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[on-hold music] Maybe TikTok brings the world together, our common love. No, I refuse, I refuse to.

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I see the TikTok videos on, on Twitter, which is my sort of like menthol cigarette addiction, and so, like, I'm full on these kind of social media vices. Like, Twitter is enough.

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Like, I'm hacking up a lung from my time on Twitter, so I don't [chuckles] need anything else.

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Yeah, I would get in some spiral of, like, you know, different, like, meat videos or something, and I'd spend, like, hours watching them.

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There were definitely moments in the pandemic where I would look forward to being done with work so I could take an edible and just, like, lay down and spend three hours- [laughs] -on TikTok.

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All right, that's a very compelling sell, though.

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[laughs] [on-hold music] The Rebooting Show is a podcast where I speak to those building and operating sustainable and modern media businesses.

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The way a sustainable media business is built now has changed. The days of talking about scale and eyeballs and being all things to all people are over.

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Now, it's more about directly connecting with specific audiences and making money in a variety of ways that often include advertising but aren't dependent on advertising.

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This week, I spoke to Alex Kantrowitz, the founder and operator of Big Technology, a newsletter and a podcast that charts the role of the biggest tech companies in our economy and our lives.

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I've known Alex for many years, going back to when he declined a job offer from me [chuckles] to go to J-- BuzzFeed News. I think he actually made the right decision.

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'Cause at BuzzFeed, um, he covered the tech beat out of San Francisco and ended up writing a book about tech leadership called Always Day One.

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Two and a half years ago, at the height of the, uh, pandemic, Alex left BuzzFeed to go independent with Big Technology, and since then, he's accumulated nearly a hundred thousand subscribers to his newsletter and will soon roll out a membership program.

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And I, I try to convince him, uh, later in this program to charge more than he plans, and so we'll see if he goes with that.

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But in addition to talking about, like, his, his journey as a solo operator, we begin with a discussion of the strange period the tech industry is in as it leaves behind the giddy days of, of pandemic-fueled growth and their multi-trillion dollar market caps and now face a winter of discontent as tech platforms of all stripes, from Meta to Snap to Google to Amazon, face an array of challenges.

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Most notably, Alex and I discuss the doubts around Mark Zuckerberg's meta-metaverse vision, how to unpack the pressures Apple is placing on Silicon Valley's preferred targeted advertising model, and why TikTok is so often eating others' lunches.

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Hope you enjoy the episode. If you have feedback, please do send it to me. My email is bmorrissey@gmail.com.

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If you like this episode, please do rate and review it, and a big thanks to Jay Sparks, who is the producer of this episode.

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You should check out Jay's company called Podhelpus, and he will help you have your own podcast.

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[on-hold music] Alex, y-you're the perfect person to have on this podcast after this, this incredibly weird week in technology. Oh, it's great to be here. It was definitely a, a total wipeout.

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Worse than a lot of people expected, and that's sort of been, you know, the story of twenty twenty-two is it c- it can always get worse. Yeah. Let me, let me just set the, set the table, which is...

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And I'm probably gonna miss a few. So we've got Meta missed earnings to the point where Jim Cramer was weeping in regret about recommending its stock on television. Al-almost weeping, yeah. [laughs] Okay. Almost weeping.

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Uh, Google reported that YouTube's revenue declined for the first time since it's even broken out YouTube's revenue. Amazon reported a weak forecast that, like, wiped a ton off of its, its massive market cap.

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In total, I was reading that, like, about eight hundred billion in market cap was wiped off of tech firms.

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Oh, and, and also, by the way, Elon Musk entered Twitter's [chuckles] headquarters as its new owner carrying a sink and then proceeded to fire, uh, the CEO and several other top executives. So did I miss some stuff?

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Pinterest reported a, an earnings beat, so... [laughs] Okay. All right.

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So Pinterest is doing well, but outside of Pinterest, it seems like we're in this weird transition period that we've been in for a little while when it comes to the tech industry, and, and it feels like everything is sort of coming to a head in some ways.

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Like, give us the sort of big macro take on, like, where the tech industry is right now, 'cause it feels like it's in transition. Right. Well, this definitely all began when the Fed raised rates, right?

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The Fed and the, the tech industry had benefited for a long time from zero interest rate policy, which puts a premium on companies that might grow sometime in the future, because if you can't make money saving your dollar, you might as well, you know, put that to use for a more risky investment or an investment that will, you know, potentially net out, uh, a return, you know, ten, maybe ten years in the future.

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That's when things like metaverses and blockchain became popular because- Yeah... you know, going into consumer packaged goods was just less sexy for, for the investor.

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So obviously the Fed has raised, raised rates, investors have responded, and the market caps have actually been falling in these com-companies for a while.

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You know, you had companies like Apple that was a three-plus trillion dollar, uh, company, you know, not too long ago, now in the, in the two-plus range.

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So, you know, it's a pretty big story when a company loses almost a trillion dollar of market cap, and now this week it's coming to a bit of a head.

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And one thing that Liz Young from SoFi said on, on CNBC this week that I thought was really interesting is this is sort of the pattern of, of how it goes. The first thing you see is valuations come down.

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Then eventually it's reflected in earnings, which is what we saw this week, and eventually it's reflected in the broader economy.

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So we're in this middle phase, actually, where we've had the valuation contraction, we're starting to see that earnings are a little difficult, but we don't have the d- the recession yet, right?

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We don't have the mass unemployment, and if it follows that logical pattern, you know, that is on the way, and the main question isHow far along this path does the Fed, which is really driving what we're seeing right now, let it get?

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So I wanna talk to you about that 'cause, like, the Fed is a g- a good point, but I think where people are trying to disentangle is how much of it is, particularly when it comes to the advertising businesses, how much of it is Apple's, I think kneecapping has become the common go-to term [chuckles] for IDFA.

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How much is it Apple kneecapping this particular type of advertising? 'Cause it's not reflected in if you look at the advertising holding companies' reports, they keep, like, raising forecasts.

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Like, it has not filtered down into the broader advertising world. But Snap has gotten crushed. Meta has obviously gotten crushed. Um, and even Google does not seem in- immune to the challenges put forth by Apple.

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How much of this is the front end of, like you said, zero interest rate policy going away, and then possibly the front end to what sure looks like some difficult economic, uh, conditions, and how much is, is related to just Apple's decision that it wanted to take over the advertising business?

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Right.

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Well, so to add a little bit more context, of course, the Fed plays a large role here, but we're also seeing a, you know, a broader pullback, and we're seeing a return to normal from what was going on in the pandemic, right?

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So, you know, we have that. We have everybody, uh, you know, now Amazon, for instance, realizing it doesn't need 1,000 warehouses on every corner. It can- [chuckles]... you know, do with 100.

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And companies are doing this retrenchment. Netflix, for instance, realizing that actually people wanna do things other than watch Netflix when they can leave their house. So you have that.

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You have the Fed, and then you have Apple, and Apple is, is actually hurting. Uh, there's no doubt about it. The way to look at it is you can take a look at the different ad businesses, right?

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So Facebook, Google, Snap, they are heavily reliant on this Apple, uh, advertising, which, which of course, like, the key is that you can attribute whether your ads are doing well or not after, you know, a sale's been made because the sale's often made off platform, right?

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So they can't show conversions to advertisers, and they're struggling. Then you look at a company like Amazon, right, which actually has the entire life cy- cycle happen on its site.

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And, you know, i- interestingly, before this week, I was thinking, "Okay, where's the weakness gonna be?" And I thought it was gonna be weakness in spend.

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So when I thought about who's gonna do poorly, I said Facebook, I said Google, I said Amazon. Turns out it was only two of three. Amazon is not impacted by that Apple stuff.

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It beat advertising expectations, which I think goes to show you that the Apple changes are actually having a pretty big impact. Yeah. And, and th- they're having a big impact on, on a certain group, but not on others.

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And, and I think what's funny is, like, you know, I mean, you've known this 'cause you, you, you covered media and advertising for years, but you then you, you went on to technology, too, so you, you know both sides.

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And, you know, publishers were always saying, you know, the duopoly took all the money and stuff like this. Meanwhile, now the money is leaving the duopoly. Guess what? It's not going to publishers for the most part.

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It's going to retail media. It's going to Amazon. And, oh, what a coincidence, it's going to Apple. That's right. Funny how that works out. Well- 'Cause I thought it was all about privacy, privacy is a human right.

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Oh, my God. The, the fact that people- [laughs]... bought that line from Apple was, was, totally astonishing to me and, and what, really didn't even question it, allowed Tim Cook to get away with this stuff.

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I mean, it was really never about that. It was about marketing. A, about marketing the iPhone against Google and Facebook, uh, number one, and then, B, like, the company is just trying to make profit.

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You know, I did this, uh, I put up on Twitter this, like, Nathan Fielder image, right? The y- you know, Nathan For You, where he comes up with this crazy- Yeah, yeah... these crazy ideas.

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And it was like, you know, the plan is to sever the key piece of attribution data from your main competitor, watch their value sink- [laughs]... and acquire them right as you build this copycat ad business.

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I mean, they are really getting into, into Facebook's territory. And, you know- Yeah... and, and I think they need, need-- There's questions for them to answer.

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And, and this privacy thing, this we'll stand up for your rights has been so important to their brand, and now people are starting to see through it.

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You know, I did this, uh, another tweet earlier this week where it showed that Apple was gonna start to take 30% of the in-app payment boosts.

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Like, if you were gonna boost on Facebook or, or Instagram, for instance, inside the app, now they consider that an in-app payment, so you have to pay Apple 30%.

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And I just wrote that it was insane, and I was surprised by-- You know, typically people are like, "Down with Facebook," but I was surprised how actually the sentiment has changed, and it was all these people saying, "If you thought Facebook was bad, actually take a look at Apple."

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So- I know. I know... I think the sentiment really has changed. It's hurt a lot of these, uh, direct-to-consumer brands, people like the... Well, I don't wanna say names. They're gonna start... I'll say names.

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I think people like the Warby Parker, which, okay, they've pulled back, but that- Yeah... that has not been an effective channel for them. Stitch Fix, all these names. Yeah. Casper.

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They've struggled to market on Facebook, and that's an Apple thing. Yeah. Well, those are the big ones. Right. Those are the big DTC brands. And all the little guys are also getting crushed.

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And the, the-- I really think that- Right...

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that with Apple, the, the, um, mentality has, has changed, and it's gonna be really interesting to see if they can, can hold their luxury brand status for much longer given that people are starting to see through them, which I find refreshing.

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Yeah. I mean, well, I guess it'll depend on the definition of people. I feel like the, the savvy sort of industry people, like, know this is nonsense, right? Like, I don't know if, like, the, the general,

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you know, consumer really ties this all together. Right. So I think Apple can... They'll get away with it because they, they can get away with it. Right. And shamelessness is always the greatest competitive advantage.

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But wait till the average consumer s- sees three ads for Casino Club or whatever it is in their app store. Oh, yeah. Well, that's the problem. That's the problem. Apple has gone down this road with iAd.

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Remember when iAd- Mm-hmm... was, like, a total disaster, and they're... You know, so they're gonna start to realize that the money for a lot of the stuff is super sub premium, you know, advertising.

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The advertising industry has many different pockets.

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The most lucrative pockets that most of Silicon Valley platforms have found have been direct response advertising that's been rebranded as performance, and a lot of that stuff, particularly in the in-app economy, is, um-You know, it's not the stuff you see on TV, let's put it that way.

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Yeah, exactly. So, you know, on one hand, we're seeing this early because we know where the money's going, but as Apple continues to flood its products with ads...

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You know, wait until someone says, "I think my iPhone is listening to me," not, "I think Facebook is listening to me." That's true. Once that happens, they've crossed the Rubicon.

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[upbeat music] So let's talk about Facebook. We'll call them Meta if we have to.

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Um, obviously by changing the name of the company, it was meant to signal that it's looking for, for its next paradigm. It never built a phone, and look, whatever, we can't go back in time.

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I think if you were to go back in time, I think that Facebook would've built a phone, right? Because they- They tried... left themselves- But they didn't stick with it. Yeah.

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But they, they, they didn't stick with it, and, like, it, it turns out that that was an existential challenge. Like, you cannot leave yourself that exposed.

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And, and so now they're looking for the next thing, and I think Silicon Valley overall has been looking for its next thing for a few years now.

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That's why I really do think we're in this in-between, uh, uh, period of time. And, you know, since the iPhone, we're going on what? Like, over, like, is it 15 years? Sounds right. When did the iPhone come out?

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It's been a very long time. Like, it- it's been a- We're up to the iPhone 14... a long time... so it's been 15 years. Yeah. [laughs] Like, there hasn't been a new... You know, there were some, like, pretenders.

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You know, people were talking about, like, big data and VR and AR and stuff, but it's clear that Facebook, Meta, is betting the company on this.

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I know you, you, you, you had a, a quote from, from Antonio about this, in that, like, on the one hand, I think it's very easy to, to mock the, uh, the metaverse stuff, and, uh, and journalists are very good at that.

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On the other hand, it's a pretty ballsy move, isn't it? Absolutely. Totally gutsy. I mean, to... Look, I don't think it's g- I don't think it's gonna work in the way that Mark Zuckerberg is hoping.

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Um, but I think he sees that he can have this sustainable business milking the asset, which is the Facebook ad business, for, for many years to come.

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But then again, he, he is buddies with Bill Gates, and Bill Gates, you know, saw his company get so dedicated to Windows it missed the next transition, right?

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And became so dedicated to it, it, it basically gave up on its browser, so, um, threats to the desktop operating system would not build online, which they eventually did.

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And it became committed to on-prem servers, right? And, um, waited too long b- to, uh, to do cloud and let Amazon run away with the lead. So I think Zuckerberg sees that. He doesn't wanna be that type of leader.

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He's only 38. He has plenty of time left. Uh, and, you know, he, he thinks that the technology's eventually, eventually gonna get there, and he has the money to do it, right? So I was like, you know, how could...

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Does, does Zuckerberg funding the metaverse defy the law of physics? But it doesn't. The company is on t- uh, already earned $84 billion this year, and it spent $25 billion on R&D.

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So it's profitable even with this, you know, massive metaverse spend. Um, it made $5 billion in profit last quarter. So a lot of it is investors being mad that, you know, we're in different times in the market.

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Zuckerberg doesn't care, right? He's like, "I'm just not gonna- [laughs]... I, I don't care. I'm gonna bet the farm. We're not gonna- Yeah... be irrelevant."

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And I'll read the Antonio quote because I think it's interesting. Uh, he said, "Meta's business has been kneecapped by Apple.

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Growth has stopped in favor of rivals like TikTok, and it's too late to build a phone," AKA it's stagnation time, right? That's me. Okay, now he's saying- Yeah...

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"Zuck is making an existential bet-the-company move at enormous scale. Most companies would just delude themselves and slowly die." Yeah. So, like, they, they have the, the runway to do this, right? This is not AOL 2.0.

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Mm-hmm. Or maybe it's 3.0 at this point. Mm-hmm. Because AOL was trying to milk a dial-up business at the end of the day, and it was much smaller.

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Like, whereas, like, the, the scale that Meta has gives it a lot of options. Right.

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A conversation with Eric Jackson, the investor, and we try to, like, have some empathy for Zuck or put ourselves in his shoes, and it turns out that, you know, okay, if the, the, the company is on schedule to make $110 billion this year, the metaverse spending, you know, maybe they spend $10 billion, or even if they lose $10 billion, right?

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It's, it's, uh, you know, relatively not as big as you think. And if, if that is, uh, uh, something that might give their company a chance to live on in a second life, no pun intended, then maybe do it.

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[laughs] Okay, so the other contender as, as far as, you know, I guess the new entrant to the big tech pantheon is TikTok. Where do you see that going with?

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'Cause I- I think what's interesting is when new tech platforms emerge now, they're emerging in a different, a different context, right?

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Like, people are not, uh, generally predisposed to believe all of the, the stuff that, like, big tech, like, tells us about everything's gonna be great, it's gonna bring people together.

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Geopolitically, we're in, if not a cold war, China is very clearly decoupling from the West. I mean, we're, we're looking to decouple our supply chains. Who owns what data is, is very important.

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China is building a massive surveillance economy.

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I think there's, there's very few issues that I believe the mainstream of both parties agree on these days, but, like, distrust in China, I believe, is probably one of the few issues everyone agrees on.

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Is TikTok going to be banned in some way, shape, or form, and what would that mean? Uh, I mean, I would say most likely there's a, an attempt to force a sale.

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I think Trump tried to do this and just was pretty sloppy and then eventually just sort of lost interest. Um, Satya Nadella was at Code, I think, last year.

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Kara Swisher asked him, like, what happened, and he goes, basically, I'm paraphrasing, but Trump ghosted him. Like, he's like, "I basically never heard back. I was ready to make the deal."

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Well, then I just sort of have to ask about TikTok. [laughs] Tell me what happened there. It's the strangest thing I've ever sort of worked on. It's unbelievable. First of all, you gotta remember, TikTok came to us.

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We didn't go to TikTok. Right. But I was pretty intrigued, I must say. It's a great property. And then I guess the rest is history.I mean, about your discussions with Donald Trump [laughs] He's gone now.

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You know, President Trump, I think, had sort of a particular point of view on what he was trying to get done there, and then it just... I just dropped off. I mean, it, you know, it's interesting.

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So I do think that there's a world where, um, US government does push to have TikTok sell. Now, you might not have support for that in China, and then what happens? You know, that'll be really interesting.

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Do they say we're just gonna shut down the app and then be done with it? I don't know. I think...

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So I, I can just say this, 'cause point of view of a marketer on TikTok, which I am, I just started doing TikTok videos for my podcast. I just view it as, as te- as potentially temporary.

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Like I, I kind of view it like I'm renting space on TikTok, and there's a good chance that it will eventually go away, so I'm trying to push people to other platforms, push people to the- Yeah...

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podcast, push people to YouTube. It's an unbelievable traffic cannon right now. I mean, the power of that thing is un-freaking-believable, especially when you create an account with no followers. TikTok doesn't care.

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It will, like, push your videos out to hundreds of thousands of people, whereas Instagram, you really need followers to get that cycle off. So, um, TikTok is at such a great advantage.

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But there is a real national security threat, and it does look, unfortunately, like the US and China are growing more and more oppositional. I wish that wasn't the case. Um, but, but they do come more- Yeah...

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and more closer to some sort of conflict, um, especially around Taiwan. So, um, this idea that, you know, what would happen if Russia owned TikTok, right? Like, it would be banned.

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And so this idea that TikTok can be banned one day, it's totally not out of the picture for me. Y- yeah, I think, like, a lot of times, like, I...

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There is a lot of catastrophism out there, but at the same time, like, I, I think back to, you know, I was growing up, the, the Cold War was still going on.

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There's no way this, uh, that the United States would have accepted the Soviet Union owning ABC. Like, no. No way. Like, it just simply would not happen.

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And, and, and with the data assets, there's even more concerns, and with, you know, China's, like, history- Yeah... uh, with collecting personal data [laughs] I don't think, like, that would be an unheard of decision.

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Yeah. But we'll see how that... So I'll just say- So the final thing is that I wanna get- Sorry... go ahead. The, the pacifist in me gets so kinda sad about this.

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Like, I don't see why the US and China need to be in conflict, and, you know, why can't we just have nice apps that we all enjoy? [laughs] Oh. Come on, Alex, let's, let's not. This is a new world.

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The, the neoliberal globalist era is over. Too bad. RIP. Pretty soon we're gonna, pretty soon we're gonna have to get, like, uh, you know, visas for each country and whatnot again. Maybe TikTok brings the world together.

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Our common love of the, you know, one enjoyable social media app, you know, for it takes us- I refu- I refu- I refuse to get on it. Like, I'm like, you know, after, like... No, I refuse, I refuse to. No, I know. I know.

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I know it is. I see, I see the TikTok videos on, on Twitter, where, which is my sort of, like, menthol cigarette addiction, and so, like, I'm like, I'm full on these kind of social media vices. Like, Twitter is enough.

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Like, I'm hacking up along from my time on Twitter, so I don't need to [laughs] I don't need anything else. I, I have a feeling, and mostly it's because I'm sure it's too addictive. I just... I, I know.

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I know it would be too addictive. I would get into some... Yeah, I would get into some spiral of, like, you know, different, like, meat videos or something, and, and I'd spend, like, hours watching them.

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There were definitely moments in the pandemic where I just, like, looked forward to being done with work. I mean, this was during lockdown, right? And I was in San Francisco, so that's the important context. Yeah.

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But I would look forward to being done with work so I could take an edible and just, like, lay down and spend three hours- [laughs]... on TikTok. All right, that's a very compelling sell though.

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[laughs] [gentle music] All right, final thing is artificial intelligence.

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I was totally... I'm late to everything, but that's strategic, at least that's what I tell myself.

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I gotta say, like, I started to get freaked out by a lot of this, these AI advances, and I know they've been happening, like, you know, pretty much in the open for the last several years.

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But I guess I've been, like, sold such a bill of goods about the next big thing so much that, like, when I experience, like, some of these AI tools, I'm like, "Holy shit, this is it." Yeah, I, I think that you...

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there's no denying the moment that we're in with generative AI, and people always make fun of the latest hype cycle. But h- when was the last time, you know, a Web3 application gave you the delight of a DALL-E?

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Here's a spoiler. It never freaking happened. But DALL-E- Yeah... you can't deny DALL-E. It is unbelievable to use it. I've been using it to illustrate stories on big technology.

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I mean, this past week, I was trying to figure out what do I do to illustrate a Facebook earnings report. I don't know how to say that word.

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[laughs] And I had it build, uh, uh, a, an image of, uh, a man in a gray shirt at a casino wearing an Oculus, you know, with, uh, some cards in his hand. Yeah, that's awesome. I saw that one.

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And I was like, "Holy crap, this is amazing." And, and I really view that as a communication technology, right? I think people are gonna use that to express ideas and views and, you know, we're just in a wash.

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I mean, your audience probably knows this. We're in a wash of, of content, right? Everyone does content, and it might... Uh, this will... It will...

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We don't have enough graphic designers or artists to illustrate all the content, but things like generative AI, like DALL-E, give us that opportunity, and I just think it's this unbelievable step change improvement, um, and, and just a fascinating- Yeah...

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technology. And we also... Yeah. You're, you're okay with them coming and, like, to do the illustrations, but what happens when they're doing the newsletter, Alex?

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Well, I, I mean, like, look, I think that at the end of the day- [laughs]... there's... Well, I just did a, a, a tweet this week about it. Um- Are you ready for, are you ready for that smoke from the robots? I'm ready.

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I'm ready for it. I just did this where should, should writers who have the newsletters, uh, written by, or writers who have their writing assisted or written by AI have to disclose that?

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And I think that's a kind of an interesting question. For me, the worst- Oh, yeah... the worst part of the writing process is the actual writing. Like, I love discovering the idea. [laughs] I hate writing.

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And so, like, is there a world where I can, like, feed my interviews into an AI and, like, give it some direction and have it do the newsletter and then sort of work and personalize it?

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I think that would be amazingI don't think it's gonna replace journalists. Like, at the end of the day, our job is to, you know, have an original insight.

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Okay, maybe it can do some of that, but find information that nobody knows, and, you know, that requires reporting, and I, AI is just- Yeah... not gonna do that for us.

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Although, I mean, AI, like, like AI-assisted reporting will ab- absolutely, you know, be the norm.

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I mean, AI is incredibly good at w- particularly, at least at this point, with sifting through large amounts of information and finding patterns, and, and- Totally...

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that's, you know, more, more data is being, you know, created- Right... about everything, and so, you know, AI is gonna do a lot of that.

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I think it, it raises a lot of thorny questions about ownership- Oh my God, totally... and just the nature- Even these DALL-E images... the nature of creation.

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Right, where people are like, "Oh, is this based off of other people's art?" Well, technically it's something completely new, right? Like you, you write the prompt, dream up the image.

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But has it taken inspiration from other people's art? Yes. Is there a proper way to compensate them? We don't know right now. OpenAI doesn't seem to be doing it, so... And, and- Yeah. So let's... Uh, go on.

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Just in terms of like the- I-... the, you know, the AI-assisted writing, it's always gonna be augment.

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I don't think it's a replace type of thing, and I, I'm pretty happy in a world where technology augments versus replace. Yeah.

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You know, our, our mi- I, I've said this before, like our minds always go to replacement a- anytime these sort of, these automation technologies co- come online, and rarely is it a one-for-one replacement.

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It is in some, in some instances, but a lot of times it just displaces and causes, you know, the need for, for, for more labor, not less. Mm-hmm. And you see this.

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I mean, we've never had more automation and, and we've n- also, you know, have labor shortages right now. I mean, like you've written about programmatic advertising back in the day, Alex. Oh, yeah. You remember? Right.

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It was like all this, "Oh, it's gonna replace the ad buyers." It didn't happen. Get me back on that old drug. What it, it, it did actually change the way that advertising works though. Like it didn't necessarily- Yeah...

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replace the buyers. Who it did replace, a lot of the direct sellers inside the publishers. Yeah. Yeah. I mean, but- Let me tell you a story. Okay. Okay.

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Before I was working in journalism, I was working at an ad tech company called Operative, which did- Of course I know that, Alex... yeah, they did, um, ad tech, uh, order...

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They, they were ad tech order management system for publishers. And this was... And, and so I was doing sales for a year, and then I moved to do some content marketing.

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And this was a time when programmatic advertising was on the rise.

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In our content marketing, we wanted to create this publication that people in the industry would turn to, not for us, like putting our, you know, why Operative is great, but here's important information.

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This was like, you know, this was the way content marketing was gonna go. You know, brand journalism or whatever. It didn't have a name at that point- Yeah... but that's what it was.

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[laughs] And I started writing about programmatic advertising because that's what I was hearing about in the industry, and that was going on in every conference.

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And one of the executives pulled me aside, and he was like, "Wait a second. Why are we writing about this if this threatens to replace us?"

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And I was like s- I mean, thinking to myself like, "Dude, the problem is not the content marketing," you know? [laughs] So, um, but it, it eventually, like, did. It- it... Not, not that it replaced Operative.

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Operative eventually sold, but, um, I, I think the people... And I start... Before I was selling ad tech, I was an ad buyer, so I was on the phone with these people, uh, you know, uh, with, with sellers- Yeah...

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trying to, to, you know, reserve inventory and then send my creative over and, you know, reconcile the financial stuff.

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It was a huge pain in the butt, and I actually started moving programmatic before I left and went to, to, um, Operative, which was like a very, um, illogical move given the behavior that I was doing.

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Um- [laughs] But, but that was the direction it was going, and it certainly did revamp, you know, a good chunk of the way that the ad market works. Yeah. I wanna talk about illogical moves.

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It's not actually an illogical move- Yeah... but I needed a segue. That's good. Uh, and get in, and get into the business, like going independent, you know, building an independent business. Mm-hmm. You know, you...

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W- How many... You're, you're two and a half years in now? That's right. Yeah. Yeah, so like, you know, I think that you were part of like, you know, the initial wave, I guess, probably.

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Maybe not the initial wave, but it was really- I don't know... starting to gain steam. I was the first- Um- I was the first full-time... I think the first full-time tech reporter, uh, to leave and do this.

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Oh, there you go. So you were like, you know, totally the first wave. Um, what... First of all, when you go back to it, um, what was the impetus?

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I, I just wanna say also that like, um, I do have an ad business, so, uh, unlike the Casey Newton episode, I'm glad we're not gonna have to spend the whole time debating whether [laughs] to start that up.

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Um, but I really- No [laughs]... did enjoy that episode. Um, by the way, folks, I am a Rebooting listener. This podcast rules. Okay, good. And I'm glad to be here. I should've said that at the beginning.

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The [laughs] impetus to start, uh, the big- It's okay. We have AI that puts that in there- Yeah, yeah... anyway- That's good... for all guests. Good, good. See? Augment.

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[laughs] Um, the impetus to start Big Technology, look, I, I was, uh, a, a reporter at BuzzFeed in their San Francisco bureau for like five years. Um, couple things happened.

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One, uh, I wrote a book about culture and leadership inside the tech giants called Always Day One, and it came out like at the worst time to release a book- [laughs]...

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in 112 years, on April 7th, 2020, which was like the peak death week in the first, first wave. And, uh- Yeah...

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you know, inside BuzzFeed, I wasn't, um, you know, understandably, like wasn't getting a chance to write about, you know, what I was, uh, trying to get across in the book.

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And not only that, you know, it was the biggest, um, health, political, and economic crisis of our lifetime, and, you know, I was getting assigned stories which were important for the desk, but I just felt didn't meet the moment.

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Stuff like were people getting refunds for their Verb- Verbos and Airbnbs because of pandemic cancellations. Yeah.

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So that, that led me to believe that, um-You know, it was time for me to go out on my own and write about what I wanted to write about and build an, an owned audience versus, you know, trying to get earned audience that is subject to the news of the moment.

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Um, and so, so that was, you know... I think one is the journalistic freedom and the opportunity to have an audience that was with me versus dependent on others.

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And then to be quite honest, you know, uh, having been at, uh, BuzzFeed for five years and Ad Age for another couple, which I love both of those experiences, but I felt like, you know, you would go away for the holidays and come in every January and get an email in the first or the second week with the subject line, "Difficult decisions."

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You know, the, the, the media business, digital media business, which I love, uh, has been subject to a lot of up and downs, and I just felt that, you know, after all the whiplash, um, it was time for me to just to control my own destiny, and I felt like I could accomplish these goals by going independent, starting my own newsletter, you know, Big Technology on Substack, and then podcast, Big Technology podcast, and so far so good.

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[upbeat music] Yeah. So what gave you... I mean, technology is, like, very, very well-covered, right? Mm-hmm. It's extremely well-covered.

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So what gave you the confidence that you could find a, a lane and a differentiated lane within that? Yeah, I just felt that I could do it different from the way the mainstream tech press was writing at the time.

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Think that, you know, I love the... I mean, I love a lot of the people at the mainstream tech press. I don't know exactly what the move was to make this happen, but a lot of, you know, the tech press at the time...

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Remember 2020, it was, you know, focused on Trump, focused on content moderation. Yeah. Not really focused very much on, on innovation, and when it covered those hot button political issues, it was somewhat frenzied.

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And I felt that I could cover those political issues with a cooler head. Mm-hmm. And, you know, I-- my whole idea is I'm not in journalism to push an agenda. I'm here to find new things.

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And so I thought that I could bring that approach to these issues, and there would be appetite in the market for it. And then second, like, I care about tech innovation. Like, that's...

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I, I kept remembering, you know, in the middle of this whole slog, about like, why did I... why were the stories I was writing, you know, today look so different from the stories that I was writing when I first got in?

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And those were stories about how tech was gonna change society and, you know, the ways that social media was changing the way that we access information.

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I just thought that, like, you know, the fact that I'm, like, writing about COVID misinformation every day, which is an important story, but I just thought that there was, there was bigger stories about tech that could be written.

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And so d- you know, I thought that based off of that editorial perspective, you know, there would be people who would be interested in what I was doing. Yeah.

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But you didn't, like, draw out, like, like, a detailed business plan or anything? No. Or did you? No, I actually, um- [laughs] I, I didn't think it would last for more than a couple months.

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Um- [laughs] I didn't realize that Substack and the podcast would be... So I didn't realize that Substack was gonna be a main pillar. Um, it was actually kinda like bullet point number three in my manifesto after I left.

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And I just kinda threw in the podcast after hearing, uh, Brian McCullough from Techmeme ride home.

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Um, he did this tweet that he's, like, looking for hosts, and I, like, called him up, and I was like, "I'm about to go independent. How's the podcast business?" He goes, "Oh, it's really great." I was like, "Okay."

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[laughs] "Maybe I add that to my list," because I just felt it could be a good opportunity, um, to, uh, to convince people who wouldn't otherwise to have a conversation with an independent reporter because everybody loves to be on podcasts, and, and that proved true.

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So there definitely wasn't a big business plan. It was really, it was really in the, in the thick of the first wave of COVID that I, you know, made that move. Um,

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I thought, like, maybe I would, uh, you know, do, do some freelance writing really and try to get that- Yeah... editorial independence.

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But immediately after I dropped my, um, you know, notice or this blog post that I wrote on Substack about why I'm leaving and what I'm planning to do,

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people just kinda swarmed on that, on that tweet and swarmed on that post and blew it up a bit, and next thing I knew, I had a decent audience on Substack to get started with. Yeah. And I think that is the key, right?

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I think, you know, getting that, getting the, the, those first few thousand is, you know- Mm-hmm... it just becomes easier. Like, we can always talk about- Yeah... the end of scale and stuff like this.

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Let me tell you, things get easier than... When the numbers are bigger, you know, growth comes a lot quicker. Yeah, it snowballs. Like, I can remember early days- Mm...

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like, it would be like, "Oh, I got, like, six new subscribers." And, and yeah, that's just the reality. So how are you thinking about the business model? Because when you went to Substack- Mm... you didn't do...

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I mean, Substack has, you know, a very well-known sort of, um, preferred business model, which is to drive to subscriptions, and there's a lot of reasons for that. But you didn't, you didn't do subscriptions. Yeah.

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I think I have a philosophical, uh, belief in content should be free or as much content as possible should be free. Like, I didn't get into journalism to write for, you know, a smaller audience.

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Like, I wanted to write for the broadest audience possible and make sense of some of the stuff I was seeing for folks who are trying to figure it out. So philosophically, I didn't wanna be behind a, a paywall.

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I also thought it'd be more difficult to grow. I always felt that I was gonna do an ad business, and after some time, you know, that ad business emerged, which was fun.

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I've been ad supported the entire way through, which has been awesome. Then I also decided... I basically realized that, that advertising can be up and down, and so I needed to diversify the business a little bit, right?

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So I did syndication, and now, uh, Big Technology is syndicated through a handful of publications.

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Basically, my pitch to publishers is, you can carry quality tech reporting that doesn't need to be edited or can be edited lightly for, you know, one-fourth or one-third of the price of that you would be paying for otherwise or, or even less, right?

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So Big Technology is now sy-syndicated a bunch of quality publications, which I'm thrilled about. It's on Medium. It's on Slate, uh, quite frequently. It's on The Observer. Yeah.

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Um, just, uh, just getting started with The Wrap, which I'm stoked about, and, uh, all these publishers are, are...

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I think they're pretty pumped about it because, you know, we used to have this idea that the internet was one big newspaper that everybody reads, but as the internet grew, um-Audiences stopped overlapping as much and so, um, you know, the audience for The Wrap and the audience for Slate and the audience for The Observer, you know, just 'cause my story was on one doesn't mean that the other group would see.

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So I think there's a lot of distinct value that syndication can, can bring to audiences. And then, um, you know, the podcast obviously is ad-supported, and it's part...

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And I joined LinkedIn's podcast network, um, which has been awesome, great support- Mm-hmm... in terms of helping distribution, building community on the LinkedIn platform, which has been amazing.

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And then this was, like, a stretch goal of mine for a long time, but I had, I had hoped to become a contributor at a network, and soon after going independent, um, got in touch with CNBC.

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I had been on the air a handful of times beforehand a- and joined as a contributor. Let's welcome in CNBC contributor Big Technology's Alex Kantrowitz. Right now we're living in a moment of uncertainty.

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We don't know if the Fed is gonna keep on with its push, although it seems like it is, but it might pivot. So that's kind of the revenue, uh, makeup of, of the business that I'm running now,

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and, uh, and I, I can drop some news here on the podcast if, if you're open to what's coming next. Yeah, let's do it. Let's drop it.

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[upbeat music] Starting in January, um, I am gonna introduce a, a paid tier, maybe just... What do we call it? Big Technology Plus or Big Technology Pro. [laughs] Yeah, Big Tech- Yeah... both.

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Something like that. I don't know. A workshop. I'm still gonna keep three stories free every month, so I'm gonna hopefully you to that, um, belief in... I will you to that belief in keeping information free.

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So you do once a week. You do once a week. Once a week. So I'm gonna bump up the frequency and also do lots of cool community, uh, stuff for people who subscribe, um, like bringing in expert speakers.

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Brian, maybe you can come, you know, and have them- Yeah... have them do- I'm in... uh, conference calls with people who subscribe and getting a chance to have them get a chance to ask, ask questions of these experts.

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And then also, you know, more Q&A stuff, how can I help you type of things. And then there's gonna... There will be- Yeah...

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some tier where, where people in that tier will be, will be able to join some sort of messaging group, like a WhatsApp group, that they can put on mute and talk with the other people in that tier.

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That's what I'm thinking. Yeah. I think it's gonna be awesome. What are you thinking about, uh, what to charge? Uh, right now my thinking is it's gonna be, um, 100 a year or- Oh, two more... 12 a month. Two more.

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And- Two more... well, I wanna... I would much rather have annual subscriptions than, um, than monthly. But yeah, maybe a little bit more. I don't know.

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But, but I will start out the first year as a, as a discounted rate. So anyone listening, if, if you wanna try out Big Technology- [laughs]...

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for free, you can do that right now for the next couple months, and then- Yeah... make a decision. But do it now because- Yeah... Alex should be charging 250 a year.

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[laughs] I don't like, I don't like people going too cheap- Yeah... 'cause then it's like, wait, I'm paying $99- Right... for Big Technology- Mm-hmm... and why are you charging me 250? That's true. So- Yeah. Okay...

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for the rest of us- Well, you saw... don't- Yeah... don't, don't rote it, Alex. Eric, Eric Newcomer just went 199, I think, on his, so yeah. I don't believe in playing around with it. Okay. Just do it 200. All right.

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I don't... Does, does anyone not, like, see through that? Yeah. I know that that's been the common- Right... sort of approach, but- Well, Brian, I, I like...

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I do appreciate, um, [laughs] I think you've made both me and Casey Newton better business people [laughs] on this podcast- [laughs]... 'cause we've, you know- Well, you gotta tell... It's always charge more- Yeah...

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than you think you should. Yeah. And particularly as journalists- Mm-hmm... we always undervalue ourselves. Well, that's the thing.

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And so- Yeah, we're not used to being business people, at least, at least, you know, for me, I haven't been sold an ad, piece of ad tech software in, like, s- eight years, so [laughs] it's definitely something new, something...

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a return to the old, old muscle. So how many subscribers do you have? Do you... You have to have a lot. Alex is also- [laughs] This is not the reason I ha- have him on here, but he's my number one, like, recommender.

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Gotten 1,500, uh, new subscribers thanks to Alex, so thank you, Alex. Yeah, my pleasure. Um, and I'm happy... I mean, I've, I've- If you, if you take me out, I, I'm, I'm gonna come to Brooklyn and meet you. Okay.

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Sounds good. [laughs] I'm not taking you out. I mean, I, I've... I link your stuff in, in my newsletter every, uh, uh- Okay... well, not every week, but very frequently, and, and I'm a regular reader of. Mm-hmm.

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Um, 93,000 subscribers, so about to cross- Oh, my God... the 100,000 mark, which has been fun, and, and the podcast has a steady group of listeners as well. So I feel very grateful to have, have an audience.

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It's, it's so fun and- I mean, that's great... yeah. Like, if you think about as a solo person- Mm-hmm... to be able to, you know... I, uh, let's just, like, go back, like, 20-something years- Mm-hmm...

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or something like this. If you had a technology like... I don't know if yours is like... Yours is a little bit B2B2C. Like, it's not like- Mm-hmm... total like, you know, trade kinda stuff.

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Like, I'm more, like, in the weeds. I'm not writing for a general audience. But, like, that's, like, sizable, you know, audience to have. I mean, it's the coolest thing. You know, direct connection too.

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Definitely it's the coolest thing about email because, you know, if I was writing a blog and, like, hoping...

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I would be firing stuff off, I'd probably try to be, you know, inflammatory because that's what does well on social media, and instead I can you to the mission, which is try to write balanced, nuanced stuff for folk, um, and not have to worry because it's all about building that relationship and making sure that if people are having a good experience, they're coming back.

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And so, like, let me... I'll just share some stats from yesterday's newsletter.

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Uh, so it's been less than 24 hours, but already 43,000 views on it, and that's something I would have to claw for even at BuzzFeed, which was, you know, hooked into the Facebook traffic cannon. So it just feels- Yeah.

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That's amazing... it feels like a very, like, wholesome way to, to build a media company, and I've just been, been pretty stoked about it. [upbeat music] So how have you...

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I mean, we've talked about this a little bit when we've met up, but, like, how do you find balancing? 'Cause, like, you know, you're... obviously the core of what you do is in this- Mm-hmm...

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the content, is reporting and the journalism and stuff like this.

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But at the same time, and that's why I think, you know, Substack has gone to this, this subscription model is, like, it takes away a lot of the, the, the, the necessary stuff to, like, you know, you gotta sell ads, you gotta traffic ads- Mm-hmm...

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you gotta report ads, you gotta do... Like, there's a lot of-Of things that go into running a business of any size, and this is, like, a small business. Definitely. It- it's a ton of work.

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And I think it really comes down to, um, I mean, learning how to say no to things. And, you know, I think year one, especially doing this, you're gonna say yes to everything.

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So, like, Rico came in and was like, "Do you wanna do the, um, Land of the Giants series about Google as a co-host?" Yeah. And I was like, "Yes, please. Major fan of this show. Of course I wanna come in."

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[laughs] And I had a great time doing it, but, um, I think that the, the... A- and I... It was like, yeah, I think the advantage of building something that's more sustainable that's, that grows bigger, um, is that

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you don't need to say yes to those things. You can focus on the core. Um, and, and you end up getting this, like, um, multiplier benefit as you do that. So that's been the main lesson for me, is focus on the core.

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Do the stuff that I like once in a while, but be very careful about, you know, committing to much more. Yeah. That is, like, such a good piece of advice.

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I've definitely fallen into that trap, like, so much [laughs] over the last two years. It's so, it's so easy to say yes. It's so hard to, [laughs] to then say...

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Well, you can't say, you know, "Uh, I said yes, but this is too much for me." You just have to grin and bear it, so the best way to do it is to be much more thoughtful before you say yes.

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And it's been a very, very tough lesson for me, and I can't say I'm all the way there, uh, but I'm getting better. So how are you thinking of, of growing this?

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Because I, I feel as though you get to a point where you gotta make a decision about which path you're gonna g- go down. Mm-hmm. Which is basically, is it gonna stay a solo thing?

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And, you know, the economics work real well solo. Like, you know, your cost base is extremely low, and, and, you know, the money you bring in, you know, is, is mostly, you know, profit. And it's like, it's good. Mm-hmm.

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It's good. I think other people are gonna go down the path of, "Hey, I've got, I've got something here. Why don't I bring in other people and build this into a, a new publication, like a regular brand?" Mm-hmm.

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My, my plan is to stay solo.

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I think the, one of the cool things about this is the, you know, the same amount of effort I put into a, an article that goes to 1,000 people is now put into an article that goes to close to 100,000 people, and then hopefully will be the same that will go to 200,000 people.

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So I think the business can grow without having to scale labor, which is really cool. I think a podcast is... You grow... I mean, you know this, right? You grow a podcast brick by brick.

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Win, you know, a couple new listeners a week and that's a victory. But the thing is that once people like their, like your show, they listen every week or almost every week, so that audience is sustainable.

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And, uh, ultimately, managing is hard, and probably not one of my strong suits.

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You know, I do have a few people that, you know, I work with, you know, folks that sell ads, edit, um, the podcast, cut the TikTok videos, et cetera, et cetera. And I much prefer to spend, [laughs]

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to s- to spend my time not telling them what to do, like with the TikTok group, it's sort of like, you know, I don't wanna work on edits. You guys just figure out what you think the best video is and, and put it live.

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And if something goes wrong, I'll tell you, but otherwise, like, let's just roll with it. And so yeah, I think that there's a lot of good things that come with, with doing the solo. Uh, yeah.

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And a lot of it is preference, right? Yeah. Like, I mean, we've all been through... Like I- Right... I, like, s- basically took, took like a decade off from [laughs] regularly writing and doing much. Yeah.

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Because, like, I was, like, in the managerial, like, cast. Yeah. And so- Like where- Exactly. And some people might call this- I used to-... like a lifestyle business, and I'm totally okay with that.

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Like, if it, it- Yeah, if the lifestyle's good- If it's a good lifestyle-... fine, I'll take that... what's the, what's the insult, you know? Yeah. No, I mean, I think I, I totally...

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And it's also, it's, it's just, like, personality type. I, I get caught in between it 'cause, like- Mm-hmm... I, I miss, like, working with people on a regular basis. Yeah.

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And, and there's ways to get around that, and I feel like, you know, Substack has tried to, to solve for some of those things. Mm-hmm. But it comes down to personal preference, I feel like, at the end of the day.

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Totally. And it's, again, it's, it's a good problem to have, right? 'Cause you've gotten across the Rubicon, if you will. Like, this is working, right? I mean, the, the, it...

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I get the worst would be, like, it's not working. Like, been two and a half years, and it's just not working. Like, there's not a market for this, but there's clearly a market for it. Yeah. So I'd...

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Before I went out, uh, and did this alone, I was just like, "Go for it. If it works, that's awesome. And if it falls apart, you know, you could probably get, like, a decent marketing job somewhere."

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And so- Yeah, you can at least do content marketing, Alex. I want you to think about that. Exactly. So, but yeah, it's nice that it's working.

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I've always thought that the test is gonna be how c- how does it do during an economic downturn, so here we go. Yeah. Do you regret not doing subscriptions from the start? Yes. I do regret it.

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I think it was a very bad business decision not to turn that on immediately. [laughs] And, um, it'll enable some things, uh, for me which, which have been good. Think, like I've took, I've... This is hard work.

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I've take, uh, taken a chunk of August, if not all of August, off, you know, the last couple years, and I think that's been easier to do without a paying, uh, subscription audience.

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Um, but yeah, I, I definitely left a lot of money on the table. But that's the thing about business. Yeah. It's sort of like, okay, you know, you make a decision, you take a look at what happened, and adjust.

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So I'm about to do the adjust. Yeah. Okay. Awesome. Looking forward to it. I hope you charge more money than $100. Okay. [laughs] Well, now I have to go back and look at the numbers, but, uh...

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[laughs] All right, Alex, thank you so much. Appreciate you taking the time. Uh, and thank you all for listening, and thank you to, uh, Chase Sparks from Podhelpus, who, uh, is our producer.

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And we're gonna be back next week with a new episode.

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