yeah. Yeah. Sung it all the way to California. Did you? Yeah. Wasn’t annoying at all. So, you go to Los Angeles and you’re in commercials again, right? Yes. You were in the Doritos commercial. And so I had a little bit of ammo because I had a demo reel with some commercials. Yeah. Right. So, I got a commercial agent right away. Right. Because I was a bigger fish in a smaller pond in Chicago. So, just kind of keep that going. What was your biggest commercial there? I had two spots on the Super Bowl in 1998. Doritos. Doritos and Bud Light. Yeah. And the Bud Light spot, I was shopping with my wife and there was this clothes rounder and you’d hear, “Psst.” And all these guys are inside the clothes rounder, like barbecuing and watching the game. Right. I was like, “This is awesome.” That one. And then the famous Doritos ... Let me hear it in the straight man voice. “This is awesome.” No, that was the straight man voice back then because people didn’t know, that was just fun. “He’s a straight guy who’s fun,” you know? I would say, if I didn’t act ... If you didn’t say Jack was gay in “Will and Grace,” he would just be the kooky nextdoor neighbor. Right, right. Like Jim J. Bullock from “Too Close for Comfort.” Yes, you’re right, you’re right. You’re right. But anyway ... So you did Doritos. And the Doritos one was ... Doritos, right? And that same ... I was at Sundance, the Sundance Film Festival with a starring role as Billy in “Billy’s Hollywood Screen Kiss” while those two commercials were airing. So that was it. So there was a lot of what they call “heat” behind me. Yes, okay. All right. You’re probably familiar with that, with all of your ventures. Yes. Yes, I have a lot of ventures. Yeah. Yes, we’re going to talk about those in just a bit. Okay, fine. Okay, let’s move on. And so, because of that, I was sitting at a theater at Sundance Film Festival, starring in this movie, this NBC exec is sitting in the audience. I haven’t even seen the movie yet. He taps me on the shoulder, he’s like, “You’re Sean Hayes. You’re in this movie.” And I said, “Yeah.” He goes, “We’re casting this sitcom, ‘Will and Grace,’ would you come in and read for Will?” And I was like, “Well, not right now because I’m about to watch the movie, but maybe when it’s done, blah, blah, blah.” Right. So, I didn’t have the money to change my ticket to fly back early to see it. Because I wanted to experience Sundance because ... Sure. Yes. Fine, yeah, yeah. It was like another week or two left. I’ve been there. But that train has left and they found the brilliant Eric McCormack to play Will. By the time I came back, they said, “Would you read for, ‘the other guy’?” And I said, “Sure.” And that’s how it happened. Wow. That’s like ... And then it just did for a long time. And that was it. How many years? How many years was that on? That was on eight years and now two and then a third next year. Two, third season. Eleven total. That was a very different era of television. You were just the star on the show. Yeah, that was very ... Yeah, yeah, yeah. Right? I’ve never done a TV show, either. I’ve just been in commercials and maybe a guest spot in one of those crime reenactment shows. Where you were like a dead body or what? No. Thanks for the confidence, but no. I was ... I don’t remember. It was like ... Were you a murderer? ”I saw the body down by the river.” Oh, right. That kind of thing. Okay. In that same straight guy voice. Okay. Yeah. So, “Will and Grace.” Why do you think it took off back then? I know. Isn’t it bizarre that it ... It still, it blows my mind that Warren Littlefield ... It was a script of three ... Warren Littlefield was a great producer. Amazing. Right. It was a script of three couples. And one of the couples was a gay guy and a straight girl. And Warren said, “Why don’t you ... Screw the other couples. This is the most interesting thing.” And “My Best Friend’s Wedding” had just come out, with Julia Roberts. Right, and her best friend was gay. Right. Was gay. Right, was ... What’s his name? That guy. That guy. That guy. Yeah, British guy. Rupert ... Rupert Everett. Everett, right. Yeah, yeah. And I never met him, but he seems angry in interviews. Yes, he does. Yeah. Okay. But I hope he’s not. I think he probably is. Okay. Have you seen him much lately? No. That’s a very good point. Thank you. Thank you. I like to cut to the chase. Really? Done. And so — by the time we’re done, this mic pack will burn a hole through to my intestines because it’s touching my skin. No, so that had come out. So Warren said do that. And that’s kind of why it happened. But it still blows my mind that NBC picked up a show about a gay guy. Right. And even in the pilot, after it tested, stupid people had no idea Will was gay, even though he said many things that would allude to the fact. ”I’m gay.” Right, you’re gay. People didn’t know that? People didn’t know because, you know, they’re testing, “That guy’s funny. Well, that girl’s funny and this is ...” Right. But they’re like, “Wait, that dude’s gay?” That was my straight guy voice. How long? How long what? Did it go on that they didn’t know he was gay? Come on. Well, I don’t know, they clearly found out by like the third, fourth, fifth episode. Right. But, that show was highly ... There was actually a series of political shows on the air. Well, Ellen had done the coming out. We always say, “She opened the door and we kicked it down.” Right, right. So, without that ... And we all, passing the baton. Right. And then you have “Modern Family” with an out couple with a kid. Right. Hopefully, I’m not saying “we did it,” but hopefully we helped ... They’ll help somebody else. But then everybody changed back, it seemed like. Right? Well, there was a joke that the character of Karen, played by Megan Mullally brilliantly on the show, when Bush was in office after Clinton, we were still on and Bush was in office, I go, “Karen, as a gay man ...” She goes, “Honey, didn’t you hear gay isn’t in anymore?” Right. Yeah, yeah. It’s funny, it’s like it’s in and then it’s not. It’s like, “How is it either?” Right, right. It should just be human. So, what do you think “Will and Grace” did? Did it normalize gays or ... Well, people used that word ... Because you play ... Right. ... and I know why they use that word. Right. But to me, it rubs me the wrong way because ... Well, tell me why? ... I’m going to tell you if you just give me a chance. All right then, fine. Normalize ... I know, right? Not even a breath. I like this, you’re always trying to top me here. I like it. Well, I am a top. Do you know what? Straight guys never try to top me. Well ... I’m just saying. Because you’re gay, we’re both gay. I know, yeah. I think she missed the joke, you guys got it. She missed it. Because she’s thinking about the next thing. She doesn’t just be in the moment. So, what now? What was the question? Besides, while you’re trying to top me on figuring out what to do next. Why is “normalize,” you’re so angry about it. No. Just because the word “normal.” I’ve always felt normal. Right. Right. But people use the word. Yes, got it. Right. So, that whole thing. But to use your word normalize, do I think “Will & Grace” normalized ... Well, you guys know that I think just like “The Jeffersons” or “Good Times.” By the way, “The Cosby Show,” present problem excluded, at the time, “The Bill Cosby Show,” that was like people were floored that a black man could be a doctor. Right. And a black woman could be a lawyer. That was amazing! And to black people that was like, “Yeah, that happens.” Yeah. Yeah, yeah. And so I think the same thing with “Will and Grace” was, people were just like floored that two gay men could be friends but not have a relationship. And actually be best friends through all of it. And that I think is what people are constantly striving to create in Hollywood, are relationships you’ve never seen before. Because that is a great percolation for a lot of new fodder. For a new fodder. So you do that for eight years and then it ends, right? Yes. And the reason it ended is just things after ... Mutual. It was like, “Maybe we’ve exhausted it.” And the network was like, “Yeah,” because the ratings weren’t as huge. I mean, they were pretty big still. They were big, yeah. Anybody would kill for those now. Right. But you know, also it’s that syndrome of, in the time of “Will and Grace” ... I think this is most of it. In the time that “Will and Grace” was on the air, NBC had gone through maybe six presidents in eight years. Right. And different owners. And different owners. Right. So, of course, who’s our parent? Like, who’s watching this for us? Who’s watching out for us? So, I think ... Well, at least it wasn’t Les Moonves, but go ahead. Right. Sorry, I had to get that in. No, for sure. Okay. But I figure there’s a little bit of that syndrome going on with the new guy was like, “I want my hands on hit shows.” Maybe? Right. Might not be true. But I think maybe part of it was. Right. And so you all ... So, out with the old because it had been on ... You all went on. Yes, we went on to do things. To do things. One of these you did was produce a lot of things. Yeah. People don’t realize, I think, that you’re sort of Ryan Seacrest-y, so to speak. People say that about Ryan, yeah. Yeah. So, I knew the ... I try as hard as I could to be self-aware, sometimes, I fail miserably on a daily basis. But when I try to be self-aware, I try to see what was in front of me, and knowing history, what happens with sitcom characters that have impact like mine had. Right. And so, you go, “Well, I need a place to go when I get up in the morning, how am I going to fix this? What’s the solution?” Because you get one hit and then that’s it. And then you don’t see them again. And a lot of the actors are like, “Yeah, that’s fine.” And a lot of actors enjoy just acting and that’s great. My brain works a little bit like yours, where it’s just like, “I need ...” The next thing. And I need multiple things going on because it’s ... it fills my soul. That way I don’t have to focus on myself. Okay, good. Right. Interesting. And so ... See the damage? All right. If I just keep busy, then the tears don’t come, but ... It’s true. Boy, is that true, right? Yeah. I once said to someone who asked me, “Why aren’t you in therapy?” And I said, “I don’t know. I’m pretty happy.” And they go, “You’re blocking.” And I said, “It’s working.” You’re what? You’re ... I’m blocking. Yeah, you’re blocking. That’s why: We stuff and we block. Yes, it’s working. So you should play football. Yeah. So, then ... See? So you’re doing “Will and Grace” and you decide to produce. Yes. So, then I was like, “Where am I going to go? What am I going to do?” And then, Tom Hanks is a friend. And I saw what he was doing with Playtone. I thought, well, there’s a perfect example. And I would say I want to embrace that, say WWTHD: What Would Tom Hanks Do? Right, okay. Right? Is he running for president? Wouldn’t we all be better off? Yeah, probably. We’d be better off with a dog, but go ahead. We would be. At least it would listen to us. A cat. Yeah. Some cat. Yeah, a dog would bring us together, at least. Yeah, yeah. Isn’t it interesting. Well, we don’t have to go on with that. Okay, we’ll go on that later. Put a pin in it. Yeah. But, yes. So I decided to do something about that and started producing with my friend that I went to college with, Todd Milner, who was a genius. And we had two shows that we started out with. One was “Situation: Comedy” because that was just the start of people not figuring out multi-cam sitcoms. Why aren’t people watching them anymore? And so, we had a kind of “Project Greenlight” show, do you remember “Project Greenlight?” Yeah. But for TV. Right. So, we had submissions of people sending in half-hour multi-cam sitcoms. And we were going to read them all, weed them down. Pick two or three. Shoot them and have America vote on which one they wanted to see go to series, which ended up being way ahead of its time because that’s what Amazon started doing. Yeah, that’s right. Exactly. And then built this gigantic studio. Right. But, we ended up doing it. NBC decided not to. “Well, that’s a cute show, we’re not putting it on the air.” The one that won. Yeah, yeah. So, the other one was called “Underexposed.” We gave a very vague script to three filmmakers to make ... Go off and you have 24 hours to make a short film based on, “Hello.” “Hello, how are you?” “Oh my God, what’s that?” “It’s coming this way.” And they had to interpret what that was. Okay. And so, and the judges were Trudie Styler, Jon Favreau and Craig Zadan, who was a good friend of mine, who just passed away. Anyways, those were our first two shows. And then we didn’t work for seven years and then we’ve done tons. We produced “Grimm,” “Hot in Cleveland.” “Grimm” was a huge hit. Yeah, “Grimm” was. And then “Hot in Cleveland” with Betty White and all those great girls. And then ... ”Hollywood Game Night.” ”Hollywood Game Night,” which is still on, we’re shooting right now. “History of Comedy,” on CNN right now, and a bunch of stuff. Right. And we just shot our first movie called “Lazy Susan” starring me, where I play a woman. Okay. I play Susan. “Lazy Susan.” I play Lazy Susan. The whole time you’re a woman, or you’re man being a woman? The whole time I’m a woman. A hot woman, the entire time. Yep. How do you look? I look not attractive. You would not be into me. Okay. Okay, all right. Yeah. Yeah. Well, I like now, the whole ... Yeah, well ... You’ve got the lesbian thing going on right now. Let’s talk after this. Okay, all right. I do, I told you that last time, I dress like a lesbian. You do, I was going to say that. And you do, too. Yes, I do, indeed. Yeah. I was just recent ... I was telling people I was ... I’ve been doing some research on some of the e-commerce companies. Stitch Fix is one of them, so I was trying ... Stitch Fix is where they send you stuff and you send it back. Do you know about these things? No, tell me, what? The company went public, I think. It went public. And they send you five things and then you ... What do you mean? Five pieces of clothing. Well, you have to say clothing. Clothing, I’m sorry. They send you five things. Like a watch, my niece. They send you a box of Coco Puffs. Yeah. They send you five pieces of clothing. And they kept sending me clothing. It was all wrong for me. There was frills going on, there was all kind of ... Yeah. There’s many of those. I send it back. I keep sending it back. And then one day stuff started coming that I liked. Yeah. And all of a sudden all five things were things I liked. Like five things. And so I kept them. This is a great story. I’m getting there. ”And they send me five things I love. Anyway, Sean, so back to producing...” Okay, I’m going to get back to producing. So, the stylist — and I’m going to finish this story because you’re such an asshole. All right? Okay. And the stylist said, “I finally figured you out, you’re simple and androgynous.” Oh. Which I don’t think was a compliment, but was exactly right. I like “simple.” Simple and androgynous. So, this is my look. Anyway, back to you. Yeah, but it’s comfy. It’s comfy, thanks. I don’t like ... That’s a real hot look. I don’t love wearing this stuff ... Yeah, yeah. ... because the second I walk in that door of my house, pajamas, sweats, I mean, like ... All right. Okay. Now, back to producing. So, tell me how things have changed with producing. Seriously, because in Hollywood you have to think of digital. Yeah. We were over there talking about podcasts. Yeah. But how do you look at yourself as a producer? Has Hollywood changed a lot? Yeah, well ... There’s a million things we can talk about that. But you have to ... I’m going to say something that sounds like a joke, but it’s not. You have to find a hole and fill it, right? Yes. So you have to find out, you have to figure out what’s not out there and provide that entertainment. But you know, now producing ... There’s different kinds of producers, right? We’re both creative and packaging so we act like our own little mini-studio. So we will find a writer and a director and an actor and the idea and the IP and try to patch it and put it together. Which is a lot of work, but we run in overdrive. So we do that with many, like with 20 things at one time. And so I think now ... The good news for us is people need content more than ever. Right, there’s so many outlets. And there’s so many outlets which is also bad for viewerships and making money because you have split now this pie of viewership in a billion ways, which is good and bad. There’s good and bad to that. If you find your niche like you have, you can make a living, a pretty good living. So we have a deal at Universal Studios. So now we have our ... Just NBC. … are able to provide content mainly for them, for the studio, not necessarily that, but for the studio and what they’re looking for. And so ... But ... I don’t know. So day to day we tried ... So why do you have a deal Universal, not NBC, versus doing things for all ... Because you have more choice there. You go to Amazon. Like look, “Marvelous Mrs. Maisel,” the hottest show, I think right now is on Amazon. Amazon, right? And then you have now ... And Jennifer Sulky, who used to be vice president at NBC is now president at Amazon. President. Yes. Took over from the guy who had some issues. Yeah. Roy Price. Get in line. Yeah. I am, get in line. You’re right. We’ll talk about that in a second. Why don’t you as a producer ... Do you think about Amazon and Google or Apple is now moving in. Apple did a deal with Jennifer Aniston and Reese Witherspoon. Yeah. Yeah, yeah. I think Apple is doing it right though, because Apple had two shows a year or two ago. They were terrible. And they asked me to host “Carpool Karaoke” and I was like, why? Why would I host that? Because James Corden does it brilliantly. That’s right. And now you’re breaking that off making it. And I started telling them everything, that why that wouldn’t work and like, “Uh huh, got it, thanks Sean.” And then ... But now they’re doing it right. They’re stockpiling and they’re going to launch huge. That’s exactly how ... But they have billions of dollars to do that. Right. That’s what I mean. How do you look at that when you have that and then you also ... Google is obviously going to get into it somewhere, they’ve been trying to do YouTube originals. I always ask people like, where is this going? Because nobody knows, right? Right. So where is this going with 500,000 new shows every year? Right. So tell me. I don’t know. That’s why I want to know. I don’t know. Nobody knows, but that’s why I’ll always be employed. Because ... That’s what I mean. Yeah. There will be ... But the problem is ownership. So the networks now have ... It’s becoming a dinosaur business. Right. But I think the streaming companies that figured it out, but everybody wants to ... We’re all held hostage now because unless you’re not a writer/producer who’s created the show as in non-writing producers like myself and there’s many of us, there’s no ownership. So you have to make better deals if you can with the success that you’ve built. Right. Better deals with who? ... Have you thought about going ... Like look, Shonda Rhimes has gone to Netflix. She’s a writer/showrunner. Right. Ryan Murphy, same thing. Writer/showrunner. So that they will be going to them from now on because the money is better and the freedom is better. Yes. Right? Right. Exactly. So, they can do whatever they want. So it’s almost like ... By the way ... What does that do when Shonda Rhimes and a Ryan Murphy leave? But that, leave what? Right? Right. So, that’s the thing. It’s like these guys are just ... These are the new networks. That’s all. Everything is exactly the same. Everything is ... They make deals with people. People are going to these streaming companies because they can do with their creative freedom, the deals are better, there’s more ownership, you can swear, you can tell real stories. A network is a dinosaur business because they have to rely on the affiliate still and advertising and that they are limiting because you have to watch what you say and do. Right. So what would you prefer to do as a producer ... Well anybody creative would like to be out of the chains of ... To do different things. Right. Have you talked to some of these companies? Have you gone to meet with them? Yes, of course. And? Yeah. We have relationships everywhere. Right. So what is your digital? Who do you do that with now? Because you have at NBC, at Universal. So my company, Hazy Mills Productions, we have employees ... Why is it called Hazy Mills? Because I’m Hayes and Todd Milner. Oh, I see now. It’s okay. And we went to college at Illinois State University in the middle of the cornfield and all you would see is these mills. Okay. Got it. So it’s Hazy Mills. Okay. I Like it. You’re welcome. Okay. Thank you. So in our company, we have employees that are heads of reality, digital, film, TV, comedy TV, drama. So everybody has different ... And different things. Right. So we are working on all of those things every day. And so now podcasts, we want to get into podcasts, which we spoke about before this thing. Right. Right. And why do you feel like you have to do that? Because WWTHD. What Would Tom Hanks Do? Right. Did he do a podcast? No, but I’m just saying, you constantly have to think forward and think about ... Tom started a production company so long ago before other actors started them. And so I just thought that was so cool. And so in keeping with trying to stay on top of that and where this is going, you know, Jeffrey Katzenberg is launching NewTV. So we had a conversation with him about that. With Meg Whitman. What’s that? With Meg Whitman. Yeah. Meg Whitman. Who I know very well. From eBay. Oh, you do? Yes, very well. I don’t know her. Well, she’s from eBay and so I wonder how she can produce television, but okay. Right? Okay. Well, we’ll see. We’ll see, right. Yeah. Yeah. Well, it’s 10 minutes ... What I’m to understand is it’s 10-minute increments. Do you guys know about this? Yeah. This is a new ... So it’s a new thing where they’re producing 10-minute shows. That are very expensive. That are very expensive. But it’s for the on-the-go person on the phone. And then, right, whatever, I’d be on the subway, you can watch 10 minutes or wherever. I have a problem with that, I have to say. Tell me what is ... Because I think it’s a mistake to think young people want to watch edible food, “edible” TV. Snacky. I kind of agree, and I don’t know the full plan so I can’t comment on it fully, but I ultimately ... people who would want to sit down and watch an hour program or half-hour program. But some watch all of “Mrs. Maisel.” In one sitting. Yeah. One sitting. But you know, well no, not one sitting. Well, but yeah. Yeah, you know what I mean. He binged it. But I’m saying, they’re able to watch a thing over a period of time. Yeah. But I mean this is a ... It’s a new way to produce content and distribute it. So who knows? It might work. So getting back to as a producer you’re always looking for different angles. You would do a deal with anybody, like that kind of thing. Well, yeah. What’s that? Would you do a web deal in contrast ...? As long as it makes sense for us, yeah. And it was people who understood our brand and yeah. I mean, we’ve been so happy and very well taken care of with NBC Universal Television. Do you think people will ultimately watch everything on these small devices? Is that how you think as a producer? I think yes, I think forever, they will. You’ve heard this a million times, your TV is actually going to be a monitor. It is a monitor. It’s not a TV anymore. Yeah, it is now. It is now, essentially. So it’s just a bigger monitor, it’s a small ... I don’t think I watch “Will & Grace” at the time that it’s on ever, ever. Oh, really? I don’t. No. No. I don’t watch it on the night unless ... Yeah, nobody really does anymore, anything. And why would I? Yeah. Exactly. Right. Why would I? So talk about the return to “Will & Grace.” So here you are doing this production stuff, very successful shows. You’re a producer, you’ve had quite a few hits. Why did you decide to do this? To come back? Yeah. We did an election video in 2016 to lend our voices in the best way we knew how, which was through this show, instead of tweeting or standing on a soapbox or whatever. So Max Mutchnick, one of the creators of “Will & Grace,” came up with this idea. We haven’t seen each other in 11 years or whatever, 10 years. Let’s ... Because everybody wanted to do this election video, because if we write it and we’re like, yeah, of course that’d be great. So the crew, us writers, everybody got together for free. Nobody got paid. We did it in secret, NBC didn’t even know. We went to this stage that was below another stage, and we called it “Hot Food” as the code name. Right. That’s a long, long story why that happened. So we shot Hot Food, released it, and millions and millions and millions of people watched it and we’re like, “Wait, what?” And so, that’s how it happened. And then the network called us like, “Would you guys want to do this?” And we actually had a dinner at my house, just the four of us. And we talked about it and we were like, “Yeah, it seems like now is the time.” And by then we’d had that conversation after our current president got “elected.” Okay. All right. We will get to that in a second. And so, yeah. And so we thought we had something to say about that and we have something to say about these people, these characters living in a time that everybody else is living in. That’s what’s cool about the show. These characters … [cheers next door] Woo, it’s like something is over there. Yeah. Yeah. We should probably be over there. Yeah. Exactly. These characters experience things the same way America does. America does. So at the same time. Did you worry about that sort of return to like ... there’s several of them now, after ... “Murphy Brown” just came back. Yours is very sharp. Thanks. The writing is amazing. It’s superb. I worry about when things come back, whether they’re going to be as good as ... Yeah. I do too. Was that a worry for you? No. Because we had long, long conversations about what this would look like. And before, we were like, “Let’s do it.” Because now, we have proof of concept. Now we knew people wanted it to come back. So before we decide to, let’s really sit down and talk about what this looks like, what these characters would be, and so, great. And they’re very self-aware enough to write the character, self-aware. So ageism, all of those things were written because we have to write what the audience thinks. Right. Right. And what do you ... Some of these things which shows are not good, they’re not ... They shouldn’t come back. They are not ... Right. They were quick fixes for ratings for a network in this kind of climate. Exactly. Right. In this kind of climate, meaning? Meaning the downtrodden... That the ratings are so much lower. Yeah. That they get lower and lower every year for every single show in television. Right. Except for events like the Super Bowl and all those things. Right. And so how do you deal with that? And live musicals, those as well. Right. How do you conceive of a show if that’s the case, if there’s going to be lower ratings. Well they have to figure out, and I’m sure they aren’t, already have ... And this is the part that I’m not in behind closed doors of is they have to figure out how to make deals with the advertisers about same-day plus-three plus-seven in DVR numbers. I don’t know how that works, but you can’t just say, well, you got a point five and your show is canceled. Now there are other factors that culminate in the decision of making a show a hit. So you have to take that into consideration. So what if it is? Yeah. What if it is? Right. Right. Because our numbers got a huge and three .... plus three like last year, in plus three or plus seven. We were like the No. 3 show on television. There was like “Big Bang” and football... And “Will & Grace.” Yeah. Why do you think it’s been successful now? Is it just the writing or is it the timing? I think so. I think to find ... From an actor’s perspective, I think we’re so in the skin of the characters that people pick up on that and see that we try to play it as real as possible. Because the problem with the format now, it is so old, it is aging, that a lot of people act ... The format. The comedy. Yeah, the sitcom. The format is ... A lot of actors act presentationally. Because it is very theater. Yeah. So it feels unreal. And yes, there’s nothing real about our show, either. It’s fake, but I guess people react to ... And yes the writing and it’s just ... If you cut all the bullshit out about what we’re talking about right now, it’s just funny. Yeah. Yeah. Absolutely. That’s all people give a shit about. Yeah. Yeah. And do you ... You’re going now for three seasons and how long do you expect this to go on? I would like it to ... Were you surprised how will it did? Yeah. Because the first show is what? In the Trump White House? Is that right? Yeah. Yeah. Yeah. You were having sex with the Secret Service agent. Yeah. Right out with a bang. Right. Right. Right. Right. I remember that, years ago. Ridiculous. Yeah, that first season was back with 16 episodes. We’re doing 18 now and 18 next year. So, that will bring us to around 240ish episodes. “Cheers” was on 275, “Big Bang” is going to be on 279. I would like to do 280. 280. All right. So because ... Yeah. Because “Big Bang” will be the longest-running one in history. Right. And you’d like to just ... Why not? It will be fun, right? Yeah, absolutely. So what do you imagine is going to happen? Are you still getting married? My character? I saw you in the show the other day recently. My character? Yeah. Your character. Yeah. He’s getting married to Estefan Gloria, who is a flight attendant played by Brian Jordan Alvarez. And yeah, so the season will end with a wedding and we’ll see how that goes. Yeah. Do you like that Jack is getting married? Yeah, I think it’s hilarious. There’s so many areas we still haven’t touched on with the characters and that’s one of them, Jack being married. Like, what’s that like? Right, exactly. And one thing that you do a lot of is ... Talk too much. No, I think it’s great. You talk plenty, but it’s funny enough. Is really take aim at the Trump administration. You really do. All your Sessions ... Or your Pence jokes. Yeah. Yeah. Yeah. There were several Pence jokes. Yeah. Yeah. But I was like, I could not believe they said it on network television. Yeah. Well, he’s a bad man. I understand that. I get that sense. Yeah. So somebody ... I think more can be done through the power of comedy than just yelling and screaming. Yeah. Yeah. What was the Pence joke? It was so good. There were so many. There were several. You did several of them. Yeah. We did ... I was talking to Karen about getting plastic surgery done. She’s like, “It’ll take that Mitch McConnell neck right out of there.” So that was great. He’s a bad man, too. Oh, my God. The turtle. Yeah. The turtle, yeah. Yeah. Yeah. Yeah. He’s, they’re all bad men right now. “Four turtle doves, four turtle necks.” That’s the invention of, that’s why they invented the turtleneck. Because Mitch McConnell. Right. Exactly. Because of Mitch. So you could cover up... Yeah. He’s a turtle neck. Yeah. You know he’s married to Elaine Chao. Yes. I do know that. Which is so ironic. Wouldn’t you like to be in their home, to watch that ... I want to have dinner with Michele Bachmann. Do you? Why? And Mitch McConnell, all those people. Because I don’t think they know gay people. Yes, they do. They can’t possibly. I think they do. Really? Yes. And? I don’t know. And they don’t like them or they like them? I think ... I don’t know. I don’t think they think about people in those terms. So I want to finish up talking about politics. So here you are. This is a highly ... I’m shocked by some of the things that are on “Will & Grace.” And I love it. I like that they’re doing it. Yeah. Yeah. I do, too. They go very far for a network show, even more so than the ones on Netflix or anywhere else, which is really fascinating to me. Yeah. Yeah. How do you guys feel about that? How do you feel ... Do you feel at risk doing that? Or is it just ... No. I think again because of the more niche-y audiences now. We have our loyal audience and we’re there for people to enjoy it if you want to come along. But it has a point of view and I think that’s why it does well. That’s another reason why it does well. Because some things change, I agree. Yeah. And that’s a strong point of view. I think it has to be genuine. I think a lot about companies. And I think that’s why people responded to “Roseanne” or whatever show that’s a hit. They’ve a very strong point of view. There’s something to say about that. What did you think of that of what happened there with Roseanne? What happened with Roseanne? Yeah. What do you say? I don’t know. What do you say? I don’t know. I asked you first. I think she is appalling. You do. Yes. I think she’s ill. Yes. That’s what I mean. And that makes me sad for her. Yes it does, but I thought it was really interesting how they ... The reaction was really interesting to me. Yes. And I found it surprising that she was unaware that the president of NBC [ABC] is an African-American. Yeah, that’s true. Yeah, that’s true. That would be an issue. But the thing is ... When you kind of have met her ... What was interesting is the quickness of social media and stuff like that. Now you, do you participate on all that or not at all? I do, yeah. Twitter and Instagram. Yeah. You have an account. And what do you think about that? How do you do that? Because she just started typing, probably ... People who know me in that world, I don’t ... I’m not a politics person. I just ... It’s not who I am. It’s not in my DNA. For some reason you’re making me talk about it, I feel uncomfortable, but I don’t ... I’m not one of those people. Right. But what do you use it for then? What do you use social for? To spread joy. Have you ever heard of that, Kara Swisher? No. Not at all. I don’t do that. That’s not my job. Pain and suffering. No. Yeah. I mean, that’s kind of like my brand, I guess. But where I want to get at with Roseanne is, are celebrities aware of the impact that they have using social media or do you think they have ... Absolutely. What do you mean that they are aware of? Of course they are aware of. I mean I know, but not everybody uses it. I can tell you a lot of celebrities don’t use it. I had to bother a billion of them for them to use. Want them to use it for politics or use it in general? No. Use it for their work, to get their work done, and get the ... Yeah. I mean, I guess you kind of have to, right? It’s part of the gig now. Right, so you use Twitter, what else do you use? Twitter, Instagram and that’s pretty much it. Yeah. Yeah. You don’t use Facebook. And I text a lot. You text a lot. OK, I don’t get... Oh, Facebook, sorry. Facebook. And Facebook yeah. Facebook a lot. We ... Some people at Facebook said ... Me and my husband Scotty were — their quote, not mine — “the pioneers of video on Facebook.” Right. Explain what you do? Because we did lip sync videos and we were the first ... Some of the, if not the, first people to actually post content for enjoyment on Facebook. So we lip sync to famous songs and we ... And that, by the way, that’s the end of the sentence. Yeah. And then what do you ... Why did you do that? And not on YouTube? Why not on YouTube? Why’d we do that? Because if a day goes by that I’m not feeling creative in my brain is the day like we spoke where I have to look at myself and be sad so I don’t want to do that. So we create stuff and he is a music producer, composer. He does the music for “Will & Grace” and “The History of Comedy” along with his music producer Leo Rosner and they’re great together. And so we were like ... We were literally sitting there and he goes, “Hey, come listen to this Jennifer Hudson and Iggy Azalea song.” And I was like, “Oh yeah, that’s really cool.” “Hey, we should lip sync to it.” I’m like, “Why?” “We should make a video.” I’m like, “For what?” He’s like, “Just because.” I’m like, “No, I’m going back inside unless.” Because his office is in the back, “I’m going back inside and I’m sitting on the couch, watch TV.” Right. So he’s like, “Just listen to it.” I’m like, “I listen to, oh, it’s cool.” He goes, “Just memorize the rap part.” I’m like, “Ugh, it’s too much work.” Okay. So I took the dog for a walk around the block and put my airpods, earbuds, whatever. AirPods. And listened to it over and over again. It was kind of fun to do it. And then I was like, “Okay, let’s do it,” one or two takes. We put it on the web. And I was like, that’s kind of funny. I literally thought my friends were going to see it and that’s it. 40 million people and we’re like, what? And then that just started it. So then we started doing that over and over again. So why didn’t you make a business out of that? We tried so hard. Yeah. But you were on Facebook. That’s why. Exactly. Nobody was interested. No. Nobody on Facebook. Right. And then we didn’t know how YouTube worked and I don’t know. What do you mean you didn’t know how YouTube works? No. I mean like, so you put it up. Okay, great. So then what? But there are a lot of YouTube stars. I don’t know if you’ve heard of that. I know, but I’m busy doing 10,000 other things. I get that. To go and have a meeting at YouTube. But like how do we monetize that? All right. Well, you need a producer, but you know what? I’m just going to make the videos, put them up and go back to my work. That’s how most of the YouTube stars work. You know that? What’s that? They all like live in one area of Los Angeles. Oh, of course. But I’m like, that’s for them. I’m an actor, producer. So you don’t have time for that, even though you have 40 million downloads. Don’t you look at that number and say maybe there’s something going on here? If somebody wants to take that on and show me where to stand and what to say, I will do it. Right. But you’re not. I don’t want to ... I’m not ... You don’t want to be a YouTube star? To build that business is exhausting. Right. It’s exhausting. You have to put out content constantly. You do. While I’m doing all those ... I was with a YouTube star on the weekend and that’s what she was saying. Yeah. She was saying that it’s exhausting. And they have a window, just like an actor has a window. Just like anybody else would. Yeah. They absolutely do. She’s exhausted by it, I think. But still, it’s quite huge. Yeah. It is. It’s a constant ... So I have to go to bed, Kara, every night knowing I made people happy without making money. I see. Okay. Do you feel good about that? What’s that? Do you feel good about that? I feel really good about that. Good. That’s nice. So did you stop doing them? Or do you keep doing them? We just did one in Spanish about a month ago and then we might do a Halloween one. Like what? What’s the Halloween one? Yeah. Do you know “Kooky”? The song? No. [hums song] Who sings that? Dusty Springfield maybe? Okay. Maybe. Maybe. I don’t know. “Spooky!” Not Kooky. “Spooky.” “Spooky.” Okay. “Spooky.” I sound like a dad. I’m just like, “Not Kooky, ‘Spooky.’” So last bit. You’ve been married eight years? I’ve been married I think four but together 12. But 12. So you met on the set of “Will & Grace”? He was the DJ on the Ellen DeGeneres talk show. Wow. When it first started. Right. And so you could say, I kind of met him that way. And you had a marriage-marriage? A gay marriage. A gay marriage. It is legal now. Yeah, I know, I heard. Right now. Just when I got divorced, but go ahead. Timing is everything. So in our backyard, with like eight people, it was great. And he’s a music producer. Yeah, he makes music, he does music for “The History of Comedy” and I said that already and he actually composed the theme for “History of Comedy” and I played it. I want to finish up. No reaction, by the way. I heard you. The reaction was inside my brain. Sure. I wonder how it’s like just to spend a couple of hours there. It’s hard. It’s really hard. It’s really like a haunted house, like getting people scared on your left and right. Right? Around this corner it’s like — whoa! — Michael Myers. It just came back. I know, I can’t wait, I love it. Are you excited? Are you going to see it? Yes, of course. I cannot see it. Why you so scared? Because it’s ... you already have it in your brain. Because I went to ... I am Michael Myers. I went to see it when I was a teenager. Right? Yes, of course. I guess we were around the same age, right? And my boyfriend at the time had seen it before me and he got up to get popcorn during part of it and ... And the scariest part was that you were with a guy. Yeah. That’s scary ... He was a very nice ... I was a great girlfriend. Let me just tell you. Okay. To straight men. You know why? Because I slept with him, I wasn’t clingy, and I wanted him to leave me alone. Men like that. Men ... honestly, we’re the perfect girlfriends. Think about it. That’s hilarious! Lesbians make the perfect girlfriend to straight guys. Think about it. By the way, really quick sidebar, about “Halloween.” Yes. But sidebar. Don’t you think it’s fascinating when gay marriage wasn’t legal and people were fighting against it, that me and you could have legally gotten married? I can’t believe you didn’t ask me. John Lovett asked me. But, isn’t that kind of creepy? Yes. Okay, glad we’re the same ... It’s weird. Like my ... We can still get legally married, but you’re already married. Scary. The scary moment in the movie, he grabbed my ankles under the ... under this chair ... Yeah. And I’ve never gotten over that. Wow! I know. It was really cruel. So, do you not like scary movies at all? I hate scary movies. I won’t see “The Purge,” those aren’t really scary, they’re just gross. Wow, yeah. Or like, “Saw,” or anything. But what about ... I don’t like ... ... what about, “Get Out,” which is like a thriller? I barely made it through that one. Oh that’s a great movie. I know this. I did go to that cause I heard it was good. So I did go see it. But, I don’t like ... “Fatal Attraction”? No. But it’s not a horror film. I didn’t like it. Oh, all right. I don’t like it. Like, I go to “man movies,” I go to like ... “The Lion King”? That’s fine. Okay. It’s okay? Yes. Scar dies. I went to see the Michael Moore movie this weekend, with my children. My sons. My teenage sons. Oh! Fahrenheit- Fahrenheit- ... Fahrenheit- “Fahrenheit 11/9 ...” ... nine. And? I loved it. Oh, I can’t wait to see it. I love a Michael Moore movie. Let’s talk about documentaries for a second. We gotta go, or no? All right, yeah no, go ahead. Keep going. Okay, so wait, “Whitney.” Then we’ll get some questions. That was a great one. Yes. Lesbian. Whitney as in who? Whitney Houston. Everyone knows that, yes, go ahead. I know, but like, that’s it. Okay, thank you. The lesbians knew that a long time ago. I know. Yeah. Kelly McGillis, we know. We know the whole story. Kelly McGillis. Fight with Jodie Foster. Go ahead, move along. I didn’t know that. Yeah, I’ll tell you later. Okay, so wait. Whitney ... I saw the Mr. Rogers one, which was great. Great, it was amazing. Not a lot happens. No, no. He was just great to kids. Well, it’s Mr. Rogers. Yeah, but great. You’re not gonna get suddenly ... Right, there’s no drama. Right. But, great documentary. Jane Fonda: great documentary. I had not seen that one, but I’m going to. Very good. Warren Buffett? I didn’t ... Oh, I saw that one, yeah. Yeah. How about the McDonald’s every day? I know, you know what, I’m going somewhere to Omaha next week, to go meet someone. That’s very specific. Very specific. But, what? Who? Warren Buffett. You’re going to meet him, for what? He’s a fan of the podcast. He wanted to meet me. Just you two? Yeah. Oh my God, I would love to meet him. Dinner. He’s ... I met his daughter, she was very nice. He wants to have a steak dinner. I’m a vegetarian, I’m gonna eat a steak. I’m really gonna get a ... No. Yes, I am. Well, you don’t have to. But I’m going to. Why? ‘Cause it’s Warren Buffett, and he offered me a steak and so I’m gonna have it. Oh, right. Isn’t he a brilliant ... Yeah. That man’s brilliannt. Yeah, he is, so ... yeah, stuff like that. Anyway, yes. Documentaries ... So anyway, I don’t know, there’s a couple of other ones. “Making a Murderer,” you know, there’s a second season. Yeah. So what did I do? Googled it, ‘cause I wanted to know the outcome. What? ’Cause if it’s a happy ending, I would watch it. If it’s not, why waste my time? I don’t understand that. I don’t even ... what do you mean? “Making a Murderer,” did you see the first one? Yes, I did, but it’s not happy at all! Okay, so the second one, shh, listen to me, stop talking. The second one, is about a prosecutor from Chicago trying to overturn the verdict. I see, right. Right, so I was rooting for those guys. Cause I don’t think ... I think they’re innocent. Right. So, I was like, “Oh, I can’t wait,” because I saw the trailer for it, I can’t wait. I’m like, “Wait a minute, if she doesn’t win and overturn the verdict, I’m gonna feel really bad about it.” But then you found out anyway, by Googling. But if she does, how thrilling is that gonna be? Right. And so I won’t tell you how it ends. Okay, fine, so I’m not gonna watch it anyway. So it’s fine. Okay, cause it’s got murder in it? Right, so I’m gonna take some questions from the audience in a second. But the last questions that I wanted: When you look at this environment, or the midterm elections ... Oh, we gotta talk about SonicCloud, too. Oh, SonicCloud, yes, investments ... What invest ... You do investments, also? Yeah, I have several, but one that’s really on fire. Because that’s a thing, Hollywood people doing tech investments. Well, it’s not a thing that’s only in Hollywood. There’s other human beings that invest. Yes, that’s true, but every now and then Matt Damon pops up in the investment ... Because he’s famous. But ... so you hear about that investment. Yeah. And then they fail. Most human beings invest. That’s right, okay, so ... So, “you Hollywood folks invest” is a nice little Kara Swisher dig to the Hollywood community. It’s true though, I really have to come troop down here to meet Ashton Kutcher every three years about whatever he’s investing in. But, go ahead. Oh, really? Does he ... He actually is a very successful investor. I know, I need to invest what he’s in. He was in Uber, he was in ... I know, amazing. Yeah. So anyway, I invested in this thing that’s very ... getting very large right now, which is called SonicCloud. SonicCloud is an app on your phone that makes hearing more clear for people with moderate to profound hearing loss. Okay. Wow, how’d you get into that? My friend ... one of my very close friends, Larry Guterman, who directed a movie called “Cats and Dogs.” Yeah. Hilarious movie. Back in 2000, I think. He has hearing loss, so he invented this, with many other people. And so it also allows you to stream media — music, TV and movies — without the use of captions or hearing aids. Oh, wow. So, it’s revolutionary. And, right now it’s doing really well, and there’s other things happening that I probably can’t talk about. Among people who have hearing loss. Right, which is hundreds of millions of people. Right. It’s not just hearing loss, it’s anybody ... He filled a hole, in a niche. That’s right. That’s right. But, it’s people who have even mild ... who would like to hear more clearly. Right. Right. Did you invest in any other internet companies? Or things? Yes, something called KnowMe. KnowMe, what do they do? It was what somebody, I think the iPhone now adapted it, but storytelling through ... You used to hold the phone and just record and as soon as you let go, it stops recording. And it would piece together those videos. You could tell a story. Right, and what happened? Didn’t do well. Didn’t do well? No. Do you like investing in internet companies? I do if I know it’s Google. Right. Yeah, there’s only one Google. I know. It’s done. I know. It’s actually in a bit of a trouble. Do you think about the damage the internet companies are doing to our society, ever? I think about it all the time. Oh God, that’s so heavy. I know. What the internet companies are doing to our society, in what way? I don’t know, the election? Well, yes, of course. Yeah. Yeah. I mean, but it also does good things. But, yes. It does a lot of bad things. I think it does. Anyway, let’s ask questions from the audience. Sorry to end on a bummer question. Questions, questions? Right here. Audience member: Do you, in your business dealings as a producer, or even as an investor, do you find that being a gay man in this continent still has its barriers in that world? Sean Hayes: So he asked if I was, as an out gay man, if I came into problems in investments or producing or other ventures, if that ever comes into play. I’m sure it does, it’s never ... I never feel it or hear it, because I don’t, I stopped taking care of people’s feelings in that area a long time ago and their uncomfortableness. So now I just kind of own who I am. So if they have a problem, I don’t know about it. I don’t think so, as much in Hollywood ... I don’t think, not in Hollywood really, yeah. Yeah. I don’t think so. Hasn’t stopped me. But boy, the second you take a step out. What do you mean? Oh, anywhere else? Just like, yeah. You think? I’m not a big star in, you know, parts of Texas. How is it in Illinois? That’s, you know, really ... it’s an unusual ... you’re right, they like the lesbians more. I went to a high school reunion, my high school reunion three weeks ago. But you would be the most famous person from your high school, presumably, right? I don’t know about that. But, yes. Imagine, yes. Who else? But... So, and everybody was so lovely. I actually am one of the few who loved high school. And there was one guy who didn’t look at me and I was like, “Hey!”, and my hand was outstretched to shake his hand and he just didn’t look at me and put his fist up for a fist-bump. I was like, oh, so gross. Really? You thought that was ... Where’s the evolution? Really, he thought it was just anti-gay. Or maybe you did something? I got that vibe that I’m familiar with. Yes, I’m familiar with it too. Yeah. I’ve had it happen to me. And, did you not do anything? You didn’t want to say anything? But, what’s the point? Yeah, what did he do? That’s like trying to change a Trumpster. Right, well you can. Don’t you think? I can ... I think, the news today reports ... and the extreme left and the extreme right, because there’s a lot of drama there, and that’s what people are into. And nobody reports on the independents or the undecided. Right, why do you think that is? Cause it’s ratings? There’s no story. There’s no story, what is these ... I mean there is a story, I think it’s interesting, but there’s not the flaming drama. Right, is that where we’re headed, do you think? Where, to...? In that thing, where we’re, the part ... the bipart ... there’s no such thing as bipartisanship. But then, they always say we need to campaign to the undecided and the independents. Right, exactly. But what do you imagine is going to happen in the midterms? I don’t know. I think that both sides are fired up. I’d like to believe that the left is more fired up now. But, we shall see. Do you wanna have a left and a right? Do you really wanna have that? No, I think we should have, I think we should have an independent. Right, in the middle between everybody. Yeah. Yeah. It really is ... Don’t you think, maybe, it’s heading that way? I don’t know, I think people every day ... Trump does something like the Saudi thing that I was telling you about, that they’re “rogue killers” now, he just repeats what this obviously fascist dictator in Saudi Arabia is saying. I think, I don’t have ... I’m not as well-versed in politics as you are, I don’t have like statistics and history to call up in my brain in an instant. So I react emotionally, like most of the country does. And just from an emotional standpoint, it’s embarrassing. He’s embarrassing. Yes, of course. But I think people ... It never ends, and people ... It still goes on. And so, it’s ... you know, largely because he happens to be the president of the United States, so you really can’t avoid the president of the United States. Right, I wish he would heal ... I wish he would say healing things, but he never does. Why do you imagine he would? I don’t, I would like that. But it will never happen. No. But it will be nice. Yes, but, did you ever watch “The Apprentice”? Because I did. Yeah. Yeah, did he ever say anything nice on it? No, I mean, I understand what you’re saying. Yeah, he’s never … I’m just saying it would be nice if somebody said like, “Hey!” Because on “60 Minutes,” did you hear him talk on “60 Minutes,” anybody? Where she was like, she said something to that effect. Like, what about, you always talk badly about the Democrats. And he said something negative again to that, her question, about the Democrats. And you’re just looking for him to say ... when she says the word, Democrats, she’s talking about a hundred million people, you know? If you divide, you know ... and he just won’t say anything nice about the hundred million people who live in this country who aren’t Republican. Yeah. It’s astonishing. Just that fact. Really? The only part of it that is astonishing to me is that there are people who are surprised by it, his behavior. No, I got it. I’m on board with just how crazy it is. He just will never say anything nice. It’s really fascinating ‘cause they go, you know you were saying before, this time, now he’s ... people are finally gonna get sick of this. Right, and they don’t. They eat it up. No, they don’t. That’s a bummer. And they believe what they believe. And they think the same about us. Would you ever run for office? God, could you imagine? Yes. I actually sat there, on the couch when it was all happening, on Election Day in 2016, and I said out loud, I go ... when he won, I go, “This means I literally could be president.” I literally ... I seriously could be president of the United States. It’s Jack. Anybody can. Yeah, anybody can. Yeah. I don’t know about that, he’s pretty famous. I think he got very famous during “The Apprentice” on NBC. No, I know, but I’m saying: He has no experience. Of course not, yes. So, in that sense, anybody could. Yeah, I said ... yes. Also, Tom Hanks, for example. You must encourage your friend to do so. It should be funny. Yeah! He would be ... yeah, I wish he would. I think actually we should have not-actors being presidents. That’s my feeling. Anyway. Another question, any other questions? Right here. Audience member: Can you speak to how the revenue model has changed from the production side, from the traditional network television to these platforms like Netflix or Amazon? Sean Hayes: Yeah, it’s really disheartening. Are you in the biz at all? No? Yeah, it’s ... You know, like I said before, you’re constantly trying to figure out how to increase revenue through a platform — like these guys have about ownership — and so you try to subsidize in other ways by creating podcasts or whatever you can before they get on board and suffocate us that way. But, I don’t know. I don’t know the answer. I don’t know. But, you know, a little company like ours is always trying to figure out how to increase revenue. And it’s all about ownership, so we have to figure that out. Ownership, meaning you have the show, so ... You have to own part or all of the show. Right, exactly. That’s exactly right. Or you have to figure out if you’re going to do a distribution, what’s worth it. Or you use the different platforms ... Yeah, because they own the distributing, right, and they have the upper hand in everything because they’re writing the check. Anybody, anywhere, that writes the check for anything, has the most power. Did you ever think of taking venture money? To do different options? We’re talking about that. Right, I’m curious, lots of people have not done that yet. Yeah and there’s stuff that’s happening that I can’t really discuss. But you see, you see that happening. I was just interviewing the Sweetgreen guy, sitting on $122 million in venture capital, for the first time in ... For who? Venture captial is from Silicon Valley. I know, for what though? Sweetgreen. The food ... Oh, Sweetgreen, yeah. You know, the chain. Yeah. That’s a lot of money, $122 million. That is a lot of money. To expand and create their business. And that’s venture money and the first time that it’s really been applied to fast food. You know, usually it’s a different kind of thing. Yeah. What about water? Are you going to invest in water? Water? Yeah. What do you mean, water? Haven’t you read about that? People investing in water? No. Water what? The stuff you drink. Yes I know what water is. Thank you. Yeah, how investing? I have not heard about this. Because that ... We’re gonna need that ... Global warming and .... Yeah. Isn’t that the plot to an Arnold Schwarzenegger movie, when he lived on Mars? That was. Yes, what was that movie. Yes, Red… what was it? It’s the plot. What was that movie, anybody? Controlling water on Mars. “Total Recall.” “Total Recall,” that’s exactly the plot. Which is what I just did to think of the ... Yes. Yeah, we’re gonna run out of water, but you and I will be long dead, so what’s the difference? We will have cases of it in our garage. Garage, something like that. Right, any other questions? Any other questions? Right here. Speaker 3: When you’re choosing what to produce, is it just content that you personally would like to watch? Or how do you pick? We ... yes, part of our edict is that. And our mission is to create things that only we watch and it has to have comedy, even if it’s a drama. Has to have a little bit of comedy. But it has to be something we’d watch, yeah. For sure. And finally, any other questions? Any other questions? Oh, right here. Speaker 4: What’s your favorite thing about being “just Jack?” I love the character Jack because there are no rules. You can ... He lives in almost an alternate universe where he can act and be and say almost anything. He can go from job to job to job. And it’s always funny to me what the writers came up with. I mean ... And it’s, you know ... A lot of actors shy away from the thing that made them famous, which I think does a disservice to them and their fans. Right. So I kind of was like that, maybe 15 years ago. I was like, I’m gonna show the world that I’m an actor and not wanting to talk about Jack. Now, of course, I embrace it wholeheartedly, because you guys do. And the audience does and I know ... And you’re a little like that. What’s that? You’re a little like that. Yes, of course cause I play him, so ... Right. ... There’s a lot, there’s a big part of me that’s like Jack. But most of it, I’m not anywhere near. Right, but I mean ... I’m married, I’m boring, I am ... I have a business mind as well and you know. He has a business mind. It’s going really well for him. Yeah, exactly. It’s not. It’s not, is the joke. I’m just curious, do you have a favorite episode? I remember when you were talking to your son and they had the boarding ... At the conversion camp? Jane Lynch was in it. Did you notice the painting of Pence in the background? No, what? Yeah, they had a painting of Mike Pence in the background at the conversion camp. Really? I need to go back and watch that. I missed that. Last year’s episode is called, “Grandpa Jack” and Jack finds out he’s actually a grandfather, which is hilarious. Right. And his parents, which is Jack’s son, Elliot. So, Jack’s son Elliot and his wife are from Texas and they’re taking their kid to a conversion camp, because the kid’s gay. Right. And then, at the conversion camp, there’s a painting of Mike Pence and ... Jane Lynch and Andrew ... And I go down there, I give this big speech about how it’s okay to be you, you create your own family wherever you go and blah blah blah. Right, that was a great episode. Yeah, I love that episode. It was really wonderful. From long, long time ago probably, the Cher one was ... And also where I come in, I’m high on coffee and I talk really fast. Okay, good. Okay, last question. What do you imagine you’re going to be doing in 10 years? I love that question. I have no idea and I love not knowing. But, I don’t think I’ll ever have a job behind a desk, because I would go crazy. I think I have to create, always something. We have a children’s book coming out called “Plum.” Really? That my husband Scotty and I wrote. It’s how the Sugar Plum Fairy got her wings, because I’ve been fascinated with the “Nutcracker” ever since I was a kid. Really? I memorized every note. Have you seen the new movie? The new Disney movie? No, but isn’t it ironic? It’s coming out. Crazy timing? Yeah. And so, I know every single note. Looks beautiful, actually. It does look beautiful. I know every note of the “Nutcracker,” and I was wondering where do their people come from? Where’s their origin stories? Because it’s like, it’s like a story on acid. It’s like “Alice in Wonderland.” Yeah, it is. It’s like the Prince is fighting and Mouse King, like, what’s happening? Right. Right, so ... Why are you obsessed with the “Nutcracker”? That’s so interesting. As a kid, I listened to it over and over and over again. Really? I know every single note. When I say every note, I know every note of every instrument of every song in the ballet. Wow, that’s astonishing. I memorized it. I could do it for you now, if you want. No, thank you, okay, because ... And, so anyway, I’ve been obsessed with it so that ... so I was doing Broadway. I was doing “An Act of God” on Broadway ... Yes, which is where we met. Yes, where we met. And, during the day, I didn’t have anything to do, can’t sit still. Yeah. I have to look at myself. Right. Okay, got that. So I said, “Scotty, let’s write a children’s book.” He’s like, “Great!” Three months later, we wrote a children’s book. Two years later, it’s out. Wow, so it’s coming out for the ... It’s coming out tomorrow. Tomorrow? Oh my goodness! Well, congratulations on that. Thank you. I like the “Nutcracker,” but I took my kids once to see it. Which they didn’t appreciate, I can tell you that. Is that the end of the story, like you get stuff? Five things you get sent? No, but we were walking out and a woman turns to the other woman, as we were walking out and said, “Ah, one more ‘Nutcracker’ closer to death.” What?! Wait a minute, what? What does that mean? Like we saw ... Meaning, like you go to see it, like Christmases, or something. Everyone goes. “One more ‘Nutcracker’ closer to death!” Honey, that’s hilarious. I know! I thought it was ... it was my favorite moment. I was like, she’s 100 percent right. One more “Nutcracker” closer to death. That’s actually the logline of our book. So, we’re gonna sell a lot to children. Anyway, thank you so much for doing this show. You’re the best, I love you very much. Thank you for coming out to this. Thank you guys. Thanks, and when you do your podcast, I will come on your podcast. I would love that. That would be really good, I’m excited, we’re excited for him to do one, too. You know, you can make a lot of money. There’s lots of advertisers. I know. Yeah, anyway, thank you so much. The networks will be on it. All right, thank you so much.

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posted 3 days ago on re/code
Wojcicki on Gwyneth Paltrow: “Some of the things that she promotes don’t actually have the scientific validity that my team would be able to stand behind.” Unlike many Silicon Valley CEOs, 23andMe’s Anne Wojcicki is constantly reminding her employees of an uncomfortable truth: “we mess with people’s lives.” “You tell someone that they’re a carrier for BRCA, or you tell someone, ‘You’re a high risk for blood clots.’ Or you tell someone that you’re one-64th Native American,” Wojcicki said on the latest episode of Recode Decode. “And it has real consequences on their life. And so we’re messing with people’s identity. And it’s really important that we take that seriously.” The DNA-testing service has been working its way through FDA regulations since 2013, which Wojcicki said was “frustrating” but understandable. She told Recode’s Kara Swisher that others in the health and science world — such as Gwyneth Paltrow’s wellness site Goop — have evaded those same controls and are spreading bad info. “One of our biggest competitors in this space of science is Goop health and Gwyneth Paltrow because she has such pull,” Wojcicki said. “But some of the things that she promotes don’t actually have the scientific validity that my team would be able to stand behind.” “One of the things that we think about with 23andMe is just promoting scientific literacy, because it’s important for people to know what is real and what is not real,” she added. “In some ways, it’s actually the same issue that you have right now in news. How do you discern what’s actually real and what’s not?” You can listen to Recode Decode wherever you get your podcasts, including Apple Podcasts, Spotify, Google Podcasts, Pocket Casts and Overcast. Below, we’ve shared a lightly edited full transcript of Kara’s conversation with Anne, which was recorded in front of a live audience at the Rock Health Summit in San Francisco. Kara Swisher: So, we have a lot of things to talk about. Obviously, Anne and I have known each other forever. Anne Wojcicki: A long time. Long time, before when she was a healthcare analyst. Yeah, yeah. And so we’re going to talk about 23andMe, but I think it’s remiss of me not to talk about the current news with Elizabeth Warren and testing. And so I wanted to sort of get Anne’s reaction ... come on, come on. People are going to learn a lot about genetic testing in this period, I think. So let’s talk about this. This is like, you know, you guys have gotten a lot of attention and different things, but this sort of brings a huge focus onto people’s genealogy. Yeah. No, I mean, I think it’s the sense of identity and where people are from, is definitely a hot topic. We have this new podcast episode that specifically talks about race and the definition of race and how it’s being redefined. And years ago — probably four or five years ago — I spoke at the National Association of Reform Rabbis, and I presented them, “Hey, here’s all the different results people are getting.” People find out they’re 5 percent Jewish, 10 percent Jewish, 15 percent Jewish, and they’re walking into synagogues and are like, ‘We want to join, we’re part of the tribe.’” And it’s kind of similar in this case, like what is that definition? What’s the definition of being Jewish? Right. And what’s the definition of saying, “I have Native American ancestry”? Or African ancestry. So without a doubt, the thing that’s amazing to me is the science of your genetic ancestry is really good. And so you get, in the fringes, it’s going to keep refining over time. I always say it’s kind of like Google Earth in the old days: It’s a little bit fuzzy, but over time, it refines and it refines, and especially as the databases are getting bigger and there’s more and more populations. So I believe ... I know Carlos Bustamante, who did the analysis, he’s well known specifically for this, he’s an adviser to us, he’s an adviser to ... Just to be clear, Donald Trump said he was a bogus ... He kind of was like, “Yeah these are fake tests, whatever. This is like ...”, and I was like, “Well it’s ironic ‘cause we’re spending all this time going through the FDA and showing just how legitimate genetic testing is.” And so on the ancestry part, it’s one thing that I remember even when I got my results, how shocking it was to see. My father’s Catholic, my mother’s Jewish. And my DNA comes back, “Wow, you’re 50 percent Jewish.” So it is remarkable how, I think, how ... Well, wouldn’t you know that from your mother’s Jewish ... Well I did, but it was interesting to see it based on, it was interesting to see it in my DNA. I’m not a scientist, but ... But I think that’s what’s interesting, is when you see something that’s so obvious to you, but it actually manifests in your DNA. Right. You know what I found out? What? I was Jewish. Oh! And African. Okay. And Arabic. Yeah. Everything was in there. It was fascinating. Oh, interesting. And so one thing I did, and my mother was even more so, ‘cause I guess we were in southern Italy, so it makes a lot of sense when you start to think about those things. And also my other side of the family’s from the south. So you don’t know where it’s all coming in. And I called my ... I have two brothers, and one lives here in Marin and is totally normal. The other is in Pennsylvania and he’s what you’d imagine a Trump person from Pennsylvania would be like. And so he’s, I would say, vaguely racist. And so I called him up, and I said, “Hey brother.” And he goes, “What?” And I go, “No, you’re African-American.” And I said, “Now you can hate yourself.” Yeah. ’Cause he’s so offensive. But it was a really interesting, it was really fun. I really appreciated that time I spent on 23andMe, just to get that. One of my favorite stories ever is, ironically, written by People magazine. And it’s a story of this man who had a one-night stand with this woman; he’s part of the KKK, he was a child of a Grand Klansman. He had a one-night stand with this woman who was Jewish. She then went on to have, they had a child. Went on then to have biracial children with someone who’s African American, someone who’s Latino. So this man, who’s part of the KKK, finds through 23andMe that he actually has these African American, mixed-race children. And they meet. It’s a well written story, ‘cause it doesn’t say, “Oh it was all lovely, roses, and everything changed.” But it was like, “I realize I have to reevaluate my position, and it’s not easy. I have a history of hating.” He’s like, “Do I love that I have this African American son-in-law? It wasn’t what I would have chosen, but I’m learning that I have, I have to re-evaluate.” But in this, I just want to get through this news. In this situation it’s being used for not-nice things. Yeah. It was initially used, for some reason she did this, and then Trump responded and kept calling her “Pocahontas.” And then she responded. And she was trying to do this in response to that. Right. What does that do to this idea of genetics? ‘Cause now it becomes sort of a clown show, in terms of how you treat it. How do you look at this, when this news thing pops up and you’re one of the companies that is doing this as a business? I think there’s a lot ... I think that it’s hard to battle fake news. And I think the only way you battle fake news is actually just with data. And I think that’s where, again, I’m proud of Carlos Bustamante who’s at Stanford, who’s the one who did the analysis, who’s led a lot of this work. Is that there’s data behind it. So in some ways, I haven’t worried that much about this because I think that there’s data behind it, that supports the validity of somebody gets something that says, “You have a great-great grandparent who is of Native American ancestry.” I think that there’s good scientific explanations for it. And it think that in this day and age, one thing I say, I often say, one of our biggest competitors in this space of science is Goop health and Gwyneth Paltrow because she has such pull. But some of the things that she promotes don’t actually have the scientific validity that my team would be able to stand behind. And so I think in this world we’re seeing all kinds of fake news and fake reports of health, but I think that’s where the only thing that we can do is help educate customers about what is real science. And making sure that we’re only promoting real science. It’s part of where we have a very strict standard about what we give back to people. But you consider Gwyneth Paltrow a competitor. Really, why? Not a competitor in ... Only because they, I don’t feel like people who advocate jade in your vagina is a competitor, but that’s ... I think it’s more about when I think about what people are doing, their engagement in health. I see, okay. Their interest in wellness. Right. They often, like you look at her site traffic. Her site traffic or the site traffic to the CDC, which is like ... Think about the publicity around the anti-vaccine movement, and their site traffic versus the site traffic to, again, people who are promoting, “This is what the vaccine schedule should be.” So my point more is that there is a lot of people who are able to promote faux science, and I think that that is actually an issue. And part of one of the things that we think about with 23andMe is just promoting scientific literacy, because it’s important for people to know what is real and what is not real. In some ways, it’s actually the same issue that you have right now in news. How do you discern what’s actually real and what’s not? So let’s talk about where the company is and where the area is. Because there’s been a lot of changes. You’ve been working with the FDA ... where do you stand? You’re getting more and more tests. So talk about an update of where you are. We keep working with the FDA on different approval processes. So we recently got the breast cancer approval. So that’s the most recent one, and it was important for us to bring that back because a lot of people — like I mentioned — don’t know that they have Ashkenazi Jewish ancestry. So, making sure that if you find out, for instance, that you might be a carrier for one of these genetic variants, but you didn’t know that you had Ashkenazi background, you could potentially develop breast cancer early in your 40s. So again, it’s been really important for me to bring that back. These are things you had initially on 23 ... I have the original one. Yeah. We did the original one. Yeah, you did. I had lots of the information and I kept it. I actually printed it all out. So I had it, and then it was removed from ... Well, you still get the PDF. Right, right, right, exactly. So but you’ve added breast cancer, and then? We have breast cancer. We added the ones like Parkinson’s Disease, Alzheimer’s — the genetic health risks, we call them. And the first approval we got was carrier status in things like cystic fibrosis. And the one that we’re still, that we talk about, that used to be in the old product but we don’t have back yet, is drug testing. So pharmacogenetics. So whether or not you are likely to respond to a medication. Whether you’re going to be a fast metabolizer or a slow metabolizer. Should you take more of a drug medication or less of that? So that’s one of the ones that we’re still, that we used to have, that we often talk about that we would like to come back. Now, Silicon Valley has often been at odds with the FDA. How do you look at the FDA now? How do you look at their processes? Who is ... The running of the FDA. How has it been under the Trump administration? So Scott Gottlieb is the commissioner. He’s not like a real estate agent, right? He’s not. Okay, all right. No, the deputy CTO of America was a real estate agent, but go ahead. Scott’s actually ... I’m not kidding. I have a lot of respect for Scott. Scott’s spent a lot of time in Silicon Valley, so he actually understands, he was a partner for a while at a VC fund. He was in past administrations in the FDA, so I think he actually really knows what he’s doing. And I think he really wants to do the right thing. And I think that sometimes it’s hard. I admire just running a 600-person company. I admire him because trying to shift such a large organization is hard. So, I think he’s making progress in important areas. In what ... What’s progress from your point of view? Well for us, we’re kind of in a ... it’s interesting to note that of all the sort of more direct-to-consumer companies out there, we’re the only ones who’ve gone through the FDA process. So it is a, again, we’re really proud of pioneering a direct-to-consumer path, and we’re really proud of actually, we’re the only ones out there that don’t require a physician’s oversight or a prescription. That said, it’s a hard path. And there’s a reason why there’s not ... no one else is necessarily following it, is actually a hard path. So I would stay it’s still, I think there’s pros and cons of being regulated. It’s definitely, it’s taken a lot of time, and it takes a lot of money. That said, the one thing I’ve learned over the last 12 years is — and I tell this thing to employees all the time — is that we mess with people’s lives. You tell someone that they’re a carrier for BRCA; or you tell someone, “You’re a high risk for blood clots.” Or you tell someone that you’re one-64th Native American. And it has real consequences on their life. And so we’re messing with people’s identity. And it’s really important that we take that seriously. So I understand the need for regulation, and I think the thing that’s been frustrating, there’s a lot of groups out there that there’s ways to sort of circumvent it. And I think that that’s where I worry more. And again, I bring up things like Goop health and others, there’s all kinds of ways to propagate not the most ideal data. Some of them got slapped back. Goop got slapped back. I know there was a lot of ... Goop did. But think in genetic testing, there’s still a fair number of groups out there that can interpret DNA, and it causes me anxiety that people will get wrong interpretations. Right. So when you look at what you want from this FDA, what do you want? What do you want to have happen? Specifically- ‘Cause Silicon Valley has always been pressing on the FDA in kind of a juvenile way- I think it’s ... I’m impressed. Like Apple got their Watch approved pretty quickly. I’m impressed always with AliveCor. That’s when it tells you that it does EKGs. My father’s used that device. We’d be on the beach and he’d be like, “Oh wow. I’m in atrial fib.” This is heart, correct, this is cardial? Yeah. It tells you whether you’re in atrial fib. So I think that it’s one of those things. I think that Silicon Valley in some ways has a responsibility to be aggressive, and to go forward to the FDA. I worry there’s a lot of companies that I meet with, and people come and get advice all the time; and I worry often that people are doing what they can to circumvent the FDA, and I think that that actually worries me because one of the things that you do need to do, is with regulators, you have to keep them informed about what is happening. ‘Cause that’s how they get educated. And we saw the consequences with Theranos for something that’s not regulated. That again, you mess with, you can really impact people’s lives. So there’s, again, I have a lot of respect for the FDA because I think that they see a lot of the bad. Well that case appears to be outright fraud. In Theranos? Yeah. Yeah. But it was one of those things. They’re not technically regulated by the FDA. They’re technically regulated by who? They’re regulated by Center for Medicare Services, by CMS, under CLIA. So there’s, it’s a softer regulatory path. So in that capacity they were able to actually get onto the market without the same kind of oversight. So how much did Theranos set back companies like yours? There’s been a lot. There’s been AliveCor, there’s Color, there’s, these are the consumer-facing ones. I think because the Theranos case was so extreme that I don’t think it’s necessarily had a negative consequence. I think that people are more aware. In some ways it’s been helpful; that people are more aware of scientific fraud. Scientists always say, “Just because something’s published in Nature or something’s in Science doesn’t mean it’s true.” But my mom would say, “Oh of course it’s true. It was published in that.” So I think it’s been a helpful example for people to realize in some ways that not everything that’s out there is actually real. And there’s a number of companies that don’t necessarily go through a real regulatory or a real data science process, and I think that’s actually been a helpful eye-opener for customers in some ways. So talk about the consumer-facing business because it’s a struggle. You’re trying to sell tests, but ultimately, you have to have something else to keep people there. Well the consumer business, we’ve really, the last couple years, especially after we got our first FDA approval or authorizations, the market is there. People are definitely interested in their genetics. They’re interested in the sense of identity. And a lot of it is that the ancestry market really exploded first. And in part because there’s more competition on the ancestry market. But people really are interested in a sense of identity. And I think that that’s where there’s a big gap that’s out there, where people would like to feel connected in a different way. And there’s interesting conversations about what’s actually the definition of family? Is it necessarily the people you’ve grown up with, or is it the people that you are genetically related to? What is that definition of family? So that’s at that health side, is where I think there’s, in many ways, the most potential. People are hungry for ways and information about how to live healthier. And in some ways, people still are figuring out what to do with information and actually, frankly, how to be in charge of themselves. Most people don’t really take ownership of their health. They go to the physician periodically, they kind of watch what they eat, their exercise, I think a lot is changing with the watches that’s coming out. But that’s part of what we’re hoping, to inspire people more and more. It’s like, “You are that center of your health, and the more you take charge of yourself, the healthier you can be.” So I think that that’s ... you will see us have a much bigger focus on health in the coming months. Health, that you’re giving them, and ... Just about, well yeah, in terms of what you can actually do to help prevent ... you know, if you’re at higher risk for blood clots, what is it that you could do? If you have African ancestry, are you potentially at higher risk for sickle cell? So things like that, like giving people ... and then helping people know what are some of the actions that you could take next. But you don’t have a physician ... a lot of these others you talk about do have physician elements, like Color does, there’s another one ... they come into my office periodically, have different parts of that. They’re often physician-oriented. Well, they’re physician-ordered, but they don’t necessarily have a physician interface. Mm-hmm. Many of them do recently, I’ve noticed, a lot of them do, where it goes to the physician and ... It goes to the physician, right. Right. And that’s because it’s under Medicare, it’s required to. Right, I see. But where does ... what I’m talking about is where the business goes next, is that you give them health advice that you ... I’m trying to grok where your business ... I think that having more and more of a robust health product in terms of like, again, getting the drug reports coming back. So I think that we look at when we can get pharmacogenetics back, it’s kind of like the complete product is back. And then it’s about helping people have the utility, of what do you do next with that? One of the things that we had before the FDA were some of these journeys of, you know, like you’re going into surgery, what are some of the questions for you to think about? And helping people synthesize some of that information. So I think that’s more and more the direction, is that people want to put all those pieces together, and then put that together in the story. And so, again, the world is exploding with the watches and your phones, and the information that you can pull about helping people say, “This is what your genetic risk factors are, this is the information that you’ve given us about how you’re living your life. This is actually how much you’re walking every day, how much you’re sleeping.” Can we actually then have predictions for you? So I think pulling together more and more of that data, and giving you better predictions, or coaching. Let’s get the privacy ... we’re going to get questions from ... we have a whole bunch, I see them popping here. The topic of ... let’s get to privacy first, then I want to answer the question of what the topic of this, the evolution. Sort of, you’ve had an up-and-down trajectory, essentially. But one of the issues around you all is privacy in what you do. You signed a lot more deals to give information. Now ... Well, we never give out your individual level ... I get that. But I think people are on a, like a ... you’re familiar with the Google people? Yeah, heard of them, yeah. Yeah, exactly. There’s been a hack there, at Google Plus, which nobody uses, fine. Except for Sergey. Except for Sergey ... does he still? Sometimes. You know he does, you’re right. I always thought of Google Plus as a social media service for antisocial people. It’s true, right? You see what I’m saying. You got it. We are going ... You got it completely. You have the Google hack, you have the Facebook hack, you’ve got the privacy issues, you’ve got a privacy bill in California around things like this. You have enormous amounts of important information. And as people input more or use your health things ... can you talk about that? Because, honestly, I think that this techlash against technology is well deserved. Tell exactly what you’re doing and how you’re thinking about it. I think what’s interesting, because we’re doing technically human subjects research, we have an institutional review board, we have an IRB, that oversees the research. Which is important. Which is actually really different. Like, Google doesn’t have an IRB. Facebook doesn’t have an IRB. There’s no outside group necessarily overseeing how you’re using the data you collected. Not yet. Not yet, not yet. But in some ways that was a helpful process for us in those early days of like, really ... the first year that we spent setting up the company, we spent a long time, not necessarily just developing the product but just thinking through specifically privacy and consent, and how are we going to do this in a way that can scale online, that protects, that actually creates more of a balance ... To be anticipating the consequences. Yeah. Like things like the Golden State Killer. It was actually something that we thought of. We specifically said, one, we don’t allow people to take other samples and upload them into 23andMe and compare it against all the data set. And we don’t do that, because in part, we thought about that in the early days. Like that other ... Hey, one day people might take random DNA samples and upload them there. So I’m actually really ... Another company did, though. Well, it’s actually a public dataset, it’s Jedcom. And it’s not necessarily against their terms of service, they ... if you want to do that. And I think that’s part of ... The most important for me is just making sure people are aware. One of my favorite quotes from the Henrietta Lacks movie was that she said, “I would have been happy to consent for research. I just want to know that I was consenting.” And I think that’s a big part, is that people don’t necessarily want their data not to be used, they just want the dignity of knowing that it is being used and how is it being used. So we ask our customers, “Do you want to consent over research?” Over 80 percent of our customers do. At any time, if you decide you no longer want to be part of research, you can opt out, you can say, “I no longer, I’m withdrawing my consent.” If I send you a survey on Crohn’s disease, and you say, “That’s not interesting to me,” [if] you don’t take it, then I can’t use your data on that. If I send you a survey on migraines and you use it, well then we’re using it. But we keep you reminded at the top. So for me, it’s always been about not giving people that opportunity, but just making it really clear that that’s what you’re doing. I think that that’s like the main thing. In some ways like GDPR, I feel I tried to do that, like, “FYI, you have these cookies, this is what’s happening.” But that’s really what we’ve tried to do, is make sure people are aware of what we’re doing. And what about the safety of the data? Because that’s the other part. Because, even if you do things just right on consents, that’s only opt-in essentially, that’s a definite opt-in. Even if that’s allowed, and I just recently wrote in the Times about the internet bill of rights, and it’s sort of a grab bag of things. And among those is opt-in. But the other one is, what happens to the data, third parties? And that was what happened, this sort of hurricane Cambridge Analytica, and then it was hurricane Russians and hurricane ... So, we don’t give ... we ask people, most of the BD deals we do, we base on aggregate data, it’s not individual-level data. So for instance, if we were doing a study on, again, on migraines, and we are working with Pfizer, we’re going to give them aggregate data. So we’ll give them the analysis of the results. There are definitely some cases where we re-consent people so that we can give them data back, and we’ve now allowed people the option. There’s some people who just say, “You know what? Use my data for anything you want.” And so there’s people who have another layer of consent and they’re saying, “I’m happy for you to do whatever you want with the data.” So, most of the analysis we do with partners is based on aggregate data. You say most, you just said most, what isn’t? That’s what I’m saying, in this specific example. So for instance, in Parkinson’s Disease, we will consent people for individual-level data, so that data could be shared with Michael J. Fox. Okay, through his ... so that they can use it ... But it’s an additional layer of consent. The majority of our research I’d say is aggregate data, some data, but again, that’s where you’re explicitly consenting again for individual-level data use. And what about the protection of the data within your walls? I mean, that’s where we spend ... again, I often say like banks have a lot, like banks pioneer a lot of data security. Your genetic information is really interesting, but your bank account is much more interesting. There’s a lot that we can learn from that sector. So we do everything we can. It’s been a high priority ... like, we have pretty robust now, security team. We’re building that out even more. But it’s been a really high priority for us since Day One. And I’m grateful to my early engineers, and that we had people who came from PayPal and came from banking, who were really focused on data privacy and security. So we do everything we can to make sure we’re building out the infrastructure. Structurally we also do things like we keep your identifying information in a separate dataset from your genetic information. So those two databases don’t speak, unless by a very few number of people. So we structurally tried to set it up to make sure that we’re doing everything we can to protect your privacy. What’s your nightmare scenario here? Because I think like, I do Clear, right, I did Clear and they’ve got my eyeball, whatever, they’ve got my fingerprints, they’ve got my eyeballs. And I just think, “You know what? They’re going to come get me someday.” They just clearly are ... between my tweets and my genetic information, I’m screwed. You know, I think that the ... I’m going right to that camp in “Handmaid’s Tale,” I’m going right there. You can only watch that first episode, it was awful. I couldn’t watch this season. It’s too real. I think that the privacy issues I find for 23andMe are mostly within a family. And it might be, since you talk about your family, let’s say your brother really did not want to know his genetic ancestry, and then you told him. What you just did. So, did you violate his privacy? I don’t care. And so, that is exactly what most people say. So I think those types of situations come up where ... I’m in jail for that every day of the week. ... where you find that people, you get this disconnect in families about whether or not people want to know. And we find this ... One of the most interesting things is, you often find children will come in and say, “Oh we want to do 23andMe,” and then one of the parents doesn’t want to. And they clearly know there’s a reason why. And then the siblings find out, like, “Hey, we’re half siblings.” Right, oh yeah. I saw that John Sayles movie. That happened. So that happens a lot. And we’ve had other privacy ... the other privacy issues we have ... Maybe someone in the audience has a story like that. I’m sure, well, I mean it’s roughly 10 percent of the population, so I’m sure there’s probably, could be a support group in here. We get those, I worry more about those. I think a lot about ... I worry more about the holistic economy. Like, I do spend a lot of time just making sure that we are really on top of privacy. Because to your point, we’re lumped in with Silicon Valley ... You are. ... like we’re part of it. And there is a real ... I worry about the backlash that’s potentially coming our way. And it almost feels like a tsunami, like we’re just in that... Well it is getting lumped in, and they’re very differentiated. I mean, there’s a difference between Apple and Google. There’s a difference between Facebook and everybody else. But they get pulled in. I had someone ... you know, you have people from other companies now, who are not affiliated like that going, “Damn Facebook,” I mean, they really are angry because of all the regulation coming this way, it’s because of behavior at Facebook and Google essentially. Right. Right. So what do you do about that? I think that’s where we try to make sure that we stay somewhat differentiated. The one thing I’m really proud of for our customers, is our customers trust us, to an extent. Like it’s, I think we’ve shown to our customers we’re really protective of how we use the information, what we’re trying to do. We’ve proven out for years. We do research for all the right reasons. We publish, we have over 120 publications. We really try to do the right thing. And I think in some ways with the FDA coming after us in 2013 and really sticking to our guns and coming back, I think it’s won over a lot of loyalty from our customers. So I think that the most important thing we can do, like I’m really protective of our customer and the brand. And I emphasize to people every day, like, our customers, you the individual, it’s not pharma, it’s not others, like it’s you ... Yeah, that’s a business. It’s a business, but ultimately ... How big a business is that part? Selling other people’s data? But we never sell people’s data. All right, okay. All right, listen, Mark Zuckerberg ... Hey. But we don’t sell people’s data, it’s a lot about ... That’s a Mark Zuckerberg answer, I’m sorry. “We never sell data.” I’m like, “No, you just mash it up and sell the insights back to people.” It’s the same thing. Well, okay. I mean, yeah, we, but it’s always under the ... it’s a research partnership. But it’s a revenue stream for you, right? It’s a revenue stream for us. But it’s also about ... like one thing I have found is that our customers who have an illness really want to participate. So for instance, we’re doing a lot more clinical trial recruiting. In part because it’s a need for the pharma companies, but it’s also a real need for customers, customers who have a disease. Somebody wrote me yesterday saying, “I have early onset Alzheimer’s and there’s nothing for me to do.” I was like, “There are things for you to do.” So matching people up is a real service there. We do a lot of research programs with academics and with pharma companies. But more and more what we found is that business line, in some ways, it’s definitely a business for us, but it’s slow, and it’s not huge. So that’s part of the reason why we invest in it and we’re doing our own drug discovery. So we have 13 drugs on our own that we’ve ... you know, we hired Richard Scheller, who came from Genentech, and we’re pursuing that, in part, because we feel like that’s ... again, our mission is about people being able to access, understand and benefit from the human genome. When you think about, “How are you really going to benefit?” It’s that, “I’m going to succeed at keeping you healthy at 100. And I’m either going to keep you healthy at 100 by helping you really know what to do,” so like I said, the consumer product, the action plan, like, “What can I do to help you be healthier?” Or if you do have a disease, can we actually develop a therapy that really helps you benefit and that really could cure you? Right. I’m going to get questions from the audience. But what do you think of all these... I recently had a meeting with a ton of Silicon Valley people on this anti-aging thing, and I’m not talking about only lotions. Oh. When you say, “oh” … Oh, that person. Well, you know but, there’s a couple ... you know that there’s VCs involved, there’s all kinds of things. And it has to do with longevity. It’s not anti-death, I think that’s sort of a miss ... it’s like not ... it’s dying at 500, or not being sick when you’re 100 and being very healthy at 100, kind of thing. How do you look at that? I mean, that’s sort of in your ... I think it is. I mean, I look at being healthy at 100. I feel like we have a long ways to go even to aspire for that. You know, and in some ways, like they’re some of the most basic aspects, as you know, understanding diabetes, obesity and smoking. You know, those three really just have such a massive impact on health on most people here. I’m inspired by genetics, because I think one thing that genetics really can do is help eliminate a lot of early premature deaths. So, BRCA being a good example. You know, people who are high-risk, who potentially die of ovarian or breast cancer ... You could potentially prevent that. Yeah. There’s people with sudden cardiac death. You could potentially really help them know they have that, and then help prevent that. But what do you ... Look at these. Don’t wanna die? Don’t wanna die soon? I haven’t ... You know, we don’t spend a huge amount of time on these individuals. I mean, I think that there’s, without a ... I think Silicon Valley has some of the reputation for the, you know, “We want to live forever” mentality and helping think that through. I think understanding aging ... Like those mouse studies. You take the young blood and you put it in the old blood? Yeah. I mean, it’s kind of fascinating. I look at my children in a whole new way. My son was so upset when I told him about that. I was like, “I want your blood.” I have no idea why. Oh, man. You’re ... So, I think there’s some ... Aging itself? Scientifically, it’s a really interesting question. We don’t fully understand aging, so I’m a huge fan of understanding that. I know Calico is doing a lot with that. So trying to understand it, I think, is really interesting. But I think that the other pursuits, which I’m not as familiar with, in terms of like, “Yes, let’s try to live to 500,” I think there’s a lot of ... Again, it’s a little bit more out there to me. Right, and that’s the thing you’re gonna be ... I just, I’m waiting to see some of the data. Like, who can make me healthy at 100, first? Let’s aspire for that. Right. Well, let’s ask some questions here. Okay. “Can you discuss the monetization of data at 23andMe,” which we just did, “and the partnership with GSK?” Mm-hmm. Can you? Yeah. GSK… So, like I mentioned before, we’re doing these partnerships with pharma partners, and we found that there’s a real hesitancy. A lot of pharma partners just didn’t really buy in to what exactly can you do with genetics? Is that really gonna help with drug discovery? So, we hired Richard Scheller, who came from Genentech. We built up our own drug discovery team. It’s great, it’s been really successful. It’s been surprising how many discoveries we’ve been able to take from concept into development. We now have 13 programs that are in the research stage that we’re making molecules, and in some ways we are almost sinking from our own success. Where, each molecule is expensive. And it’s not like we just focus on multiple sclerosis or Crohn’s. We have a wide variety of diseases that we’re focusing on. As we planned how we’re gonna scale, it became really clear that we need the expertise and the ability to scale that a large pharmaceutical company is going to have. Right. Frankly, we need medical teams across a wide variety of diseases. So, the partnership with GSK, I think, is really ... Or the collaboration, to say ... Is super-exciting, because we can do what we do best, and they can do what they do best, and they’re really gung-ho about genetics and the potential there. Hal Barron, who runs the research team at GSK, used to work with Richard Scheller at Genentech, so we kind of brought the band back together. So there’s a lot of synergy there, and I think there’s a lot of ways for us to be able to accelerate and prove out how people are gonna benefit from the human genome. All right. Next is, “You talked about cold cases, GEDmatch solving cold cases. Can you speak about that?” Which you did. Which you’re not participating ... Yeah, we’re not part of it. I mean, I think it’s a really interesting issue — and I think one thing, just to highlight for people, I think a lot of people don’t realize this — is that your medical samples could be subpoenaed, also, for criminal cases. There was a story out there about a woman whose pap smear was subpoenaed and actually used to solve a crime. So, again, I look at ... I’m a huge fan of transparency. Again, people want to consent, and they want to be part of research for all kinds of reasons. But when I go in to the doctor and I have any kind of procedure, I’m assuming it’s just for that procedure. And I find that there’s a whole new world that I’m really focused on. You know, we have GDPR in technology now, or in the internet. Where’s that equivalent in healthcare? Right. And why is it ... Again, you look at Henrietta Lacks and others. Why is it that my healthcare information is circulating all over and I have no access to it? Right. So, the right to be forgotten, really. Right. There’s definitely no right to be forgotten in healthcare. No, not at all. All right. “Who provides your ethical North Star? The board, you, a chief ethicist? Will she or the consumer demand or determine where we draw the line?” Have you thought about having one? I know some companies, tech companies — I’m gonna be writing about it — are hiring for that role. For a chief ethicist? Mm-hmm. You know, what’s interesting ... We tried. We had this issue where, in the early days, we interviewed ethicists all over the place and we actually had offers out. And then, every ethicist would engage with us and then they would say, “Oh, no. We’ll never speak to you again.” And I was like, “Why?” And they’re like, “This is so exciting. This is a career-making opportunity. We can only talk about you from our ivory tower.” So, we actually couldn’t get an ethicist to join because people found it was such an interesting hot topic. And so, frankly, what I have found is that an opinion of one is not as helpful as us just actively engaging all the time. So, there’s something ... Again, in healthcare, there’s the ethical/legal/social, ELSI group. Joanna Mountain, who is one of the first scientists we hired, was actively involved with the whole ELSI community, and we do a lot. We got the feedback in the early days. Thankful to 23andMe, we generated tons of funding for this community, because there’s suddenly so much interest and discussion in this topic. So, we spend a lot of time thinking about that. I would say now ... There’s me. I have a strong, without a doubt ... I have the mission and I drive for the company, of like, what is our North Star? But I’m really lucky ... Who does that for you? Who does that for me? Yeah. You know, I think ... I think that’s kind of your soul, like how you’re brought up. To me, it’s my family keeps me very grounded. Others. Also, in some ways, being in Silicon Valley, I see for sure what I don’t want to be, and then I’m also reminded of what I do want to be. I think one of the best things to do, especially in this day and age of Silicon Valley, is sometimes ... Like when I worked on Wall Street, I used to volunteer at San Francisco General, and I would just clean gurneys, and I was like a patient advocate. I did it from 11 pm to 6 am. In some ways, having that humility again and keeping staying normal was really helpful, of remembering, like, why are you doing the things that you’re doing, and what is the reality here? So for me ... Man, they’re gonna have to clean a lot of gurneys, these people. Yeah. Oh, no. I mean, the problem is definitely ... But I think it’s keeping ... You know. Part of keeping yourself real in the world of ... Like, I love interacting with our customers because it helps me stay grounded with the mission of the company, and really what is our impact? And it keeps changing over time. “Do you expect 23andMe will ever become a covered benefit, or will it remain self-pay?” Self-pay. I think people don’t realize that when insurance companies pay for your information, they own it, and I think it’s a really important ... Again, I go through this GDPR. Of, like, where is the GDPR of healthcare? You know. I really question where ... If you want to have privacy? Your insurance company, they pay. They have all kinds of rights to the information. And so, I’m a huge fan ... All kinds of countries outside the United States, there’s just a self-pay option. Healthcare, in my mind, should be affordable. It should be accessible. And I’m a big supporter ... 23andMe, we would be a very different product and we would be a very different company and price point if we were taking reimbursement. Right. Okay. “What’s the one lesson you’ve learned since the company’s founding that you wish you knew at the very beginning?” That’s a very nice open-ended question. I think the thing that we missed early on is just how long it takes to educate people about something totally new. I think that we were overly optimistic about the state of scientific literacy in this country. So, the early days, it was really a slog about how are you gonna educate people about genetics and what exactly does it mean and why would you even be interested? You know, we got that question all the time. Like, “Why do I even care?” And as a group of scientists, it was sort of seen as, it was so obvious. Like, “Of course.” Like, “Don’t you want to look in the mirror? Why would you not want your genetic information?” So, I think that that was one aspect that we missed early on, was just how hard it is going to be to educate people about why they should want their genetic information. All right. Last two, I’m gonna do together. “So many male founders in Silicon Valley, and VCs admit preferentially funding them. How do you see your role as a female founder, to raise the tide for female founders?” And then, “How does 23andMe ensure a diverse population is represented in its data sets shared with pharma, as new drug therapies are developed for all populations?” I’ll take the last one. You have to take both. We spend a lot of time really making sure ... One of the most interesting issues in healthcare is that it is very much biased toward a European population. And 23andMe, even ... You know. We’ll be 75 percent European. Even at that percentage of 25 percent diversity, it’s the largest data sets that are out there in these different populations. So, we do have a number of initiatives going on right now to make sure that we can actually improve the product for different communities, and then make sure that we’re actually selling and that we are giving it away to specific communities as needed. Diversity in research, I think, is one aspect. It’s really poorly understood how much it could benefit everybody, and I think that’s where ... When you think about personalized medicine, I don’t necessarily think about ... You know, people talk a lot about specific drugs. I think about, “What is the right blood pressure for you, based on your ancestry, based on everything?” Some of these measurements are just really not well-defined, and I think that’s where we could actually do a lot. Right. They’re well-defined for one group of people. For one group of people. And I think that’s where there’s a lot that we could do, but I think about that. Really understanding the diversity. And then, the female founders? Oh, female. I’m not doing ... You’re a female. I am female. I think it’s important to support. I mean, as more and more ... I have a hard ... I spend a lot of time with my sisters and so I’m kind of surrounded by women all the time. There’s my moments where I’m like, “I really should hang out with more men.” So in some ways, I’ve had that privilege, and I also see how great it is to work in gender-balanced environments. I should do more investing that does really try to encourage women, and when I get those requests, it’s always quite appealing to me. I haven’t spent a lot of time doing my own investing right now, because I think it’s just ... It’s a whole other set of projects. But I think it’s really important to do that. And I see just in running the company, for my teams where there’s less diversity ... I think you’re one of the only woman CEOs in the Valley. One of the few. I’m trying to think. I’m one of the few. There’s maybe four. Another one is your sister. Yeah. I know. That’s why we hang out. Right, right. We can’t go by the Wojcicki sisters, the Wojcickis. But really, you and your sister ... Who else is a CEO? We had Marissa. Yeah, but she’s not anymore, so ... I know. Katrina Lake. Yup. There’s not a lot. And it’s really too bad, because I think the diversity makes such a positive difference. It’s so much better when you have a diverse group of people. We had a time period where we had a management team that was entirely women, and we were like, “We need to hire a man.” We’re very unusual in that way. But it’s in part, diversity really benefits. You see all the biases. I think it’s an issue. So if there’s things that I can do, I should definitely do more of it. I just, it’s been a lot. You’re busy. Last question from me. You’re gonna go public or sell or what? I think that being public ... I don’t think there’s any glory in being public. I actually think being public is almost the last-resort option, because you lose all your privacy. You lose so much when you have to be a public company, and then you’re also coming as a public analyst. Like, you have all these people just paid to spy on you, and trying to get ahold of your employees and do all kinds of things. So, there’s no glory. I think that what people always want is, they want liquidity. And there’s all kinds of fabulous new ways these days of actually having liquidity. And I think if we ever do go public, it’s gonna be when we’re a much more mature, stable company. Okay. And sale? Say again, sell? I don’t think ... You know, we don’t fit with anyone. And we’re also in some ways such a rebellious brand that we should stay independent. We need that freedom. So we’re not, we’re definitely not ... No. We’re not selling. All right, then. Thank you, Anne Wojcicki. Thanks so much. Thank you.

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posted 3 days ago on re/code
Even the experts disagree exactly how much tech like AI will change our workforce. Tech CEOs and politicians alike have issued grave warnings about the capability of automation, including AI, to replace large swaths of our current workforce. But the people who actually study this for a living — economists — have very different ideas about just how large the scale of that automation will be. For example, researchers at Citibank and the University of Oxford estimated that 57 percent of jobs in OECD countries — an international group of 36 nations including the U.S. — were at high risk of automation within the next few decades. In another well-cited study, researchers at the OECD calculated only 14 percent of jobs to be at high risk of automation within the same timeline. That’s a big range when you consider this means a difference of hundreds of millions of potential lost jobs in the next few decades. Of course, technology also has the capability to create new jobs — or just change the nature of the work people are doing — rather than eliminate jobs altogether. But sizing the scope of sheer job loss is an important metric, because for every job lost, a member of the workforce will have to find a new one, oftentimes in an entirely different profession. Even within the scope of the U.S., the estimates for how many jobs could be lost in a single year vary widely. Earlier this year, MIT Technology Review analyzed and plotted dozens of across-the-board predictions from researchers at places like McKinsey Global Institute, Gartner and the International Federation of Robotics. Here, we’ve charted some of the data they compiled, with some of our own analysis from additional reports: if("undefined"==typeof window.datawrapper)window.datawrapper={};window.datawrapper["2oTtU"]={},window.datawrapper["2oTtU"].embedDeltas={"100":753.020834,"200":651.020834,"300":625.020834,"400":625.020834,"500":625.020834,"700":600.020834,"800":600.020834,"900":600.020834,"1000":600.020834},window.datawrapper["2oTtU"].iframe=document.getElementById("datawrapper-chart-2oTtU"),window.datawrapper["2oTtU"].iframe.style.height=window.datawrapper["2oTtU"].embedDeltas[Math.min(1e3,Math.max(100*Math.floor(window.datawrapper["2oTtU"].iframe.offsetWidth/100),100))]+"px",window.addEventListener("message",function(a){if("undefined"!=typeof a.data["datawrapper-height"])for(var b in a.data["datawrapper-height"])if("2oTtU"==b)window.datawrapper["2oTtU"].iframe.style.height=a.data["datawrapper-height"][b]+"px"}); So why do these predictions cover so much range? Recode asked leading academics and economists in the field and found some of the challenges in sizing how automation and similar technology will change the workforce: Just because a technology exists doesn’t mean it’s going to be used Even as new groundbreaking tech becomes available, there’s no guarantee that it will be implemented right away. For example, while autonomous-vehicle technology could one day eliminate or change the jobs of the estimated five million workers in the U.S. who drive professionally, there’s a long road ahead to getting legal clearance to do that. “The fact that a job can be automated doesn’t mean it will be,” Glenda Quintini, a senior economist at the OECD, told Recode. “There’s a question of implementing, the cost of labor versus technology, and social desirability.” Jobs involve a mix of tasks Take the job of a waiter. A robot may be able to take over some aspects of that job, like taking orders, serving the food or handling payments. But other parts, like dealing with an angry customer, maybe less so. Some studies, such as the OECD report, assess the likelihood of each task within an occupation, while the Oxford studies make an overall assessment of each job. There’s a debate among academics about which methodology makes more sense. The authors of the OECD report say that the granularity in their approach is more accurate, while the Oxford report authors argue that for most occupations, the detailed tasks don’t matter: As long as technology like AI can do the critical portion of the work, it ultimately has a binary “yes” or “no” capability to be automated. The data isn’t good enough because it only measures what we know To model the future, researchers have to start with data from the present — which is not always perfect. Economists do their best to take inventory of all the jobs out there and what tasks they involve, but this list admittedly isn’t exhaustive. “There’s no assurance in the end that that we’ve captured every aspect of those jobs, so inevitably we might be overlooking some things,” said Carl Benedikt Frey, an economist at the University of Oxford. It helps to know just how these experts make the predictions to fully understand the room for human error. In the case of the Oxford study, researchers gathered a list of hundreds of occupations and asked a panel of machine learning experts to make their best judgment as to whether or not some of those jobs were likely to be computerized. The researchers weighed in on only 70 out of the about 702 total jobs that they were most confident they could assess. For the rest of the occupations, the researchers used an algorithm that attributed a numerical value to how much each job included tasks that are technology bottlenecks — things like “the ability to come up with unusual or clever ideas” or “persuading others to change their minds or behavior.” But ultimately, even that algorithmic modeling isn’t perfect, because not everybody agrees on just how socially complex any given job is. So while quantitative models can help reduce bias, they don’t eliminate it completely, and that can trickle down into differences in the final results. For all these reasons, some academics prefer not to forecast an exact number of jobs lost in a specific timeframe, but instead focus on the relative percentage of jobs in an economy at risk. “All of these studies that have tried to put a number on how many jobs are going to be lost in a decade or two decades or five years — they’re trying to do something that is just impossible,” Frey said. Economist John Maynard Keynes famously said that by 2030, due to rapid advancements in technology, we’d see widespread “technological unemployment” and be working an average of only 15 hours a week. It was a positive vision for a world where mankind would finally have “freedom from pressing economic cares” and live a life of leisure. Those estimates seem widely overblown now. While Keynes was right that technology has helped increase productivity in entirely new industries, the average workweek in the U.S. hasn’t declined since the 1970s. Thanks in large part to persistent wage stagnation and rising income inequality in the last few decades, most people still have to work just as many hours as they did before in order to make ends meet. Keynes’s comments remind us that there’s a bad track record of punditry in this field, and that even the greats can be wrong when it comes to predicting just how much, or how fast, technology will impact the workforce.

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posted 4 days ago on re/code
The upstart is taking share. Can it build from there? For more than a decade, online restaurant reservations pioneer OpenTable was seemingly the only place you could go to book a table online. Now, in four years, its upstart rival Resy has managed to bite off some of OpenTable’s market share, particularly among newer and trendier restaurants. Recode researched the reservation system used by hundreds of restaurants in New York, San Francisco, Chicago and Los Angeles, focusing on three categories: Hip, newer restaurants as chosen by our sister site Eater’s “heatmap” lists; the top-ranked restaurants in each city on TripAdvisor, as a proxy for established, if touristy restaurants; and fine-dining restaurants with Michelin stars. if("undefined"==typeof window.datawrapper)window.datawrapper={};window.datawrapper["R2Z1Y"]={},window.datawrapper["R2Z1Y"].embedDeltas={"100":446,"200":334,"300":278,"400":278,"500":236,"700":236,"800":236,"900":236,"1000":236},window.datawrapper["R2Z1Y"].iframe=document.getElementById("datawrapper-chart-R2Z1Y"),window.datawrapper["R2Z1Y"].iframe.style.height=window.datawrapper["R2Z1Y"].embedDeltas[Math.min(1e3,Math.max(100*Math.floor(window.datawrapper["R2Z1Y"].iframe.offsetWidth/100),100))]+"px",window.addEventListener("message",function(a){if("undefined"!=typeof a.data["datawrapper-height"])for(var b in a.data["datawrapper-height"])if("R2Z1Y"==b)window.datawrapper["R2Z1Y"].iframe.style.height=a.data["datawrapper-height"][b]+"px"}); Using data Recode gathered late this summer, we found that OpenTable dominated overall, servicing almost 60 percent of all the restaurants on the list that take reservations. Resy had 10 percent market share among those restaurants. (Globally, Resy has far fewer restaurants using its software — around 2,000 — than OpenTable, which has more than 45,000. OpenTable was founded in 1998.) Resy was particularly unpopular among the touristy spots on TripAdvisor, where only 5 percent of the restaurants we tabulated used Resy; more restaurants still used the phone. OpenTable’s market share there, though, was its highest among our groups at more than 60 percent. Among Michelin-starred restaurants in the cities — excluding Los Angeles, which doesn’t yet have a guide — OpenTable was the big winner. But almost a third use Resy or two upstart competitors: Tock, which is focused on ticketing-based dining, and Reserve, which is more like Resy. But among the newer, hipper restaurants on Eater’s lists in those four major U.S. cities, like Frenchette in New York and Dama in Los Angeles, Resy is eating into OpenTable’s potential customer base, garnering 21 percent market share — half of OpenTable’s 42 percent share. Why is Resy catching on? When the company — led by Eater’s co-founder Ben Leventhal — launched in 2014, it tried to innovate in the reservations market by asking diners to pay extra for a premium reservation, a strategy it has abandoned. These days, it’s mostly a cheaper, simpler system. OpenTable and Resy both charge restaurants a monthly fee for their services. But only OpenTable charges for each reservation made through the platform — $1 per reservation made directly on OpenTable’s site and apps and 25 cents for each reservation made on a restaurant’s website. That adds up. Michael Schall owns two restaurants in New York: Camillo, a neighborhood Italian joint, which uses Resy, and Locanda, a pricier and more upscale restaurant, which uses OpenTable. Schall estimates his monthly bill from OpenTable is usually around $1,200, while his bill from Resy is $189. “The main reason I use Resy at Camillo is that it’s much more neighborhood focused,” he said. “So I don’t need to maximize my dining room — I just need a cheap online reservation [system] so I don’t have to pay someone to sit in the office and answer phones manually.” For now, restaurateurs also get less from Resy, so it makes sense that Resy works for places that aren’t as dependent on reservations — say, at hot, new places, or neighborhood restaurants. Leventhal says he’s interested in working with “any and all” high-quality restaurants. But it makes sense for a fast-moving startup to more easily service a smaller restaurant with simpler needs. And the company is building out a more elaborate “ResyOS” offering, including what it describes as “the most advanced table management system in the world.” The question, then, is whether that will allow it to scale to a wider group of customers. One recent development: The legendary New York restaurateur Danny Meyer recently announced he would move his group — including Blue Smoke, Union Square Cafe and Gramercy Tavern — to Resy in the coming months.

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posted 4 days ago on re/code
Clegg is joining Facebook as global head of communications and public policy. Facebook has filled one of its most important executive roles: Nick Clegg, the former deputy prime minister in the U.K. under David Cameron, is joining Facebook to lead all communications and global policy. It’s an important job. Elliot Schrage, who has held that role inside Facebook for the past decade, was incredibly influential. He was a top adviser to Facebook’s top decision makers, CEO Mark Zuckerberg and COO Sheryl Sandberg, and help shaped Facebook’s response to a number of important crises, including Cambridge Analytica and issues of Russian election meddling. Clegg will be tasked with handling those kinds of challenges moving forward. He’s a rare outside hire for Facebook, which tends to fill its most important vacancies from within. Clegg’s experience in British and European politics will be key given the European Union seems much more interested and capable of regulating Facebook than U.S. politicians. Bringing in a former British politician is also a sign that Facebook sees potential European regulation as a major concern moving forward. “Facebook, WhatsApp, Messenger, Oculus and Instagram are at the heart of so many people’s everyday lives — but also at the heart of some of the most complex and difficult questions we face as a society,” Clegg wrong on Facebook Friday morning. “The privacy of the individual; the integrity of our democratic process; the tensions between local cultures and the global internet; the balance between free speech and prohibited content. “I believe that Facebook must continue to play a role in finding answers to those questions,” he continued. Clegg starts at Facebook on Monday, according to a company spokesperson. Facebook’s head of communications, Caryn Marooney, and its head of public policy, Joel Kaplan, will report to Clegg. Clegg, meanwhile, will report to Sandberg, as did Schrage. Here’s Sandberg’s Facebook post announcing Clegg’s hire (function(d, s, id) { var js, fjs = d.getElementsByTagName(s)[0]; if (d.getElementById(id)) return; js = d.createElement(s); js.id = id; js.src = 'https://connect.facebook.net/en_US/sdk.js#xfbml=1&version=v3.1'; fjs.parentNode.insertBefore(js, fjs); }(document, 'script', 'facebook-jssdk')); I’m excited to announce that Nick Clegg is joining Facebook as VP, Global Affairs and Communications. He is a...Posted by Sheryl Sandberg on Friday, October 19, 2018

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Plus, how SoftBank is handling the global fallout of the Khashoggi crisis; Apple sets the date for another new hardware event; the awkward etiquette of iPad tipping. Uber has transformed the global taxi industry — now it’s aiming at Uber-izing side hustles. The ride-hail company has quietly been developing a new short-term staffing business, called Uber Works, to expand its “on-demand” model into additional types of temporary work, like waiters and security guards for events and corporate functions. The new venture has reportedly been in the works in Chicago for several months after an earlier trial in Los Angeles, but it is unclear how soon Uber Works could debut. Meanwhile, banks are competing to become the top underwriter for Uber’s 2019 IPO; the favorite is Morgan Stanley, whose top tech banker moonlights as an Uber driver. [Rob Price / Business Insider] With one prominent exception, some of the most powerful figures in business are distancing themselves from Saudi Arabia since the disappearance and apparent killing of dissident Saudi journalist Jamal Khashoggi. The noteworthy holdout: Masayoshi Son, chief executive of the SoftBank Group, which oversees the Vision Fund, a technology investment fund that sought $100 billion in investments and received the promise of $45 billion from the Saudi sovereign wealth fund. SoftBank has expressed doubts about the likelihood of a second Vision Fund; here’s a look at how the Japanese conglomerate is handling the growing crisis. [Kate Kelly, Landon Thomas Jr., Andrew Ross Sorkin and Erin Griffith / The New York Times] Chart of the Day: Brandless wants to create the next great consumer packaged goods brand — but it hasn’t built customer loyalty yet if("undefined"==typeof window.datawrapper)window.datawrapper={};window.datawrapper["fOnUH"]={},window.datawrapper["fOnUH"].embedDeltas={"100":297,"200":247,"300":247,"400":222,"500":222,"700":222,"800":222,"900":222,"1000":222},window.datawrapper["fOnUH"].iframe=document.getElementById("datawrapper-chart-fOnUH"),window.datawrapper["fOnUH"].iframe.style.height=window.datawrapper["fOnUH"].embedDeltas[Math.min(1e3,Math.max(100*Math.floor(window.datawrapper["fOnUH"].iframe.offsetWidth/100),100))]+"px",window.addEventListener("message",function(a){if("undefined"!=typeof a.data["datawrapper-height"])for(var b in a.data["datawrapper-height"])if("fOnUH"==b)window.datawrapper["fOnUH"].iframe.style.height=a.data["datawrapper-height"][b]+"px"}); U.S. Treasury Secretary Steve Mnuchin withdrew from the Future Investment Initiative economic conference in Saudi Arabia amid bipartisan backlash over his plans to attend the event despite the disappearance of Khashoggi. Mnuchin was planning to speak at the conference during a weeklong, six-country swing through the Middle East, focused on combating terrorism financing. Several prominent chief executives, including JPMorgan Chase CEO Jamie Dimon, Uber CEO Dara Khosrowshahi and Ford Motor chairman Bill Ford, also canceled plans to attend the conference, along with ministers from Britain, France and the Netherlands. [Alan Rappeport and Eileen Sullivan / The New York Times] Apple still has a few new products up its sleeve for 2018: The company issued media invites for an October 30 event in Brooklyn. Apple-watchers are expecting new iPad Pro tablets with Face ID and potentially several updates to the Mac lineup, perhaps including the long-awaited successor to the MacBook Air laptop. The event’s enigmatic tagline: “There’s more in the making,” which some are interpreting as a signal that Apple may debut products aimed at creativity and expression. [Chris Welch / The Verge] One of Silicon Valley’s most secretive companies, data-mining giant Palantir Technologies, is considering an initial public offering that some banks have valued at as much as $41 billion — one of the largest in recent years. Palantir, which was co-founded by investor Peter Thiel, has talked with investment banks Credit Suisse Group AG and Morgan Stanley about its plans, and it could go public as soon as the second half of 2019. The discussions come amid a gusher of technology giants — including Uber, Lyft, Slack and Postmates — charging toward newly volatile public markets. [Rob Copeland / The Wall Street Journal] Fortune magazine released its second annual Future 50, which ranks established public companies with the best long-term growth outlook. U.S. companies in the Top 10 include Workday (No. 1), ServiceNow (No. 3), Vertex Pharmaceuticals (No. 7), Netflix (No. 8) and Salesforce (No. 10). The vast majority of this year’s forward-looking list are headquartered in two countries: 42 percent are in China (including Hong Kong) and 42 percent in the U.S. [Martin Reeves / Fortune] Top stories from Recode Trump’s latest China threat could crush the $8 billion Amazon competitor Wish. Here’s its plan to fight back.The days of Wish building its company on the back of artificially low shipping rates may be over. [Jason Del Rey] Marc Benioff voiced concerns on a San Francisco homelessness measure months before becoming its most prominent booster.The high-profile tech exec was critical of the initiative as late as this summer, according to July emails sent by him and seen by Recode. [Theodore Schleifer] Brandless wants to create the next great consumer packaged goods brand — but it hasn’t built customer loyalty yet.Third-party data puts its sales and customer retention below its peers. [Rani Molla] Silicon Valley’s Saudi money crisis illustrates a decline of “moral leadership” in America.Recode’s Kara Swisher and NYU’s Scott Galloway discuss the links between Jamal Khashoggi’s killers and the tech industry on this episode of Pivot. [Kara Swisher] This is cool Canada sold out of weed on the first day of legalization. The awkward etiquette of iPad tipping.

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Recode’s Kara Swisher and NYU’s Scott Galloway discuss the links between Jamal Khashoggi’s killers and the tech industry on this episode of Pivot. Some of Silicon Valley’s biggest companies are swimming in billions of dollars invested by the crown prince of Saudi Arabia, Mohammad bin Salman — a heavy financial backer of SoftBank’s Vision Fund who is now accused of ordering the torture and assassination of journalist Jamal Khashoggi. “Anywhere you tug, at any company or any investment firm or any VC, there is either Saudi money or there’s questionable money everywhere, across the system,” Recode’s Kara Swisher said on the latest episode of Pivot. “And if you remove the Saudis from the worldwide global network, everything collapses.” Her co-host, NYU’s Scott Galloway, said the silence of most tech leaders — and, even more importantly, the slow and muddled response from Washington — are indicative of a crisis in morality that will bite businesses in the end. “We have put a price on moral leadership,” Galloway said. “And the presidents of the past have always tried to figure out the balance between the realpolitik and our strategic interest. This isn’t new. But we at least pretended to care ... And by the way, I think this is the same infection that has called illness across all of Big Tech, we’re trading off long-term moral leadership in exchange for short-term profits.” “The reason why we have inflows of capital, the reason why our publicly traded stocks traded at 19 times PE, not 11 or 12 in other markets, is because we have rule of law and some sense of moral leadership here,” he added. “And when we engage or traffic in bone saws, we are long-term trading off our brand and the margin power that comes from our brand. So this is not only the wrong thing to do, it’s economically a stupid thing to do.” You can listen to Pivot with Kara Swisher and Scott Galloway wherever you get your podcasts — including Apple Podcasts, Spotify, Google Podcasts, Pocket Casts and Overcast. Below, we’ve shared a full transcript of Kara and Scott’s latest episode. Kara Swisher: Hi everyone, this is Pivot, from the Vox Media Podcast Network. I’m Kara Swisher. Scott Galloway: And I’m Scott Galloway, coming to you live from one of the 19 cities that has been played and will not be HQ2, Kara. Chicago. This is at Amazon, right? Correct? Got it. That’s right. I like Chicago, it’s one of my favorite places. 80 percent of New York for 50 percent of the price, it’s the Old Navy of cities. All right, let’s get started. Let’s get right to the big story this week. And it’s also had so many implications in tech, which is the Saudi money toxically awash in Silicon Valley and how tech companies are responding to the disappearance of the journalist at the Saudi embassy — not the disappearance, the murder of a journalist at the Saudi embassy by the Saudis, which I think most American intelligence, all the reports are coming in, that this is what’s happened. And the presence of Saudi money in Silicon Valley. So let’s talk about it. So last week, Kara, you said you couldn’t get anybody to comment. What’s happened between now and then? What is the response, what are they saying on the ground out there? Well, what’s really interesting, I had a really interesting dinner with a lot of people who are involved in this stuff, and there’s a couple things, there’s a few things. One is that there’s been dirty money here for a long time, whether it was Russian money, and the fact that it’s not just Saudi money, it’s all kinds of money from the Middle East, that is really problematic, not just sovereign wealth but individual wealth, because there’s so many wealthy people, they just washed into this area. And lately it has been money from the Mideast, comparatively. And then there’s Chinese money, there’s all kinds of different things going on, and they were all talking about where the different money is moving in, which was fascinating to me, and there were several people who were involved in these things. One of the issues is, first of all, the first thing they did, they said they’re not gonna go to “Davos in the Desert,” this event that MBS has, the head of Saudi Arabia, the crown prince has. It’s Mohammad bin Salman, is his name. Right now, everybody is calling him Mohammad Bone Saw. I know, awful, it’s an internet meme right now, but I think fine, that’s good with me. So they were talking about whether they were going. A lot of them had gotten out. The first one was Dara Khosrowshahi, who is the CEO of Uber, and he was gonna attend this and now he’s not going. He was one of the first to declare that. That said, he has not returned the $14 billion that they got, half of which was Saudi money, from SoftBank’s Vision Fund. I think a lot of people are focused on the Vision Fund, which was the big fund that SoftBank raised, and they were about to raise another hundred-billion dollar fund, which was an unheard of fund, which has been throwing money at everybody, from Slack to WeWork to Wag, which is a dog-walking app. $300 million to the dog-walking app. So half of that is ... 45 percent of that fund, $45 billion, is from the Saudis. So anything, if Uber’s gotten $13-14 billion, then $7 billion is from the Saudis, essentially, from the public investment fund that they have, which is called PIF. So nobody’s giving the money back, let’s just say, that’s what’s happening. And nobody wants to think about that idea. Now, whether they’re going to take it from them going forward, that’s the big question. Yeah. Do you think it’s realistic or even a reasonable ask to say, “Give the money back”? No. That’s not gonna happen. Yeah. That’s not gonna happen. You know what’s an opportunity here, Kara, I think SoftBank, which by the way, in the ecosystem, at least in New York, is showing up with a very, very big stick. Whereas these VCs with only billion dollar funds might offer you $30 million at a pre- of $60 [million], they show up and say, “We’ll put in $100 at a pre of $150.” And they were literally muscling around U.S. venture capitalists. They are. And they’re taking a lot of the companies, they’re taking 40 percent of the company. I think it’ll be interesting, because they have been a little muscle-y, I would say, and I think a lot of people don’t like it, but how can you ... What they have done is gone and said, “If you don’t take my $300 million, I’ll go and give it to your competitor,” and they’re very aggressive, they’re an aggressive group of people. And this is Masa Son, who is head of SoftBank. But I’ll be interested to see what’s going to happen going forward. Nobody is giving the money back. And a company like Slack, Stewart Butterfield who’s the CEO there, he usually calls back and he has not called back. So I think everyone at dinner was horrified and embarrassed, and at the same time, the money was not being returned, and they were making the point that anywhere you tug, at any company or any investment firm or any VC, there is either Saudi money or there’s questionable money everywhere, across the system. And if you remove the Saudis from the worldwide global network, everything collapses, because this is where much of the investment money ... And they’re trying to obviously buy influence in technology. And it’s working. Yes. Go ahead. The reality is, people 10 times as important as you and me can be murdered and dismembered with a bone saw, as long as you’re buying a bunch of aircraft carriers or submarines. We’ve basically put a price on ... I don’t know this, but I would speculate the conversation post- this event between Pompeo and Trump and the Saudi government there was like, “You guys obviously screwed up, we had nothing to do with this, but if you want us to be co-conspirators in the coverup, you’re gonna have to buy another 130 tanks,” or whatever it might be. We have put a price on moral leadership. And the presidents of the past have always tried to figure out the balance between the realpolitik and our strategic interest. This isn’t new. But we at least pretended to care, we at least said, “Okay, anything involving a bone saw, it’s time,” or I think it’s time, anything involving a bone saw... And by the way, I think this is the same infection that has called illness across all of Big Tech, we’re trading off long-term moral leadership in exchange for short-term profits. Well, it is. It’s interesting, but this is where the money is coming from. This is where the wealth is, this is where it is. So there’s two questions that people are going to be asking. Do they need this much money, do they need the $300? They probably don’t, they were fine with the smaller amount. They didn’t need it, but everybody feels like they need to have these war chests. They were like, if they have to have the war chest, we have to have the war chest. So that’s how these things escalate. And the question is, what companies are going to go, “No?” One interesting thing was, the previous Saudi investor was ... I can’t remember all their names, but he was an investor. He had Kingdom Holdings, and he was investing in Twitter, or Apple or different things like that, and he was just a basic investor, it wasn’t this PIF thing that was going on. And he was considered the “good” investor, essentially. He was one of the ones that was jailed at the Ritz, and then MBS took everybody’s money there. He basically took hostage money, I guess, from them. And some of that is what’s now flowing into Silicon Valley, which is fascinating. Of all the people that were jailed at the Ritz-Carlton, which is a strange thing to say. What the key part is is that Silicon Valley cannot say it didn’t know, it doesn’t know where this is from. Yeah. It’s 100 percent true. But I would argue that the companies, granted, are complicit in it, but at the end of the day, because of the structure of our capital markets, companies have a very difficult time not thinking short-term. But the reason we give 23 cents on the dollar to our government is we pay them to think long term. And the ultimate reason that people buy Fords or have bought Fords is not because they were better cars, but because it reflected a belief in the middle class. The reason people buy Nikes is it’s about elite excellence can bring you to the highest echelons of performance and recognition. And the reason why we have inflows of capital, the reason why our publicly traded stocks traded at 19 times PE, not 11 or 12 in other markets, is because we have rule of law and some sense of moral leadership here. And when we engage or traffic in bone saws, we are long-term trading off our brand and the margin power that comes from our brand. So this is not only the wrong thing to do, it’s economically a stupid thing to do. I would agree. But one of the things that’s interesting, the Saudis also have a lot of money in the stock market. So they own 5 percent of Tesla. Look, Elon Musk can’t stop them from doing it, although he was talking to the Saudis, as you know, when he did the “funding secured” [tweet]. That’s the PIF, who he was talking about. So that’s interesting. But Apple can’t help it, I think the Saudis own 30 percent of Snapchat at this point. There’s an enormous stake that they have, PIF does. It’s a large amount of a lot of these tech companies, and that’s what they’ve been buying into. Now, those you can’t prevent, it’s an open market situation. But you certainly can, even if these are your investors, say something. And most of these companies have said nothing, really. The strongest was Dara Khosrowshahi, but he has to because he has so much other money. And I think Sam Altman, who was an investor at Y Combinator, did say he’s not going to the Davos in the Desert event, whatever it’s called, but it’s the PIF thing. And a lot of people have pulled out. Steve Mnuchin’s still going, I think he’s going, right? Shocker. [editor’s note: shortly before this podcast was recorded, Mnuchin dropped out of the event] I think it’s him and ... that’s all that’s going. But I know all the tech people are definitely not going now, and they can’t show up there. But there’s got to be another step, they’ve got to start saying something like, they have to make some declaration even if they’re not gonna give the money back, but they haven’t. And this is the whole trend, is they now have to make declarations on everything. On everything that happens now, companies are on the hook for saying something. In this case, it’s such a bright line between what they have to say and how much money they’re taking from them. It’s unavoidable. So I’m gonna keep bugging them. Anyway. But it’s an opportunity. It’s an opportunity for SoftBank. I think one of the ultimate brand moves of the past year was actually at the World Cup, where the Japanese soccer team, a national team, after a crushing defeat at the hands of Belgium and Romulu Lucaccu — one of the most underrated strikers in the world, but that’s another story. Please don’t tell it to me. You know what they did? They cleaned up their dressing room, and they stuck behind and helped the fans and the workers clean up the stadium, and then they wrote a thank-you note. And I think we have unfortunately an ability, we can’t not stereotype organizations by their national identity. And I think SoftBank has the opportunity here to say, “The way we roll in Japan is we’re just a little bit more dignified, we’re a little bit more polite, we’re a little bit more honorable,” and to not accept that money and take the fund down from $200 billion to 120. Masa Son has not said a word. It’s an opportunity. I think he’s listening. I don’t think he is, I think he’ll say nothing. And Masa Son, I think this is an opportunity. We’ll see about that. Anyway, by the way, I have a Ford Fiesta, Scott, just so you know. I just can’t even imagine that. It’s a lawnmower with doors. We gotta get you out of that thing for safety reasons. I have a turbo stick shift, so let’s just try again, it’s a sports car. Turbo stick shift? That’s right, it’s very fast. You’ll see, you’ll drive it when you’re here with me, we’ll go around, it’ll be great. We’ll do Pivot from my ... I would have an elbow sticking out of each window. That would look ridiculous. No, you and I are going for a ride in my turbo. Everybody makes fun of my Ford Fiesta, and they get in it and drive, and they go, “Oh, this is a great car.” Just so you know. That’s cause they’re kissing your ass, Kara. They don’t really think that. It’s not, you’re gonna see, it’s gonna be great. That’s an awful car. We’re gonna do Pivot from the Ford Fiesta and we’re gonna get Ford to be our sponsor. You see, this is how this works. Anyway, let’s talk about something positive, a win of the week, because it’s been a crappy week, it’s a shitty week. So we’ve lost all over the place in the Saudi situation. Who’s your winner? No, what is your winner? What is your winner? My big winner? I have two. Okay. There was a wonderful article in the New York Times about a gentleman who was the head of the Japanese consulate in Lithuania during World War II and it ends up that him defying his government and refusing to stop signing and writing visas, literally until he could no longer write, and then when he was extracted from Lithuania, writing these visas for Jews who were trying to get to Japan and then to somewhere else. He, on his train ride out, was literally throwing visas out the window. And they’ve done some research and it ends up that this gentleman, Chiune Sugihara, likely saved 6,000 Jews, possibly 40,000 who are alive today. It’s a wonderful story of moral leadership in the face of adversity, moral heroism. Moral. There’s been some interesting research here that moral heroism stems from some of the same attributes, the rebelliousness that creates great entrepreneurs, and it’s just a lesson for all of us. It’s pretty obvious what the right thing to do is, sometimes it’s really, really hard. And this guy saved ... 40,000 alive today because of this guy. Just an inspiring story. And my second is Nike, who made ... You love that Nike. I’m so into Nike right now. Okay. I didn’t much like their sexual harassment stuff, but go ahead, move along. Rain on my parade, seriously. Just, I feel shamed. All right, go ahead, what did Nike do? So Justin Gallegos, a runner with cerebral palsy, who’s a pretty serious runner ... I feel bad, okay. Nike showed up and endorsed him, made him an official Nike athlete. And there’s this fantastic two-minute film on it. Granted, it’s commercial and sappy and soft lighting, soft music. But my feeling is the basis, and the wonderful thing about capitalism is as we pursue economic interests for us and our families, really wonderful things can happen. And I think this was such a wonderful thing. Scott, you’re such a softie. What, did you put the afghan around you and have marshmallows and cocoa? This is lovely, this is beautiful, I’m crying. Kara, hold me. Let me just, no, I will not. Thank you. Once again, crossing a line. In the Fiesta. Crossing that line, never changes, you. Listen, I had a win for the week. We were liking that Facebook had a tougher ban on false information posts, but of course what happened on Recode this week is they introduced the Portal, which we talked about last week. You guys broke this. Yes. When they said they introduced it, “No, no, we’re not using the data for ad targeting,” and then they called us back and what did they do? What do you know? Yeah, apps and who you’re calling, right? Yes. We are using the data for our targeting. Which was like, for one brief second, we were like, “Okay, we don’t love their surveillance device, but at least they’re not using it for ads.” And then they were. That was just awful, I have to tell you, just awful. But you know these guys, I don’t. What happened? I don’t know why they didn’t just throw it in the trash. They waited six months to put out the Portal and then they just did it right in the middle of a hurricane of privacy, I don’t know. I don’t know what’s going on there. Have you heard anything about initial sales or reception in the marketplace, have you heard anything? All I know is literally I had a table full of internet people say, “There’s no way I would put a dancing Facebook surveillance device in my home.” So I don’t know. And this was the, these people would buy it, but nobody at this dinner party was buying it. You know these guys, I don’t. What do you think happened, that they knew they were targeting and then they lied to you and said, “Okay, what do we do, we’ve lied, do we let the lie hold or do we have to ...?” Was it incompetence or deception? I don’t even know if it was a lie. They said one thing, I don’t know, I couldn’t tell you. I don’t think they were lying. I don’t know. I don’t have any information for you on this, it was just like, “What?” I’m telling you, Scott, they just have got to get it together down there, don’t you think? I’m so outraged I’m going to go express my outrage on Instagram. I don’t use it, I do not use Instagram. That’s it. Take that, Facebook. “Instagram is a museum,” as my children say. Anyway, we’re gonna go to predictions now. Mr. Galloway, some predictions? The individual throwing out the first pitch of the opening game for the Washington Nationals 2019 season is Jeffrey Bezos. Okay. Why is that? Explain. Imminently, they’re gonna announce that the D.C. metro area is the location of the HQ2, reflecting that this entire shitshow circus HQ2 is nothing but a ruse. That a man worth $145 billion at the age of 54 gets to live where he wants, where the Bezoses want to live is D.C. They’re coming to you. Do you know my ex-wife’s house is like seven doors down from him? It’s really interesting. So he’ll be a neighbor. Really? Are they close, do they know each other? Yeah. We all know each other. We knew him when he was a little guy. Yeah, sure. We’re not married anymore, but we’re friends, and I don’t think we’ll be going over for tea. I don’t see that happening. But neighbors, in this crazy neighborhood. I heard the house was bigger than the Museum of Natural History, it’s just enormous. My ex worked for Google, she’s got a big house. So does he. They’re all big. They’re all these big ... they look like the Bulgarian embassy, that’s what it looks like. They all do, every one. They’re big. They’re just big Washington houses, then they look like embassies, every one of them in that neighborhood. It’s called Kalorama. Obama lives there, Ivanka lives there, Rex Tillerson lived there, I think Mnuchin’s somewhere wandering around. I’d like to party with Tillerson. Yeah. Would you? Yeah. I think he, me and Zach Braff would just slay it in Adams Morgan. A few beers, me and Rex and chili. Where did Zach Braff come in? Oh my goodness. He’s always a good third partner when you’re rolling. He’s always a good third partner. Okay. All right. So you think he’s gonna pick Maryland, Virginia, for that thing. Oh, by the way, I have some insight, you get all the scoop. I was on the train back from D.C. and I saw, gosh, this really good guy, the [founding] dean of Cornell Business School, [Daniel] Huttenlocher, he’s on the board of Amazon, and I immediately thought, okay, that means he was down there extracting a pound of flesh from Mark Warner or someone in Virginia. Anyways, that’s my prediction. What’s your prediction? Okay. I think Maryland is probably a very good bet, and second backup is Pittsburgh. That would be my guess. You think there’s a backlash when everyone realizes they’ve been played? No. Everyone’s like, “Oh well, I didn’t win on that lottery ticket, let’s try again next week.” You know what I mean? I just think the whole thing ... to give one of the world’s richest men a tax break is always an enjoyable thing to watch. Isn’t it cute, though, how Indianapolis and Columbus actually think they have a chance? Isn’t that just adorable, if they think the wealthiest man in the world, who doesn’t need to spend 12 minutes much less 12 weeks a year in Indianapolis, is going to decide to put his HQ2 there? I think it’s just so cute. One can dream. One has hopes and dreams and things like that. Yeah, I think it’s probably gonna be located there. The only other option is if he picks a Canadian city. Yeah, that’ll happen. I’m just saying. That’ll happen. You never know. I’m just gonna put it out there so I look smart, that’s all I’m saying. Tied for first wealthiest person in the world is MacKenzie Bezos. After spending 10 months here in rainy Seattle, she’s gonna be like, “I know, we need to spend more time in Toronto”? It’s not gonna happen, Kara. And they’re not going south, you’re right. Yeah, you’re right. That’s a fair point. All right, okay. All right, well, we’ll see. It’s gonna be very soon. The dark horse is Miami, because I spoke after him at this JPMorgan Master of the Universe conference, and he was by the pool and I think he was really happy there. It’s nice there. Isn’t Miami great? Miami’s a hell of a place. I’ve been on the board of seven public companies, and I’ve gone through four headquarter relocation processes, you know what it always comes down to, in retrospect? What? You find out the CEO cloaked business reasons in the decision, and the decision all came down to one thing and one thing only, Kara. What, a pool? Where the CEO wanted to spend more time. Where he was chairman of a golf club or where his next wife was living. I’m gonna just leave it at that, except to say I love Miami. I always feel like doing something naughty when I’m there. Anyway, all right. So Amazon ... In the Fiesta, you’re rolling along Collins Avenue in your turbo Fiesta. Next week we’re gonna talk about Uber’s public offering. But not this week. I’m gonna leave it at that, Scott, the second wife thing. And I have to get out of here. Did we miss anything? I think we’re good, right? We’re good. Yeah. This feels right as rain. Saudis and Jeff Bezos. I would describe you, the Fiesta and this show as a tall drink of lemonade with vodka. Okay. All right, I don’t even know what that means. Thanks Scott, looking forward to talking again next week. By the way, if you have any questions for us on this podcast, shoot us an email at [email protected]

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Thiel is giving $1 million to the Club for Growth, a hardline conservative advocacy group. Peter Thiel has made his biggest political contribution since his divisive bet on Donald Trump in 2016, investing $1 million into a conservative advocacy group that is backing key Republican candidates before November. The donation to the Club for Growth, revealed Thursday in a new campaign finance disclosure, could be a signal that Thiel plans to re-assert himself as a political donor despite some unease with Trump. Thiel has been a fairly modest giver in the grand scheme of presidential politics, but his vocal and financial support of Trump in the last cycle made him a real political player in the early days of the Trump presidency. Thiel cut the $1 million check on Sept. 27, according to the disclosure. He has made contributions of about $350,000 to the Republican National Committee and other GOP groups and candidates earlier this election cycle. The high-profile investor and Facebook board member has voiced some discomfort with Trump since helping elect him and speaking at the Republican National Convention. “Obviously there are all sorts of things that are somewhat disappointing,” he said in March, “and at the same time, I don’t know how much one can expect.” Thiel moved to Los Angeles earlier this year — a change of address that he’s attributed to a revulsion to Silicon Valley’s politics and culture. In 2016, he gave $1.25 million to a super PAC sponsored primarily by New York hedge funder Bob Mercer — not a massive check in the world of big-money politics, but an amount that stood out in a Silicon Valley that heavily financed Hillary Clinton’s presidential run. The Club for Growth is a hardline conservative group that has gleefully challenged Republican incumbents in primaries. It has focused almost exclusively on fiscal issues, which should appeal to Thiel, who has described himself in the past as libertarian. A spokesperson for Thiel did not immediately respond to a request for comment.

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Third-party data puts its sales and customer retention below its peers. When Brandless launched in the summer of 2017, it aimed to disrupt the $760 billion U.S. consumer packaged goods industry by offering low-cost, high-quality home products and non-perishable foods. So far, that disruption hasn’t been felt by major CPG retailers. The startup now sells more than 350 “better-for-you” products, ranging from non-GMO gummy candy to stainless-steel can openers, most priced at $3. They are banking on millennial buyers who want more transparency in their products and who believe in Brandless’ mission, which it advertises as “deeply rooted in quality, transparency, and community-driven values.” This summer, the company received $240 million in funding from SoftBank’s Vision Fund, which valued the company at over $500 million. For a consumer-focused company as young as Brandless, that’s an incredibly rare and large investment (and why we’re paying attention to a fledging e-commerce brand). It’s also risky, since Brandless has entered a highly competitive space with little room for error. On the competition front, Amazon continues to expand its Amazon Basics line of products — which total more than 1,000 today —and Walmart’s Jet has its own brand called Uniquely J. Just this month, Target announced 70 items under its own label, Smartly, which cost just $2 each — undercutting Brandless’ $3 price point. Thus far, Brandless doesn’t have a notable market share in any of its product categories. Perhaps more importantly, people who do buy from Brandless don’t seem to be purchasing from them again at the same rate as some of its competitors, according to data from two third-party sources. Of customers who bought from Brandless for the first time in the final quarter of 2017, 20 percent made another purchase in the following quarter and just 13 percent bought something three quarters later. That’s according to new data from Edison Trends, which tracks email receipts for three million U.S. consumers. For the following charts we looked at data for new Brandless customers in Q3 and Q4 of 2017 so we could view several subsequent quarters of data. People who’ve made their first purchases in more recent quarters had levels of retention similar to these. if("undefined"==typeof window.datawrapper)window.datawrapper={};window.datawrapper["TxFmd"]={},window.datawrapper["TxFmd"].embedDeltas={"100":718,"200":617,"300":575,"400":550,"500":550,"700":533,"800":533,"900":533,"1000":533},window.datawrapper["TxFmd"].iframe=document.getElementById("datawrapper-chart-TxFmd"),window.datawrapper["TxFmd"].iframe.style.height=window.datawrapper["TxFmd"].embedDeltas[Math.min(1e3,Math.max(100*Math.floor(window.datawrapper["TxFmd"].iframe.offsetWidth/100),100))]+"px",window.addEventListener("message",function(a){if("undefined"!=typeof a.data["datawrapper-height"])for(var b in a.data["datawrapper-height"])if("TxFmd"==b)window.datawrapper["TxFmd"].iframe.style.height=a.data["datawrapper-height"][b]+"px"}); That puts Brandless in line with Walmart.com and Target.com, which might seem like good company, but those retailers still do the vast majority of their sales in brick-and-mortar stores. That makes their online retention rates not quite as critical to current success, though they’d certainly prefer higher retention rates as well. But Brandless’ retention rates fall far below those of Amazon, Instacart or even Thrive Market, another young better-for-you e-commerce retailer that specializes in discounted natural and organic goods. Brandless, a private company, would not provide any data but said their internal numbers paint a better picture. Edison’s retention levels, however, were consistent with data from Second Measure, a firm that analyzes billions of dollars worth of anonymized debit and credit card purchases. Second Measure found that only 11 percent of new Brandless customers in Q3 2017 were still making purchases a year later. Last quarter, Brandless customers made an average of 1.34 transactions. if("undefined"==typeof window.datawrapper)window.datawrapper={};window.datawrapper["tJVW0"]={},window.datawrapper["tJVW0"].embedDeltas={"100":718,"200":617,"300":575,"400":550,"500":550,"700":533,"800":533,"900":533,"1000":533},window.datawrapper["tJVW0"].iframe=document.getElementById("datawrapper-chart-tJVW0"),window.datawrapper["tJVW0"].iframe.style.height=window.datawrapper["tJVW0"].embedDeltas[Math.min(1e3,Math.max(100*Math.floor(window.datawrapper["tJVW0"].iframe.offsetWidth/100),100))]+"px",window.addEventListener("message",function(a){if("undefined"!=typeof a.data["datawrapper-height"])for(var b in a.data["datawrapper-height"])if("tJVW0"==b)window.datawrapper["tJVW0"].iframe.style.height=a.data["datawrapper-height"][b]+"px"}); Retention matters especially for companies like Brandless because it trades in inexpensive goods that need to be repurchased frequently. Low customer retention means customers aren’t coming back. “They are new and building awareness and therefore focused on customer acquisition, so their [retention] number won’t be anywhere near a mass merchant’s,” said Sucharita Kodali, VP and principal analyst at Forrester Research. This problem, of course, is not unique to Brandless. “Across most commerce sites, overwhelmingly purchases are one-time,” according to Jason Goldberg, SVP of commerce at digital marketing agency SapientRazorfish. “Every time I have a new client the problem is, how do we move from one purchase to two? How do we develop a habit around buying that product?” Brandless’ limited offerings, however, hinder it in that department. A person shopping on Amazon or Walmart.com or Target.com might buy kitchenware one month and a TV the next. Big-box stores carry about 100,000 products while Amazon sells hundreds of millions. It’s difficult to compete in scale. “If you only have one kind of thing, it’s less attractive for everyday use or every quarter use,” said Noble Kuriakose, VP of data at Edison. And versions of Brandless’ products, while inexpensive and purportedly of better quality, can be found at all its competitors. The company also doesn’t sell fresh-food products, which are more difficult to store and transport but need to be purchased more frequently. Brandless finds itself in the uncomfortable middle ground of not being niche enough and not being broad enough — yet. It is, however, trying distinguish itself with wholesome ingredients and progressive politics. “The key for Brandless will be whether they’ll be able to stay true to their purpose over time as they extend their product assortment and deliver more comprehensive offerings,” said PwC Consumer Markets Leader Steve Barr. if("undefined"==typeof window.datawrapper)window.datawrapper={};window.datawrapper["fOnUH"]={},window.datawrapper["fOnUH"].embedDeltas={"100":297,"200":247,"300":247,"400":222,"500":222,"700":222,"800":222,"900":222,"1000":222},window.datawrapper["fOnUH"].iframe=document.getElementById("datawrapper-chart-fOnUH"),window.datawrapper["fOnUH"].iframe.style.height=window.datawrapper["fOnUH"].embedDeltas[Math.min(1e3,Math.max(100*Math.floor(window.datawrapper["fOnUH"].iframe.offsetWidth/100),100))]+"px",window.addEventListener("message",function(a){if("undefined"!=typeof a.data["datawrapper-height"])for(var b in a.data["datawrapper-height"])if("fOnUH"==b)window.datawrapper["fOnUH"].iframe.style.height=a.data["datawrapper-height"][b]+"px"}); Currently, online shoppers are also spending less on Brandless goods than at its competitors. The average Brandless order size was $34 last quarter, according to Edison. That’s below its peers and even below its own free-shipping minimum of $39 for non-members. Small shopping carts wouldn’t matter as much if customers were coming back frequently. But they’re not.

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The high-profile tech exec was critical of the initiative as late as this summer, according to July emails sent by him and seen by Recode. Over the last few weeks, Salesforce co-CEO and chairman Marc Benioff has cast himself as the champion of a homelessness measure that would raise taxes on San Francisco tech giants, including his own company. It’s an appealing message of selflessness — the high-profile tech executive willing to forfeit some money in order to help raise $300 million to protect the city’s most vulnerable people. Salesforce is the city’s largest employer and Benioff has been one of the city’s most generous and prolific philanthropists. But privately, Benioff has at least at one point been more critical of the initiative, according to late July emails sent by him and seen by Recode. In the emails, he voiced concerns about the tax increase assessed on corporations and the $300 million that San Francisco says it already spends to combat homelessness. Benioff’s top government affairs aide, Jim Green, was also included in the emails, and Green later would participate in August conference calls centered around an alternative plan, according to a person with knowledge of the calls. Benioff did not personally participate on the calls, which came at a time when he has said he was trying to raise private money to solve the homelessness problem. People are, of course, allowed to change their mind. While Benioff never explicitly states in the emails that he would oppose the measure, he brings up only negative impressions when asked for his initial thoughts. But he wrote that he did not know how public he’d be with any opposition to it. In an interview Wednesday with Recode, Benioff said he reads 500 to 600 emails a day and could never recall a time when he straight-up opposed the measure. He did acknowledge that, after a vacation for much of June, he didn’t really know what Proposition C, as it’s now known, was until September. “I know I definitely hadn’t studied it or hadn’t done any deep work,” he said. “Because I do so many emails with so many people, I could be responding to things where I don’t even know what I’m responding to.” The emails matter because Benioff has cast himself as part of a new wave of tech philanthropists and as one of the city’s corporate leaders. And, as someone who has aggressively pushed other business leaders to be more financially charitable, he has left little room for any equivocating — painting a stark, personal portrait of the supporters and opponents of the measure, which is quickly gaining national attention. Benioff said earlier this week that city leaders could only be “for the homeless” or “for yourself.” San Francisco has been know for having one of the country’s worst homelessness problems. Proposition C would impose an additional tax on corporations with more than $50 million in revenue to support things like expanded mental health treatment. Benioff added that he continues to share those economic concerns that he expressed in July. “Who cannot have those concerns?” he said. “I have those concerns too. But I’m much more concerned about the homeless than I am about those questions.” Benioff, who helped raise $37 million for homeless families, has long been an outspoken advocate for the homeless; his local philanthropy is laudable. He has loudly voiced frustration with other tech billionaires for their lack of charity to the city they operate in and he has previously called for more government intervention only after feeling that the private sector was not doing enough. What also changed since July: A report from the City Controller’s office that Benioff said was the key driver of his decision. That report, released in late September, convinced Benioff that the economic impact of the tax increase would be smaller than he feared. “We didn’t make any decisions until we saw the Controller’s report,” Benioff said. “That’s what really swayed me.” Salesforce said in mid-July, prior to the email seen by Recode, that the company was “evaluating the ballot measure to carefully assess its merits in addressing this important issue.” During the month of September, Benioff said he was closely consulting with new San Francisco Mayor London Breed — along with his late-night conversations on Twitter with a local bookstore owner, Christin Evans. Breed declared her opposition to the measure this month, noting that the city should do a better job with its existing homelessness resources. Benioff said that he was in touch with Breed as recently as Wednesday, despite being on opposite sides of Proposition C. Benioff went public on Oct. 8. Whatever his position, the Salesforce CEO’s involvement has focused national attention on the homelessness issue, especially given that other prominent tech CEOs — such as Twitter’s Jack Dorsey — are publicly opposing it. Benioff told Recode he was “grateful” for the public bickering with the Twitter CEO. Marc: you’re distracting. This is about me supporting Mayor @LondonBreed for *the* reason she was elected. The Mayor doesn’t support Prop C, and we should listen to her. I support the Mayor, and I'm committed to helping her execute her plan.— jack (@jack) October 12, 2018 “Nobody cared about anything,” Benioff said, “until he commented.”

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The days of Wish building its company on the back of artificially low shipping rates may be over. Wish CEO Peter Szulczewski built an $8 billion e-commerce juggernaut on the back of bargain-basement pricing made possible by cheap shipping rates for low-weight goods sent to the U.S. from China. But now, the Trump administration is threatening to withdraw from the United Nations agency that oversees those rates — throwing the future into question for one of the few U.S. online retailers to grow to a mass scale in recent years, even as Amazon’s dominance has expanded. Yesterday, the White House said the U.S. intended to withdraw from the Universal Postal Union over the next year and move to set its own rates if it can’t negotiate terms it felt were fair. The current rate structure, developed originally to help developing countries, was created long before China grew into a manufacturing and exporting powerhouse. The Trump administration has argued that the cheap rates give Chinese manufacturers and merchants an unfair advantage over their American counterparts, and have resulted in scenarios where it is at times cheaper to ship items from China to the U.S. than it is from one part of the U.S. to another. The two countries are currently engaged in the early stages of a trade war. A Trump administration official also told the Wall Street Journal yesterday that China’s subsidized rates cost the United States $300 million a year. For Wish, the threat of postal rate hikes sound like a big problem for now — even if the rhetoric turns out later to have just been a negotiating tactic. The company hosts an online bazaar where shoppers across the globe can browse a giant catalogue of cheap, predominately unbranded goods, from $11 sweatpants and $1 “Make America Great Again” hats to $14 binoculars. Most of these goods are shipped from China. Today, U.S. customers account for around 30 percent of Wish’s billions in gross annual sales, Szulczewski said in an interview. And about 70 percent of those U.S. orders are shipped directly from suppliers — drop shipped, in industry vernacular — to the United States Postal Service, which handles final delivery to customer homes. This arrangement takes advantage of the low China-to-U.S. postal rates that are currently intact. Those rates have been a big reason why $1 shipping fees are possible on Wish, or why a Chinese merchant can make money selling a sub-$10 item that is shipped across the globe. Without the cheap shipping rates, Wish may have to raise prices, perhaps impacting customer appeal. Szulczewski, however, insists the company has been planning for this day. “If this happened two or three years ago — maybe even last year — we would be in trouble,” Szulczewski said in an interview with Recode. “If drop shipping went away overnight, that’d be tough. But we’ve been preparing for this for a long time.” That preparation has involved investing in the buildout of three warehouses in the U.S. where the company stores some of its best-selling goods. The main goal of those investments has been to cut down on how long customers have to wait for the most popular items — from several weeks in some cases to several days when stored in the U.S. But this initiative also reduces the company’s dependence on the artificially low, cross-globe shipping rates that Wish relied on for its early success. In these instances, Wish uses freight-forwarding services to ship these items in bulk from Chinese merchants to Wish’s U.S. warehouses. When a customer places an order for one of these items, it is then shipped within the U.S. using U.S. carriers and normal rates. “The difference between us and much smaller competitors is we have the infrastructure to freight-forward all these goods and the capital to finance these operations,” the CEO said. Wish is still a privately held company, but has raised $1.3 billion from venture capital investors. Companies like Shopify and eBay, as well as Alibaba’s AliExpress business, also rely on merchants who use China-to-U.S. drop shipping for significant business. Amazon does to a lesser extent. “Ironically, this helps Amazon and Bezos,” Szulczewski noted, alluding to Trump’s publicly expressed disdain for Amazon and its leader. The companies declined to comment. For Wish, there are still real challenges to its warehouse approach serving as the company’s answer to the cheap-China-postage predicament. For one thing, around 70 percent of Wish’s U.S. business still does not go through its warehouses — meaning those orders take advantage of the current shipping rates in question. That’s a lot of business to move from one logistics method to another. That leads to another obstacle: Convincing the merchants responsible for that 70 percent of volume to send bulk orders of inventory to Wish without being paid upfront. “These merchants will not be comfortable with just putting $7 million of inventory in Kentucky,” Szulczewski conceded. So Wish will have to pay some fraction of the total inventory value upfront, and then trust its forecasting to promise merchants it can unload all of the items being stored — and to pay the merchants for any inventory that goes unsold. Wish does this in some cases today, but scaling such moves could put a crimp on margins. As for the idea that the U.S. is losing $300 million from the current arrangement, Szulczewski offered up a personal fix. “Come on,” he said. “I will pay that. Wish will pay that.”

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Plus, Canada celebrates legalizing recreational pot nationwide; your next doctor’s appointment might be with an A.I.; here’s the math on whether you should buy a Mega Millions ticket today. The Democratic National Committee has undergone a massive cybersecurity overhaul since the 2016 U.S. election. Led by chief technology officer Raffi Krikorian, whose resume includes senior roles at Uber and Twitter, the DNC has been hiring tech talent from Silicon Valley and training staff to spot suspicious emails and signs of hackers targeting the party. Still, the DNC faces an enormous challenge in recovering from the damage inflicted by the hacking of emails, strategy documents and other internal records in 2016, which U.S. intelligence agencies have said was part of a Moscow-backed effort to help President Donald Trump win the White House. [Eric Geller / Politico] [Want to get the Recode Daily in your inbox? Subscribe here.] Meanwhile, Twitter is publicly releasing all known accounts and posts mostly related to Russian and Iranian disinformation campaigns on the site dating back to 2016, including tweets and images, to encourage independent analysis by outside researchers, academics and journalists. More than 10 million tweets, two million images and videos and over 4,600 accounts, will be available for download on the platform’s “elections integrity” page [Makena Kelly / The Verge] Jamal Khashoggi’s last column for the Washington Post calls for free expression and a free press in the Arab world — “a modern version of the old transnational media so citizens can be informed about global events.” Khashoggi, a Saudi dissident journalist, is believed to have been murdered in the Saudi consulate in Turkey two weeks ago, which has become a huge global story. “This column perfectly captures his commitment and passion for freedom in the Arab world,” his editor Karen Attiah writes. “A freedom he apparently gave his life for.” [Jamal Khashoggi / The Washington Post] Canada is now the second country in the world to legalize recreational cannabis nationally (Uruguay was first). As a result, Canada has become the frontrunner in the legal-weed industry, giving it a massive head start in a global pot market some peg at $150 billion. Medical marijuana has been legal in Canada since 2001, but it’s only been about four years since the first cannabis companies began to list on Canadian exchanges. In that short time, about 140 pot companies have gone public in Canada, with a combined market value of more than C$60 billion ($48 billion). Here’s a glimpse at how Canadian’s celebrated after the “bud drop” at the stroke of midnight on Oct. 17; here’s a look, in charts and maps, of the impact of marijuana on the country. [Natalie Wong, Kristine Owram and Doug Alexander / Bloomberg] Mark Zuckerberg and Sergey Brin are among the tech billionaires who have funded an award to make scientists into stars. The Breakthrough Prize carries a no-strings-attached $3 million award — more than double the amount of the Nobel Prize; part of the prize’s goal is to bring wider appreciation to the work of scientists. Among the winners announced yesterday are immigrants to the U.S. from China, Austria and Uruguay; a Harvard professor working on a Google Map of the 30 trillion cells in the human body; and a mathematician based in Grenoble, France, at work on clean energy technologies. [Reade Pickert / Bloomberg] Your next doctor’s appointment might be with an AI. A new wave of chatbots, designed to relieve your doctor of needless paperwork and office visits, are replacing physicians providing frontline medical advice. The tech — used by U.K. companies including Babylon Health, Ada, Your.MD and Dr. AI — is built on a grab bag of AI techniques: Language processing to allow users to describe their symptoms in a casual way, expert systems to mine huge medical databases, machine learning to string together correlations between symptom and condition. But are the robot doctors as good as the real thing? [Douglas Heaven / MIT Technology Review] The jackpot for tomorrow’s Mega Millions lottery has ballooned to $900 million; if someone wins on Friday, it will be the second-largest jackpot in U.S. lottery history. Mega Millions has existed in some form since 1996; here’s how lottery officials have tweaked the rules and odds of the game to make jackpots pay out less frequently, spurring their monster growth. Business Insider did the math to see if you should buy a ticket today. [Alex Horton / The Washington Post] ELON WATCH: ”Tomorrow brings a lemur” TRUMP WATCH: ”The assault on our country at our Southern Border, including the Criminal elements and DRUGS pouring in, is far more important to me, as President, than Trade or the USMCA” KANYE WATCH: [drawing] Top stories from Recode The media is responsible for President Trump and it still hasn’t learned from 2016, says Rolling Stone’s Matt Taibbi. On the latest Recode Media, Taibbi says the difference between the campaign and today is “we replaced one million hours of Trump with one million hours of ‘Trump is bad.’” This is cool High-tech anti-distraction blinkers for humans. Everything is happy at Bob Ross Inc. and: How China rips off the iPhone and reinvents Android

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Taibbi says the difference between the campaign and today is “we replaced 1,000,000 hours of Trump with 1,000,000 hours of ‘Trump is bad.’” Rolling Stone contributing editor Matt Taibbi’s latest book, “The Fairway,” is all about “how mass media keeps thought inbounds.” And as someone who has covered U.S. politics for the past four presidential campaigns, he’s not convinced that the media has changed in any significant way since 2016. “You’ve seen a lot of quasi-reflective changes in the media” since Trump’s election in 2016, Taibbi said on the latest Recode Media. “One thing you haven’t seen is less coverage of Trump, like we’re doing more of it and we’re more profitable than ever. And that’s because this is what sells.” “We replaced 1,000,000 hours of Trump with 1,000,000 hours of ‘Trump is bad,’” he added. “... We took a lot of heat during 2016 for giving him billions [of dollars worth] of free coverage and we had this fork in the road, like, are we going to cover him less, or are we going to cover in the same amount but in a different way? And then we chose Door No. 2.” So far, Taibbi told BuzzFeed’s Steven Perlberg, he’s not convinced that journalists have accepted responsibility for “dumb[ing] down the process long before Trump even ran for president,” turning presidential elections into a reality show. And they may be over-estimating their understanding of regular people who voted for Trump. “We’ve come up with a lot of explanations that are shorthand for us, but not for them,” Taibbi said. ‘All of Trump’s voters are racist and they’re all sexist and that explains everything.’ Well, that’s a big part of the picture but it’s not the whole picture.” “When we told him that his behavior was unacceptable and he should no longer be in the race after the McCain thing, he just blew it off and said, ‘I didn’t say that,’” Taibbi added. “And his followers loved that, precisely because they hated us so much.” You can listen to Recode Media wherever you get your podcasts — including Apple Podcasts, Spotify, Google Podcasts, Pocket Casts and Overcast. Below, we’ve shared a full transcript of Steven’s conversation with Matt. Steven Perlberg: This is Recode Media from the Vox Media Podcast Network. I’m Steven Perlberg, I’m in for Peter Kafka. I’m a media and politics reporter at BuzzFeed News and I’m here in the Vox Media Studios today in New York City. Let me first say something that Peter usually says, which I’m sure you’re all familiar with. Please tell someone else about the show. Thank you very much. So today I’m really excited to be in the studio with Matt Taibbi. He’s a contributing editor at Rolling Stone. He’s the author of several books and he’s the author of a new book called “The Fairway” that he’s releasing as an email newsletter. It’s very 2018 way to release a book. Matt, welcome to Recode Media. Thanks very much for having me. So, lots to talk about, but seeing as this is a podcast that focuses on the business of media, I want it to start with your new project. You’re releasing a book and some of your writings on Substack. For our listeners who aren’t familiar with that platform, what is Substack and why did you start working with them? It’s an email subscription site where there’s all sorts of content, lots of different kinds of writers who are essentially sending out emails of content on a regular basis. And when I was approached to do this, the only room in my contract at Rolling Stone that wasn’t covered was books. So I thought that it would be really interesting to do something that I’ve always wanted to do, which was serialized books, try that out. I think in the internet age, it may be a new way for people to experiment with different kinds of content they wouldn’t otherwise get to try because we’ve always had this middleman, whether it’s a publisher at a magazine or a newspaper or the book publisher. This allows you to directly go to the reader and allows me, after decades in the business, to play around with things that I wouldn’t get to do normally. All right. And you’re sort of the ... in a little bit of a rare case where you’re like a magazine writer, but with a national profile. So you have an audience that might say, “I’m willing to pay.” And what is it, like $5 a month for your work? Exactly, yeah. The book that you’re serializing, can you describe it? Because it’s a little bit different than some of the work that you’ve done in the past? It’s fiction, right? Sure. Yeah. Well, the first one I did was called “The Business Secrets of Drug Dealing.” And this was a project that came about because I had a longtime friend, somebody I’d met in the course of my work as a journalist, who kind of came out to me after a few years as a high-level marijuana kingpin, basically. And so we sat down and tried to figure out a way that we could tell that story. Now, he’s never been arrested on a drug charge, so he had to be anonymous, and we ended up co-writing what’s essentially a fictionalized version of his adventures. This was a new kind of writing for me because what we really did is we sat down and I interviewed him over and over and over again, hundreds of hours, probably. And then we just took the best details and sort of reconfigured them into a narrative. And it was cool, it was a lot of fun, and it’s his voice. If you read the book, it comes out as him, not me. The process for you is similar to reporting, right? Oh, yeah. Some similar sort of process but different kind of form. Well, yeah, it was a different form, and then there was the additional thing where a lot of it, it really is fictionalized, which is something that was completely new for me. And that was really a collaborative process with me and this unnamed African-American drug dealer. We sat down and figured out how would it go, how would a meeting, how would a buy like this go, what would happen if you stiff this kind of person on a deal? And that was a lot of fun. And when I sat down to write it, one of the things that was really interesting to notice was that the pace of the writing was a lot faster than my own. And I’m somebody who tries to write in a way that’s very fast. So, it was a lot of fun. It was a blast to do. It was as much fun as I’ve had writing, in my career. As someone who’s so familiar with what it’s like to work at a magazine, someone who’s worked at a media startup, I think you’re seeing a lot of reporters now and different writers looking at email newsletters or at least ways to say like, “I have an audience, let me monetize it direct to my reader. I don’t trust Facebook, I don’t trust Google. I don’t trust, like, large media organizations.” What was that experience for you like? How has that been different than working in sort of the traditional media landscape? Well, first of all, your audience isn’t given, right? You have to earn it. You have to earn it. And the price point is high enough that it actually has to be pretty good material for people to stay. When I write something for Rolling Stone, X number of people are going to see it every time no matter what I do. This is different. And it’s also, you’re not writing with the same kind of immediacy that’s behind periodical journalism. Like when you are responding to something that’s in the news, people are already primed mentally for that experience because it’s already in the ether, right? There’s this feeling of, “this is in the air right now.” When you’re sending something to somebody by email once a week, right? And it doesn’t come when the event happens, but it comes on schedule and it’s something that’s more reflective. That’s a much harder thing to do. It’s kind of funny that the email newsletter has endured in the way that it has in the media business where it is still actually a pretty lucrative business model. There has been this return to the email newsletter over the past few years. That is sort of interesting and I think you see writers embracing that. I think there’s a lot of reasons for that. It pops up in your inbox, it’s for you. Right. And it’s not in your feed. You chose it and that’s a big part of what’s going on in the media that people can’t stand right now is the manipulation that goes on and what the algorithms at platforms like Facebook ... You’re walking along, you’re hanging out with your kids, and all of a sudden your phone buzzes because Facebook has decided that you need to see this equilibrium-upsetting headline about something. People actually, even though they do it, even though they do look at the headline and they do spend hours and hours and hours scrolling through stuff, there’s a part of them that hates it. And that then that wants to make the choice to pick up something the same way they used to pick up the newspaper whenever they felt like it. Right. One of the things that you’ve written about and you’ve written about for “The Fairway” on Substack, is cable news. And much like the magazine business, very much changing. But in a way, cable news is sort of more important than ever before. We have a president who is obsessed with it. Even though the industry at large is facing all these challenges like an aging population and cord cutting. How do you think cable news is handling the Trump moment? Terribly. You’ve been critical, why is that? And how? For a variety of reasons. First of all, the cable era was enormously responsible for the Trump era. Let’s start with that, right? I mean, you have to go way back in history to see all these changes. I grew up in the media and my father was a television reporter, so I watched all the different stages of change in television reporting. And the 24-hour news cycle had a profound effect on the way we cover news because now there was a new emphasis on not doing one-, two-minute hit a day on something you felt was interesting, but instead we found stories that were visually appealing and that could string people along for hours. The classic example is a baby falling down a well or a disaster or something like that. We’re like, “Oh, well, what’s gonna happen next?” And the campaign was ... it turned into a story where we trained our audiences to be like, “You can’t turn off the station because anything could happen at any given moment.” Right? Because there’s so much coverage of like a Trump rally and ... This was before Trump, even before — I’m sorry to interrupt. No, no. Even before Trump, we did so many hits about this stuff and we micro-analyzed every tiny little thing and told people that it was all important. And then Trump comes along and we had created a bad reality show. Trump was a good reality show. He was somebody who created insane, crazy, horrible drama, and we, of course, we couldn’t resist putting it on television at all hours because it was perfect. It was perfect for this — sales-wise for the medium. And the one thing that you haven’t seen since Trump has become president — and you’ve seen a lot of quasi-reflective changes in the media — one thing you haven’t seen is less coverage of Trump, like we’re doing more of it and we’re more profitable than ever. And that’s because this is what sells. Right? I mean, I remember Michelle Wolf at the White House correspondents dinner, one of the things that she said that was sort of overshadowed by the Sarah Sanders controversy was like, you should be thanking Trump, he’s... Of course. And it’s a criticism that Trump has said as well, I do think that you’re starting to see cable news executives ... This week, for instance, Fox News didn’t take either Trump rally live, they went back to it. Obviously, they’re still covering Trump, everyone is wall-to-wall, but it seems like news executives are starting to look at things like Trump rallies — which there are a lot right now, it’s ahead of the midterms — and saying like, “How much airtime, just live airtime, should we really give to this guy?” Because CNN got absolutely killed by the media press for — and a lot of people — for just kind of giving him all the free airtime during the ... Yeah, my take on that is that this is a superficial change. It’s the way I put it is, we replaced 1,000,000 hours of Trump with 1,000,000 hours of “Trump is bad.” Right. And we just took what we were doing and we added on this new thing where we’re openly against it and we’re adding this new editorial take on it. And do you think, from sort of the Russiagate perspective or just writ large? No, writ large. Trump has earned that kind of treatment by reporters and I get that, but I think that there are both commercial and ethical reasons why we’ve decided to take this switch. I think what happened after, and I wrote a lot about this and of the next chapter of “The Fairway,” it’s, we took a lot of heat during 2016 for giving him billions [of dollars worth] of free coverage and we had this fork in the road, like are we going to cover him less or are we going to cover in the same amount but in a different way. And then we chose Door No. 2, and rather than then had this reckoning after the election, like, “My God, 40 years of dumbing down the campaign process led us to this.” Instead, the new thing was, “Oh, democracy dies in darkness. We’re going to be the intrepid crusaders.” Trump like ... Come on, we brought this about, we dumbed down the process long before Trump even ran for president. And we haven’t reckoned with that. Do you think that democracy dies in darkness? Like Marty Baron likes to say, “We’re not at war, we’re at work.” There’s this sort of renaissance of traditional media right now with the Times and the Post, but in a way the Times and the Post, these traditional media outlets, feel ill-equipped to handle the Trump moment. As soon as right-wing Twitter trolls are on them, they’re like contorting in ways that they don’t understand that maybe people are operating in bad faith. What is your outlook on the traditional newspapers and how they are handling this moment? Because it’s been good for business, but at the same time it’s been fraught. It’s been great for business, which makes me skeptical of all of these changes because I look at it in much the same way that I look at the way the Democratic Party has responded to the Trump phenomenon. After the election, there could have been this come-to-Jesus moment where we said, “Wow, how did we lose all these voters?” Right? “Let’s go back and figure out what it is about our pitch to people that isn’t working.” And so instead of spending the last two years coming up with a New New Deal that might’ve been more appealing to ordinary people, we instead — they doubled down on “Let’s focus on Trump’s negativity. Let’s investigate and let’s do all these other things,” right? So Trump was always at the center of the picture. Whereas, I think there’s a bigger picture about what journalism’s mission is, right? Like, you’re not seeing more stories about poverty or important issues, what you’re seeing is a new twist on Trump. And that’s why I’m skeptical about all of those, because people like me have forever struggled to get certain kinds of content into the press. And it’s now even harder because everything has to have a Trump angle to it. Right. I want to read something that you wrote recently about this. You said, “People should trust reporters. It’s the context in which they’re operating that’s problematic. Now more than ever, most journalists work for giant, nihilistic corporations whose editorial decisions are skewed by a toxic mix of political and financial considerations. Unless you understand how those pressures work, it’s very difficult for a casual news consumer to gain an accurate picture of the world.” That’s sort of like what we’re talking about. But I’m curious, what is the pressure? I mean, I’m a reporter. I cover politics and media. Nobody’s telling me like, “Hey, you need to take down Trump.” I mean, that’s just not how we work. No, it doesn’t work like that. It doesn’t work like that. My mandate is to break news and write features of impact and guest-host the occasional podcast. But what do you see as the sort of perverse pressures on reporters right now? It’s drilled into you from the beginning, from the first days of you enter into the business, you just get, you learn on a sub-intellectual level to guess what kinds of stories fly and what kinds of stories don’t, right? If you want to do a 10-part series on why private equity people don’t pay a whole lot of taxes or the seven different ways that they evade taxes, it’s an important story, right? And it’s an interesting story. I keep hearing about it often, very often. But compared to any kind of story that has a Trump angle to it, it’s just not going to sell as well. All right. So this is in the back of your mind whenever you’re talking to your editors, whenever you’re thinking about what you’re going to pitch to editors, you just know that a certain kind of story is going to be met with, “Meh, yeah, maybe.” Right? And the other stories are going to be like, “Yeah, let’s do it today.” Right? How do you get to a place where that kind of journalism can be backed by a successful business model? I mean, is it something like the email newsletter business or a ProPublica-type model? Because there are important stories about poverty. I think about this all the time with, like, climate change. It seems like every year there’s one big magazine piece about climate change that goes viral and everyone’s like, “Oh my God, have you read this?” And then like nobody talks about it on Twitter for another year. And then there’s another one the next year. So there’s got to be some way people do want to read that stuff. They do want to read about poverty. They do. I’m not asking you to solve the media business here, but is there a business model that makes sense? Where you can do that kind of work, pay journalists a good wage, get people to read it and everyone’s happy. Well, that’s the million-dollar question. I think on the one hand there’s always been some kind of subsidy that has figured into journalism work. Like the original bargain of the public interest standard basically said, you can use the public airwaves to have a TV station and do TV news as long as you promise to reinvest some of your profits from your dumb stuff back into real journalism. And for a while we did that, right? And then we started to drift away from that in the ’90s. There were other subsidies that figured in. If you go back to the very beginning, we allowed newsletters to have free postage, right? Once upon a time. But in addition to that, journalists need to find strategies to kind of sneak past important content, past this problem. For ages — when I was doing the financial services stuff, I used a lot of storytelling techniques. I tried to take stories about Wall Street and create villains and heroes, recognizable faces, use wild language, metaphors, all that stuff. And that sometimes will get you past the threshold of getting people to read it. Or you need some sort of benevolent billionaire to come in and buy your publication and pump resources into it. Of course. I worked for Jann Wenner throughout this entire time. If you have an eccentric rich person, who’s willing to be like, “Yeah, sure, do that,” that’s another way to do it. It’s just not a business model that you can count on. Right. So you mentioned the financial crisis. I started reading your work — not to make you feel old or anything — in college during the financial crisis, and you came to a lot more national prominence writing about politics and the financial crisis. You famously wrote that Goldman Sachs is a “great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money,” which became a famous famous line of yours. It’s been 10 years since the financial crisis. Yep. You wrote a story recently saying economically, nothing’s changed, and we’re still in the same situation. I wonder, since this is a media podcast, media discussion, what are the lessons that the financial press or the press learned at all from the financial crisis? Ten years on, do you see anything there? I mean, a little tiny bit, but not really. I think the big obstacle that I had with that story — and again, I was really lucky that I had editors who thought it was interesting and we got a response early to this stuff. But the reason that we got a response is because what we were doing was basically translating the kind of incomprehensible language of the financial press for ordinary people. That was essentially what it was. It was, if you pick up the Financial Times, you won’t understand what a credit default swap is. Right, what subprime mortgages are. Yeah. And Rolling Stone can kind of explain that in a way where an average reader can say, “Okay, now I get it.” Yeah, exactly. And the sort of metaphors you’re using. Right. But it’s still, you’re saying that the financial press is still unintelligible to that reader. Yeah. It’s not aimed at the ordinary person, right? If you pick up most financial outlets, and this is not their fault because that’s where their customers are, for the most part. People who are most intensely interested in ... Investors and companies and CEOs, yeah. Exactly. But there are moments when ordinary people have to learn what’s going on and we don’t have a mechanism for helping people wade through all that stuff. And I think one of the things that we found out in the financial crisis was, layers of complexity had been added to the financial world that were now beyond most ordinary readers. Like people didn’t know what a derivative was. They didn’t know how mortgages were sold, they didn’t understand securitization, they didn’t understand. Most people still think that when you get a mortgage, your bank is holding it, you know? Right. And so that’s why fallacies like “the subprime mortgage crisis was caused by the government forcing people to lend out mortgages.” That’s why that took hold, because we just didn’t have that kind of educational process going on. And unfortunately, I don’t see that there’s a lot that has changed. There’s been more interest in it. There are more blogs that have taken it on, but it’s not institutionally part of the business. Plus, media companies that might’ve done some of the toughest reporting on these matters were hit hard by the financial crisis itself. Of course, yeah. So that sort of reporting, maybe, is not there quite as much anymore. I wanted to ask something that may be a little bit more uncomfortable, but a topic that I think we should talk about. Last year during your book tour for a book you wrote called “I Can’t Breathe,” as the #MeToo movement was really picking up steam, a book that you co-wrote about your time in Russia editing The Exile, it’s an English-language newspaper, it came back in the public view. This is a book that came out, I think, in 2000, 2001. Mm-hmm. And it detailed sexual harassment and even sexual assault. And you wrote at length about this. You defended the book as satire, but you apologized for The Exile’s misogyny and you apologized for writing dumb and hurtful things. At the same time, The Exile was really about presenting the real Russia, kind of tearing down what regular foreign correspondents did in Russia. I feel like we’re at this moment now in time, the #MeToo movement, the confirmation of Brett Kavanaugh, where he’s been accused not only of sexual assault but of perhaps misrepresenting misogynous things from his past like what someone may write in a high school yearbook. And I’m wondering in this context, I know you’ve talked about it some, but have you rethought your own experience in the wake of the Brett Kavanaugh hearings? Well, I’m not trying to be a Supreme Court justice. I wouldn’t nominate me for the Supreme Court. I’m a writer, and more particularly, I’m a humorist. The Exile was a shtick. It was a gross shtick. The whole point of it was… The idea behind The Exile was we were living in this community full of American expats who were ugly Americans at their worst, right? They were there, they were completely taking advantage of a third-world country that was in chaos. They were doing blow and taking gazillions of dollars in consulting money. And our whole idea was that The Exile would be the newspaper for these people. Right? So we created this sort of gross Andrew Dice Clay-style ugly American voice of the paper. And it wasn’t real. Unfortunately, there were aspects of it that sort of became real over time. Because the paper’s advertising base was almost entirely the worst kind of nightclubs and strip clubs and brothels even. We did a lot of partying during that era, and we did a lot of drugs, and we kind of turned into the people that we were satirizing over time. Right. But the original original idea of the paper was just to be disgusting and to flout every single American convention. And so there’s a lot of stuff in there that, if you’re just picking it up cold and you’re not in that environment, it can be really jarring. I did write some stuff that was really stupid and that I wouldn’t do today, but the specific allegation from last year was that I had actually sexually harassed my employees and that kind of stuff, which was completely untrue. And if anybody had bothered to call any of the people who were named in the book, they would have figured that out quickly — and did, actually, once somebody did that. But yeah, of course I have regrets. The Exile, I regret not because, not necessarily because it was offensive to any particular group, but just because it was mean in a way that was really gratuitous and unnecessary. Like, I think when we could have done something that was closer to Spy Magazine that was just kind of like appropriately nasty, and that would’ve been good enough. But we were young and high, and it got out of hand. I mean, I think that ... caveat being we’re two white guys talking about this, but... Sure. But we are at this sort of moment where everyone is kind of rethinking what is okay, and there are all these gray areas. I think some of the things that you wrote from a more misogynist point of view, that’s what stuck with people, I think has been written about at length. I guess I was curious how you thought about what you wrote in the past in the context of, certainly not direct sexual harassment or sexual assault, but just how this stuff comes to the fore again and what sort of responsibility people should take. And not to say that you should be some sort of pariah, but like, how do you think about it? When you’re watching ... Well, you know, you can tell what I think about it by how I write now. Back then, the operating humor that we had grown up with was Sam Kinison, Bill Hicks, Richard Pryor, where everything was fair game and it was actually considered kind of a liberal position to be as disgusting as possible and to say the forbidden thing, even if you’re being offensive. You listen to Richard Pryor’s routine about like the stuttering Chinese waiter, right? You could never do that today, but when I grew up, that was supposed to be the thing that liberals were celebrating. Like, “Hey look, we’re saying the forbidden thing.” Right. That was the humor I grew up with. We tried to do a lot of that stuff. When we picked on people, we completely were unbelievably cruel about physical characteristics, whether they were men or women, but if there were women, we did it, for sure. And when I came back to the States, that went out of vogue pretty quickly. I learned a lot of things, that that was inappropriate, and I’ve completely changed the way that I do a lot of those things. But do I think that that should be disqualifying forever? No. I’m embarrassed by it, for sure, but it’s a lesson that you learn. Just sticking with the Russia, you get back and the Russia story sort of feels over, in a way, for years. And now you find yourself sort of in this group of journalists who are like accidental Russia experts who spent time in Russia, someone like a David Remnick or who ... Masha Gessen. Right, exactly. Spent time over there and then now all of a sudden, Russia is strangely the biggest story in the world. But you’ve been critical and you’ve been skeptical of a lot of the journalism surrounding the Mueller investigation and the Russia probe. And I wonder if you could describe, why is that? What do you see as the sort of problem with that? First of all, a lot of us are. Sure. A lot of us who worked during that period, even those of us who didn’t particularly like each other, people like Masha Gessen, Leonid Bershidsky over at Bloomberg, who was a colleague of mine at the Moscow Times once upon a time. A lot of us ... most all of us were vehemently anti-Putin when he came to power, but there are elements of this story that just didn’t add up for a lot of us, or that just seemed sloppily reported. My kind of moment where I was concerned about the story came very early with the release of the Steele report. I had done a lot of stories about short sellers who were shorting stock, who had used the technique very similar to what went on with the Steele report in order to sort of move the tape on stock. You hire a private company to do a negative research report, you foist it into the hands of a regulatory agency, you tip off a reporter that it’s now in the hands of the FBI or the SEC. They do a report that the company’s under investigation. Then you cash in when the stock plunges. There was an element to this with the Mueller report that just set off alarm bells for me. We’re doing a story about handing a report that we can’t verify from one intelligence person to Barack Obama or to Donald Trump. If you follow those early stories, the entire arc of the story was about the journey of that report. Yeah, and this was before, I should say, this was before I joined BuzzFeed News. When we published the dossier, I was actually in talks with Ben Smith at the time. So it was an interesting week to be talking to them about a job. I’ll bet. But yeah, that sort of defense from BuzzFeed then and now was right like that, “This document is being talked about at the highest levels of government. The president, the president-elect have been briefed on it, and we’re in this sort of new era, maybe, of journalism where our readers are smarter and can decide.” And you know, CNN had done a report saying, “There’s this document.” And BuzzFeed said, “That thing that everyone’s talking about in government and media that everyone’s seen, but you, the reader, have not, here’s what it is,” with all the caveats involved. So you’re saying that you think that was an irresponsible journalism decision that sort of set in motion this frenzy? It’s a tough ... I mean, like I couldn’t have done that story. I would’ve been scared to do that story. If somebody had said, “Here’s a report that says X, Y and Z. I can’t tell you any of the sources are, I can’t tell you where any of this information comes from, you’re just going to have to trust me that I’m a trustworthy person, and it’s serious. And so therefore, go and report that this report has traveled from a senator’s hands to the CIA,” or whatever it is. That would make me very nervous. That sets off alarm bells for me as a reporter. If there are parts of stories that I can’t confirm, I start asking questions like, “Well, why?” Right. And there’s been a ton of this that’s gone on in the Russiagate story. It doesn’t necessarily mean that I disbelieve it. You see a lot of stories where there are four unnamed intelligence sources all saying something that is totally unverifiable. Right. Do you think that ... One of the criticisms that you hear often is like all of a sudden the media, which is supposed to be deeply suspicious of intelligence sources, is perhaps overly relying on anonymous intelligence sources, maybe to their peril. So, I get that. I think that one of the things that you’ve written is that you don’t believe that there’s this collusion, but Russia certainly interfered in the election and they’re sort of bad actors. That’s what it looks like. There’s certainly more evidence for that than there is for other things. What bothers me ... Yeah, let’s pick a story that’s from the New York Times or Washington Post, like a big story that you were like, “This makes me feel uncomfortable.” Yeah. So recently we had a story that ... I’ll give you two. Okay? There was one from pretty early on where the New York Times said, “Trump campaign officials had repeat contacts with Russian intelligence.” All right? And again, it was four current and former officials, none of them named. Now, I knew and anybody who lived in Russia knew that you constantly have contact with intelligence officials there often, whether you know it or not. And the story didn’t specify whether the contract was knowing or unknowing, like what the nature of it was, but the headline was incredibly damning, right? I was very concerned about the vagueness of it, the inability to verify it. And then, sure enough, James Comey came out months later and said, “Well, that story isn’t true.” All right? And so if I’m the reporters, I’m really pissed about that, right? Like, “you burned me on this.” Right. Then later, more recently, we had a story that said, “Oh, all of our informants in Moscow have gone dark.” Now, I get that the sources in that story had to be high level. Sure. Of course they were, but how do you confirm that story? Think about it as a journalist. If you get a call, it doesn’t matter to me if the source is the head of the CIA. It’s not like you can go find those intelligence sources and confirm with them. Right? I mean, can you look at the string of cables that have suddenly ceased? You can’t, right? I even called the paper and asked about that. I said, “What’s the deal with this?” You said there’s no public editor, so I have to call myself. Right. Yeah, exactly. And so there’s lots and lots of ... Did you get a response? I did. Some of it was off the record so I can’t get into it, but the point is that there’s kind of been an epidemic of this sort of thing where you have an intelligence source telling you something and it drives the story forward, sure, but we don’t know whether we’re being made dupes or not. And there’s a whole history of us being made dupes by this particular crowd, and some of them, in some cases, by individual people. And by good reporters, right? Right. Sort of falling for that. I think that there’s been just a ton of great reporting about the Russian investigation but I think that’s a reasonable point that these are traps that papers like the Times have fallen into before. And I think that one of the big questions right now is the use of anonymous sources and the overuse of anonymous sources. I think that that’s something that all reporters think about, but when you’re dealing with this super-high-level stuff it seems completely unavoidable. Well, it’s very difficult. We all do. I’ll grant you. This podcast is on the record, though. Of course. And what do you do if a high-level intelligence source comes to you and tells you something that is very difficult to verify? Sy Hersh just wrote a memoir, right? Yeah. And he wrote something in there where ... the intelligence agencies were upset about the extent to which they had been betrayed by a Soviet spy to Israel. It was an Israeli spy who had betrayed us, I guess it was. And they invited him and showed him all the stuff that had been given to the enemy. And Hersh talked about how, “I who had always sought the secrets was now being handed the secrets.” And there is a huge huge difference in ... If you’re digging something up, that’s when you feel really confident in something. But when someone is calling you and handing you something ... Right. That’s when you know ... Someone has an axe to grind. Right. At the same time, obviously, the information could be true, but when someone hands you something they obviously have something. There’s a reason people talk to reporters. Right. And this particular community is a community that didn’t normally, will not tell you that the sky is blue if you’re outside. Right? And so all that makes me nervous. And now it could be true, but it’s a factor that ordinary people are not aware of when they read these stories. Pivoting to 2020. We got another presidential campaign that will start the day after the midterms, in earnest. It feels like things are going to get started really early this time. You’ve covered many campaigns. If you had to pick right now a campaign to embed yourself into to write your next book. It’s obvious who the Democrats are, the handful that are most certainly going to run. What campaign do you think would be interesting as a reporter to cover, not necessarily who you think’s going to win because we’ve been wrong before in that. But what is an interesting story to you in 2020? Well, I stayed away from the Sanders campaign last time because I had kind of a relationship with him. I worked with him before and I didn’t want to wade into that. But if he runs this time, I think I wanna go that route. He would sort of be the front-runner at this juncture? He could be, yeah. Because I think there’s really two stories that are going to be key in 2020. One is, will Trump be able to be a viable candidate? Will he win again? The other one is the schism that is going on in the Democratic party and the sort of fight for the party’s soul. Which to me is really an incredibly interesting story about fundraising, when you get right down to it. It’s like who’s going to pay for our fundraising efforts? And Sanders has said “We’re not going to take money from here. This other group is.” I think that’s a profound and interesting moment in our history. Are we going to finally wean ourselves off that model? I think I’d like to cover that part. And it’s going to be wild to have and it’s going to be really interesting to see how news outlets react if Trump is presumably still president during this, someone narrating the Democratic race in real time on Twitter. What does that look like? And counter-programming. Counter-programming rally for rally, maybe and it’s just going to be completely a style thing in 2020 in a way that it has never been on the Democratic side before. We should not forget that Trump was incredibly effective on using the overabundance of candidates on the Republican side to his advantage. So is Michael Avenatti gonna come in and there’s going to be 20 other “serious” Democrats and Michael Avenatti’s going to be throwing bombs at the debate and everyone going to be going wild and all of a sudden he’s the 46th President. Is it possible? It could be. Or, the rules of gravity will apply this time. I hadn’t considered that, but that’s possible. Sure, yeah, it sure looks right now like... Because what happened last time on the Democratic side was there was a backroom consensus that we’re not going to have a whole bunch of people competing for the pie. The fundraising pie. This time that’s not happening. A whole bunch of people are jumping in, it’s a free-for-all. You’ll get Howard Schultz, you’ll get the Rock, you’ll get Mark Cuban. Right. Yeah. No, exactly, yeah, it could be all kinds of people. And that tends to be to the detriment of the party because you see all the worst aspects of all these people come out. That’s what happened with the clown car episode last time. They all looked ridiculous and Trump took massive advantage of that. Because he was the only real reality star in that crew of idiots. He just came out looking much better than all of them. Has the media learned anything from 2016 — I mean, it’s obviously not a monolith — that they will take into 2020 in terms of how to cover someone like an Avenatti? The sort of “why not me” candidates or just the circus of it all? Or are we just going to keep plugging along like we do? I doubt it, because for me the huge lesson that should’ve been learned in 2016 was that we had become way too cut off from the population, right? And I knew this from having covered many campaigns before that there is a bubble, that is real. You’re literally walled off from the rest of the people when you’re on the campaign trail. The Secret Service doesn’t let you out, you’re like in a prison together. I remember covering the Obama campaign, coming on the plane and seeing on the press section walls of the plane, each person had posed with the candidate like a yearbook style picture. And I like Barack Obama, but wow, that’s a really bad look for us. We were supposed to be kind of separate. Trump apparently with reporters in the White House, insists on it. Really? Yeah. Probably to have leverage over them. Like as a blackmail picture? Right. “No, you’re taking the picture with me.” I’ve had White House reporters tell me this. That is really funny. That’s a good move. Excellent. Excellent. But the fact that people completely blew off Trump’s chances despite the fact that he was packing these huge Wrestlemania-style arenas showed how completely out of touch we were. And it showed it that we no longer had a sense of what is important to a lot of voters. And I think what happened in the postmortems was, we’ve come up with a lot of explanations that are shorthand for us, but not for them. “All of Trump’s voters are racist and they’re all sexist and that explains everything.” Well, that’s a big part of the picture but it’s not the whole picture. It doesn’t explain the failure of the other candidates as much. It doesn’t explain the dissatisfaction the people felt before Trump even entered the race. So I don’t see that that problem has changed a whole lot. And I think what one of the things you’ll see in 2020 is if candidates on the Democratic side are going to take any cues from Trump, and antipathy towards the media is going to be one of them, right? Oh yeah. And I think you’ll see this sort of insurgent, “Breitbart of the left” has become a little bit of a cliché. But even the Intercept — which is a company where you used to work at — you’ll see these sites be really aggressively covering the soul of the Democratic party fight that you were talking about in a way that will change the media landscape. It’s something that I think about as a media reporter that I think is going to be really interesting. Yeah, I remember covering Howard Dean when he first became a phenomenon, he had this sort of “I’ll introduce myself to you” tour that he called the Grassroots Express. Where he invited everybody from all the biggest news companies on a plane trip around America. It was like this weird road trip and all of the big elite newspapers and TV networks sent representatives and they spent the entire time asking him questions like, “Are you too left to be president? Are you too much of an intellectual to be president? Are you too anti-war to be president?” So they’re really telling him basically ... Is that you’re all those things. Yeah, you’re all those things and if you want to be president you’re going to have to move a little bit in this direction. ‘Cause that’s how the press corps rolls. We sort of tell you what presidential is and people try to fit into that. But when Donald Trump is president maybe that gets upended a bit because presidential … the definition has changed. Sure! That was a huge factor last time because Trump completely defied all those orders that we usually give to candidates. We tell them straight up, “You can’t do this, you can’t do that.” We’re going to call you “fringe” unless you do this. We’re going to call you “bookish” or “professorial” if you do this. And Trump just crapped all over it, and when we told him that his behavior was unacceptable and he should no longer be in the race after the McCain thing, he just blew it off and said, “I didn’t say that.” And his followers loved that, precisely because they hated us so much. And that was the part that the press corps never caught on to is that he was ... There’s a wing of the Democratic party base that is deeply suspicious of the mainstream media, in maybe the exact same way that the Trump base is. And so I think that’s gonna be maybe a rude awakening for some members of the press that they thought this wing of American life still trusted them, but doesn’t. No. And again, it’s because for the most part, you can do this job without talking to people. This is an insight that I’ve unfortunately had to learn over the course of ... this is going to now be my fifth presidential campaign. You’re hanging out in the plane, you’re traveling from city to city, you don’t talk to anybody. You’re getting scoops from the process, horse race scoops from the comms person. Something that you don’t have to go out and talk to the ... Right! It’s in the hotel. You go from the event to the hotel and that night at the hotel, over a couple of highballs, you sit down and they say, “Oh, here is what the numbers show.” And that’s the journalism. And where the reality is, where if you want the real story, show up at the city two days in advance. Hang out in the opium recovery ward and find out what people are really thinking. They hate us. They hate that whole show. And that was a huge factor in what Trump was doing. Trump was basically doing a barnstorming tour that was anti-elite. And to those people, a reporter who makes $180,000 is elite and Trump isn’t. Which is odd but there is an element that’s real to it. All right, we are going to have to wrap up things there. Thanks, Matt, so much for coming on the podcast. No, thank you for having me on. I really appreciate it.

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Plus: Silicon Valley stays quiet about the international backlash over the murder of a dissident Saudi journalist; Uber and Lyft are driving toward IPOs in 2019; emoji bagel justice. The new hot thing in the land of the megawealthy: Do-gooder investments they can write off on their taxes. Expect big boasts from Silicon Valley titans next year about how their money is changing the world, thanks to a little-known part of the tax code called “Opportunity Zones” — a.k.a. “O-zones” — low-income areas designated by each state. Investors like Sean Parker, Peter Thiel, LinkedIn founder Reid Hoffman and venture capitalist John Doerr will soon be able to sink their recently realized capital gains into philanthropic-looking projects or companies based in one of 8,700 Opportunity Zones, in the process reaping extensive benefits — and a gold mine of positive PR — thanks to the tax bill passed by Congress earlier this year. [Theodore Schleifer / Recode] [Want to get the Recode Daily in your inbox? Subscribe here.] Saudi Arabia is the largest single funding source for U.S. startups, but Silicon Valley has remained mostly quiet about its connections to the kingdom as international backlash grows over the possible murder of dissident Saudi Arabian journalist Jamal Khashoggi. Crown Prince Mohammed bin Salman has directed at least $11 billion of Saudi money into U.S. startups since mid-2016, either directly or through SoftBank’s $92 billion tech-focused Vision Fund, far more than the total raised by any single venture-capital fund. Since Khashoggi’s disappearance, powerful U.S. executives have withdrawn from a high-profile investment conference in Riyadh this month. [Eliot Brown and Greg Bensinger / The Wall Street Journal] Uber and Lyft are both charging toward potential IPOs next year. Uber could be valued at $120 billion in an IPO as soon as early 2019 — that’s nearly double the ride-hailing company’s valuation in a fundraising round two months ago, and more than General Motors, Ford and Fiat Chrysler are worth combined. And rival Lyft has hired JP Morgan to lead its 2019 IPO, which could value the company at more than $15 billion. [Michael J. de la Merced and Kate Conger / The New York Times] Netflix is growing faster than even its most bullish fans on Wall Street predicted, calming doubts about its global prospects and sending its already-stratospheric stock higher. The world’s largest paid online TV network added 6.96 million users in the third quarter, boosting its global total to 137.1 million, and said it plans to add 28.9 million customers in total this year, a new record for the 21-year-old company. The results should prolong Netflix’s reign as one of the best-performing stocks on the Street, giving it leeway to spend billions of dollars more on original programming. [Lucas Shaw / Bloomberg] A new study from Stanford University has once again confirmed that the majority of the U.S. public opposed the FCC’s repeal of net neutrality.The Stanford report eliminated all automated or form-generated comments from the 22 million public comments submitted to the Federal Communications Commission — that boiled the results down to just 800,000 Americans who put their own thoughts on the net neutrality repeal into words; of those real people, 99.7 percent opposed what the FCC’s repeal. Meanwhile, New York Attorney General Barbara D. Underwood subpoenaed more than a dozen telecommunications trade groups and lobbyists, seeking to determine whether the groups submitted millions of fraudulent public comments to sway the federal decision on internet regulation. [Karl Bode / Techdirt] “Microsoft would never have happened without Paul,” says Bill Gates, who shared some memories of Paul Allen, one of his oldest friends and first business partner. The duo helped pioneer the personal-computer industry when they started Microsoft in 1975. Allen died at on Monday at age 65 from complications of non-Hodgkin’s lymphoma. [Bill Gates / gatesnotes] TRUMP WATCH: ”Ted Cruz has done so much for Texas ... Beto is a Flake!” ELON WATCH: ”Just reviewed Tesla’s service locations in North America & realized we have major gaps in geographic coverage! Sorry for this foolish oversight.” Top stories from Recode Instacart’s new $7 billion valuation is a bet on the future of grocery delivery — not a wager against Amazon. The startup has a fresh $600 million in funding to boot. [Jason Del Rey] It turns out that Facebook could in fact use data collected from its Portal in-home video device to target you with ads. Who you call and what apps you use could determine what ads you see. [Kurt Wagner] Eyeing a 2020 run, Los Angeles Mayor Eric Garcetti explains how he (or someone else) could beat Trump. Garcetti isn’t committed to running for president yet — but he’s been thinking a lot about it. [Kara Swisher] This is cool Bagel emoji justice.

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Garcetti isn’t committed to running for president yet — but he’s been thinking a lot about it. In U.S. history, no one has been directly elected out of the mayor’s office and into the presidency — but Los Angeles Mayor Eric Garcetti is “thinking hard” about whether he’d like to try. “No sane person would run for president, right?” he said on the latest episode of Recode Decode. “... This country is in such bad shape. I worry about the country I’ll leave my daughter behind. I worry whether America will lead in this world again. I wonder whether my fellow Americans will have a shot at a better life. I’m really worried they won’t. That’s what propels me.” It’s a good start to a stump speech, but more concretely, Garcetti thinks he has a shot because leading Los Angeles for the past five years has put him on the front lines of everything from autonomous vehicles to international relations. And although he is a Democrat, he thinks his party has failed to address the realities of technological change in America, while China has invested billions in “artificial intelligence and biotechnology and semiconductors and renewable energy.” “One of the frustrations I had in 2016 was nobody was really talking about the future in a comprehensive way. Trump obviously was going backwards decades,” he said. “Bernie was bold but they weren’t new ideas and they weren’t necessarily adapting to the world as it is today. Hillary Clinton had a great answer to every incremental question but there wasn’t an overarching vision.” He told Recode’s Kara Swisher that he also disagreed with Democrats’ propensity to either ignore or “roar back” at President Trump. The way to win in 2020, he said, is to attack the perception of Trump’s strength and efficacy. “You have to actually diminish him without getting sucked down by him,” Garcetti said. “Yelling back, he’ll win the yelling fight. Ignoring him, he’ll pound you.” “You have to get him off of his game and get him, show the person that he often is, which is petty, small, but most importantly, ineffective,” he added. “I think we really have to point out how little he has done ... Whether it’s me or somebody else, I hope it will be people saying, ‘Doesn’t America deserve better?’” You can listen to Recode Decode wherever you get your podcasts, including Apple Podcasts, Spotify, Google Podcasts, Pocket Casts and Overcast. Below, we’ve shared a lightly edited full transcript of Kara’s conversation with Eric. Kara Swisher: Today in the red chair is Eric Garcetti, the mayor of Los Angeles, which I love. I actually love Los Angeles. I was driving around today and thinking that. He was first elected to the post in 2013 and was reelected last year. We’re going to talk about the state of local politics, the tech scene in LA and much more. Eric, welcome to Recode Decode. Eric Garcetti: Thank you, Kara. Or I have to say Mayor, right? Do I ... No, no, Eric, please. Is that okay? Mayor Eric, or? As I tell my daughter, “That’s just a title for a little bit, I’m your daddy.” It’s a good title. Maya’s daddy. It’s an excellent title. So we’re going to talk about a range of things, including national politics, which you have been ... discussed running for president and things like that. Let’s start first in Los Angeles. Talk a little about your background, the people don’t know you. Sure. Go through it just very quickly. I’m one of these rare natives of Los Angeles, actually a fourth-generation Angeleno. My newest family member to come here was my grandfather, over 100 years ago. But I represent the city’s absolute sprawling and beautiful diversity. I’m half Mexican, half Jewish, with an Italian last name. I grew up in the San Fernando Valley, which was where the Brady Bunch home was, and kind of the middle of nowhere and the middle of everywhere, and grew up, you know, pretty anonymously. I think people think I grew up in politics because my dad later, after I was in college, ran for district attorney, but he was a prosecutor, just a line prosecutor growing up. My mom worked in charitable foundations, and grew up in a very kind of middle-class San Fernando Valley life as “Valley Girl” came out. I thought I always wanted to do something to change the world, but I figured that might be ... Why? My parents raised me with that. I think my dad was doing that, my mom was doing that. They gave me a lot of free rein growing up, so I traveled to Ethiopia in high school to help out with medical relief work. I, in college, lived in the jungles of Burma with the democratic resistance that was there. I got a degree in human rights that encouraged me and my sister to be exchange students. [My parents] had met from opposite sides of the tracks here in LA at Pan Am Airlines, and so I think they had a very kind of ... Pan Am. Yeah, the great Pan Am airlines. TWA. They fell in love, got married six weeks after their first date. Wow. And so the world was a very important place for them, where they kind of fell in love, and they always wanted us to see the world on the streets of our city, and vice versa, to see kind of LA on the streets of the world. So I always felt comfortable almost being anywhere, though I always knew I’d come back home. And taught as a professor, when I came back, diplomacy and world affairs, international human rights work, then ran for city council. And why? Somebody suggested it to me — my predecessor on the city council’s chief of staff — and she probably suggested it to a dozen people, but I couldn’t get it out of my head. It was definitely not something I had ever thought of doing. I didn’t know who my city council member was growing up. But I realized, why am I going [to] faraway places to work on human rights when those issues are right here, and this is the most global city in the world? And I always give this advice to young people, don’t run off to D.C., don’t go abroad, until you set your roots down someplace, because the work you do in America today is as diverse as anything you’ll do around the world, and you can’t grow into that if you don’t start someplace. Right but ... That was the first time you were in politics. Yeah, I mean, I had worked on campaigns, I had helped out, you know, my dad in one of his reelections. I had worked for Kathleen Brown’s campaign for governor way back when, when we took a 15 point lead and lost by 15 points. Yeah, nice. Well done. Good swing. The nice thing about losing campaigns is everybody stays friends because there’s no spoils to divide. But I, you know, worked against Prop 187 out here, as a Latino seeing that attack on immigrants, prescient to what’s happening now. So I’d been involved in politics. I thought maybe way later in my life I’d get involved, but at 29, I got a new pair of shoes and started walking door it door, and loved it. It was scary. I don’t like bothering people, but I found myself ... Like, I was going to be a journalist. I actually took a couple ... Oh, wow. Okay. ... classes at Columbia J School, where I know you went, and then I hated it because I had to ask strangers questions, which is kind of ironic, doing what I do right now. Right, that’s all you do. But I loved it when the questions were about something I might be able to do to help them. And I wore holes through those shoes and got elected. Did you work on the Bronx Beat? Do you remember? That was the thing, they put that out for students there. No. No, I ... Yeah, the Bronx Beat, actually, yeah, yeah, yeah, that one class I took, I was over at the School of International Public Affairs and cross fertilizing. So you ... So, when ... You ran for city council and then mayor, what were you hoping to do as mayor? Well, after 12 years of serving a neighborhood in the heart of LA that really had dramatic turnaround and kind of the Bohemian heart and working-class and immigrant heart of LA, the heart of the LGBT community, I saw the potential of what we could do taking that city-wide, to really revitalize areas without pushing people out of them, to build an infrastructure, thinking about the future, and harness what mass participation can do. I mean, to the most seemingly unsexy of topics, but things like graffiti, which just wear you down. When we enlisted a few hundred people to help us know where the graffiti was, we reduced graffiti by like 90 percent, and counted that every year. I think a lot of people are so cynical about government, “There’s no role for me to play in it,” they think. And secondly, they just tell me the good news. And I learned to open up the process, to teach people the basic skills of how City Hall works, to be kind of a teacher like I was before. And even if you teach people who are going to be against you, that’s okay. And so, as mayor I saw three things in LA. We had taken our eyes off the basic city services. People hire you to run a city, just paving the streets, picking up the trash, all of that. Second was our infrastructure was crumbling, from public transportation to our electrical infrastructure, everything, and I wanted to invest in that for the next 50 years. And three, I wanted to invest in the economy of the future, and I think LA had been very lazy about our legacy. Because aerospace had been here and then … or, space and Hollywood. Aerospace, Hollywood, but we were letting those things go away. When Northrop left LA with its headquarters, no elected official besides one, I think, even called them. We were letting other states win ... We put tax credits through to get production, so the studios were still based here, but the productions weren’t. Right, they were in Vancouver and elsewhere. And then there’s emerging digital technology, biotechnology, and other industries, like financial services or healthcare, that have always been huge here, but we’ve never marketed them, grown them. So I wanted to kind of strategically build a city, from its infrastructure to its services to its economy. So, let’s talk about each of those. The issues around city services, they’ve gotten ... I mean, a lot of the big cities, everyone’s living in them, they’re moving more and more to cities. In the next century, that’s all that’s going to ... people are going to be mostly living in cities. And countries like China and others are doing a lot around infrastructure of cities, and how cities are created and formulated. Obviously, Los Angeles is a real challenge given how spread out it is compared to a San Francisco or a New York or a Chicago. Where do you imagine ... where are we thinking about cities right now? Because in a lot of ways San Francisco, as we talked about before, has become unlivable. There’s a lot going on with homelessness, with all kinds of things, that are really reaching a crisis point in that city. What do you think is the big challenge big cities face? And LA certainly isn’t immune from those. There’s these increasingly kind of winner cities and loser cities, loser cities that people in regional areas are bypassing, and then these mega cities that everybody is coming to, which is really pushing them past the boundaries in terms of infrastructure, that if you don’t build transportation to accommodate that, and housing, those two things, they can become unlivable. LA has kind of seized the bull by the horns, and we passed three measures, the largest in the country’s history. Is infrastructure. For homeless services, homeless housing, and for transportation. So, we passed a permanent ... Just to give you the idea of the scale, it’s, for the next 40 years, $120 billion, 15 new rapid transit lines at the same time ... The light transit lines, yeah. ... in a city. A subway, light, and busways, as well as fixing streets, it’s 787,000 jobs — careers I should actually say, because it’s not just a two-year off thing. And I think that positions LA to build a brand new city. There’s nothing that will be as fundamental to the transformation of a city than how you lay down those networks. And if you build affordable housing around where you put your transportation, you don’t compound the problem, you actually can solve it. And I do look at cities like in China and other places where the scale of imagination is so much bigger and bolder. LA is one of the few Western cities now to say we can be in that club. And some people want to snap their fingers and say get rid of traffic tomorrow, get rid of homelessness tomorrow. I feel more confident about being able to do those two things in the next decade than we ever have, and I see too many cities around the country where they’re just starting to confront the scale and the magnitude of that problem. What has happened? Why do you think that has happened to cities like the ... Well, it depends on which problem. I mean, for homelessness, it’s an expression of a lot of trauma, it’s everything from mental health, and drugs, and PTSD, and emancipation, foster care, and rape, and sexual domestic violence, combined with high rents. I mean, those are the two things, so high rent and trauma combines into homelessness, but you don’t have to be homeless to feel the housing crunch, which is just that people have said “no” for too long. What’s beautiful to see is there’s an emerging — not spurred on by developers or City Hall — group of residents here that are saying, “Go denser, go higher. I want to stay in this city, I love this place.” But you know, I was talking to one guy who bought his ... his grandfather bought his house in the San Fernando Valley, $5,000, his dad for $50,000, he works in the film industry as, like, a lighting guy, he bought it for $500,000. But he said, “My daughter, if she has to buy a home for five million, our story ends in LA.” And so, for me it’s all about the middle class. You have to build middle-class housing. You have to build middle-class wages. You have to build middle-class transportation networks. And I think LA is better poised than any other big city in America to do that. But I’ve also been networking with other cities, because it’s an exciting time. Washington wants to do $200 billion of infrastructure, and this president’s produced zero. Nothing, so far. Zero. The same night Trump was elected, American cities, including ours with Measure M that I just talked about, passed $230 billion in a single night. So part of my message, too, is don’t wait for Washington. There is no cavalry, that’s not the way the country has ever been constructed. And we hope they’ll be better partners, but in the meantime, take action where you are. That’s interesting. I’m just reading the Andrew Jackson biography to try to understand our state better, it’s the same exact debate that was going ... He’s very different than people portray him, he’s a much more complex political figure than other ... And he was a builder. He was, but he didn’t ... The section I’m in now is national versus local infrastructure, and the fight, and he vetoed a bill to do local infrastructure, was potentially pork barrel politics, essentially. Well, look, and that always can happen, but I think that we all know now, we have the worst communications, transportation and energy networks infrastructure in the developed world. Absolutely. And imagine if we had Washington leadership that placed assistance in helping local governments get that work done, and then took care of the stuff that no local government can do in rural areas and other places. That’s what our federal government, at its best, has always done. Right, but has not been doing right now. Absolutely not. Yeah. Missing in action. So when you ... So, the issues you face, housing, affordable housing, which goes along with transportation ... Absolutely. ... what do you imagine is your biggest challenge right now, among those three? I think it’s bringing the cost down. You know, as somebody in tech, most of our tech revolution has been two-dimensional, it’s been how we can communicate with our kids on FaceTime, and, you know, one-click ordering. I think it’s entering the three-dimensional space. There’s a couple things. One, I want us to be the transportation technology capital of the world, and we’re doing a lot of things to kind of bet on everything. You just kind of bragged that you’re going to be the first autonomous ... Nobody’s claimed it. And I think you have to ... Not just the autonomous, I mean, it’s everything. I think the mayor of Phoenix has, but go ahead. Greg Stanton? My buddy? Well, yeah, exactly. I think so. Not in the best way, but ... Greg’s a dear friend. But I think there’s no place, when you think of ... the way you think about entertainment in LA, or digital tech up in the Bay Area, or finance in New York, there’s no place that can lay claim, “Oh, that’s the transportation technology capital.” And we’ve got the dollars, innovation, the aerospace, the engineers, like, all of that to try it, from the Boring Company tunneling underneath us, to gondolas to Dodger Stadium, to the more traditional ways, and autonomy. But secondly, I think the other three-dimensional tech revolution that should be happening is housing. Why is it that we still build things so slowly, so expensive? Now, part of that’s us, it’s either red tape or our own opposition to building something. The government, you mean? Or communities, just neighbors saying, “No, don’t build that in my backyard.” So, it’s both. But the third area where we can really be much more disruptive is we can build things for cheaper. We just got people into housing for formerly homeless Angelenos for about $109,000 a door last month. It’s, on average, $400,000 to $500,000 to do that in traditional ways. So figuring out a way to create land by going high, and you have free land ... With density, like they do in Europe. Exactly, or prefab and more factory-style construction is really, I think, one of the areas where we can in California. To modular housing. Yeah, modular, or just ... Part of it’s modular and part of it is just we have a lot of specialized people who do specialized things for construction, instead of ... A car doesn’t get sent, have five different types of workers come in to work on it. You have one person on the assembly line, or one group of people, and I think we can do that with housing. So it’s housing, homelessness, and then creating jobs within the city. And good wage jobs. I mean, we raised the minimum wage here, biggest city to do it to $15 an hour, which I don’t discount, it’s ... Did Jeff Bezos copy you? Go ahead. I hope so. There’s $3.4 million every working hour, is the stat, for about 650,000 families, so that’s ... and disproportionately women. But second, it’s going for the $50-an-hour jobs. I mean, LA ... I don’t want LA to turn into the way Manhattan feels like, you know, the very successful and then the service economy serving them, and nothing in between. And I think, you know, that’s why passing Measure M was so important. Those are really up the middle middle-class jobs that pay between, let’s say, $30 and $100 an hour. So people can have a home, you know, send their kids to college. And along those lines, the biggest gap cities have to confront, and our economy does, is the gap between having college degree or not, so we made community college free here, the biggest city in America to do so. And the first year we boosted, out of our public schools, college attendance by 40 percent in our community colleges. So getting that good-paying job is about that pipeline of education, internships, apprenticeships, and just building an economy around those jobs. So, when you’re thinking about that, you’re almost ... These cities are now, to me, like nation-states, as far as I can tell. Absolutely. You know, with the running them and doing different things. Very little is iterated from city to city, which I think is ... You know, Mayor Bloomberg was trying to do that with his efforts, the city’s efforts, they’re trying to do ... But the concept is that these are ... where a lot of the change is coming is from these cities, and ideas are coming, versus federally, from doing it for a federal ... Absolutely. In the past, it was what states were the great laboratories of democracy brand, I said, it’s now cities. And that’s not new. The number of people living in cities is new, the speed of innovation is new, but that’s where politics started. I mean, the Greek word for city is polis, which is the same root of the word politics, and they ... those two places, I think, intersected. You came to the city to engage in politics, and right now that’s where the innovation is occurring deeply. And I agree with you, it doesn’t spread quickly enough, and so one of the things I did is found a group called Accelerator for America. It isn’t a think tank, it’s a do tank, where we literally put people on the ground saying, you know, Louisville has a great idea, let’s do that in four more cities. LA is doing something cool, you know, can we help Washington, D.C., do that? And putting people on the ground to accelerate that instead of being a decade, maybe in a year or two. All right. So let me ask you, we’re going to talk about California in the next section, but what do you think you’ve done wrong? Oh, give me a list. I’m always one to fess up. Where was your wrongest wrong? My wrongest wrong was I think in LA, in general, and in California in general, we’ve been too slow to own up to this housing crisis. I mean, I’ve been here on the city council, so I don’t just blame some other administration. But on homelessness, I think another thing we ... California has most of the homeless people in this country, right? Is that correct? It’s some enormous amount. Not most, but close to. Close to. And we have the most raw numbers here in Los Angeles, not the most proportionately, but most raw numbers. I think also deferring too much early on. I’m by nature a small-D democrat ... Deferring meaning? Like, let’s build consensus, let’s talk to everybody, when I realized time is really short, people elect you ... You need to be a fascist. ... just go and make decisions and do it, whether it’s with your own team or sometimes within the city, that too much process can kill. So I kind of learned from that, I hope I’m doing that a lot quicker. But early on it was like, no, let’s talk to everybody, when I find when you actually take action, it changes the conversation, because people see the change. Just making a declaration. They might want to fix it, but just do it. Just make a declaration, like you’d say no more cars in Los Angeles by 2020. Absolutely. Just saying something like that, it changes the ... Yeah, something like that, right. That was going be my whole ... Is that what you’re proposing? Yeah, that’s what I’m proposing. That’s your agenda? Good. Yeah, I was just going to say things like that, crazy stuff. You know, I think that the funny thing about being a mayor today is stuff that seemed crazy, like, even two or three years ago, now is normal. Such as? One hundred percent renewable power. We own the largest municipal utility in the United States, our Los Angeles Department of Water and Power, and I said 100 percent. Now, five years ago I would have been saying, okay, let’s get to 50 or 60. And just recognizing that, or saying every autonomous vehicle that’s going to come into LA needs to be electric and shared, which is something I think we’re going to announce soon. That, to me ... Everyone that comes in to Los Angeles? No, every autonomous vehicle. Oh, autonomous vehicle. So, for all the companies that are going to have autonomous shared vehicles, that they all be EVs. And it won’t be too long, I think, before we’re all saying, “Hey, no more internal combustion engines,” except in some very rare cases. Right. Right, you just have to declare it. But two or three years ago that was still such a huge stretch. Let’s talk about California. One of the things that’s really interesting that’s happening in California right now is they’re passing a lot of bills that are national bills around privacy, around diversity, around everything, everything seems to be a nationally based bill. Talk a little bit about that. It seems like California is going to be in a position of governing, in a lot of ways. I think California doesn’t see the power it has before we exercise it, whether that’s at the state level or local level. I mean, if time’s up on #MeToo, why not do something about it instead of just trying to support survivors who are coming forward? In the city of LA, in six months I made over half of our commissioners for the first time — and there’s about 300 of them that run the port and the airport and the police department — women. And the public sector’s always seen as slow, right? You know, we do things much slower than private sector, and I said if we could do that in six months, why aren’t you doing it too? So to pass something like that here in California is just ... it’s like desegregating schools. Just do it, and instead of talking about it, I think Californians are much ... we don’t do everything perfectly, but we’re ... We will take that kind of American test it, try it, something new attitude, and it is more concentrated here, I’d say, than almost any place. So what happens when California’s doing these things? Because I think, again, from the privacy bill, from a tech point of view, a lot of people are calling for more privacy. There’s never going to ... I mean, I just wrote a story in the Times about this internet bill of rights, federally, but no one’s moving to do those things. But California passed probably the most ... the strongest privacy bill in America right now. Well that’s ... it’s really ... Which isn’t very strong, by the way. Yeah, right, it’s a low bar. It’s a low bar. It’s like being the tallest building in Dubuque, but it’s ... We’re going to get there. I think that California doing that is absolutely critical, because Washington doesn’t get tech, and I think they look to California for leadership, and we’re doing it to “ourselves,” that’s a really good sign. Secondly, I think as well that, you know, we’re the folks who ... I think people want to stereotype us as just ... We’re just the big tech companies, as opposed to folks who are ... they’re kind of tech entrepreneurs. And so people who know what they’re talking about, and also value privacy, can actually write the architecture of this well, can redo the architecture of the internet right now, which is based on the data being owned by somebody else rather than a blockchain way of kind of coming down and grabbing your data when you say yes. It’s consent, you know, for privacy. And, you know, these things that lead the way, I think most people usually copy them coming out of California. And they might not ... They might make fun of them early on, but, you know, Iowa is a red state, and they’re at 31 percent wind power, even though it was California who was talking about it first, so, you know, we’re not so cocky that we don’t learn from other places, or that we’re always the best. I’m not a California supremist, but I do believe that because ... You don’t want to break the state away? You’re not on that ... No way. No way. What do you think of that? I think it’s crazy. I mean, I do get the argument of splitting it up into pieces, because why should we have only two senators and another state with, you know, one hundredth the population has ... You get the idea, but you’re not for it, right? Yeah, yeah. Well, I don’t want to break away from this country. I mean, I love California being part of America, and vice versa. I think we are a vision of America, and right now it’s going to be a Pacific century. We’re going to be this gateway to American ideas. Hopefully American ... America winning that future as well, and instead of retreating from it the way we kind of see out of D.C. So, California ... Look, California makes mistakes. We overregulate. We sometimes tax too much. Taxes. We get in our own way of building things quickly, to our point earlier on infrastructure. But by and large, most things that we do are usually what’s next, and I think it’s what attracts people to come from all over America to live here, and all over the world to come here. So, I think those things on privacy, on energy, on building infrastructure, creating good middle-class jobs, that’s something that hopefully we can share with America. And one last point, this BS that suddenly there’s, like, the coasts and the heartland, like, we’ve got so much heartland inside California it’s almost like a mini laboratory for America. The Central Valley, or even in zip codes or neighborhoods in the city right here, even though everybody thinks LA is just, you know, Kardashians and reality shows, we have a lot of bus drivers, nurses, people struggling with the same issues, but we have the ability, I think, to give a vision of belonging that right now a lot of Americans don’t feel. Right, but most people, when they ... they think exactly that, it’s the elite cultural ... How do you think about that, when they have the elites versus the ... There is that developing within California. How do you change that? Well, it’s nice being mayor, because I can’t believe that for a second, because most of the people I represent, four million people, are everyday folks, or folks even struggling and hitting hard times. So, we caricature each other across America right now. We caricature by color, by political party, by region, by rural versus urban. I do think Washington, D.C., has unified us into two Americas, but it’s kind of Washington and the rest of us. And everybody feels a connection with local community, and, you know, we’ll talk more in next segment, but ... What do you mean? Washington and the rest of us? Meaning ... Washington is the place that’s fundamentally out of touch in talking about stuff that the rest of America isn’t. We sometimes watch that circus. Some people are consumed by watching the circus. But 90 percent of our work is where are our kids going to school and what’s going on in the neighborhood? What’s the street I drive on like? Is there a park to go to? It’s what kind of job, what kind of dating pool? You know, all those things are local, they’re not coming out of D.C., and D.C. has a conversation that seems completely removed from that. Even today, I think it’s split us into two countries, really. Right. Right, so, I’m going to stick with California. So when you ... when these innovations are coming out of California, a lot of people feel that it’s over for the California century, essentially. California did create these big tech companies, it isn’t very long, it’s about 20 years, and most of them are in Northern California, a few down here, but pretty much all the digital innovation happened up there. Now people feel China is overtaking us really dramatically. Do you think that you’re competing more with China, or with the rest of the country? If you’re obsessed with just digital technology maybe, but that’s such a small slice of our economy. It’s been one that we have a very intimate relationship with, so I think it disproportionately consumes our thinking. When most ... Like, we have more tech jobs here than any county in the Bay Area, but it’s a very diverse set of tech jobs. It’s biotech, food tech, it’s digital tech, it’s entertainment tech, video game tech, aerospace. And so it attracts engineers who like to go between different things. But there’s no question that you have leadership right now that is not investing in winning the future in this country. I think California, no way is it over. I think we’re still right there, in fact, probably still leading the world. But China has made ... has put down the markers, for sure. And our advantage is to compete against the ... just, size of China, is being better on immigration, is continuing to have great and open academic institutions, good weather and healthy air, and if we can preserve the better quality of life that we have. I mean, those things ... People make rational decisions whether they’re in tech or not, and the people who are going to drive the economy of the future I think will pick California for the next hundred years if ... and America, if we play our cards right and invest in the right things. Part of why I want to make LA the transportation technology capital of the world is, you know, you have great companies like Joby [Aviation] and, you know, Boring Company and others who are really pushing the envelope, but shame on us if that innovation happens here and then it mostly gets implemented in China or Dubai or someplace else willing to go first. So I think it’s really important for us to get out of our own way to test these things and to make sure that they take off, you know, no pun intended, here as much as anywhere else. Talk about the Boring Company, you’ve been very supportive of it. Absolutely. Tell me why, because, you know, Elon’s sort of in an interesting position. Personalities all aside, I mean, Elon and I get on very well, it’s the ... I want to test anything that might give us a shot at relieving traffic. So, whether that’s the interconnectivity software, whether it’s looking at VTOLs, vertical take-off and landing vehicles, or whether it’s the Boring Company, we’re kind of saying everybody’s welcome here. Or the hovercrafts of Larry Page. Hovercrafts, we haven’t tested those yet, but we had ... Yeah. Oh, they have one. Yeah, I know. Yeah. And we held a conference here for, you know, Uber Elevate and stuff. Like, I want people to come to LA and figure it out here. It’s a really good place to test things because it’s dense but also wide open. We got the biggest port in America, so if you want to talk about international trade and logistics, a great airport, you know, the aerospace workforce. We’re still making things here, too. When you look ... And you asked that question about whether this is in the past, I was visiting for manufacturing week last week … Aerojet Rocketdyne, which made every rocket that went onto the space shuttles with a 100 percent record, they’re still making them. There’s 140 jobs open right now. They just hired 180. And you’d think, reading things, oh, California can never support high-wage jobs like that, they’re going to go to someplace where the taxes are cheaper. What about bringing back manufacturing jobs to the state and to the area? I don’t know if it’s ever going to be that frame of bringing it back, I think it’s preserving and grabbing the new ones that are there, because they may not, on net, be ever bigger than it is today, because it’s steadily declined. And by the way, most people don’t recognize the decline from about 38 percent of the economy to less than a third of that today, 11 percent, most of that happened between ‘67 and ‘76, half of that. So most of it happened a long time ago. It is where it is. But now, yeah, when you go to look at welders at Aerojet Rocketdyne, it is folks who are on a screen doing position welding with a machine, not somebody holding, you know, the welding equipment. So, absolutely, I think we’re extremely well poised to do that, as is America. I was in Iowa and visited in Waterloo, Iowa, next to the John Deere tractor factory, some of the ... one of two places in America with the most-cutting-edge 3-D printing. The other one was in Ohio, in Youngstown, where steel mills had closed up. So this cliché — that it’s only happening at an MIT lab or at Stanford or down here in some aerospace company — actually isn’t the case. So, absolutely, I think we’ll continue to have manufacturing. I put construction with manufacturing for the kind of ... that bucket of decent jobs with something you do with your hands. But we should be more focused on high-paying service jobs, which is what the story of the last 50 years is. That’s now about 40 percent of our economy, that manufacturing piece is only about 11 percent. So, yes, we need to. I’ve put focus on that. But that usually comes at the expense of, you know, the other ones. And that’s also mining. You know, coal peaked in 1928, we’ve got a president who’s only, like, what, 88 years behind? Yeah, I know. I know. Every time he says it I want to ... I was in Kentucky and I was like, “You’re not getting your jobs back, and if they’re coming back, the robots will be doing it, and the robots should be doing it.” Right, because ... I just went in Chicago to the science museum there, and there’s a coal mine you can go down into, and you see when it went from pickaxes, like, in the ‘20s, to machines that did the work of 100 men, so that’s come in ... Probably they should be doing the work. Yeah, exactly, and I think it’s better for our lungs that they did. Yeah, it was interesting. So, I want to finish up this part on California, where do you ... Does California not set the agenda anymore? Because it feels like it doesn’t. Politically? Technologically? It feels like there’s been a tech lash, like, you know, the tech backlash in terms of the responsibility. No, I still think we absolutely do, but we’re going to go through in tech what every big industry did, when it was either monopolies or oligopolies that came through, I think that is ... that absolutely is going to happen. But we’re still, no question, setting, or among the lead in setting the agenda in this world. What are your thoughts on what happened with all these tech companies, all of whom are in California? In the election, and the various backlash to social media. Well, people forget, California isn’t a liberal state, it’s a libertarian state. Okay. Libertarian-light, as far as I’m concerned. It is. Well, I mean, traditionally that’s what it’s been, like, make freeways, let us, you know ... Give us the basic things, bring us water in Southern California, steal it if you have to, give us some power, build some freeways, and then get out of the way. And I think we still have that ethic among a lot of people who have started companies, saying look, I know this is so disruptive that it empowers me to just, like, say to government, “Get out of the way,” my experience is there was a lot of cities, mayors, political leaders who kind of were either future-phobic, like, “Oh, we have to beat Amazon away and preserve the bookstore.” That never works. The local retail or taxis or ... And the second is everybody else seemed to be in a bucket of future-passive. Some were really excited about it, “Oh, the future is going to be awesome!” But just ... “I’m going to stay out of the way.” Or depressed about it, but can’t do anything. And very few were future-guiding. And so to me this comes around to libertarian, we can’t afford a libertarian age anymore. Tech by itself isn’t going to do something, you always need interpreters, folks who are inside government who understand technology and can say, yeah, there’s issues of privacy, there’s ... Many of whom don’t. Most don’t. Most don’t, right. But that’s why you need them. And vice versa, in tech, you don’t have many people who really look at the 30,000-foot view and all segments of the population needs. They’re looking at their market share. They’re looking at just, “I’ve won, and everybody has an account with me,” and they’re not as concerned with the larger social issues. We need more interpreters between those two sectors, and I’ve tried to be one of those, who takes, like, a Bird when they come in with 15,000 electric scooters, and people have smiles on their face, and it seems like there’s some car trips being taken off the road, but there’s folks also getting hit by cars. And we say, “Let’s sit down and make these rules together. Don’t just tell me to get lost, and I won’t tell you to get out of my city. Let’s figure out a way to do this together.” What did you do? You did ... You were doing a sort of middle of the road kind of thing. We’re allowing those that are there now, and we’re writing the rules. There’s a lot. I’ve seen a lot. Yeah, I think 15,000 just from Bird alone. Yeah, do you ride them? I have ridden one, yeah. Yeah, I ride them all the time. It was fun. It was great, yeah. I love them. I mean, it’s ... And I think trying to overly regulate is a mistake, and trying to say just let them disrupt it on their own, inevitably is a mistake, too. So, you know, we’ve ... And we’ve infiltrated that culture inside government. Our metro, which is our MTA system, has an Office of Extraordinary Innovation. What? I didn’t come up with the name. What? Come on. But it’s basically a place where private companies can come pitch us on transportation solutions. Instead of us engineering the one solution ... Right, that you have. ... spending two years, you guys bid on it, and it cost two times as much, doesn’t work as well. Literally we have people every day knocking on our door saying, “Here’s a quicker way to finance it. Here’s a new technology. Let us do something between an Uber and a bus, you guys can run it, it’s still in the public realm, but our software will help get that grandmother ...” So, but it is the privatization of public transport. No. No, it’s still owned by us. Because that’s where I think it’s going. There’s going to be some, but we’re getting pitches as much from private companies who say, “Let us just give you the software,” because if they go out of business, that’s a pretty bad thing for a city not to have an option. But there are bus lines in every city because there’s the two grandmas who really depend on that to get to the store. It only runs once every hour because there’s nobody else on it, and you run it at a very expensive cost, when, you know, you could have something between an Uber and that running, still owned by the city, but maybe contracted in by another company or just their software. We’re looking very aggressively at that. But my point is you have to put a culture in City Hall and you have to put a culture in companies that we do have to talk to each other upfront when we architect these things. Let’s talk about you and running for president. So? So? So, we’re going to go back and forth with this. So? It’s, look, this is a moment ... Were you just in Iowa and then you defended Ted Cruz, I’m like ... I was just in Iowa, I went to about four or five ... I defended Ted Cruz? You didn’t show up at the restaurant, you thought he should be able to go to restaurants. Oh, God, I guess that’s the biggest stretch of defending Ted Cruz, I rarely defend him but yes, I do think we should give people a private space unless they’re crossing extreme, extreme lines. Anyway, no, I’ve been out there and I’ve been doing that long before I’ve been straight up about thinking about running for president. I’ve been involved in national politics from a local perspective for over a decade. I was a chair of all the Democratic mayors and council members in the country for about five or six years. This year, and I can say this because I’m not running, it is the most important election in our lives. Yes, 2020. I’ve been in Oklahoma, Mississippi, places that have nothing to do with presidential considerations. I hope every patriot is thinking about what they can do in 2020 after we get done with elections in 2018. I’ve been straight up that I’ve been thinking hard about it. I don’t know ultimately whether I will or not. I hope some mayors will. In other countries, that’s natural. Explain why, why is a mayor better suited? A mayor’s never been president, correct? Is that correct? Folks who have been mayor, but never a jump from mayor. I think like Grover Cleveland and like four or five folks who have been mayors. Right, yeah, right, right. Was he the mayor of Buffalo? What was he mayor of? Mayors are executives. He was mayor of Buffalo, good. Yeah, that’s right, thank you. I didn’t know you were such a Cleveland fan. I know things. It’s because I’m not spending my time focusing on the Dodgers. Exactly. So, you’re saying I’m losing a lot of my brain time. No, no, it’s fine. You can watch your baseball. It’s all good. I learn things. It’s a popular thing. Yeah. There’s metaphors you get out of it. See, now I can’t really run for anything because I say I don’t like baseball teams. That’s okay. I think that mayors run things, they bring people together in a much more non-partisan way. I’m a proud progressive, that’s not a way of saying I’m a centrist, but I also can cross over and reduce the city’s business tax while I’m raising the minimum wage or investing in infrastructure and work closely with Republicans and independents while I’m doing that. If I run or not, I hope some mayors will think about it because I think Americans are fed up with kind of the D.C. reductionist, partisan, tweet, counter-tweet, pretending that’s getting something done. Well, that’s new. That’s new. That’s Trump. That’s a new thing. It’s not a ... No, no. Long before Trump. I mean, Fox became Fox, MSNBC, MSNBC, and I’m glad that there’s, I loved living in England when you knew what the paper’s perspective was. Yeah, the Independent or the Star or the Sun. There’s no place I can go to watch news anymore. It’s one point, and then it’s made for like an hour. I’m a person who likes getting things done. I like going out there and saying, “Look, homelessness is a humanitarian crisis on our streets.” I’d love for Washington to be involved, it’s not just here, but let’s actually get our hands dirty and go do it. I think that’s, to people, what they’re looking for in leadership these days is folks that know something about international trade because we run a port, or know something about power because we’re going to 100 percent renewable power in the utility that we own. Right now, D.C. is more interested in those tweets than in our streets. I mean, that’s something that is different ... Oh, is that your line? I like that. That’s a line. A little bit of poetry that I, I might have said that at the Women’s March. Oh okay, good. He’s sending us tweets, we’re taking the streets. But that was kind of different then. All right, okay, good, okay. I want to be the Dr. Seuss of politics. The tweets seem to be winning, but go ahead. Yeah, I know. How do we get the streets to win again? The tweets are good. He’s good at Twitter. They are good. Do you use Twitter? I do. You need to as a presidential candidate, just so you know. Instagram is my fave, but yeah. Oh, is it? Yeah, I like that. All right. Getting back to the national race, so the reason you would run is because you’re a mayor and know how to run things? No, I mean the other thing is I want to add some things to the conversation. Three things: One is, I think we’re not talking from the Democratic side about freedom. By freedom I mean economic freedom. I think it’s the most important issue that we face right now is that people don’t feel free. Free to do things, to be things, for their children to soar because they’re so close to bankruptcy and the economic insecurity. So, freedom. Second is a sense of belonging. I hate using words like “inclusion” and “diversity” and “tolerance.” They kind of imply somebody’s giving you the privilege of being at the table. Cities know about a vision of belonging and I think this country, if you want to run this country, you have to have a vision for this country. Most Democrats, we’re bad patriots. We don’t want to describe something that includes everybody. We want to have like 51 percent of us have our vision win. I think we really need to start thinking about something that includes everybody in a sense of belonging. I think third is the future. One of the frustrations I had in 2016 was nobody was really talking about the future in a comprehensive way. Trump obviously was going backwards decades. Where there is comfort. Bernie was bold but they weren’t new ideas and they weren’t necessarily adapting to the world as it is today. Hillary Clinton had a great answer to every incremental question but there wasn’t an overarching vision. There wasn’t the sense that China with a hundred billion dollars in artificial intelligence and biotechnology and semiconductors and renewable energy, and those are just categories. Who’s talking about the nature of work? Where we’re going to land? Where we’re going to get our meaning? Where we’re going to be unified together? How people are going to move? How people are going to be educated? If we don’t catch up, America doesn’t inevitably have to be No. 1. No, not at all. I keep banging the China drum. It’s interesting that Trump is focused on the tariffs. To me, he’s focused on plastic toys. It’s the wrong thing, yeah. He’s always directionally somewhat correct. Ever noticed that? He’s sort of vaguely right about Amazon being a little bit scary but he focuses on the post office. It’s always like no strategy. I never say fair trade rules 100 percent where the president and hopefully every American that we need fair trade rules, but with no strategy and going after the wrong things we’re declaring that “New NAFTA” is some big win. No, nothing really changed and you didn’t lead us to any new promised land. Being president, what qualifies you particularly to do it over this massive pool of people? Oh, I never assume I’m the only person qualified. There’s going to be like 412 of you, right? I think it’s going to be a lot less than people think. Really? Why? I just think, I’m going through this myself, it’s an intensely personal decision. The politics, the culture is so nasty right now. People have families, people have to consider what they want. You want to look who else is out there too. No sane person would run for president, right? Really, why? No sane person would think about it if they had a shot right now because of how bad things are in this country. Having been mayor, I know how much of a sacrifice it is to your life. I love it, I am glad I’m doing it, but you really have to carve out your time with your loved ones, with your friends, with your family. It’s an intense seven-day-a-week job. Why would you want to do it? Because this country is in such bad shape. I worry about the country I’ll leave my daughter behind. I worry whether America will lead in this world again. I wonder whether my fellow Americans will have a shot at a better life. I’m really worried they won’t. That’s what propels me. What makes me qualified is I think mayors do run big things, like I said. I don’t have to be educated about international trade. I know that from the dock workers who feed their families in the port of LA, together with Long Beach, 40 percent of all the goods coming into America. When heads of state are traveling, they come here. Justin Trudeau and I sit down because more Canadians live in LA than any city outside of Canada. Prime Minister of Spain, we engage international relations instinctively. You’re not saying you can see Russia from your backyard, right? Oh, no, no, I’ve got really good equipment. I’ve got this drone I send up, I can absolutely see it. Oh, okay. That didn’t work out well for Sarah. No, it didn’t. I’ve spent time, 12-and-a-half years as an intelligence officer in the Navy, I used to teach international relations, I know the global picture. I’m really interested in accomplishing things and I don’t think that’s where this president came in. I think we’re too often as Democrats interested in winning now or yelling back, and most people have a pretty good sense. I’ve never won an election by talking, I’ve always won it by listening, and I think most Americans — most Americans, not all activists, but most Americans — feel nobody’s listening to them right now. Right, that’s true. By instinct mayors do that because ... I don’t know if you saw the quote that Mitch Landrieu said when he was asked recently ... Another possible candidate. He’s been a great friend and I hope he will consider it. Jeff Flake was confronted by the survivor in the Senate and like, that was pretty intense. His line was like, “No, that’s like eight or nine times on the way to getting milk when you’re mayor.” We kind of know the rough and tumble of things. That’s true. Yeah. But I think we stay optimistic enough because we see manifest, concrete changes in our cities every day. How do you fight against Trump then? I think he’s much more popular than people realize, I think. Oh yeah, he is. People who hate Trump don’t realize how much he’s also loved. And people who fantasize the latest, outlandish thing that he does, or racist thing that he says, that suddenly people go, “Oh, now, I get it. I was wrong. Let me flip.” It’s going to have to be people who say, “Okay, I like what he’s saying, but I like more what he or she is saying or has done.” It’s going to be people who trust, it’s not just taking down your opponent, it’s outshining them and offering them something better. Americans want us to compete with the best ideas, best experience, best vision and give them a choice. We’re not doing that. We’re saying, “He sucks.” How can you compete with his sideshow? I mean, it’s a show. My sense is that there’s been two failed strategies. One which is ignore him and one which is roar back. Neither of them really work. He’s so practiced. Most political campaigns make the mistake of attacking opponents’ weakness instead of their strength. We attacked his weakness of being a racist or a misogynist. What is his strength? It’s kind of a strange strength. Remember John Kerry’s strength was his service. They attacked him, swift-boated him and he lost. His strength is actually the perception of strength itself. That is what he has practiced his entire life. To portray strength. You have to actually diminish him without getting sucked down by him. Yelling back, he’ll win the yelling fight. Ignoring him, he’ll pound you. Remember when Hillary Clinton, during the debate, he was right behind her and she kind of tensed up. Understandably, it was a creepy thing that he did. Creepy stalker. You almost need to turn around, laugh and say, “Get back to your little corner. Thank you.” Or compliment him about like, “You’re an American hustler, you’ve done so great. You’ve been up, you’ve been bankrupt. You’ve been down.” You have to get him off of his game and get him, show the person that he often is, which is petty, small, but most importantly, ineffective. I think we really have to point out how little he has done. He’s out there portraying, “I talked to Kim Jong Un.” Well, what’s come of that? Taxes. Right, right. ”I’ve engaged with Saudi Arabia.” What’s come of that? China, he has a weird relationship but it’s clearly ... Putin. He loves strong leaders, but if that was producing something great for America, he could make a case. I haven’t seen it. I think we have to be reminded of that. Right, and so that would be the way to defeat him. Yeah. A lot of this happens, not over issues, not over debate lines, it’s like a feeling. You know? Mm-hmm. I think you just have to be authentic from the beginning. You have to offer a contrast to him, because every election is always a contrast of who came before. Even if they’re popular. Of course, of course. We’re not going to have like a fantasy, like a good Donald Trump beat Donald Trump. Right. It has to be somebody saying something totally different. From me, whether it’s me or somebody else, I hope it will be people saying, “Doesn’t America deserve better? Don’t you want to have a kinder nation? Have a more unified nation where people belong? A nation more focused on the future rather than trying to restore past that isn’t coming back?” Lastly, the Democratic party, which seems to be in the middle of a crisis. Well, always. Of course. On schedule. As Will Rogers said, “I’m not a member of an organized political party, I’m a Democrat.” People also overthink that political parties are somehow central commands. They never have been. They’re reimagined every two years, across the board. Well, the Republicans are. They stay in line. Republicans are better but it’s really the stuff around the Republicans that have been more unified. It’s the whole network and stuff, it’s not the RNC. It’s never going to be the DNC people who want that to be central ship. What I love, is I’m seeing this decentralized Democratic awakening of folks who are engaged, supporting women who are engaged, supporting folks who have been veterans engaged too, supporting state legislatures or gubernatorial candidates. They’re kind of bypassing the traditional party, which is too bad because we need some meat there especially for those states that get overlooked. Which is why I just raised a million and a half dollars for 10 state parties because nobody raises money for state parties. There’s nothing sexy, no chip to call in. They’re the ones who register people to vote, turn them out, help in redistricting, etc. I love that there has been more elbow grease, more dollars I think than we’ve ever seen come out of people who are supporting Democrats. In Democratic ... Yeah, absolutely. It bodes well for November. Your prediction for the midterms, then I’ll let you go. House, knock on wood. And we got three weeks where anything can happen, I think we win with a majority of 10 to 15 seats. I think the Senate is really tough. The greatest unsung part of this election will be the gubernatorial gains we get. I think between five and 10 gubernatorial houses, gubernatorial seats that we flip including making history with Gillum or Stacey Abrams or Ben Jealous, women in certain states will take back a lot of those purple states. It looks good. The most important thing is going to be the day after, though. Do we go, “Yay, we did it.” Or do we say, “Double down now. Get ready for 2020 where there’s going to be a five-front war. Win the presidency. Keep the House. Get the Senate. Do the statehouses because that’s where redistricting comes in after the census in 2020. Register people to keep them engaged and involved.” Yeah, that’s a lot of work. Yeah, it is. Mayor Garcetti. Anyway, thank you so much for talking to me. I really appreciate it. I really enjoyed it. Thanks.

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posted 7 days ago on re/code
Sean Parker crafted a little-known part of the tax code called Opportunity Zones. Now every one-percenter in Silicon Valley wants in. The men and women who serve as financial aides de camp to Silicon Valley’s billionaires are brimming with phone calls from curious clients. “Hey, I was talking to my buddy about this. It sounds too good to be true. Can you help me understand?” That’s how tax accountant Mike Bernier describes his conversations this fall around “Opportunity Zones” — the hot new thing in the land of the mega wealthy. At private dinner parties and on the suddenly overflowing conference circuit, billionaires like Tom Steyer and the people who advise them are swapping notes, beating back viral rumors and trying to understand whether these tax write-offs are indeed too good to be true. “It’s a lot of the high net worth individuals talking to each other,” said Bernier, who advises clients at Ernst and Young. “A lot of it comes from, ‘I heard this on the internet.’” Behind it all is another Silicon Valley billionaire: Napster founder and early Facebook executive Sean Parker, who is using his celebrity and Rolodex to schmooze the wealthiest people in town. He’s been chatting up people like his longtime friend Peter Thiel, LinkedIn founder Reid Hoffman and venture capitalist John Doerr, pitching them on the idea in the way only a true peer can. “I’ve had to do a lot of evangelism over the last couple of months,” Parker, who helped craft the new provision, told Recode in an interview. “It’s designed to have them do something with their capital that’s productive, rather than just sitting on a huge amount of Facebook stock or something.” The ability to defer paying capital gains tax through 2026 after selling your company, for instance? Appetizing. The chance to not pay any capital gains tax on any money you make on top of that payday if it’s invested into an Opportunity Zone? The real cha-ching. By spending the money in one of 8,700 Opportunity Zones — low-income census tracts ranging from nearby Oakland to the Aleutian Islands of Alaska and covering as much as 12 percent of the country — people can reap those extensive benefits thanks to the tax bill passed by Congress earlier this year. And perhaps most alluring to image-conscious billionaires who want to be seen as modern day Rockefellers or Carnegies: An anticipated gold mine of positive PR. That’s much of what is driving America’s richest to invest, several wealth managers privately told Recode: Expect big boasts from Silicon Valley titans in 2019 about how their money is changing the world — and perhaps even some gumptious attempts to cast Opportunity Zone investments as “charity” — with little to no mention that this is simply money chasing more money. “I hope there’s a lot of chest thumping,” said Michael Novogradac, a San Francisco accountant who hosted a conference on Opportunity Zones this month with more than 1,000 attendees. “If they thump their chest and get good PR, they will probably get others to look in the area. If it’s ‘marketing,’ that’s great.” There is not much of a scandal here — the whole point of tax breaks is that it incentivizes selfish behavior that the government thinks is good for society. Silicon Valley’s one-percenters have long flocked to tax loopholes to try and keep the IRS out of their lives. When you’re as rich as Mark Zuckerberg or Jeff Bezos, you have legions of highly paid lawyers and advisers who specialize in taking advantage of every subsection of the tax code to keep your billions your billions. The rage in recent years has been the rise of Donor Advised Funds, limitless pools of cash that earn a tax break since they are earmarked for philanthropy but have drawn criticism because there is little accountability to ensure the money is actually spent. That’s old news. This is the new toy — “impact investing on steroids.” “I would say it’s very clearly not technically charity. But the charitable impulse is something we hear about a lot,” said John Lettieri, who is now flooded with calls from Silicon Valley’s wealthiest as the chief lobbyist who pushed for the inclusion of Opportunity Zones in the tax bill. “They view this as an alternative to traditional forms of philanthropy.” Silicon Valley’s billionaires also all talk with one another, and Parker today remains their main point of contact. He said he’s been bringing Opportunity Zones up in virtually every meeting, feeling out people like Ben Horowitz of Andreessen Horowitz, who Parker described as “very much up to speed” and studying ways to invest in them. One other billionaire described as interested: Tom Steyer, the San Francisco-based Democratic mega donor and climate change activist, is said to be very curious about how he can invest in the zones, according to one person in touch with his camp. Wealth managers in Silicon Valley say what had once been a trickle of calls about Opportunity Zones from billionaires has turned into a stream of several a week. Yet there are early rumbles of a backlash to the new investing gambit, with multiple wealth managers telling Recode they worry that their clients are being overly influenced by aggressive accountants and billionaire friends to invest in communities where they might not actually make any money. For instance, if a startup CEO sells her company and puts her new $100 million fortune — a capital gain — into an Opportunity Zone fund that invests in real estate in Oakland, she would be able to defer the capital gains tax, yes. But what if that real estate bet goes belly-up and she loses all of her money? Then it wasn’t smart to invest the $100 million into an Opportunity Zone, even if the math was slightly more friendly with the tax break. Plus, a more important question: Is it even good for Oakland? Steve Rosenthal, an expert at the Tax Policy Center, doesn’t think so. He imagines that some investors will make small tweaks to already in-progress development plans and not actually revitalize any communities. “I expert that billionaires will do very well for themselves,” he said. But he’d rather see the government just spend money to alleviate poverty rather than “take a wild gamble on the public’s money.” That’s the worst-case scenario — a rich person getting richer thanks to American taxpayers, but without changing his behavior. Here’s the best-case scenario: A client of Bernier is in the grocery store business and has looked in the past at investing in one particular part of the country that has very few supermarkets. But the numbers never made sense from the grocer’s point of view, and he instead prioritized stores in more posh areas . Now that there’s a tax break on the table? The numbers work. He’s planning on doing it. The federal government as soon as this month is expected to clarify some more specifics that observers predict will truly trigger a commotion in the world of high finance. That’s when to expect a new round of phone calls (and probably for a first round of press releases.) But in a sign of how much energy there is behind these, some investors aren’t even waiting for all the rules to be nailed down before hatching plans — including venture capitalists. Venture capitalists are studying these investment zones carefully and considering raising funds to invest directly into these areas, but there’s a holdup: Getting the full tax benefit requires holding onto an investment for 10 years, which doesn’t always happen. What if their portfolio company is sold, for instance? That’s expected to be answered in the next few weeks. It hasn’t stopped Peter Brack, who is one of the few venture capitalists who is actively planning an Opportunity Zone fund already through his new organization, Hypothesis Ventures. Brack, like other venture capitalists, is in this to make money. His reasoning syncs with a growing desire in investing to find cheaper deals outside of Silicon Valley. It’s a business decision. But there’s something of a bargain that seems to have been struck among investors, philanthropists and governments: Yeah, maybe some of the deals will go awry. And maybe this is a tax loophole that is being exploited. And maybe some of the new cash is, in effect, buying a press release. “If I were a community organizer or a city manager or a mayor or even a governor,” he said, “I’m not going to really worry about the intent behind those dollars — as long as they’re pointed at my community.”

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posted 7 days ago on re/code
The streaming service expects to add nine million new subscribers before the end of the year. In half a decade, Netflix has gone from “streaming video service with a kinda mediocre selection” to arguably the most influential outlet in all of American television. Netflix’s quarterly letter to shareholders, released with its third-quarter results this afternoon, includes the usual discussion of the quarter and the broader industry. But it also includes this great chart, showing its young stars’ prolific growth in Instagram followers after their Netflix launches: Netflix “We’re also thrilled that Netflix has been a launching pad for a new generation of global stars like Millie Bobby Brown, Jacob Elordi, Noah Centineo and Gaten Matarazzo,” Netflix writes. “When our service helps our talent develop huge fan bases (from small followings to over 10 million Instagram followers), we can attract the best talent in the world. This explosive growth in popularity is a good indicator that our shows and stars are breaking out around the planet.” In other words, its hit original shows like “Stranger Things” and films like “To All The Boys I’ve Loved Before” don’t just drive subscriber growth — they also drive culture. Netflix announced today that it grew by seven million subscribers during the past quarter and that it expects to add more than nine million subscribers by the end of the year, passing 145 million globally. After a rough time following its last earnings report, Netflix shares are up 12 percent in after-hours trading, making back much of this fall’s stock-price decline.

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posted 7 days ago on re/code
Who you call and what apps you use could determine what ads you see. Facebook announced Portal last week, its take on the in-home, voice-activated speaker to rival competitors from Amazon, Google and Apple. The biggest question surrounding the device: Why should anyone trust Facebook enough to put Facebook-powered microphones and video cameras in their living room or kitchen? Given Facebook’s year of privacy and security issues, privacy around the device — including what data Facebook collects and how it’s used — has been an important part of the story surrounding Portal. That’s why we need to update our reporting. Last Monday, we wrote: “No data collected through Portal — even call log data or app usage data, like the fact that you listened to Spotify — will be used to target users with ads on Facebook.” We wrote that because that’s what we were told by Facebook executives. But Facebook has since reached out to change its answer: Portal doesn’t have ads, but data about who you call, and data about which apps you use on Portal, can be used to target you with ads on other Facebook-owned properties. “Portal voice calling is built on the Messenger infrastructure, so when you make a video call on Portal, we collect the same types of information (i.e. usage data such as length of calls, frequency of calls) that we collect on other Messenger-enabled devices. We may use this information to inform the ads we show you across our platforms. Other general usage data, such as aggregate usage of apps, etc., may also feed into the information that we use to serve ads,” a spokesperson said in an email to Recode. That isn’t very surprising, considering Facebook’s business model. The biggest benefit of Facebook owning a device in your home is that it provides the company with another data stream for its ad-targeting business. That isn’t what was conveyed when we spoke to Facebook executives at Portal’s launch. But in a follow-up call with Rafa Camargo, the product VP in charge of Portal, he apologized for sharing inaccurate info and said that while this data can technically be used for ad targeting, he doesn’t know if it will be. He added that the Portal team doesn’t plan to use the data for ad targeting purposes because Portal doesn’t run ads, which was part of the confusion. It could, however, be used to target ads to users on other Facebook apps. “I think [my colleague] was intending to say that we don’t intend to use it,” Camargo said on Monday. “Potentially, it could be used.” This confusion, though, is exactly why people have concerns around Portal and any other Facebook-owned app or device right now. Explaining exactly what data Facebook collects, and how that data is used, has been a challenge for the company. Properly explaining that with a new in-home device equipped with microphones and a video camera is even more important.

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posted 7 days ago on re/code
Plus, Bon voyage and thanks, Paul Allen; cannabis-company stocks hit an all-time high on the eve of legalization in Canada; a dating app for Trump supporters; boom time for baby-boomer bands. Amazon CEO Jeff Bezos isn’t just focused on selling you everything you’ve ever wanted, or on winning another Emmy. He is also focused on sending people into space on what he called a “tourism mission.” Bezos, who also runs Blue Origin, a rocket company he has called the “most important thing I’m working on,” wants to launch the mission next year. Blue Origin’s New Shepard rocket has a capsule large enough to hold six “paying astronauts” — basically regular tourists with the ready cash for a round-trip ticket to space. Bezos didn’t mention how much it will cost, but he did say that Amazon will continue working with the Department of Defense, noting that if tech companies turn their backs, “this country is going to be in trouble.” [Kurt Wagner / Recode] [Want to get the Recode Daily in your inbox? Subscribe here.] Microsoft co-founder and philanthropist Paul Allen, who helped pioneer the personal-computer industry, died at age 65 from complications of non-Hodgkin’s lymphoma. Allen was a childhood friend of Bill Gates, and the two started Microsoft in 1975. After leaving Microsoft in 1983, Allen became an investor through his company Vulcan — its current portfolio ranges from the Museum of Pop Culture in Seattle, to a group focused on using machine learning for climate preservation, to Stratolaunch, which is creating a spaceplane. The owner of the Portland Trail Blazers and Seattle Seahawks, Allen also launched a number of philanthropic efforts, which were later combined under the name Paul G. Allen Philanthropies. His “philanthropic contributions exceed $2 billion,” according to Allen’s own website, and he had committed to giving away the majority of his fortune. [Jacob Kastrenakes and Rachel Becker / The Verge] Facebook will remove false voting-related posts leading up to and during next month’s midterm elections, including banning posts that spread fake information about voting requirements and fake reports of violence. The new policy is a tougher expansion of Facebook’s effort to reduce voter manipulation while stopping short of banning all false or misleading posts. The company is also expanding reporting tools for other forms of voting misinformation, like posts that falsely describe the conditions of polling stations. [Makena Kelly / The Verge] Twilio is buying SendGrid, which helps companies send mass marketing emails, for $2 billion. As long-time tech biz-dev guy Justin M. Overdorff explains on Twitter, while the deal looks expensive at first, “I think it ends up being a home run w two API first / focused companies coming together to provide a powerhouse of communication tooling for developers.” [Sara Salinas / CNBC] Whoa, Canada: Recreational cannabis becomes legal in Canada tomorrow, and a reporter who has covered the legalization of marijuana in California offers some suggestions on what Canadians can expect, from ever-more-esoteric products, to bureaucratic paperwork, environmental regulations and an entrenched black market, to a mad capitalist rush to establish brands and capture market share. Meanwhile, shares of publicly-traded pot companies reached all-time highs yesterday. [Thomas Fuller / The New York Times] “Make America Date Again,” invites the website for the new dating app Donald Daters, marketed toward Trump supporters who may want to find like-minded people “without bias, judgment or liberal intolerance.” Fox News reported that “users can chat for free when a match is mutual, block any potential liberals that troll them and Donald Daters is open to everyone.” But the $29.99/month app is open in more ways than one: After the media attention, a security researcher discovered the app is exposing user information in an open database, including biographical details such as names and profile photos, but also potentially tokens for logging into peoples’ accounts and private messages. [Joseph Cox and Jason Koebler / Motherboard] TRUMP WATCH: ”Thank you to the Cherokee Nation for revealing that Elizabeth Warren, sometimes referred to as Pocahontas, is a complete and total Fraud!” KANYE WATCH: ”In the wild” Top stories from Recode Instagram’s Kevin Systrom on leaving Facebook: “No one ever leaves a job because everything’s awesome.” Systrom has no idea what he wants to do next, but he knows he won’t just be sitting on a beach. [Kurt Wagner] Full Q&A: 2U CEO Chip Paucek on Recode Decode. Paucek says online education started out with a bad reputation, but now people are starting to take it seriously. [Kara Swisher] Amazon’s HQ2 announcement is imminent. Here’s a look at the final contenders. Sort them by tech talent, rent and commute times. [Rani Molla] This is cool It’s boom time for baby boomer bands. Goodness news.

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