Facebook的3个时代（以及互联网）、FTC诉Meta的问题、完全竞争的现实

Hello, and welcome back to another episode of Sharp Tech. I'm Andrew Sharp, and on the other line, Ben Thompson. Ben, how are you doing?

I'm doing fine. The question is, how are you doing?

We just passed April 15, tax season. I saw a pretty funny tweet about someone saying, “Accountants, just stop whining. Sorry you have to actually work once a year,” or something along those lines. A lot of people got pretty upset about that one.

Yeah.

Listen, I love my accountant, but emailing back and forth with him, it did occur to me: What do you do the other 11 months a year? But he did a great job for me this year, so no shots at him.

They file taxes for people like me because what we do is file extensions, and then the actual deadline is in October.

Love you, Bob.

But of course, you still have to pay now. Anyhow, that's number one: what they do. Number two, we are basically entering tax season for you as a basketball podcaster. Are you ready?

Well, a lot of 2:00 a.m. nights over the next couple of weeks. I'm feeling general anxiety about the Timberwolves–Lakers series that begins on Saturday night in Los Angeles.

Five on eight. It's always tough.

A lot on the line. Exactly. Everyone in the world is picking the Lakers. We're going to be playing five on eight for the next two weeks. The Wolves are my adopted favorite team since the Wizards have fallen off the face of the earth. So right now, I'm just waiting for Saturday, but waiting uneasily, because Luka Dončić and LeBron James are on the other side.

Well, I will join you in supporting the Timberwolves. Small markets unite. I already know—may I say “we”? We, as the small markets, are going to get screwed, so you're just going to have to win despite it all.

Yeah.

Middle America always ends up taking it on the chin. As for the show, a programming note at the top: o3 and o4-mini were both released Wednesday afternoon. Ben, you haven't had a chance to really dive in and play with those models yet, is that right?

Well, I use Deep Research all the time, which is o3-powered and is amazing. So I do have high expectations. We should also note that we haven't really talked about Gemini 2.5, which is apparently incredible.

Mm-hmm.

I've noticed that more chatter is coming online about how much better the overall experience and the way it is to use ChatGPT is compared to almost everything else. I think that's an important point, but we can always talk about AI. I don't think we're going to do it today, but I've not used them directly.

Yes. So we'll reserve comment until perhaps next week, and perhaps every week for the next 10 years—

Right. Exactly.

—as AI takes over the world here. Instead, we are going to begin with a note from The Wall Street Journal, which wrote this week:

“Meta Platforms and the Federal Trade Commission squared off Monday in a trial that could shape the future of antitrust enforcement and force the tech giant to break itself up by selling Instagram and WhatsApp. The FTC called Meta Chief Executive Mark Zuckerberg as the first witness on Monday in the case, which is seeking to compel the company to undo its acquisitions of Instagram and WhatsApp, alleging it wields an illegal monopoly in social media. Forcing Meta to get rid of those two popular applications would devastate the company's business, which relies heavily on serving ads to users of Instagram and Facebook.”

Those are the basics. We can talk about the case more generally later in the podcast, but you wrote specifically about the market definition for this case, which is elemental to any antitrust trial. In order to prove that someone is wielding monopoly power, you first have to establish the market that they have allegedly monopolized.

As far as Facebook's market, you wrote about Facebook's 3 eras. I want to talk through those eras and trace the history here. We can start with era 1, 2004 to 2013. In the beginning, Ben, there was a website: thefacebook.com. I remember going on thefacebook.com. What happened next?

1. Facebook Finds Its Feed

The dates are a little fuzzy, but I think they're generally correct. 2013 is convenient because it happens to align with when I started Stratechery.

But it was funny thinking through this case because they're arguing about what I have documented over the years. I think the fundamental issue I have with the FTC's case, beyond broader concerns just raised about antitrust, is that you have this scenario where they're talking about a company, pulling emails from 1 era of that company to complain about dominance in another era of the company that has not much to do with the present era of the company. That's why I think these eras were important to pull apart.

A lot of the emails are—not all of them, but a lot—from this early era. You start out, and yes, you have thefacebook.com. I always forget that Facebook started in 2004. I always want to say 2006.

Mm-hmm.

The reason I always come back to 2006 is because that's when they introduced the feed. To me, that's the real Facebook. Before, you just had individual profile pages.

Mm-hmm.

That was the revolution. That was Dylan going electric in ’06.

It transformed the internet. That's the single most important thing. It's more important than Stories, and it's more important than Reels. All of that stuff is downstream from the feed.

We talk about the feed again and again and again. That's what changed the internet from being a pastiche—is that the word?

Pastiche, yeah.

—of the print world. The advertising all sucked, and you couldn't make any money on there. It was print dollars and digital dimes, to suddenly becoming astronomically more valuable because it was a format that was native to the internet. It was only possible on the internet.

It had 2 key things. Number 1, you had an infinite amount of content. It never ran out. Number 2, it could be personalized to you. That is the internet. The internet is infinite and personalized, and the feed was the first manifestation of that.

So Facebook starts out with individual profile pages. You had to click around. Then you get the feed. The introduction of the feed is the seminal, culture-forming moment for Facebook.

Okay.

Everyone hated it. Everyone was like, “This is terrible.” There were literal protests outside their offices in Palo Alto, I think it was at the time, with people upset about this. People were signing petitions all online. What Facebook saw was that there were a lot of people upset, a lot of media coverage about this, all these stories, and it was all negative.

Like, they're using it.

Usage had gone up 100 times.

I can't remember how I felt in 2006. I was in college, and all the memories are pretty foggy from my first few years of college. However, given my Luddite predilections generally speaking, I can imagine that in 2006 I was a chief feed hater. Ultimately, everybody bought in over time.

This idea that, instead of clicking around to all your friends' pages to see if there was an update—and maybe there was, and maybe there wasn't—you could just have a feed that had all the updates right there. The utility is so obvious in retrospect.

What the cultural impact on Facebook was is that immediate reaction and public relations are not indicative of whether or not we're doing the right thing. Look at the data. That characterized a lot of their decisions over time.

That was a very traumatic moment for the company, but they held the course and, like I said, it transformed the internet and transformed history. Whether that's for better or worse is a different discussion, but there's no question the feed was transformative.

Okay.

2. Facebook Chases Platform Power

Anyhow, you have Facebook. This was the core of the company. It took the company a while to get this and figure it out. They were in the browser, and they really wanted to be a platform. Mark Zuckerberg has always looked up to Bill Gates in particular.

What was the vision for what Facebook would be as a platform?

Do you remember things like FarmVille, for example?

Mm-hmm.

You had this idea that there were applications that would actually run on Facebook, and this was the era of Flash games and all these sorts of things. I can't remember if FarmVille was Flash. It might have been HTML5. Regardless, Mark Zuckerberg has always—and I think this is arguably a weak point, or an engendering of blind spots—been focused on being a platform.

A platform in the traditional sense—in the operating-system sense—is the layer on which other companies build.

Mm-hmm.

These are the most amazing businesses in the world, right? Because you have two-sided lock-in, or multiple-sided lock-in. You have users, you have developers, and if you're an actual operating system, you have hardware makers. Windows was incredible. Windows is still around. Just because it didn't shift to mobile doesn't mean it still hasn't been, and continues to be, an amazing business that throws off a ton of money for Microsoft.

Right.

So he wanted to be a platform. “We're going to be a platform,” in this case in the browser. You can run applications on Facebook, so you got things like FarmVille. These companies were making all this money, so Facebook was going to provide payments. You can see the prototypes of things like app stores back in the day.

Yeah.

I'm sure they wish they had figured out how to be as clever as Apple about it. But the reason they could do that is that, in the browser, you could do anything within limits. You couldn't run apps on your computer, but you could link out to the games and so on. You also couldn't have walls on it like Apple does with the App Store.

Mm.

They couldn't have done that because they weren't controlling the operating-system environment. Openness is a double-sided sword in that regard. But the goal was to be a platform.

Part of this was that mobile came along, and of course Facebook had an app, but the app was just a wrapper around the website. It was all done in HTML5; it wasn't using all the native stuff on the device. First, that was an easier, faster way to do it, and you could theoretically write once and run anywhere across different things.

Mm-hmm.

But that could also preserve the platform aspects, where, at least in theory, over time, if we're running this basically as a glorified browser, we can keep up with all these different bits and pieces. What people forget—and this case is probably one of the all-time examples of it, but it comes up again and again—is that people look back and they only see what happened. They can't remember the way things were at the time. People can't be empathetic toward people in the present, and they really can't be empathetic toward people in the past.

Mm-hmm.

What were the constraints and things that they were facing? Beyond the overarching skepticism of Facebook—that it was just the next MySpace—there was this sense that, by going to mobile, they were really screwed. They were going to lose this platform. People were going to find new networks.

Facebook IPO'd in 2012, and I think at the end of the first day, its stock was around $38. Within 3 months, it was down to $19. People just didn't buy it. Their first earnings call was disastrous, and they were losing everything. Again, you could see this: all their money was on the browser. Their ad units were mostly browser-based, on the side rail and things like that. They hadn't really mastered in-feed ads, and the platform was obviously going away on mobile. By the way, the app sucked. This was Facebook in 2012.

It's—

When they bought Instagram.

It is really hard to remember that. Facebook was so dominant in the mid-2000s, and has been so dominant since 2012, that it's hard to remember there was a valley in there.

Dominant in the mid-2000s for a college student.

Well, yes and no. It took the nation by storm like nothing that internet users had really seen before. It wasn't some mom-and-pop shop in 2009.

It wasn't guaranteed they would get to where they are today. Look at Snap. If you looked at Snap in the mid-2010s, you would assume it would be as large as Facebook 10 years on, and it isn't. It totally flatlined.

Mm-hmm.

Now, was that becau—

Facebook is part of that story.

Sure. But that's why, when Google+ came out, people were like, “Oh, yeah, there's a lot of people.” Again—

Yeah.

I'm not putting myself in this bucket. At the time—in 2012—I was not writing Stratechery. Fortunately, I was tweeting, so I have some tweets. I'm like, “This is like Microsoft buying Netscape in 1993 or 1994,” or whatever it was. I'm like, “This is going to be a problem.” That obviously turned out to be correct.

But again, there's a reason there are quips everywhere. You can go back and dig up analyst reports, and you can look at the stock price. Facebook went into the IPO at $38 and went down to $19. That $19 nadir was the same month the FTC gave its final approval of the Instagram acquisition.

Hmm.

If the FTC was so smart, and if this was all so obvious, and if everyone looking back says, “Duh, how could they approve this?” then why aren't you a multimillionaire today because you bought up all this Facebook stock in August 2012?

I guess so, yeah.

No, I'm dead serious. There are all these people—

No, but I don't know who you're talking to there.

No, but there are people who look back. I didn't buy it either. I was also $100,000 in debt from business school, or more than that. But there are a lot of people out there acting like this was all so obvious.

Mm-hmm.

You had the opportunity to show that you knew what was going on, and you didn't.

Yes.

Again, I can't fully put myself in that boat. All I have are tweets. But it was seeable, it was doable, and the vast majority of the market did not see it and did not agree with it. The stock was down on the approval of Instagram.

Yeah.

Well, the problems with the Obama-era FTC are legion. This is just one of many. But I also think, in general, there's a collective understanding.

There was no world where buying a $1 billion app with no revenue was not going to be approved.

Hmm.

Now, you can—again, this is arguably a fundamental problem with the approval process, and we can get into this.

Well, I also just think that we understand tech power differently today than we did in 2012. Would you agree that, ultimately, a lot of people have been reading Ben Thompson and understand the power of aggregators today, so the calculus is a little bit different?

Right. I've written extensively about this, and seeing some of the feedback from my writing about this on Tuesday, people have a hard time following it. There's a subtlety in my description of this problem and what should be done.

Hmm.

3. Mobile Makes Facebook An App

You move to Facebook's—this is the first era where Facebook is basically at its nadir. Fast-forward: I wrote a lot about Facebook in 2013, when I started Stratechery. The article I always go back to is “Mobile Makes Facebook Just an App. That's Good News.”

Basically, my argument in that article was that Mark Zuckerberg's platform ambitions were the biggest thing holding Facebook back. It wasn't meant to be a platform. It was meant to be an ad-supported attention mechanism. That was before I'd coined the word “aggregator,” but I was basically trying to say that Facebook was meant to be an aggregator, not a platform.

Aggregators are not platforms. They're attention-gathering devices. Platforms are meant to fade into the background. They're the infrastructure on which you serve the app that has your attention.

When you're in Photoshop, you're using Photoshop. Yes, you're in macOS or Windows, but it's about the application that you're in at the time. When you're a platform, you're fading into the background.

If you're an ad-supported company—which it was clear Facebook was, and needed to be—this whole payments thing and all that sort of stuff was a waste of time.

Distraction, yeah.

It was a distraction. You need to own attention. You need to be front and center. Your job isn't to serve up other people and give them opportunities. It's to be selfish and own the opportunities for yourself.

Mobile forced Facebook to do that. They couldn't be a platform because of Apple's rules.

Hmm.

They were just an app. This is where Apple's rules helped Facebook. When you're using Facebook, it took up the whole screen. When you're scrolling that feed, at times you're looking at content, and at times you're looking at ads, and the ad takes over the whole screen.

It's funny because the nature of the feed and the nature of mobile actually made a vastly more disruptive and in-your-face ad unit feel better than ad units of the past. When you were reading an article online in the browser and there were ads on the side—

It's so true, yeah.

It sucked. And on Facebook, when an ad literally took over the whole screen, it didn’t suck.

Yeah.

That’s kind of amazing if you think about it.

Yeah. All of this is an interesting little window into how we’ve come to use and interact with the internet over the last 15 years. It’s one of the reasons I wanted to start with the 3 eras here, because you could trace these little shifts in user behavior through the Facebook experience.

If I’m on a desktop computer and an ad takes over the desktop screen, it’s like, “How do I click out? How quickly can I click out of this website? What the fuck is going on?” But on a phone, it’s totally natural. So, yes, it all worked to Facebook’s benefit, and Facebook was ultimately forced to focus because of Apple.

That kicks off the monopoly era.

The golden age.

Yeah.

Yeah.

Again, I think a question for people like you is: if a monopoly era was only 5 years long, is this actually worth considering? And I trust you. But again, I wrote an article, I think, in 2016, which I marked as the peak of the era.

Mm-hmm.

I did this for self-serving reasons, because I think I wrote 2 articles in that year. There was some fidgeting with the years. Arguably, the first era should have ended in 2012. That was the last year when they bought Instagram and realized they needed to rebuild their mobile app.

I think the rebuilding of the mobile app happened in 2013, so I chose 2013, and I also chose 2015 because that’s when I started Stacker.

Okay.

So, a little bit of self-serving fudging here. But 2016—there are 2 articles I wrote that I mentioned in the update that I would point to. Number 1, I wrote an article about “the reality of missing out,” or something along those lines, in early 2016.

And you looked at all these companies. You looked at Twitter, Pinterest, LinkedIn. All these companies were flatlining. Yelp, I think, was one. They all wanted—everyone was looking, all these investors were looking—“Where’s the next Facebook? Man, we missed out on that one. Could’ve bought it for $80. I’m so dumb to miss that one. I’m going to be smart enough to catch the next one,” right?

Can you do the rest of the podcast in that voice? As a challenge.

It’s pretty funny. If you didn’t see it the first time and now you’re sure you’re going to catch it the next time, what you’re going to do is buy a bunch of crappy companies because you actually didn’t know what you were looking for the first time around.

Yeah.

And they bought a bunch of crappy companies. Twitter is probably the all-time example. My point in the article was that it’s over. Facebook and Google dominate this market. It is what it is, day 1. All these other ad-supported businesses should stop hoping for a Facebook multiple. Stop hoping for a Facebook growth curve. It’s not going to happen.

The 1 company that people had hoped for was this startup called Snap, or Snapchat, as I believe it was called at the time, before they changed their name. Then, in August of that year, Facebook blatantly ripped off the Stories idea from Snapchat and put it into Instagram.

Yep.

What was compelling about that—and I wrote this at the time—there are some articles I wrote where I can remember where I was. I was sitting at my kitchen table in Wisconsin, so I remember this one. It was such a blatant ripoff that Facebook didn’t even attempt to hide it.

You had Kevin Systrom and Mark Zuckerberg doing interviews saying, “Yeah, they came up with a great concept. Why wouldn’t we do it?”

Of course, they tried to do other apps and things like that. They did Poke and things along those lines. But basically, what they did with Stories was realize that Snap had something, and still has something, with chat. Snap is still big with high schoolers and things like that for private messaging.

The threat was Stories. For people like you and me, who didn’t have any friends on Snap and thus no one to chat with, they weren’t going to lose users. They maybe weren’t going to gain as many young people as they wanted to, so that was a problem.

The worry with Stories was that this was a great reason for people like you and me to download Snapchat and give it a try. Once we had downloaded Snapchat and given it a try, maybe we would start using the messaging feature, and then Facebook would have a real problem on its hands.

So they dropped Stories into Instagram. Stories are awesome, by the way. It became an immediate hit because it’s a great product, and it had all the content from my friends and family already there because they were already on Instagram.

Right.

This was the peak of leveraging their social network to win this market. What’s funny is I feel like a lot of the competitive angst and anger with Facebook stems from this moment specifically.

It does feel unseemly. They tried to buy Snap. Snap said no. So Facebook said, “Okay, cool. We’re just going to nuke your growth forever.” You’ve plateaued, and there’s nowhere to go but down.

But didn’t they do what we want them to do?

Uh—

Didn’t they compete?

What’s that?

They competed. They built the feature, and they won.

Yeah.

My overall thrust here is that there’s a temporal mismatch between a lot of the pieces of this case that make it look good and the fact that I actually think it’s a terrible case. I think this is another motivational mismatch, where people are upset at Facebook.

The other thing about Facebook doing Stories is that Stories, from day 1, were better engineered and better than the Snap version. The performance was better. It worked great.

I mean, it’s brilliant across the board. It appeals to guys like you and me because I’m not really posting. I don’t want things to be on the internet forever, but I’ll post a photo if I know it’s going to delete 24 hours from now, number 1.

Number 2, it also was a wonderful way to serve ads for Facebook and Meta, and they’ve made boatloads of money doing it that way.

I’m going to pick on you because this is another example of looking backward and actually missing what happened.

Okay.

Stories were a bad way to serve ads because there was no way to measure them or keep track of what they were. So what happened was you had the largest stock-price decline in 1 day in U.S. history, I think, in 2017.

Mm-hmm.

People were spending so much time on Stories because it was so good, but they weren’t yet monetizing well. So Facebook’s earnings missed expectations.

Another moment I can remember—I was in Wisconsin that summer, and I remember walking down the street. I wrote an article called “Facebook Lenses,” which was basically the first version of Facebook Myths and was basically the same take: “No one understands this company. This is dumb. They’re…”

You’re actually looking at 1 of the greatest opportunities of all time because they had massively increased the inventory of ads. They would figure out how to monetize Stories well, and when they did, it was going to be this massive growth thing.

The reality was everyone was like, “Facebook’s doomed. It’s over. It’s done.”

This is a real thing that happened. By the way, that didn’t keep its crown as the biggest 1-day decline because we had to fast-forward to the huge decline that precipitated Meta Myths.

Sure. Yeah.

Which was, by the way, the exact same story: Reels was taking up a lot of time, it wasn’t monetizing well, so they had this mismatch of time being spent and monetization happening. That was the exact same thing that happened with Stories.

Again, the reason I’m picking on you is because this is the problem with the case in a nutshell. People look back at history as a 2D image. They see it as what existed based on where they are today, and it’s not a 2D image; it’s a 4D image because there’s a temporal aspect to it.

What they did to Snap was so dirty. They ripped off its product innovation and then applied their social network to it and killed them. It’s also what all the antitrust advocates, if you follow their arguments, want to do.

They innovated. They didn’t buy. It would have been better for Snap, everyone involved with Snap, and especially its investors, if Facebook had bought Snap.

Mm-hmm.

That would be like: “We kept a competitor. It’s out there, and they stink because Facebook is better.” There’s a refusal to understand history, to understand how these markets operate, to understand why Facebook has succeeded where Snap doesn’t, and to think that everything is the fault of regulators for approving XYZ.

And again, I think it’s just so striking that the number one anti-competitive thing that Facebook did in the context of destroying a competitor was actually competing. It wasn’t actually buying someone—

Well, I don’t think anybody—

—or doing something illegal.

They’re not saying that is illegal. But—

They’re not saying it because they’re forced to think about it, but I think in their subconscious this all gets conflated. I think that’s the episode that really irks people: what Instagram did to Snapchat. Intellectually, they know that wasn’t anti-competitive.

Mm-hmm.

But I think it foments a sense of Facebook being unfair, when actually what irks them is the one time they did it the way you wanted them to do it.

Well, Instagram Stories did eventually become an unbelievable way to serve ads. Is that right?

Yes.

Okay.

I’m just—

Just making sure.

Yeah, no, they made a ton of money off that. And by the way, there was this 2-year period where, if you were an advertiser, you could make— There was a huge arbitrage opportunity because the problem wasn’t that it wasn’t a great ad product; it was that the measurement was poor.

Yeah, yeah, yeah.

Established advertisers wouldn’t use it because they couldn’t get the numbers. But if you were able to take a chance—if you said, “I’m throwing a bunch of money at this, and I can’t guarantee it’s going to work”—you could act as if it would work. Your return on advertising spend, your ROAS, on Stories was astronomical for about 2 years before Facebook’s measurement got really good and all the big players came in. That’s when Facebook started really taking margin from it.

There you go. I was just clarifying, since you were picking on me, that I wasn’t wrong when I said it turned into a phenomenal business for Facebook. And—

No, you didn’t say it turned into one. You said it was one.

Well—

That’s my whole point.

Okay.

I think this is really important.

I was a useful—

I’m picking on you.

—rhetorical crutch—

That’s right, that’s right.

—for you to make your point.

Sorry, you are the stand-in for—

It is what it is.

—for all these folks. Yes, sorry.

Yeah. Well, my thoughts on this case are actually a little bit more nuanced. But in terms of Facebook’s monopoly era, there was a—

All right, we need to get to number 3. Let me—

Wait, wait, wait, wait.

—just— Okay.

There’s one point on Facebook’s monopoly era that I thought was pretty interesting. In 2017 and 2018, Zuckerberg was feeling the heat. Facebook was public enemy number one after the first Trump election, and then he started making all these changes to reduce some of the slop that you would see on Facebook, for lack of a better word. That was ultimately a testament to Facebook’s dominance at that point, and Instagram’s dominance, because they didn’t have to worry about engagement. Is that right?

Exactly. This is the classic “What’s the downside of a monopoly?” They can artificially restrict supply because they have control.

Mm-hmm.

When you go through the economic theory of monopoly, it was actually in Facebook’s deck at the beginning. They’re like, “The current market shows no signs of monopoly. There’s a big expansion. No one’s restricting supply.” Actually, the reason why you can call this the monopoly era is that they were restricting supply. What the numbers showed is that people wanted video slop.

Right.

That’s what they want. That’s what they’ve always wanted. It’s what they’re getting today, which we’ll get to in a moment.

And so at this point, Facebook was basically like, “No, we’re going to show you more from your friends and family. We’re going to reduce the noise that you’re encountering,” basically trying to win over critics at that point. It’s just this wonderful bit of irony baked into the story, because one way to prove that a company has a monopoly is that the company has the ability to unilaterally impose changes that make the product crappier for customers.

Right, right.

Here.

And by crappier, we could say that normatively that was better. It’s better to not have slop and to be connecting with friends and family, but from an economic perspective, yeah, it was worse. People used the app less.

It was worse for Facebook, yeah.

Yeah.

But the inverse is true here, where now Facebook has to roll up its sleeves and serve slop like everybody else—

Yep.

—because the market is a lot more interesting and crowded. So, era 3.

Exactly. This is why the Snapchat bit was so important to this story. The Snapchat episode is super important because they killed Snapchat, or completely cut its knees off, by bringing to bear their personal network.

Mm-hmm.

Stories are great. Wouldn’t it be better if your friends and family were already there? Here you go, on Instagram. In the running for my most prescient article ever—and I didn’t get everything totally right, but I think the overall framework was right—in 2015, I wrote an article called “Facebook and the Feed.” The point of that article was that Facebook’s long-term risk was that it was overly indexed on social networking.

What people actually want beyond social networking is just entertainment. It’s TV on your phone. It’s mindlessly sitting back, consuming slop. My argument was that Facebook was too stuck on social networking because that’s where they started, and they needed to transform the feed into generalized entertainment. By the way, 100% correct, as we found out over a decade later. That’s what TikTok did.

Mm-hmm.

The mistake I made in that article is that I didn’t imagine the TikTok-style algorithm, where it would all be user-generated content. I assumed they needed to push more professional content because— But my point was your friends and family—

There was that famous Paul Krugman quote where the internet’s not going to be any bigger than the fax machine because people don’t have that much interesting to say. That’s right in a narrow sense. Your friends and family actually don’t generate enough interesting content to keep you locked onto Facebook.

Yeah.

But guess who does? 8 billion people. They’ll make it up in volume. It’s like the Moneyball quote, right? We can’t replace Jason Giambi. We can recreate him in the aggregate.

Mm-hmm.

4. TikTok Changes The Feed

And so that’s what TikTok did. TikTok said, “We’re not a social network. Yeah, you can follow people. It basically has no impact on your experience. What we’re going to do is algorithmically figure out which videos you watch again, which ones you linger on, and we’re going to quickly tune this algorithm. We’re going to pull videos from across the entire TikTok network.”

The network here is a video network. It’s not a social media network. It’s not a network of people you know. It’s, “We just think you’ll like this kind of video, and we’re going to surface it to you.” And guess what? That was way more compelling than what you got from your friends and family.

Mm-hmm.

People started spending more and more time on TikTok, and Facebook just ignored it. Not only did they ignore it, TikTok bought, I think, billions of dollars’ worth of ads on Facebook and on Snap to build its business and get people to go to TikTok. It was this massive blind spot because Zuckerberg actually meant it when he said he wanted to build a social network. He wanted to connect people.

That monopoly power to not give people what they wanted, but to give them more friends-and-family content, was driven, I think, by a real motivation that that’s what he wanted to build. They ignored it for way too long, and then suddenly—and this is the next era—they dramatically had to pivot.

Yeah.

That’s been the era, and we’ve been in this era for 5 or 6 years. Again, I was writing about this at the time. I’ve linked to a few articles in there. You look at how extreme the changes have been, and you look at the total abdication of “We want people to have a good feeling on our networks” to just absolute garbage that is incredibly addicting and impossible—

Mm-hmm.

—to break away from. The amount of video has skyrocketed, and all the apps—apps everywhere—increasingly look the same. People just want this video slop. That’s what they want, and it’s just a competition to give it to them.

I see some people mocking the fact that Facebook raised YouTube Shorts as a competitor, and I’m like, “Are you—what are you talking about?” And, by the way, the reason is that if you’re going to monopolize something, it has to be scarce, right?

Mm-hmm.

And what is scarce?

Time.

The only thing that's scarce is time and attention. The idea that Facebook is not in a competitive market today doesn't hold water.

Yeah.

And it's not just that this is suddenly a new thing in 2025. Facebook's pivot has been ongoing for 5 years. It's been happening for 7 or 8 years.

So your take on the case is essentially that the market is so big that you can't establish that Facebook and Meta have monopoly power in this market.

The market definition of personal social networking is dumb. It's stupid.

Mm-hmm.

There's a reason why the only competitors they have are Snap and MeWe, which I had never heard of.

Me neither. I was Googling MeWe earlier on Wednesday and still don't really understand what's going on there.

Honestly, I actually think Facebook understated the case, because they put a boxing ring with all the different apps that they compete with. It has all the apps on your phone: YouTube, Twitter, LinkedIn, and so on.

Mm-hmm.

You know who wasn't in there? Netflix.

Yeah.

I'll tell you what.

Text messages, iMessage.

Netflix sees TikTok as a competitor, I promise you that. Why? Because time and attention are the only scarce resources.

5. Antitrust Needs Better Rules

And this is my irritation with these cases in general. So you go back to my evolution: I wrote a lot in the mid-2010s that we need to change the way we view guidelines, because it was obvious to people who understood these markets that Facebook buying Instagram was a bad idea.

Right.

It shouldn't have been allowed.

Right. And just for the record, that's why when I call out the 2012 FTC, I mean, there were people—you being one of them—who would say, “This is a bad idea. It's going to lead to more consolidation than we want in a market like this.”

But the defense is that there were no guidelines about the difference between Apple buying PA Semi—

Mm-hmm.

—which undergirds Apple silicon, which has been tremendously beneficial to the world. There's a huge benefit from these large companies buying technologies, because those technologies get diffused immediately everywhere.

Yeah.

You have to consider the consumer benefits, right? Versus Facebook buying Instagram. I've written so many articles trying to tease out this distinction about what sort of acquisition should be allowed, particularly an aggregator buying a potential aggregator.

Can I just interject to say that I'm glad that Facebook bought Instagram, because it made it easier for me to use Instagram and connect with all my Facebook friends on Instagram? I'm glad that they adopted Stories, because I never had to download Snapchat. As a user, this has actually worked out fairly well, as far as I'm concerned.

Well, it's better for advertisers, too, because you have one platform and it's easy to use. And again, there's an infinite amount of space for advertising. It's not like they've constrained the number of advertising opportunities. They've consolidated it, but the nature of internet advertising is that Facebook isn't pricing the ads. It's all auction. It's all market-based.

If Instagram were large, the burden would be on advertisers to have to go to 2 places, and you're still, on net, probably paying similar prices. So, yeah, let's step back for a moment. In defense of Obama's FTC, there weren't clear, codified reasons or guidelines, or any reason to reject this.

Mm-hmm.

So I spent a few years trying to articulate those reasons. Then, I think it was in 2020, right before COVID, I went to this conference at Stanford. The Justice Department was there, and they gave a speech, and there was a lot of debate.

I suddenly had a come-to-Jesus moment where I thought, “The mistake—and this is arguably an applicable lesson to what's happened the last few weeks—is that the reality of politics is you don't get subtlety and you don't get carefulness. You get blunt instruments.”

Mm-hmm.

What I realized was that, yes, it was problematic that Facebook was smart enough to acquire Instagram when it was small and could see where it was going. Facebook would not have been allowed to buy Instagram even a year later, probably, because Instagram would have been so large by that point that it would have been clear.

The problem with trying to come up with these very subtle, strategic-style arguments and distinctions about how to break this apart is that what you're actually going to get is a blanket ban on acquisitions.

All or nothing, yeah.

And that's going to be really bad for Silicon Valley. The entire nature of the Valley is predicated on most companies failing, and it's okay because Google or Facebook or whatever will acquire you. Basically, you get to go to prison for 4 years, which is sitting in a corporate office in Menlo Park, earning out your 4 years, and then you go and try again. That's how it works.

And guess what that means? That spurs a ton of startups and a ton of going for it, because you're kind of eliminating the downside. It's really less about VCs and more about the founders, in some respects.

Mm-hmm.

And by the way, there are a lot of startups and a lot of technologies that need to get into big companies so they get that diffusion. The P.A. Semi example: P.A. Semi, stuck by itself trying to make chips, is not useful to anyone. P.A. Semi being acquired by Apple changes the world, right?

Yeah.

So what I've realized—and this is my shift—is that while I understood why Instagram was allowed to be acquired, you could see the problem on the wall. I tried to draw a distinct framework about how you could stop just that one acquisition and not any of the other ones, and I've come to realize that's not possible.

I'd rather preserve the system, even if it means the occasional Instagram acquisition gets through because of Facebook's foresight. And to your point, there are positives of Instagram being acquired by Facebook.

Mm-hmm.

Overarching all this, though, it's been 13 years. Mark Zuckerberg yesterday was right to point at Snap. Snap's stuck at 500 million people. They can't make money.

Yeah.

Why would Instagram be what it is today if we hadn't built it, if we hadn't done all the advertising for it, if we hadn't eventually moved the founders aside because they couldn't take it where it needed to go?

It's an interesting counterfactual to wonder about what the landscape would look like if Facebook had not bought Instagram. Facebook has really become a grind to use over the last 10 years or so, and it's just a wasteland, at least in my life.

Does Instagram become more and more powerful as the years pass? Does Snap fill the vacuum? I really don't know what that world looks like. I don't have any answer here as I've raised this hypothetical, but it's one of the things that I've been thinking about as this trial proceeds.

By and large, I don't think things look that much different. I think you have a race to the bottom, arguably even more quickly, on the points we talked about before.

Hmm.

Maybe TikTok is actually even more dominant, because Instagram, even though it was late to pivot, pivoted hard because that order came down from the top. There's a reason Kevin Systrom left before they got all slopified, right?

Mm-hmm.

Yeah, it is an interesting hypothetical, but Facebook would have also evolved differently if it had been standalone.

Yeah, exactly. Do they pay more attention to the user experience and try to make it stickier in the app?

Well, what happened was Facebook became the utility tool, right? Facebook Marketplace is a gazillion times better than Craigslist ever was, and that's something you could do on Facebook because Facebook is just a utility.

Mm-hmm.

We have people connected, we have messaging—

Birthdays.

We do all these sorts of things. If they want to have an immersive visual experience, go to Instagram.

Yeah.

Right? Again, I totally think it's reasonable, and I've argued the point that they shouldn't have acquired Instagram, that all these things should have been different.

I don’t think you can go back 13 years, particularly when your case—and this is what I mean, the FTC’s case—is a 2D image looking at a 4D past.

Mm-hmm.

It’s taking emails from era 1 to complain about dominance in era 2 to seek a breakup in era 3. More broadly, the fact that despite this acquisition, despite the fact that Zuckerberg is smart and ruthless, Facebook still has real, meaningful competition today raises the question of what we’re actually trying to accomplish here?

Mm-hmm.

This isn’t the railroads. This isn’t the telephone company, where you have wires in the ground and it’s locked that way and the use case isn’t evolving forever. Things change. The internet is incredibly dynamic. I will grant you the argument that Facebook shouldn’t have acquired Instagram in the first place. Facebook leveraged that into basically having a monopoly for a few years, if you look at the fact that they didn’t do video as much as they should have from an economic perspective and at their dominance of the ad markets.

Just trying to be good stewards of the internet, you know?

And then the market took care of it. There’s no argument that they have a monopoly today. Are they large and powerful? Absolutely.

Well, and that would be my—

Do they have a monopoly? No.

—issue with it. I mentioned earlier that I have some nuanced thoughts on the case. I don’t know how nuanced they are, but in general, on Monday when you and I were on the podcast talking about the perception that there’s been a death of upward mobility in America—that there are fewer possibilities in American society today—I think a huge part of that story is not necessarily outsourcing jobs, but moving huge portions of the economy online, where now everyone has to pay massive tolls to Amazon, Apple, Google, or Meta just to operate small and medium-sized businesses.

You have these essentially utility companies that make it possible to operate successfully online. I can buy the idea that the internet works better if there are a handful of aggregators serving that role, but there has to be a limit on the margins that they can take from other businesses that are actually creating value. For me, as I’ve come to think about this more while podcasting with you over the last couple of years, as opposed to antitrust cases that may or may not deal with that core problem, I would prefer to have laws written to rein in the use—and sometimes abuse—of market power by a company like Meta, Amazon, Apple, or Google, whatever it may be.

I don’t know if trying to break up Meta really solves the core issue that we have, and that’s been at least what’s on my mind through the first couple of days of the trial here. Does that make sense to you?

No, because I don’t know what market power Meta is abusing.

They have the ability to charge huge fees for advertisers that work on their platform, and people can’t really go anywhere else to get anywhere near the same reach.

Who sets the fees?

Facebook.

No. It’s an auction. The fees are 100% liquid. The reason the fees are what they are is—say you and I want to buy something. This is, by the way, relevant right now because Shein—

I can never pronounce it.

—and Temu.

I butcher it every time I talk about China.

I know, it’s terrible.

Shein and Temu is how I do it.

As I predicted 10 days ago and no one paid attention to—oh my gosh, everyone paid attention to this.

As, by the way, I predicted it multiple times on this podcast, on Sharp China, but I probably got it from you.

Yeah.

So fair enough.

Yeah, no, well, listen, I know. We could collectively—

—predicted it.

How’s that? Their advertising is going to zero on Google and Facebook. What that means is the price that everyone else pays on Google and Facebook is going to go down, and the reason it’s going to go down is because there is a decrease in demand for Meta ads. If there’s a decrease in demand and the supply of inventory stays the same, the price per ad on Facebook is going to go down.

Mm-hmm.

The amazing thing about a Facebook or a Google is those dips—and you saw this with COVID very distinctly—where there’s this drop for a couple of days, then it popped back up. You had all these companies that knew, “If I acquire a customer for X amount of dollars, I can make this much in the long run.” They immediately start buying. They say, “Oh, wow, the price is at a level where we can buy more ads,” so they bring more demand into the market to respond to this, which brings the price back up.

I set you up like this, but I’m setting you up as a stand-in for, I think, a huge number of people commenting about this case who are missing a really fundamental fact: Facebook does not set ad prices.

Mm-hmm.

The reason ads on Facebook are expensive is because they’re good ads that work, and a lot of people want them. You absolutely can go elsewhere. Go buy ads on Twitter. Go buy ads on Snapchat. The reason you buy them on Facebook is because they work better, and you can understand and measure them. There is no market power in ad pricing.

Okay.

Period. It doesn’t exist.

The concern, though, is that in that scenario, you’re basically forcing people to buy ads that are more effective and then fork over a huge portion of their margin.

The problem is competition. The problem—the exact thing that the—

But it’s not. The problem is that ultimately, the economy you get when it’s shaped like that is not optimal. That’s my problem. It’s not—

Sorry, can I pick on you directly?

Okay.

I’m pre-warning you not to get worked up.

I’m not worked up. I’m worked up about the Lakers and Wolves.

You folks say—

I don’t want to be sitting here talking about antitrust again.

I know. I hear you. No, but I think this is actually really important. This goes back to my bit about Snapchat making people annoyed, even though that was theoretically what they wanted. People say they want competition. The problem with being someone online who needs to buy ads is not Facebook. It’s that Facebook created perfect competition, and so you are competing with everyone in the world to serve ads on Facebook.

They’ve made the market so large and so liquid that it feels unfair, but the unfairness is actually a function of perfect competition. Guess what? If you’re a supplier, perfect competition sucks.

Yeah.

That’s the problem with newspapers online. They’re competing with all writing on the internet. When you were the only newspaper in a city, life was great. When you started a small business, guess what was really hard? Getting your stuff onto the shelf of a Best Buy or Circuit City, or opening up a storefront and acquiring customers.

Facebook—wow—you can now access the whole world. You can reach everyone. The problem is that privilege extends to every single person on Earth.

Mm-hmm.

People are ascribing to Facebook the challenges of competing with the world. That’s not market power. It’s the exact opposite. It’s creating perfect competition, and guess what? Perfect competition sucks.

Perfect competition, you could argue, also ultimately sucks for consumers, because if I know that—

Yeah, you get a race to the bottom.

Yeah, exactly, and so that’s the concern. When I talk about this not being optimal for the economy long-term as we do more business online, that’s where it wouldn’t bother me if somebody stepped in and said, “These companies can only take X percentage of the sale that they’re facilitating.” There’s no argument that most of these sales on Facebook wouldn’t exist if not for Facebook connecting businesses with customers.

But also, most of what you buy through Meta—whether it’s Facebook or Instagram—is kind of crappy, because the people selling on there aren’t incentivized to build great products and try to use the Facebook funnel. They’re incentivized to keep their costs as low as possible, just churn out crap, and connect with customers.

To be clear, I completely disagree with you.

Okay.

Well, sorry, I completely agree with you about all these bad outcomes. You’re guarding your voice.

Yeah, no, I’ve been down that road before.

I’m sorry about that.

It’s fine.

No, I agree with you. The counterpoint is what you’re asking for is basically price controls. You’re going to get scarcity. You’re encouraging corruption and ways to go around the line. It’s not necessarily going to spur more quality.

Mm-hmm.

Again, I’m playing devil’s advocate. I’m acknowledging your position.

There are a lot of problems with the internet. There are a lot of problems with perfect competition. There are also a lot of problems with the solution, but what it sounds like we can shake hands on is that the issue here is actually not antitrust. It's the exact opposite.

Yeah, exactly. As I've come to understand the issues, that's been my personal evolution. You were talking about your evolution earlier. I just don't think antitrust solves this.

My evolution has been that most people in D.C. are not like you, and so I need to—

Give up now, Graham.

I cannot walk them down a narrow road. That's right.

6. Regulating The Reels Wormhole

Well, and then the one other note on regulation: You wrote about feeling queasy and kind of depressed when you get sucked into an Instagram Reels wormhole. Is that right?

Oh, it's terrible. It's awful. Number one, it's so addictive, and you just waste so much time. Number two, the speed with which it goes to just the worst—it's disgusting.

Yeah.

It really is.

I don't have that experience on Instagram Reels, but boy, do I have that experience—

Oh, no. You're exposing me.

—on X. It is really rough. Every now and then I get 30 minutes—

Yeah.

—in, and I'm like, "What am I doing with my life?"

Oh, see, X is so bad, it can't keep my attention for longer than 2 videos. I'm like, "Wait, why am I scrolling videos on that?"

It's really tough. And it's not all videos for me. I'm not a big video watcher generally, but the text alone can take me to that dark place—

Oh, yeah.

—that you described.

Oh, for sure. It's all terrible. It's really not great.

What came to mind when I was reading your experience, and you cited somebody else who was talking about how degraded—

Yeah, Karen X. Cheng, who's incredible. You should look at her Instagram. She does this crazy stuff.

Well, I'll have to check it out.

Yeah, I've linked to her years and years ago. She started doing this stuff around the same time I started Stratechery, so I feel a kinship with her. But yeah, I thought her point was basically—and it's a weird thing—it's too good, right? I'm consistently wasting time I don't want to spend, and that's good for the business right up until the point people bail on the platform.

Yeah. Well, I was reading that and thought about this tweet from Ross Douthat at The New York Times. I'm almost certainly pronouncing his last name wrong there. But in October of last year, he said, "Yes, of course, regulations and restrictions on building things naturally leads to fewer things being built, but historically, moral regulation is more likely to increase achievement via discipline and sublimation than to impede it."

That's a very simple idea, not all that groundbreaking, but it feels like a principle to keep in mind as society deals with all this technology and the market compels various companies to race to the bottom. The idea that all of it should be permanently unregulated feels a little psychotic now, and 25 to 30 years from now, when we look back at this era, after guardrails have been put in place, I would guess that it will look totally psychotic that it was unregulated for as long as it was. I don't know how you would possibly regulate it from a product standpoint, but it just feels like so many people have the experience that you described on Stratechery on Tuesday, that there has to be some way to make it less depressing and less productivity-killing. I don't know, but I just wanted to raise that.

Well, you're not digging deep enough in some respects.

Okay.

Because I think there are 2 factors that have led us to where we are. They happened simultaneously, and maybe there are interaction effects between the two. There probably are; they've driven each other. Number one, you have this overall decrease in friction. Things like this just weren't possible before.

Defenders would say, "Oh, there were all these scare stories about TV and blah, blah, blah." I think people like you would say, "Yeah, TV also sucked." It wasn't good, or whatever it might be. But even beyond TV, you still had to go to a room, sit down, and turn it on. Now it's just there, and it's with you all the time. The decrease in friction makes a lot of things possible, and a lot of those things sound good in theory until you realize you follow them all the way to their logical conclusion.

Mm-hmm.

Right? I think a lot of people who say they are pro-competition actually are anti-perfect competition because they realize it's not so great. Being pro-competition in the context of moving from a muddled, monopolistic framework to a somewhat more open one—oh, yeah, I'm pro-competition. But the internet pushes things all the way to their logical extreme. So that's number one: You have this lack of friction emerging.

Number 2 is—and this is a much deeper discussion, maybe even beyond the dorm-room discussion—this is more of a sitting-in-church sort of discussion.

Mm-hmm.

When you have a decline of a shared moral framework, you start having to legislate, and once you start legislating, you get all the problems that go with it. The ideal society is one in which people self-police, where they don't do things that aren't the right thing to do. It's a society where Mark Zuckerberg is not criticized for saying, "We're going to decrease videos because we want to connect people," but is actually praised for it.

Mm-hmm.

Right? And in a way—and I always point to this—

Well, was he criticized for that, or was he penalized by the market when he did that?

Well, he was criticized by stock analysts.

Okay.

By people like this.

And the people who might have criticized him hated Facebook so much that they weren't willing to acknowledge any of his good faith in that moment.

Well, all the people who are mad about the monopoly right now—that's a pretty clear manifestation of monopoly power: that they could even entertain doing that.

Mm-hmm.

That they could even entertain doing that. And you know what? I always point to this because it's more of a traditional right-wing conservative argument. It sounds, again, like the argument I make that sounds the most like my dad, which really concerns me—

Always a red flag for any of us.

—a decline in moral fiber. Yeah, exactly. I point to a traditional right-wing constituency—I think Wall Street in the '80s is an area where this became prevalent—this idea that, as long as it's not illegal, it's right. Legality became a substitute for right and wrong, and that is a very dangerous place to be because that is asking for either depravity or way more red tape.

The reality is, it's the organic nature of collective self-policing that lets you have liberty. You don't have to legislate everything. You can strictly enforce the laws that you do have because there aren't that many of them, and most of the problems of society are handled by the citizens themselves.

Mm-hmm.

Even in your call for "We're going to need regulation for that" is implicit a decline—a certain civilizational decline—

Mm-hmm.

—that I think is unfortunate. And again, it's probably tied in part and parcel with this decrease in friction and all these sorts of things. I don't know what we do about that. It's just a bummer.

A trade-off to be mindful of—

It is—

—if there were ever regulation.

Well, this is arguably the core of the argument for why technology leads to totalitarianism: It enables a lot of bad behaviors and also gives citizens the tools they start demanding be used to stop those bad behaviors. China is probably a good manifestation of this, with the Great Firewall, all the surveillance, and things along those lines.

As all this exists, a lot of people in the U.S. are like, "Yeah, they've figured out industrial policy," and guess what? They don't let people play. They crack down on video games and all these various bits and pieces. People make all these disparate observations without appreciating the extent to which they're actually all deeply intertwined.

Well, I look at China and I'm like, "Well, they may have some good ideas on how the apps are used."

It's like, imagine if China—imagine if we could get everything they have—

Get this without that.

But with freedom.

Yeah.

And it's like, I'm not sure it's not possible, guys.

Yeah, I don't know. I think there's probably some middle ground between the US today and China over the last 25 years, but—

Yeah. Well, no, there's massive ground because we've completely bifurcated. People friction was an unseeable yet very effective wall on a lot of bad behavior, and a lot of good behavior.

Mm-hmm.

Right? We look at the good part and say, “Wow, without friction, we can have a podcast. I'm sitting in Taipei, you're sitting in Washington, DC, and we can reach the whole world. That's amazing.” And also, it unleashed a lot of stuff we don't like. We can pull videos from across the entire network and serve people slop, and they will just sit there and mindlessly consume it, feel crappy about themselves, and do the exact same thing tomorrow.

Let's start with just banning the phones in school. I don't know what else we can regulate over the next 20 years or so. I am pretty confident that one day we're going to look back and be like, “Whoa, nobody was ready for that, and I'm glad we did this, this, and this to help society cope with this technology.”

But final notes here. You mentioned tech leading to totalitarianism. Let's close with this email on AirPods. Adam says, “Ben and Andrew, regarding the praise to Tim Cook for saving Andrew's iPhone by removing the headphone jack, you don't have to sacrifice ports for waterproofing,” which I believe you said on Monday, Ben.

“I've been an Android user since the Galaxy S5 came out years ago, and that phone not only had a user-replaceable battery, Qi charging, and a headphone jack, but it was fully waterproof as well. As evidence, I can offer a personal anecdote. I was out hiking with my wife, and while taking pictures, I dropped my phone from the top of the rock. It bounced several times and landed face down in the creek below me. I climbed down, retrieved the phone from the water, and resumed taking pictures.”

“The area was filled with iPhone users, and they were all shocked that my phone wasn't destroyed. It can be done, folks. It's just more profitable to sell you glass phones with fewer features. Note, Samsung is guilty of this too, so don't think I'm just hating on iPhones.”

So there you go, Ben. I recant my praise to Tim Cook for saving the iPhone earlier in the week—sitting there on his mountain of AirPods cash, grinning.

It's not just glass. It's thinner. It's, like, better battery life. Anything that is modular is going to diminish performance. So, like, if you have a replaceable battery, for example, you're going to have much less battery life and you're going to have a larger phone.

Uh-huh.

Nothing is for free. These are all trade-offs. Now, you might be willing to make that trade-off and wish that Apple offered that option, but all this stuff does have trade-offs. I just looked up the S5. It's a chunky boy.

Okay.

Or was, you know, without waterproofing, so.

I'm okay with a chunky boy. I never understand the obsession with a thinner cell phone.

But final note, Matt says, “Andrew, longtime listener, first-time caller. Big fan. I love the mispronunciation call-outs. I feel it's a badge of honor in a certain way when a person mispronounces a word in a way that makes clear they've read it more times than they've heard it. Nerd street cred.”

I just want to say that is the proper way to understand us mispronouncing words on this show. We're cool nerds. We're not idiots that can't pronounce words correctly. Thank you, Matt, for getting it.

I mean, everyone says this and brings it up, but I'm not really—I don't embrace—I don't know. I have mixed feelings about the word “nerd.”

You just want to be a cool guy who's too cool to ever learn how to pronounce words correctly?

Yeah. I've surpassed the need for pronunciation as a podcaster. I don't know. I just think I have mixed feelings.

Exactly.

That's for somebody else. Well, he wanted to point this out, and, look, Matt, you are not the only person who wanted to point this out. We got a lot of emails about this.

At 56:15 on Monday's podcast, Andrew says, “Solder. But here in America, it's pronounced solder. Ben is not the only one mangling the language.”

So there you go. I have been reading it as solder for years and years, and now I know that when Intel was out there in the lab—Fairchild Semiconductor—everybody was soldering. They weren't soldering. Is that correct?

Yes. Well, there's also this. This is actually part of the chip-control skirting. There's a company that has a 45-nanometer chip, a super-old one that no one uses, on a board that's loaded with 100 gigabytes of high-bandwidth memory.

Mm.

And then they sell it into China, and because it's such an underpowered chip, it doesn't violate any chip controls. And now it's in China, and they desolder the high-bandwidth memory from the chip, and then they can use it somewhere else. So you can solder well, or you can solder poorly. That is also a thing.

I like the “I'm beyond pronunciation” take. It's really arrogant. It's just very distasteful.

Lean into it.

I've moved beyond it appropriately.

That was our official stance on however Nadir [?] is correctly pronounced: We were beyond pronouncing it correctly.

Yeah. Well, I mean, I have to lean into it because I've long used the joke that I have a site that grows via word of mouth named a word that nobody can pronounce. So I just have to lean into that level of accidental arrogance, if you will. I'm beyond pronunciation.

Well, thank you, because now I, too, have to explain Stratechery—Stratechery—to all sorts of people in my life as well. On that note, we will be back next week, and we will keep it rolling.

Ben, please pull for my T-Wolves on Saturday night. Anthony Edwards, Dante Di Vincenzo, and Andrew Sharpe—we're all going to shock the world together over the next couple weeks against the Lakers.

Good luck.

Here we go.