Meta & Snap's New AR Glasses, Perplexity's Ads, Google's Work Ethic

0:00Meta and Snap have augmented reality glasses on the way. Perplexity is about to introduce advertising. Google's work ethic is under question from a former leader. And will the U.S. government break the company up? All that and more coming up on a Big Technology Podcast Friday edition right after this.

0:36to the world on your local public radio station and wherever you find your podcasts.

0:47Welcome to Big Technology Podcast Friday edition, where we break down the news in our traditional cool-headed and nuanced format. We have so much to talk about this week, including potential new AR glasses for meta and snap, a new business model for artificial intelligence. And of course, Eric Schmidt's comment saying that Google is behind in the AI race because they're not showing up to the office. It's going to be a fun edition. Joining me as always is Ranjan Roy. Ranjan, welcome. Great to see you. Good to see you again. Excited to hear about your travels. Yes. So I think just to address it off the start, last week, we tried and failed to record an episode.

1:25So and that's on me. I apologize. We didn't have a Friday episode for you we attempted friday we attempted saturday morning i've been traveling in the balkans and i expected to have decent internet but alas i could not find it so here we are we're going to do a super episode today covering some of the new stuff some of the stuff that we were attempting to cover last week and i'm just thrilled to be back and thank you ron john for rolling it and rolling with it and good to see you again so uh how have the travels been i'm not i don't think i've ever been to the Balkans? So I think the Balkans is one of the most underrated parts of the world.

2:01I do have a friend from Kosovo or a couple of friends from Kosovo. And I came here three years ago. And this year we decided, my wife and I decided, you know what, let's go ahead and see some more of it. So we've been to Kosovo, Albania, Montenegro, and North Macedonia. And I do think nobody knows about North Macedonia, but that country blew me away. It's so beautiful, beautiful lake, an amazing capital city. And I think, I mean, it's, yeah, it's just overall very, very, very beautiful place. When did North Macedonia become a country or what's the, do you know the story if I'm putting you on the spot?

2:39Because that's one of those countries that I still don't, it suddenly happened and I never quite got the whole story. So asking me to go through Balkans history is probably going to hurt my credibilities with listeners. Let me tell you, one of the interesting things that I saw and I figured it was worth bringing up is that a lot of the roads here are really rough. And I'm going to apologize in advance to our friendly rental car folks for what we're going to return to you guys. But then some of the roads are absolutely beautiful. And it turns out that many of the roads in the Balkans are funded by China.

3:17to the tune of tens of billions of dollars. And in fact, on the way over here, I did have some time to do some research. And this is from a Balkans research agency. China has been linked to 136 projects in this area of the world worth up to 32 billion euros. And that's from 2009 to 2021. So it is very interesting to see the country's influence here. and I'm curious, Ranjan, from your perspective, I know that you have connections to Taiwan. What do you think the point is of China spending all this money and doing all this development in regions of the world like this one? They also have projects in Africa.

4:01Well, no, this is the Belt and Road Initiative was launched in 2008. So this is interesting because I haven't heard that much about it recently. But again, this was this massive undertaking launched in 2008 to invest in emerging economies all over the world and help them build infrastructure. So this is kind of amazing that you literally saw roads, because I know a lot of it was like ports and other types of critical infrastructure, but you actually saw that they're building roads in emerging economies. So that is kind of amazing. I do know that it slowed down the pace of development because of economic concerns in terms of like the amount of debt that was undertaking or even a lot of the debt that was issued, people have complained that was a bit onerous in terms of what they were imposing upon these economies.

4:57But that's kind of amazing on the road reporting for the Belt and Road Initiative and actually seeing it in action. I mean, the influence of China and the US is like definitely impossible to escape here. You see these Belt and Road initiatives, projects that China has been undertaking. And then we walked into the library in Pristina, which is the capital of Kosovo. And the first thing you see when you walk in is the American wing. And you walk in there and there's like a section for great American authors and different books of the US and like literal books, like talking about democracy. And this is funded by the State Department.

5:34Soft power battles. It's still going. And I will say, during this time, I was able to look why I was confused about Macedonia is I remember there was the country Macedonia. But then when everyone's when you're saying North Macedonia, that's what confuses me. Apparently, in 2019, they had to change the name. The country was founded in 2012. And in 2019, they had to change the name for Macedonia to North Macedonia, because apparently Greece subjected to the name Macedonia and they finally had to give in. And this was brought to you by a quick perplexity search. And this is not a sponsored segment for perplexity, but we are going to talk about perplexity ads in just a little bit.

6:21Definitely. Yeah, and the North Macedonia thing also threw me for a loop. But I think basically they're trying to enter the EU and Greece is like, oh yeah, you want in? You can't use the name of our region, Macedonia, so pick something else. I think that's unfair. I think they should be allowed to be called Macedonia, but definitely absolutely beautiful country. Okay. So speaking of great power struggles or one power telling the other power what to do, Meta and Snapchat are about to do their new AR glasses. And I was sort of surprised seeing this story. It's from The Verge that Snapchat is even continuing to build spectacles.

6:58But the big news here, I think, is the Meta glasses, which are going to be called Orion. and these are not just like the ray bands where you can film and speak to ai but they're actually going to be augmented reality glasses and to me this is simply just like the obvious next iteration of what the metaverse is going to be i think meta sees the limit with the vr goggles and they realize that if they're able to create an ar device that might be something that has the potential to bring this metaverse vision mainstream. Will it succeed? I don't know. I don't think this version will, but I'm curious to hear what you think about it.

7:37I think this, so I saw this headline too, and I think this is actually going to be one of the most interesting stories in the next year or two. And there's a couple of reasons for it. So first, glasses in general is something that I think has been an underrated story because one, Snap was the one that launched Spectacles, I think like seven years ago, eight years ago. I remember it was pretty splashy when they launched it and it looked kind of cool. And again, these were glasses that could basically record and post, not do anything else. And then meanwhile, I've talked to so many people who are obsessed with Meta's Ray-Bans.

8:17I mean, I will admit, I kind of want to buy them. I've come close to pulling the trigger a few times. And to Zuckerberg's credit, If a few years ago you told people that I would be wearing a Facebook device on my face that is constantly able to record people even without them knowing it, you would think that that kind of device would have just been completely panned. And yet I've seen so many people who I trust and respect proudly wearing them, talking about them, saying they're amazing. Even the audio, I think it's bone conduction, so it's not directly in your ear. So for biking around, for running, for these kind of things, it's just a lot better than having something directly in your ear.

9:03So glasses in general, they're battling and Snap is behind the fact that Spectacles never launch. Then you start to think about the AR glasses. The Vision Pro, clear that it's not ready for mass adoption just yet, if it will be. So maybe glasses will be the form factor that really deliver augmented reality to the masses. And I have to think, to me, the one major competitive advantage, if any, snap has over meta is augmented reality. They're the OG. I mean, they basically invented the entire field at the mass level with their lenses. They still, I think they're very smartly. I've been seeing at sports stadiums and the Olympics, they're really leaning into lenses in bigger situations, like on the KISC cam and stuff now.

9:56They'll have augmented reality lenses. Yeah, sponsored by Snap very clearly. So I think if the battle becomes layering augmented reality into the real world and everyday situations, kind of like Pokemon Go all the time or whatever that might look like, I think Snap is probably positioned better. They've always shown that they can deliver augmented reality in a fun, simplistic way, not some like immersive world, but just let me layer a bit of AR and make it fun and accessible. I think they have a chance here. So I'll talk a bit about the Ray-Ban stories because I have a pair. First of all, I think you should definitely get them.

10:35I do have one. All right. I'm literally after this recording, I'm going to. I've had some really fun moments where I've been able to use them. I was wearing them in a triathlon that I did with my wife and a friend a couple weeks ago. And I mean, not in the swim part. Alex with the subtle triathlon flex here. I mean, it was a sprint triathlon. It was basically like a baby could do this triathlon. It really was not very long, but I did have those glasses. They were really fun to wear in the bike part of it and the run. And just like, that's not a place where you really want to have your phone out too often.

11:13uh but to use those glasses it's great we also did a hike a couple days ago into like the mountains here in the balkans and like it started to pour it was like ridiculous it was a true like ready to die moment the massive thunderstorm in the mountains and i just hit record and just like you can see the video of us just like walking through and um the thunder and lightning all around us and like again not a point you obviously want to keep your footing at that moment so it's not a point where you want to take your phone out and that's where this stuff really works well and the speaker by the way it's not bone conduction it's a bunch of different speakers pointed like toward your ears from the brim of the glasses so it's actually like a mini speaker doesn't go in your ear and the sound quality is like absurdly good for the technical specifications I just laid out.

12:05So they are very cool. Is it weird if it is a storm and rainy and thundering to be where the guy wearing sunglasses? That's my only concern here. It's like, if I want to be recording, am I going to just put on sunglasses at odd times and just be that guy? Well, they actually, so they are responsive to the sun. So when it's not that sunny out, they look like clear glasses and then when the sun comes out they go uh sunglasses tint but i will answer your question it's always weird to wear them absolutely i uh i wore them onto an internet week panel and i think a lot of people were like cool glasses it's very difficult to tell that they're actual facebook glasses with cameras in them and even though they have the light on like I recorded the end of this session and people had no idea that I was recording so all thing is a little bit odd and I don't wear glasses usually except when I'm like looking at the screen and I'm riding it's definitely a thing that's gonna take getting used to and they're definitely like even before we went on the hike this past weekend I was like am I gonna look like a tool if I wear these and the consensus was yes I was going to so I didn't wear them and I only took them out mid thunderstorm because i just like really wanted to get the shot but i think over time over time they are going to become i think more accepted and more normal and maybe not these ar ar glasses though because they they look like a cross between i mean zuck has shown some of this the the um the model already they look like a cross between the meta ray band stories and a VR headset with like stuff on the side.

13:49Like obviously you need more computing and people are really going to tell you you're wearing those. But that being said, they're going to be less awkward to wear in public than the Vision Pro. I don't know if you've been in a public situation with somebody wearing the Vision Pro yet, but I have. And it just takes all of the attention in the room and not in a good way. Yeah, I think I was looking at the renderings of the Snap upcoming AR spectacles And they do, they don't look completely insane. They definitely look like, kind of like, I was thinking, you know, like Kanye Yeezys for shoes versus regular sneakers.

14:28Like they look a little crazy, but they don't look like a completely different form factor or just like you are actually a crazy person. You're just, maybe you're a little stylish. But actually, I think, I mean, the smartest thing Meta did in this arena was partner with Ray-Ban and make them look like the standard Wayfarers because making them look okay and reasonable so you're not in the are you a tool or not a tool to wear these, I think is actually the most important consumer adoption question versus is the tech good? yeah the reaction that i've gotten has largely been cool glasses man and not what the hell are those yeah and i think that might be partially people being polite or maybe these just look good on my face which i think is probably most definitely the case obviously obviously

15:23but i do think it's an achievement to make a pair of smart glasses quote-unquote that do look do look good. Now here's a question. Snapchat, so first of all, let's put this all in perspective. Snapchat's going to make 10 ,000, less than 10 ,000 units of its new spectacles, and Meta is going to make even fewer of these Orion glasses. So obviously, while I think they're pretty stoked at what's going to happen with these Ray-Ban stories, like the current set of smart glasses, they understand there's going to be an adoption curve for the AR glasses. With Snapchat, is it a wise move for that company to continue to invest in this product line, given that they don't have the excess billions of cash to throw off in a way that Meta does?

16:13What do you think? I think absolutely. And here's why. I think the future of Snap is going to be something around innovative AR membership subscription, because one of the things that's like gone under the radar, and we've talked about it here and there, but every quarter Snapchat plus subscribers,$3 a month, it's now at I think 11 million. It is the biggest consumer facing social media subscription service. I mean, X certainly has not landed it. Facebook had tried some stuff over the years. So I think coming up with these kind of like cooler experiences, having people pay for them in different ways, because direct response advertising, they still have not cracked.

16:58And one of the biggest limitations for Snap always has been that it is not as like, you know, data extracting a platform as meta. So that changes the way advertising works. People use it more for messaging, and actually connecting with friends, versus just seeing celebrities and whatever else on a feed. So I actually think it's really important that they invest in stuff like this because this is where they've always been better. They've always been first. They've actually learned how to figure out. Even the subscription service, a lot of it is around, like fun little generative AI experiences.

17:40And I think you had said it. Snap is quietly like next to ChatGPT, might have launched the biggest consumer generative AI service that no one is even talking about. So I think this is actually, it's not just, you know, questionable. I think it's incredibly important that they're investing in things like this. I'm with you. See it through. The technology is getting better. It's getting cheaper to make. And you're right. They do have this, I won't call at an edge but certainly a knack for making these products work so it's going to be tough coming up against meta because for all the science this has always been the problem with snapchat right for all the innovative work they do and all the science they can put into their products meta can clone this stuff in about a half second and they will but you have to do it if you're snap because you cannot basically continue to rely on a business model that hasn't worked very well.

18:40Although one that seems to be improving. Agreed. So speaking of companies trying to do new business models, this is something you highlighted. Perplexity is thinking about rolling out cost per a million view, cost per a thousand view advertising. So they're going to do advertising, but I think notably it's not going to be search style advertising that looks at your intent. or maybe it will be, but it's not going to be cost per click. It's going to be cost per impression. What do you think? Is this the right way for perplexity to go about trying to make money off of its business? It's a tough one because on one side, trying to get cost per click advertising is always a lot riskier because then you have to actually deliver the click to monetize.

19:25And that's tough. And they might come up with an idea around it and it'll totally bomb versus CPM advertising or view-based advertising. All you have to do is just deliver the view and do it reliably. I do think it's, so I think it's smarter to start there. Advertisers will be curious because if you think about it, I mean, everyone is talking about what does the next iteration of search look like? And I now, and about a year and a half ago, I think we had talked about searching in a generative AI platform for like, you know, best shoes for with a summer wedding or something like that. And I was like, that, I don't think that'll ever be the use case.

20:08I've started doing more product oriented search in perplexity, actually. And then that basically, I still start with Reddit everywhere. But otherwise, I'll go to perplexity. I'm not using Google search for any kind of product and shopping related search. So once I'm in there, marketers being able to reach me in different ways makes a ton of sense. So I think whatever they do and what exactly it looks like, I think will, I don't know, they need to be creative. They need to come up with something new. One thing I actually saw, it was Mike Malazzo, his newsletter, which is really good on these kind of like marketing focused topics.

20:52he had written, you know, perplexity asks follow on questions, and how powerful it would be for marketers to be able to get into the follow on questions, that already, it's a ton of insight around what are the follow on questions, like, if you ask for what are the best pairs of shoes to wear for a summer wedding, then the follow on questions would be like, you know, can I match this color of shoes with this color of suit or whatever else, but then being able to actually sponsor follow-on questions would be something completely new, different, really focused on information that's valuable to a consumer.

21:27So I think they, whatever they do, they need to be creative rather than just sticking a display ad that's like traditional in the current interface. Yeah, it does look like they're going to do traditional display ads. And I wonder if this leads to a compounding of some of the problems that they've already run into regarding copyright, because I do think that generative AI companies that are content-based, which is what perplexity is, are just going to hit very murky ethical grounds when it comes to, let's say, repurposing other companies' content and then slapping a display ad next to them, which is what most other content companies use to make money off of their stuff.

22:09And I just thought it was so interesting to read the lead in on this story on CNBC. So this is how CNBC describes perplexity. It says perplexity AI, the artificial intelligence startup that has been embroiled in controversy due to accusations of plagiarizing content from media outlets, plans to start running ads on its search app in the fourth quarter. And it's going to be a cost per thousand search model. And it'll be more than$50 per thousand ads where like if you think about the typical cost per thousand display ad it's around$3 right so just think about the you know the controversy that might emerge the next time some publisher like Forbes material shows up on perplexity maybe not word for word but summarized whereas like the sources of this material are scrambling to make three bucks for every thousand views of this.

23:06And perplexity is now going to make 50. And I know it follows the path of the internet from time immemorial that this is just how it goes. But I also think that this seems like it's going on a path that's quite dangerous for perplexity. And I know we both like the product. We're kind of perplexity heads here. But I do think that it is a risk and it's dangerous for the company to choose this as a way to make money off of its technology. I disagree because the idea that just because a, so, well, I agree with the idea that they should not, they need to be a lot more careful. The Forbes examples that were pulled out where they took paywalled content and summarized it already, they need to just kind of clean up the act there and like really focus on making sure it's not repeating anything verbatim, making sure it's only publicly accessible information.

24:05but the idea that a media site because like Forbes of all publishers I mean what they did to that site for years it's improved over the last couple years but just the amount like taboola and outbrain style advertising or just just really you know insulting the reader with the way the advert full page takeovers of like autoplay video these kind of things are what a lot of these publishers did to their own sites for so long. So coming up, if Perplexity can deliver a genuinely valuable premium advertising format that doesn't exist now, I support it. I swear anything that can make advertising better on the web, because especially in publishing, it's gotten to just a complete hellscape over the last number of years.

24:56I think that's a good thing. here's my even hotter take and that is that this really isn't going to matter in the broad scheme of things because perplexity isn't going anywhere fast and i wrote about this last month but in the whole scheme of like google's going to lose out to generative ai search and perplexity being its biggest challenger and i again like i like what they're doing but it just hasn't caught on in the way that a lot of people are have expected and in the search i did in terms of trying to figure out where perplexity sits on the App Store. Given the amount of buzz, I was like, all right, maybe it's number like 30 or 40 in terms of all apps on the App Store.

25:36Actually, it's number 60, and not on all apps, just in productivity apps. And here's what I found ahead of perplexity on the App Store. Six generative AI chatbot wrappers, a bunch of VPNs, and a printer app, all outrank perplexity. So I guess my broader message here is, Go ahead, perplexity. Take all you want. Run the display ads you want. It's not going to matter. You have lost to Google already, and we're just counting out the days until you fold. See, I agree mass adoption is going to take some time, and maybe that printer app is really good. No, it's not. That is for sure not the case. Okay, I'm sorry.

26:19Go ahead. I have gotten to the point, like when I see someone doing just a regular old fashioned Google search, it's kind of like in New York when people were you saw someone hailing a taxi and you're like, you could just call an Uber. It's just it's so much better. It's just so much better that when you're like for certain informational things, if it's just light years ahead of traditional Google search and where that is right now. that I think whether they are the ones that win, whether search GPT from OpenAI actually turns into a real thing. I think whether Google's AI overviews end up being the thing, I think this way of searching is going to be the future and everyone's going to be doing it pretty soon.

27:07When you see people using Google, do you feel like you have a responsibility to tap them on the shoulder? And being like, as someone looking over your shoulder, watching what you're doing, I feel a responsibility to tell you that this is truly a mistake that you're making. And I couldn't in good conscience allow you to use old fashioned blue link search, knowing there's something better out there. If you're listening, and I know the Perplexity CEO was on here a few months ago. I think in terms of viral marketing, sending people to coffee shops around the country and just going up and tapping them on the shoulder and just, you know, giving them a little bit of a nudge saying there's a better way.

27:45that's the idea. This would be an absolutely an amazing advertisement for perplexity where like literally you have Ranjan walk into a coffee shop in a trench coat see somebody googling taps them on the shoulder opens up a flap to reveal a QR code and it just says perplexity Can I interest you in something better? I think the big technology agency has just been launched Let's go. I do think we can make good ads for these companies. Maybe if this podcast flops, you know, but our listeners won't let that happen. So listeners keep us from having to launch an ad agency for flagging generative AI startups.

28:29Share this podcast with a friend, rate us five stars. We need your help not to end up becoming this agency. Because we do have a strong work ethic. We do. We do. I mean, folks, you should have seen what we were trying to go through to get you an episode last week, I promise. Unlike what Eric Schmidt has said about his old colleagues at Google. That's right. So Eric Schmidt has talked about how Google is losing the AI battle because its employees are not showing up to the office. And then he walked it back. And Ranjan and I have some differing opinions on what this all means. and I think we're going to debate it a little bit right after this.

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