Greg: Welcome everybody to the inaugural edition of The Near Memo, which is a weekly conversation among the three of us about events of the week in search, social and commerce. I'm Greg Sterling. I am pleased to be the editor of Near Media and joining me today are Mike Blumenthal and David Mihm, my collaborators and co-conspirators.
And you guys want to say something a little bit about yourselves, not that you need any introduction?
Mike: I'm just excited to be finally working with the two of you on a project together.
Greg: All right. As am I.
David: likewise, I was about to say age before beauty, but Mike jumped in before I can even get that out.
So as usual, Mike gets the first word.
Greg: All right. What we've decided here is each go around and,reflect on a development, a news item, something that happened this week in this broad range of technology news and have a discussion about it and we'll see how it goes. So why don't we start with you Mike Blumenthal?
Mike: So the piece of news that really caught my eye this week.
Running in the shadow of Jeff Bezos, big announcement that he was moving from CEO to chairman of the board. And surprisingly, if not suspiciously released on the same day was the fact that Amazon had been fined by the FTC for $66 million. For stealing tips from their workers from 19, from 2015 to 2019, contrary to what they had promised the workers and they didn't stop until the FTC actually started investigating.
And I know that in your, in our newsletter, you noted it, that it was this sort of Bondian villainous Bezos, but I thought of it more like here's a capitalist doing what capitalists do, trying to get away with things by exploiting the lowest flex worker in the chain of delivery and only sort of coughing up once they got caught.
And I see it as a systemic problem. This is something that door dash and Instacart and every one of these other guys have done. And see it as a systemic problem in our society that largely lets these companies run unregulated.
Greg: Let me, let me clarify the bond villain headline because that was, that was prompted by a picture that I saw somewhere.
I don't know the source of it now. That showed Jeff Bezos in 94 when he just had founded, Amazon. And he's kind of this nebbishy guy, thin guy. And then I saw the picture of him, you know, more recently he's got, he's all, you know, he's really jack now, and he's got this vest and it's all in black and he's bald.
And I thought this guy is a Bond villain, and now, you know, he's become, and he's got the space, you know, Space X, I forget which one is Musk's in which one is blue, blue, blue, or whatever the hell has space company is. But that, so that's why I wasn't saying he's a bond villain because he's stealing from his own drivers.
I'm saying just because he's transformed himself into this kind of, you know, figure. But, what was mystifying to me about this item, the FTC fine is like, why, why have they don't need to do this? I mean, it's not like they're a small company that needs to show revenue growth, you know? Like, what is the con, what is the possible motivation from, for ripping these people off?
It just, it does. It's, it's insignificant to Amazon itself,
Mike: right? Totally.
David: It's a $6-$7 trillion company, right. There's like it's 0.00000001% of quarterly revenue or something like that. So.
Mike: It is totally mystifying. And yet it seems to be a standard in our industry and it happens over and over and over again, whether it's Uber or. DoorDash or GrubHub or one of these others, and in the absence of firm and consistent high-level regulation, I guess it will continue to happen just because it can and why leave $66 million on the table and why not take it from the flex driver who's working three jobs and sleeping in his car at night?
Greg: I mean, I guess the system rewards, you know, profit maximization or shareholder value maximization, but I. It's just it's, it's crazy. And it's kind of horrible, you know, I mean, this is true. This is, this, this sort of phenomenon seems to be, as you're pointing out, I think true across many of these companies, but what was also striking to me is that you, you know, Bezos is trying to present himself as a, as a benevolent figure, a philanthropist.
He's got the Bezos, you know, earth initiative, whatever it's called and, and, you know, trying to do good things at the corporate level. And yet this kind of stuff is going on and it's true for Google and it's true for Facebook. You know, they're all touting. This is black history month that are, they're all touting, you know, their, their black owned business initiatives and supporting black entrepreneurs.
And, and, at the same time they're doing all these things, which are,, you know, very, very questionable, ethically. You know, the example of, of Google ousting, the, The AI expert, her name is escaping me right now. Who's African-American?
Mike: Yeah, it's the gilded age reincarnated.
I went, I visited Johnson last year. The site of the world's, you know, horrendous flood caused by the industrialists of the area from Pittsburgh, wanting an Adirondacks like park, in the hilltops they built a dam poorly. It broke. Everybody died. No responsibility. And yet they all went on many of these like Frick and the others went on to become major philanthropists to recover their name in history, even if not in reality.
Greg: So, David, why don't we go to you?
Mike: One last point I want to make before we leave this, is the just amazing timing to me of the move. I found it fascinating that they were able to announce it on the exact same day that the FTC released the news. And I am not a conspiracy theorist.
I just think it was an incredible PR maneuver to have this buried in the news.
Greg: So on that, on that note I'm not somebody who indulges in conspiracies that often, but I think. I think there's a way in which this is about PR because, you know, apparently Bezos has really not been running day-to-day operations for a long time.
Mike: Right. So why announce on the same day the FTC is --
Greg: and he's not leaving the company, he's just sort of taking this higher level role where he's going to focus on strategic projects. So in a sense, nothing is changing and as a practical matter. So, you know, in one way that it is, it is our PR maneuver likely in all likelihood.
Mike: Over to you, David.
David: So, there wasn't necessarily a single story that caught my eye the last week or so, but a series of stories,, starting with the acquisition of Revue by Twitter, which is a newsletter platform, not entirely dissimilar to my own newsletter platform, Tidings, which was acquired by Demand Science this week.
And then also Facebook announcing that they were going to.start to, well actually they didn't announce it. It was, released. It came out that they're developing newsletter tools for journalists. And Revue's primary audience is also journalists, which is a little bit different than Tidings, which is geared around small businesses.
And inside of Demand Science we'll be geared at a B2B company specifically, but I think all three of these things, you know, kind of combined,, I feel some vindication for my thesis a few years ago, that social media, is not necessarily the best place to, for a business to be communicating with its customers.
That there's so much happening sort of in the stream that you don't get the sort of dedication of, of attention, number one, and that you don't own your audience the same way that you do with an email platform. So, I think that email has long been, sort of abandoned, by a lot of less sophisticated marketers.
And it's still one of the most, one of the most powerful channels out there and one that everyone should be taking advantage of and Twitter and Facebook, and to a much, much lower level Demand Science, invested in that this week, put their, put their dollars where, where their sort of strategic vision is.
Mike: You think Substack will be impacted by this? I mean, some sake was,
David: well, it was interesting. I don't know if you guys saw, but their CEO came out with a couple of smart snarky tweets saying, "Oh, this is, you know, GM deciding to build the Bolt, but then Teslas, you know, over here on the side, taking their lunch".
I do think SubStack will be impacted. I'm certainly impressed with, have, have been impressed with Revue's platform. And I think, in the hands of a company, as large as Twitter, which has the same audience as SubStack. I would, I would certainly be feeling the heat a little bit, over there.
And, and, that's not to say that there isn't a place. I mean, I think with any sophisticated technology product, I think there's going to be certain customers for whom a particular product is better suited for or not. And so I think, you know, to the extent SubStack can find where that gap is.
We certainly have seen Twitter execute very poorly on small business oriented products in the past. And, you know, they, they all by all indications seem to be much more interested in journalists as a customer base. So maybe that won't be the case here, but, I don't know that it's going to. You know, put SubStack out of business or anything, but I think it's, there's certainly, seem to be targeting the same customer set--
Mike: and it's half the price for a paid subscription. I think it's 5% versus 10%
David: Twitter is even dropping what Revue had been charging. So yeah, it's getting, getting even cheaper, right.
Mike: And free for anybody who isn't charging for the newsletter. So it's pretty competitively priced.
David: So that's what, that's what caught my eye this week. I just, you know, call it the resurgence of email, but you know -- however you want to frame it.
But email is still one of the top performing channels and everyone should be doing it. And you know, one of the reasons that we launched Near Media as a newsletter first company, we just, we all three of us, I think really believe in the power of newsletters.
Mike: Absolutely. At GatherUp when I was tasked with targeting Progressive Agents, which are notoriously hard to circle into a crowd, email was the only thing that worked. I tried calling. I tried direct mail. I tried everything. And the only successful tool turned out to be, email of all the things I attempted. So, I can attest to its power. I don't think it's a resurgence. I mean, it's always been there.
It just doesn't, it's not sexy.
Greg: It's not sexy. You know, it it's, it's something that's always performed and is one of the things that's most highly valued. I mean, it's paradoxical because there's so much email and there's so much noise and email, but it's still very effective and it's, you know, but, but, but people don't want to talk about it because it's, it's just this thing that's this workhorse that's kind of continues on and it doesn't have the bells and whistles of it.
David: Doesn't have the shiny object syndrome, for sure. Yeah. Yeah.
Greg: So for me --
David: Meanwhile everybody's excited about Clubhouse, is that what where you're going, Greg?
Greg: No, not at all. Not at all. So on that, you've forced me now to talk about it.
I mean, you know, you, if you had been on the call with me and Barry Schwartz and Matt McGee was on that call, Matt is the one who was very, very involved. And, you know, I mean, I think he's having, I think it's meaningful for these realtors there, they have embraced. You know, realtors are a funny group among small businesses like realtors and lawyers and maybe one or two other categories are really ahead of the curve.
Realtors have always been very progressive when it comes to marketing and trying new things and they're, and they're apparently using that. using clubhouse in ways that are meaningful for them, as opposed to just wasting time. I mean, I like you, I had sort of dismissed it, like, Oh, it's like this 1950s party line thing, and it's just really a noise and literally, and figuratively it's just noise.
But then I got on the call and I did talk about it and we were talking about how people are using it. And, it was pretty interesting. And I could imagine some specific use cases for it. I mean, it's not something that I want to just hang out on, you know, and, and I mean, there are people that are just on there all the time, I guess, but, but it is pretty interesting. It's like an, it's like a missing networking tool, you know, it's, it's all the virtual events that have taken the place of the live events. Don't have any viable networking. I mean, there's some novelty things that have been happening, but really that's gone and that's what people are hungry for.
And that's a big motivation for going to conferences. And this isn't necessarily the replacement for that, but it gets closer to that then something like Slack or, you know, I don't know, Zoom breakouts, maybe. I mean, I don't know, but it's, it's pretty, it's pretty interesting. And I haven't gotten my brain completely around it.
But that's not what I'm seeing,
Mike: But just to note on that, Matt and I, Matt showed it to me the other day I joined up. Obviously they want everybody in my email list and every social network online, they wanted that information. I only shared some of that with them, but man is particularly well suited to an audio environment, you know, he was trained in traditional media and he has an audience built in with realtors. So it's exciting to him because he has everything you need to take off., I, you know, if I'm going to go there, I have to build a new audience there. Right? It's difficult.
Greg: It's analogous in a way to radio.
See, I'm running out of time. Now you've forced me to talk about this issue that I wasn't going to talk about. David forced me, I guess, it's analogous in some ways to radio, you know, or, existing media that people are familiar with, you know, they're the new, you know, the, the author who's being interviewed before this big audience, or, you know, the, the, the, the radio host and guests, and then the audience.
So it's interesting. We'll see.
David: I'm certain that we'll have by this point, achieved, you know, exit escape velocity with its own audience, but do you think that the return to an economic normal and in-person events will stunt its growth. Or do you think it really is kind of an ongoing thing that people will use regularly?
Greg: I think like anything at a certain point, people will figure out what it's good for and then, you know, and then the sort of the marketers will descend on it and turn it into something, you know, distorted or like suck the life out of it.
You know, the, the exploitation and manipulation, but,, I think it'll have it. I think it will continue to have a life. I mean, events, you know, it'll be interesting to see as we sort of go forward. How many virtual events survive, how many live in-person events sort of return? We'll have some kind of mixed landscape.
[00:15:10] I think, you know, mixed reality. So I can't launch into another topic.
Mike: Get a do over. You get a slot,
Greg: okay. So I'll tell you, I'll tell you what, I'll tell you what, what I was going to talk about. And then I'll, then let's talk about, I'll talk about one, one final thing that's quicker. So I was going to talk about Apple versus Facebook, sort of IDFA deprecation and how that's playing out.
And it has a lot of interesting dimensions to it. You know, one of which is, is. Is Facebook's effort to create its own environment, to persuade you, to opt in, as opposed to using the Apple kind of a pop up, which has very limited space. So that will be very interesting to watch, to see what happens. Also, the justification of, you know, help small businesses, which is essentially implied by their messaging, which is manipulative, I think, and has some truth to it.
But it's largely manipulative. That's pretty interesting. And then against the backdrop of like the speculation about what are people going to actually do when these messages start showing up, you know, will it be like GDPR or CCPA where essentially nothing is happening, people are just complacent,
David: just an extra hurdle for users to see content yeah.
Greg: Precisely. Or is it going to be meaningful where people are going to say, I don't want to be tracked. You know, and I wrote the story this morning, or the, the sort of excerpt about, about how all the capitol rioters are being found using their smartphones. You know, it's, it's, I mean, social media and smartphones are the things that are, that are identifying them and people are just, you know, they know where they live, they know where they're been.
It's, it's incredibly revealing and it's, it's concerning. I mean, I'm all for rounding up the ringleaders, but it's very concerning. And so privacy continues to be a really important ongoing issue and how consumers, I mean, I saw some data this morning that I maybe we'll include it in a subsequent newsletter about how there's a, there's a gap between people's recognition of the problem, how they, they, what they say to surveys and then what they actually do, which is the GDPR issues. Like people are complacent or they're not making the effort, or they're just not doing anything different .Yet they're anxious and concerned.
You know, this is, this is sort of the, the market that we're in right now.
Mike: yep. Except for David who walks around inside a bubble of tinfoil. Right.
David: It is, it is true that I have location services, disabled, for every app until I enable them including Apple Maps.
Greg: So yeah, I mean, I think people genuinely want more control over these things and they recognize the limited context, the value of having that awareness.
And, but, but it's, you know, it's, it's, it's just very, people don't, you know, know what to do necessarily, or they're complacent or whatever. It's too much work. Whatever it is,
Mike: but Apple has certainly gotten to a point of market dominance where they can now drive the conversation to a large extent and help consumers understand what's going on and take the next step.
No, when they first started this marketing campaign around privacy several years ago, I remember David and I had a conversation around it and it wasn't clear that it would have an impact. And I think they were right in identifying as a topic and right in establishing as a corporate value that they could market and
David: good long-term bet for sure.
I think it's, you know, the stuff is only getting more Orwellian. So, even if it's not at the surface yet, it probably will be in the next five or 10 years.
Greg: Well, of the problem that this is something that they need, that they should be addressing.
But also there's a self-interest dimension because they don't have to rely on advertising. You know, they're in a position to, they can take the high road because they can take it as opposed to somebody like Google, who apparently is going to do the, the, the light or the bad version of what Apple is doing.
All right. So I was going to bring up, I was going to bring up the, the, the Apple AR VR, mixed reality goggles, glasses, whatever that apparently you're going to cost $3,000. And, just have some fun with that, but this is a weekly show. So maybe we can save that for next, the second, the second memo.
And I will bring into that conversation, the Apple car, which I've been studying recently. Yes. Very interesting. Very, very interesting. That's another, like, what are they actually thinking is going to happen? Kind of. Topic and I'll play the Luddite who wants neither. So that's usual. Okay. All right. Well thanks very much.
And we'll do this again next week, and it was fun. Thanks for listening guys. Thanks. Bye-bye!