Good morning,
Elon Musk has offered to buy Twitter for $54.20 a share — a completely arbitrary dollar-and-cents figure, I am sure! Here is the full letter to the board via an SEC filing:
I invested in Twitter as I believe in its potential to be the platform for free speech around the globe, and I believe free speech is a societal imperative for a functioning democracy.
However, since making my investment I now realize the company will neither thrive nor serve this societal imperative in its current form. Twitter needs to be transformed as a private company.
As a result, I am offering to buy 100% of Twitter for $54.20 per share in cash, a 54% premium over the day before I began investing in Twitter and a 38% premium over the day before my investment was publicly announced. My offer is my best and final offer and if it is not accepted, I would need to reconsider my position as a shareholder.
Twitter has extraordinary potential. I will unlock it.
This is very late-breaking news, but I will just add a couple of points:
- As I noted on Monday, Twitter is already poison-pilled; Musk can’t just run a pro-acquisition slate against the board. He needs the board to accept this offer.
- Musk is offering about a 20% premium to the company’s current share price, which is quite small for a hostile takeover, but that is why he emphasized the delta between Twitter’s price before Musk was involved. This is the exact dynamic I’ve been writing about over the last two weeks: Musk has power because if he exits his position a lot of people are going to lose a lot of money.
- I actually agree that Twitter could greatly benefit from going private. Leave aside the free speech issues: it is clear that the company’s monetization approach just doesn’t fit its market niche, but it’s going to be impossible to rework that while on the public markets.
For now, get (more) popcorn.
On to the previously scheduled update/interview:
Facebook AR Plans
From The Verge:
Mark Zuckerberg has a grandiose vision for the metaverse, and he hopes that you’ll one day see the same thing, too — quite literally, through a pair of augmented reality glasses…Zuckerberg has ambitious goals for when his high-tech glasses will be a reality. Employees are racing to deliver the first generation by 2024 and are already working on a lighter, more advanced design for 2026, followed by a third version in 2028. The details, which together give the first comprehensive look at Meta’s AR hardware ambitions, were shared with The Verge by people familiar with the roadmap who weren’t authorized to speak publicly. A spokesperson for Meta declined to comment for this story…
The whole story is worth a read; other pertinent details on the AR glasses specifically include:
- The bill of materials is in the thousands of dollars
- The first version is expected to “offer a full AR experience with 3D graphics, a large field of view, and a socially acceptable design.”
- The glasses will rely on a custom chip to power its new-to-the-world capabilities
This last point is obviously pertinent to what I wrote yesterday; I heard from a little birdy that while my take on custom silicon for the next version of the smart glasses was spot-on (Qualcomm’s chip is more than sufficient), Facebook really does need to build something new to make the AR glasses work. That’s not the only thing Facebook needs to build, though; here is the relevant paragraph from The Verge:
Nazare won’t be a mainstream device, at least not at first. Its current battery life is only four hours, and the glasses are intended to be used mostly indoors. Even though it will take a while before the glasses sell in high volume, Zuckerberg has spared no expense. The displays are powered by costly custom waveguides and microLED projectors. The first version will have eye tracking and a front-facing camera, along with stereo audio in the frame. Employees are working with semiconductor fabs in Asia to build custom chips for the planned roadmap through the latter half of this decade.
This all sounds very cool; it also sounds very, very early. In fact, the degree to which Meta is having to invent everything reminds me of General Magic, a much ballyhooed startup founded by Apple veterans Bill Atkinson, Andy Hertzfeld, and Marc Porat in 1990; their goal was to create a handheld touch device for email, gaming, streaming, e-commerce…basically a smartphone! The problem, though, is that this was the 1990s, so they had to invent almost everything themselves; their first product looked like this:
The Magic Link was a technical marvel, but General Magic was a failure of a business: it was just too early. The components weren’t ready, and the market wasn’t there. It would take another 13 years for the iPhone to take General Magic’s ideas mainstream, after a whole bunch of technological improvements — driven by products like PDAs, keyboard-driven smartphones, and the iPod — had happened in the meantime (not to mention software: OS X had to walk before iOS could run).
I do wonder if Meta’s AR efforts will face a similar fate: right idea, wrong timing. Indeed, the arguments I was making yesterday fit this theme: one reason why Meta can’t figure out its strategy might simply be because the market is too immature for such decisions to even matter.
Adam Mosseri at TED
From the TED blog:
[Head of Instagram] Adam Mosseri expects that web3 — a new iteration of the internet built on blockchain and encompassing ideas such as cryptocurrency, NFTs, smart contracts, DAOs and more — will empower creators over the platforms that host their content. Currently, creators can use platforms like Instagram, YouTube, Patreon, Substack and many more to host content and get paid, but they’re still beholden to the whims of each individual platform. With blockchain-enabled technologies, creators could fully own their relationship with their fans: just as people invest in startups, so too could fans “buy a share” of their favorite creators through terms codified in a smart contract, removing the need for a platform as the intermediary. This would help creators build a community of people directly invested in their long-term success, Mosseri says, shifting power away from the Internet’s gatekeepers and towards the people themselves. No single company can build this model alone: it’ll take people across the tech industry, alongside the experimentation of pioneering creators, to get to scale. But if it happens, Mosseri says, “We will have helped to realize the great promise of the Internet.”
The video of Mosseri’s talk is not yet publicly available; I do have a copy of the transcript, which you can view here. What he discusses should, without question, be taken with a very large grain of salt. After all, why would Instagram’s CEO be talking about empowering creators, or arguing that the dominance of platforms is an accidental blip in history?
I had the chance to push Mosseri on these exact questions, and I think the conversation that resulted was very interesting. There are insights not only about Mosseri’s talk, but also how the company is thinking about competitors like TikTok and YouTube, and a bit of riffing on both of our parts about where blockchains really could make a difference for creators (there is even some Passport talk as well). This isn’t any sort of product announcement, to be clear, but I thought it was quite interesting, and I hope you think so as well.
An Interview with Adam Mosseri About Creators, Blockchains, and TikTok
This interview has been lightly edited for clarity. As a reminder, the Daily Update Podcast is particularly useful for interviews, even if you are generally a reader. It will be posted shortly after this Update is published.
Adam, it’s good to talk to you. You just gave a very interesting TED Talk on Tuesday about creators and blockchains. Is that a fair summary? Why don’t you give Stratechery readers the high-level overview of what you discussed?
Adam Mosseri: Yeah, I think that’s accurate. What I talked about was how power’s going to shift, and is going to continue to shift, from institutions to individuals, and more specifically, how I think power over the next ten years or so is going to shift from platforms like Instagram and Facebook to creators, and how we might build some pretty interesting things in that world if we lean into that direction using the blockchain. I was trying to talk about not the technology itself as much as some of the interesting use cases that the technology might enable or augment, particularly subscriptions that could work across platforms, and also over a much longer time horizon, more like ten years, how we might invest in people the same way we invest in startups.
What was this exactly, though? I mean, on one hand you are obviously the head of Instagram, so you don’t say anything publicly on accident. On the other hand, I don’t think that there was any sort of product announcement here. What was this talk, in the broader context of your day job?
AM: I believe that a lot of these conversations are going to happen with or without us. You see me out there a lot, probably on Twitter and elsewhere, doing talks sometimes but often engaging in other ways, because I just think it’s important to engage in the conversation because it’s going to happen with or without us.
I think one of the more interesting conversations over the next five to ten years is how power is going to continue to shift. I think technology has shown over and over, over centuries, that it tends to take power from the establishment and give it to people. It’s not a direct line, there are always detours, but if we assume that’s going to continue to happen, if you look at the fierce competition out there, particularly for creators, you assume more challengers are going to be interested or willing to hand more power over to creators. I assume the incumbents will follow.
Then, I think we should be part of the conversation of what that world looks like. I think, as uncomfortable as it might be, we should embrace it. I think ultimately, over the long run, we should take a view that what is best for creators is best for platforms, because there’s going to be more creativity in the world. There’s going to be more exchange of ideas, there’s going to be more art, there’s going to be more content, and we should try and figure out what that world looks like. The main idea here is just to throw out two longer-term ideas and hopefully influence that conversation.
Well, let me start picking apart a couple of these pieces, if you don’t mind.
AM: Yeah, please.
You talked at the beginning of your talk, and you reference it here, about how the Internet broke down gatekeepers but then “unexpectedly”, your words not mine, we ended up with even larger platforms like Instagram. Obviously that’s been the core thesis of Stratechery, is that actually all this stuff goes in the opposite direction people think.
AM: Aggregation Theory.
Yeah, exactly, that’s exactly what it is. Is Instagram a gatekeeper? Is it just a super-gatekeeper?
AM: I think that the Internet has very clearly pushed power into two directions. It’s pushed power into the hands of more and more people, not just creators, but I mean it’s enabled all sorts of businesses like yours, and it’s also pushed power up into really broad platforms like Instagram. I think the big companies, or what we used to think of as the big companies, have suffered the most. There’s just been these über-sized companies. I do think, though, that large platforms, if you look at the next ten or twenty years, they’re going to rise and they’re going to fall. When they fall, they’ll fall slowly, but I think they will fall. They’ll slowly lose cultural relevance, and —
But why? What’s going to be the driving factor? This is the big question. You talk about this as if it’s a law of nature, that creators are going to take over, but what’s the causal function here?
AM: Probably I think it’s really going to be competition. Take TikTok, for example. TikTok is a behemoth, I actually don’t think most people realize how big and relevant TikTok is, if you look at how much time people spend or how total minutes on TikTok in a day compare to most of the competition.
I was told you have no competition, you’ve killed it all.
AM: (laughing) Oh, yeah. Well, it doesn’t feel that way on my side! I know there are a lot of people who disagree with me, it certainly doesn’t feel that way over here! YouTube is also a behemoth. Actually I think’s TikTok’s a really good example, I’ll give a lot of credit to them for some things they’ve done well.
I think the newer platforms are going to see how important creators are. I’ll talk to a couple of reasons why I think creators are important. We’re in a world where clearly we’re inundated with more and more information, and there’s value in aggregators to help us find the most valuable information, that is sort of an adjacent concept to Aggregation Theory. One effect of that is, yes, aggregators have value, but another is that people are less and less interested in processed content, they want to get more of a sense of authentic content. I’m not saying creators are all authentic, obviously people bring a certain part of their identity, not their whole identity online, but people are much more interested — and we see this in engagement data — in seeing what it’s like to be in someone else’s shoes, seeing what it’s like to be backstage before a political debate or warming up before a football match or in a green room before a TV spot. They want to see the world through other people’s eyes and they’re more interested in creator-focused content, someone’s point of view, whether it’s you sharing your analysis on a business or The Rock pontificating or a small country artist from Nashville showing a song that she’s working on.
You’ve seen that one of TikTok’s strengths has been how strong they have been at breaking new talent, how well they have done by the little guy, the small creator. They have leaned much more into exploration-based ranking than pretty much all the competition, or least earlier, and they’ve helped new talent break. Now, it’s not all perfect over there, I think that there’s a lot of volatility and there’s a lot of downsides too, but they’ve done really well by particularly smaller creators and I think you’re seeing the competition follow. You’re seeing the other major platforms that you can think of, or you would’ve thought of two years ago as incumbents, which now I think you might actually even think of as challengers, follow, and I think you’re going to continue to see that.
My take is, and I could be wrong, but my take is that over the next five years, ten years, you’ll see more platforms, both challengers and incumbents, be willing to hand more power over to creators. I think that’s the causal relationship, is competition, but I think there’s also some extrapolation of existing trends. You’ve seen Spotify use OAuth, you’ve seen the podcast world, become a bit more —
I’m very familiar with that, yes.
AM: Yeah, I know you are! I’m sure you are. By the way, one of my favorite things you did was start to read your newsletter, because I don’t always get a chance to read, but I just want to give you credit. I think you’re the only newsletter I subscribe to that I get a regular audio version of it, I want to thank you publicly for that.
This is all obviously very, very near and dear to my heart, because the vision of Passport is exactly this, that a creator should not be limited to one medium, and a lot of these platforms are medium-specific, so whether it be video or whether it be images. Obviously, images and video kind of has a crossover where Instagram sits very well. Not just audio, not just text, but you should be able to move between them, and you should be able to carry your creators with you, I think that’s actually language that you actually used in your talk.
AM: Yeah.
I guess the question, though, is from my perspective, creating Passport, “Hey, let’s talk. I’d love to sign up Instagram” and say, “Hey, I can bring my creators there,” or wherever it might go, but when you’re coming at it from the other perspective, why would other people want to work with you, whether that be the creators who might think “What’s Instagram going to want to put over on me here?” or I think more pertinently, you talk about competition. This vision you’re talking about basically entails some sort of cooperation between these competitors, such that creators can move seamlessly between them. What would cause that to happen?
AM: I love this question. A couple different things. The subscription idea and the version that I’m pitching of it is similar to Passport, but it’s on-chain. I want to be clear, I’m not a crypto bear, I’m not a crypto bull, I do think we should be intentional about what technologies are actually better suited to these ideas. This idea doesn’t have to be built on-chain, but there’s something I think powerful about it being built on-chain and we can go more into why, but it doesn’t have to and I want to be clear about that.
No, please do because actually, I have my own suspicions why being on-chain is important, but I’ll let you give a shot at it first.
AM: Yeah. So just to be clear about the idea, the idea is essentially a token that’s a membership card and if we can get enough of the major platforms to honor that membership card-
A Passport, you might call it.
AM: A Passport, you might call it — exactly, the branding is hard! As I try to come up with names, I’ve been like, “Oh man, Passport is actually, I kind of get why you ended up there.” Makes sense to me.
As far names go there is nowhere to go but up after naming Stratechery!
AM: (laughing) I didn’t say that! But yeah, let’s say you get big on Instagram and then later you want to branch out into YouTube. That can happen, we actually see that a lot, we see creators establish themselves on our platform and then go out onto other platforms. Sometimes they go into new media types, sometimes they even just go to other platforms to syndicate their content.
If we can get both YouTube and Instagram to honor that same protocol for a Passport token or a membership card token, then you can OAuth on both sides, and then not only could you bring your subscriber base with you, but everyone who subscribes to you would have to do so only once, and that’s also powerful.
One of the reasons why I think building it on-chain is appealing is because, this isn’t technically necessarily how it would have to work, but I think it’s how it would most likely work is, because it’s built on-chain, no company could ever take that community away from you. We could go under, someone else could come up and you would still maintain your relationship with your subscribers and that income.
Right. You could cut off YouTube basically if you decided, “Actually, we don’t want to cooperate with YouTube anymore. We’re going to turn off the integration.”
AM: Oh no, I don’t think we would build it.
Yeah, you would not be able to do it.
AM: Yeah, no, I couldn’t do that. And yeah, you could get de-platformed from Instagram, let’s say it was you, we could say “You’re no longer allowed to be on Instagram”, but even if you had acquired all the subscribers a hundred percent through Instagram, you would still have a relationship with those subscribers because other platforms would honor them, and then you could actually retroactively move to another platform.
Now, if you talk to everyone involved in this kind of idea, there’s a number of pieces to a subscription. There’s some sort of distribution tool — in the case of Substack, it’s an email and it could be a phone number — there’s something it’s related, which is sort of the authorization of content, so this is kind of how Passport would work using OAuth, you could authorize the ability to see some specific content because you paid for it.
And then there’s payments, someone has to handle the payments. There are a couple of people playing in the space, but there are not a lot of people building subscriptions on chain because you need a token that will burn, that you have to re-up. I don’t think you want to buy a new token every month, I think the mental model is cleaner if you buy a card or you buy a passport and you have that passport. If you talk to anybody involved, if you talk to the bottom of the stack, if you talk to the payments providers, and the ones I’ve talked to, whether it’s Web2 companies or Web3 companies, they all tend to be interested in this because they all — actually much more than I realize — think of themselves as creator platforms because they’re the one who at the end of day, own the financial relationship with the creator.
I think you just got into what I see as one of the issues here, because the Web2 people tend to have Web2 solutions, the Web3 people have Web3 solutions, when it’s always been at least clear to me that this token idea has always been the most attractive and interesting thing about blockchains. You can pay for a token with a credit card, there’s no reason why it has to be an all-in-one system, and this idea that it has to be full stack up and down all Web3 under the blockchain doesn’t make sense. Believe me, I know a lot about database performance — that’s why there’s been very little news about Passport over the last year, fixed now — but you’re not going to be doing a lot of this stuff, certainly not on a blockchain.
The idea that you could have all Web2 infrastructure, but this one piece that to your point, you can carry around from place to place, I mean, I’m not being a very good questioner here because I’m sort of making the point, I think this is what is very attractive, having this piece that no one controls. But to your point, someone needs to build it. You didn’t do a product announcement, you just painted a vision, is this though sort of a backdoor announcement of Meta’s new blockchain play? Are you going to help sort of build this infrastructure?
AM: I think we’re definitely interested in it. To be totally transparent, part of the reason why I want to talk about it publicly is to apply some pressure and get some excitement around the idea and build some momentum. I can’t talk about or I’m not going to talk about the specific companies I’ve been talking to, but I’ve been trying to talk to as many people as I can at all the different levels; at the payments level, at the authorization level, at the platform level. There’s a lot of interest, but to make this happen is far from a sure thing. It’s like you’re trying to align a bunch of different cultures and a bunch of different sort of philosophies around this idea.
The biggest risk to the idea, I think, is, is there enough of a market fit for creator subscriptions that this idea would create enough incremental value that those involved, particularly the platforms at the Instagram layer, not the sort of payments layer, will believe that it’s going to create enough incremental value that they won’t need to over-worry about their particular share.
It’s not lost on me that a lot of people don’t trust the company that I work for or me even. And so in all of these conversations, they’re trying to figure out what my angle is and I’m like, “No, no. I just think this should exist. I think it’ll be good for us indirectly over the long run.” I think if we get critical mass, if we get enough platforms to do this, then there’s pressure for the holdouts to do it because the creator community will put pressure on platforms to support this. But the question is, “Can you get to critical mass?” And I think the biggest risk with getting to critical mass isn’t the technical one. Like you said, we don’t have to build a whole thing on-chain, sure, you could pay with this with coin if you wanted to, but you could totally pay with it with fiat.
The stack should be 98% Web2 technologies and like 2%, or actually probably more like 0.2% on-chain. People, when they talk about blockchain, you only want to use it for what it is uniquely suited to do, and what it is definitely uniquely suited to do is to be a neutral arbiter between platforms where it is the one place you can go that no one controls, no one touches, and you can stick a token there and that token has the minimum amount of information necessary. Believe me, I’ve thought a lot about this, but no product announcements for Passport here either!
AM: The question is what’s the token? What’s that protocol? What exactly does that token entail and how do we make sure that it supports enough use cases that enough platforms and businesses will be interested in supporting it, right?
Let’s drill into this point because I think this is the biggest question. So from my perspective, the value that Instagram brings to the creator ecosystem is, Meta in general is by far the best customer acquisition platform, period. There’s no one even close. And I would say that’s the case, even post ATT. It’s instead of a thousand times better, maybe it’s a hundred times better, but it’s still really good. TikTok, you have discovery of new talent, Instagram, you can acquire customers, and YouTube is where you actually make money.
I think you talked about creators start on Instagram, and they go to platforms like YouTube, and to me this is because YouTube monetizes so well. One of the brilliant things that YouTube did and Google did, and it took many, many years to build up, is they shared a huge chunk of the revenue with creators, and every single creator in the Internet knows that outside of subscriptions, the way to make money is to get on YouTube.
And so the question is, given YouTube is so dominant here, to me, they’re the great white whale, I would love to have a Passport integration with YouTube, they’re so far ahead in this particular area, why would they ever want to partner with anyone, number one? Number two, that suggests that Instagram needs to get way better at monetizing its creators so it’s a competitive counterweight, but then we’re back in, “Well, you’re in your walled garden, they’re in their walled garden.” There’s a valley of disconnect here, and how do you think about crossing that chasm?
AM: So a few different things. On the Instagram side to start, I think there’s two ways it can benefit our business. Certainly we’re a customer acquisition channel and we’re good at that, but also, it’s the same idea, but not paid ads, we are a marketing channel for a lot of creators. Creators share a bunch of content and tell a story, build an audience, and then they monetize that audience, whether it’s through rev share on YouTube or branded content deals on Instagram or subscription on Twitch, and they drive a lot of impressions for us. So you don’t even need to pay us directly for you to create value for us and for us to create value for you. If we are a great platform for you to build an audience, then you’re going to be creating compelling content and we can advertise against that content the same way we advertise against everything else. So it doesn’t even have to be ads.
I agree. Just to say it’s just an ad platform — an ad platform only exists in the context of great organic reach.
AM: Well, I want to point out both because I think this is true for any of the platforms like us. I think YouTube is I think one of the big questions because they are — if TikTok is the best at breaking new talent, YouTube is the best at driving direct dollars into creators’ hands. I think if you look at the branded content ecosystem on Instagram, it’s probably about the same size. It’s many, many billions of dollars in your industry.
The same size as YouTube money or YouTube-branded content?
AM: I don’t know what YouTube pays out creators, I’m just talking about rev share. I don’t know what the total is because I don’t think they’ve released it, but I’m just saying, there’s other big things, but I don’t think anyone who’s a creator who sells branded content on Instagram thinks of that as Instagram service. They think of that as like, “No, that’s my deal. I made that happen on the side,” even if we help.
Even though it’s definitely an Instagram thing.
AM: Yeah. We’re just not going to get credit for that.
It’s not branded “Instagram”
AM: So for YouTube, I think it’s sort of the big question, because I think they have the most advantage on the monetization side. They’re best at directly writing checks into creators’ hands and getting credit for those checks. I think that at the end of the day, they have a subscription tool, memberships. It’s not as well developed and advanced as their other monetization tools. I don’t believe that’s because they don’t believe in it, I just think it’s just not that important towards driving their business. But I do think that yes, I can make all the same cases for YouTube then as I can for Instagram but it’s the weakest for that platform.
I think the most likely way to get YouTube involved is to get the creator community interested in it, because they’ve been very good at listening to creators, and to get a bunch of other platforms involved, which will then pressure them to be not left out. It’s a hard case to make. Like, let’s say we actually get a bunch of big players to do this, you don’t want to be the one platform that says to creators, “We’re not into that. We don’t think you should own your relationship with your subscribers. We think you should build the thing entirely on us.”
Why would TikTok be interested?
AM: I think it’s more important for TikTok. I think TikTok doesn’t have a strong financial creator monetization play. They pay creators, but it’s, from what I can tell, very inconsistent, it’s not predictable. We know creators value predictability and stability in income. You can’t win the lottery one month, not hear from a platform for four months, that’s not a way to run a business and creators are businesses at the end of the day. I also think it’s important to differentiate relative to YouTube. They don’t have long form video, I know they’ve got into it, but it’s not core to their model and it’s very hard to do rev share for short form video, that’s why YouTube is the best at rev shares because they’re the best at long form video.
Yeah. They have a lot of places to put ads.
AM: Yeah, exactly. It’s also the attribution, right? If I put an ad in the middle of your pod or in the middle of your video, it makes sense that I would pay you at a percentage of that. But if I put an ad between your video and then someone else’s video and then there are three other people’s video and then there’s another ad, then who gets the cut? That’s the core challenge for creator monetization rev share on YouTube Shorts, for creator monetization rev share on Reels on Instagram, for creator monetization rev share on TikTok, on any short form video platform, and it’s just a gnarly one, it’s a very gnarly one. And so for them, you’ve seen them experiment with subscriptions, you’ve seen them lean into being creator first. I think that’s an easier sell, I don’t know, but I think that’s an easier sell than YouTube.
Again, I’m on board with the vision. This is basically the vision I have as well. But what now? You’ve thrown this sort of —
AM: Thrown the gauntlet.
Right! But you’re not a indifferent actor. You’re one of the big three — I would say it’s really Instagram, TikTok and YouTube. But at the same time, I get the tension, if Instagram is too aggressive, now it’s an Instagram initiative and other people aren’t interested. So what now?
AM: It’s about getting as many people interested as possible. That’s why I did the talk, I didn’t really game theory out, I just tried to talk to as many people as I could, and I will continue to do so. I am completely open, there’s no hidden secret ideas here. I just figured, “This is high beta anyway.” The most likely outcome is nothing comes of this, but it’s possible, and it’d be I think amazing if it did, so I’m trying to drum up as much interest as I can at the payments layer, both talking to Web3 people and Web2 people. By the way, another challenge is, we’re a Web2 company, it’s not like the crypto folk look at us with welcome arms, they’re very skeptical.
I think that is the opportunity. It has always been the opportunity for Web3 stuff, is to be a layer on top of Web2. There’s a lot of very difficult problems about operating at scale that Web2 companies have been figuring out for a couple decades now, and this idea that there’s going to be this wholesale substitution is just one of the most ridiculous things ever. But at the same time, Web2 people look at Web3 and they’re like, “Oh, the idea of this wholesale substitution is ridiculous.” and they miss the fact there’s very real, distinct value that is delivered by there being a neutral arbiter of truth, and I think this is a perfect example.
AM: There’s things where they can help each other. So one of the ideas I really like here is let’s say you do this on Twitter. So they’ve got Super Follows, but I can’t tell what’s going on with that. That doesn’t seem like that’s moving very, very far. They’ve had a pretty crazy couple of —
The Twitter story in a nutshell, but yes. Continue. I said that, not you.
AM: I’ve got to give them credit, though. After taking not many swings for many years, they really accelerated at least the amount of swings that they’ve been taking over the last, I don’t know what it is, Maybe two or three years now, so I’m going to at least give them credit for that. I’ve met a bunch of them recently and I really like those guys.
Okay, here’s an idea: You subscribe to someone on Twitter and they on the back-end mint a token on your behalf, it adheres to this protocol. One of the core things that I think the Web2 world and platforms can do to offer to Web3, is to make this technology more accessible to more people. So you could buy a subscription on Twitter and you could get a token, let’s say it’s, I don’t know, on Solana or Ethereum, we could pick your — by the way, this should be a protocol that should be available on different chains, but we’ll just take Solana for a second, for example. Twitter can then say, “Listen, we made you a token. You can bring this with wherever you want, but to get it, you need to sign up for a Phantom Wallet account and we can actually create a really strong incentive”. You shouldn’t get blocked trying to get a wallet, whether it’s MetaMask, or Phantom, or whatever, set up to get a subscription. It should be as easy as possible to get a subscription.
Right. It should all happen in the background.
AM: And if you don’t care at all about crypto, if you don’t know what that word means-
That’s exactly it. You can go in by yourself and go get the keys if you want to. But if you just want to sign in via Twitter, that’s fine, it should all work.
AM: What I think is awesome is Twitter can, and Instagram can, and YouTube can literally help you leverage that moment where you make a subscription, and then create an incentive for you to do the hard work, because, by the way, it’s still too hard to get a wallet set up and get that token into that wallet, and understand what that even means. And because you have one now, even if you don’t have the wallet, which is why custody is an important thing here, and because there’s value in you being able to bring that token to another platform, we’ve now created an incentive for you to do it as a consumer, but you can do it on your own time. You can do it when your friend can teach you how to do it.
It’s almost like a new OAuth, but the OAuth is undergirded by this neutral blockchain, and you could actually sign in with your Instagram account, or with your Twitter account, or basically whatever account created it, and if you’re unsatisfied with that, if you want the underlying keys, you can go in, get the keys, and use your own wallet, or your hardware wallet, whatever it might be. But for most people, they never even realize that they’re not signing with Instagram, they’re signing in to a blockchain via their Instagram login. It’s all happening in the background.
AM: So one of the things that gets the crypto community that I’ve talked to excited is when you explain ideas like that, and you explain how you can grow that community from single millions to tens or hundreds of millions — there are tens of million of people who have some sort of form of crypto but nobody who actually have a wallet and can manage it, it’s a much smaller number — that’s what gets them interested. This seems obvious in retrospect, but I was expecting more skepticism from that community, and I’ve gotten a lot less, and I was expecting less skepticism from the Web2 community and I’ve gotten, not a lot more, but a little more.
That’s the dynamic. I think that makes sense. The vocal proponents of Web3 are so vocal and so overwhelming that it’s easy to sort of castigate the entire movement by them. Meanwhile, I think Web2 is almost the inverse, because the Web3 proponents are so vocal, no one wants to actually speak up because they don’t want to get cancelled. You have the inverse idea where no one actually wants to voice objections even though they’re building them internally in response to these overly-vocal, overly-aggressive people on Twitter. And so I think the Twitter perception is actually the exact opposite of the real-life reality on both sides, and I don’t think that’s actually an accident.
AM: Yeah, I hadn’t really thought it all through, I just was excited about the idea, and started pitching it, and getting feedback. One of the most fun things about doing this over the last couple months has been just getting an excuse to talk to really smart people and have them just punch holes in the thing and then refine the idea, and refine the idea, and refine the idea. Look, let’s be clear, honestly, the Valley – and it’s not just the Valley – but tech, in general, is often really insular. We’re all hit with waves of fires to solve, and problems to deal with, and scrutiny and we end heads down, just trying to crank out the work, and competition’s getting fiercer, and we don’t talk a ton across the companies, also for fear of being seen as some sort of crazy cabal. But literally getting really good, hard questions and critical feedback from a bunch of smart people at other companies has been a blast for me. It’s been a real blast.
Very cool. Well, I’m getting this signal from PR
AM: Oh, sorry.
See, that’s how you know you’re definitely on company time, because I’m getting the signal that you have to go. But a very interesting conversation. Again, who knows what will actually come of it, probably nothing, but if we get good conversations and interesting content along the way, that’s a win for me as a creator.
AM: Yeah, there you go! See, I love multiple positive outcomes. That’s like a thing, that’s a thing. But I really want this one so I’m going to work on it.
Very good. Well, I think the people at TED will know what we’re talking about. It’ll take a while to get the video out, I’ll update this interview whenever that comes out, but I think people will be looking forward to that release now, whenever it comes.
AM: Yes, so will I. I have actually no idea when it’s going to come out. (laughing)
Very good. It was good to talk to you.
AM: Thank you, Ben.
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