 This 10th year of Daily Tech News show is made possible by its listeners. Thanks to all of you including Kelly Cook, Scott Hepburn, Jeff Wilkes, and we've got a new patron everybody. Welcome, Brad. Hey, Brad. On this episode of DTNS, Brad and everybody else get to hear that Apple's earnings report actually means this. We're going to tell you what it means plus YouTube seems to be winning the ad blocker war for now. And Nate Langston explains why the UK is inserting itself in the world AI conversation. This is the Daily Tech News for Friday, November 3, 2023 in Los Angeles. I'm Tom Merritt. And from Studio Secret Bunker, TGIF. I'm Sarah Lane. Drawing top tech stories. I'm in Cleveland. I'm Len Peralta. And I'm the show's producer, Roger Chang. Joining us, Bloomberg's tech editor and host of the text message podcast, Nate Langston, welcome back, Nate. Thank you. Happy Friday, everybody. It's good to have you IRL. Very good. Get it? Oh, yeah, I got it. He gets it. Anyway, yeah, go check it out. It's a good show. All right, let's start with the quick heads. We haven't covered the trial of FTX's Sam Bankman Freed all that much. Since we assumed he'd be found guilty of fraud and conspiracy. And Thursday, he was sentencing will not happen until March 28 of 2024. So we'll check back then. All right. Okta has finished assessing the effects of attackers gaining unauthorized access to its customer support system last month. Once again, Okta dealing with this sort of thing. It believes the attackers accessed files belonging to 134 customers. And as it's quick to point out, that's less than 1% of its customers. Five of those were targeted in session hijacking attacks. So in other words, they were able to take some tokens and actually get in and poke around a little more. Three of those customers have said through. They are publicly one password beyond trust and cloudflare. Okta has disabled the compromised accounts, of course, as well as blocking the use of personal Google profiles with Chrome on Okta managed devices. That's one of the ways they suspect that the attackers were able to get in. It has also taken other actions, including binding Okta administrator session tokens based on network locations so that they can't be stolen and then reused from another location again. Microsoft employees are used to having certain perks. For example, free Xbox game past ultimate benefits. They like those perks, but the company started telling its 238,000 employees that the benefit would end starting in January of 2024. So just in a couple of months from now, Xbox employees are in the clear. But the vast majority of Microsoft employees don't work for Xbox and aren't part of Xbox or Microsoft gaming and will be offered a discounted 12 month Xbox game pass ultimate subscription at the company's internal store. Yes, reminds me when they took the instant oatmeal away at the tech TV break room. Remember that? I'm still not over it. Yeah, it's kind of the same thing. Samsung may launch the Galaxy S24 early. It traditionally launches new Galaxy S phones at the end of February, but last year went early February. And it seems like maybe this year they'll go even earlier. But SPS biz from major Korean media company SPS says its sources say Samsung will launch the Galaxy S24 on January 17th 2024. So just after CES the S24 is expected to be marketed heavily on its AI features. Not a big surprise there, I the guest, including a lot of on device processing. Some analysts believe the earlier launch might be meant to increase revenues in the quarter as the chip market bottoms out and it's not expected to recover immediately at the beginning of the year. Samsung makes a majority of its revenues from chips. So it's possible. It also reports that a fan edition of the Galaxy S23 will arrive December 1st. Fan editions are more affordable versions of flagship models with a couple of the specs lowered. And the Galaxy S series hasn't had a fan edition in three years. Google is not proceeding with its web integrity API for Chrome, which many deemed to be a type of digital rights management. The feature was prototyped, but only at the proposal stage. And the company announced yesterday it's not going to move forward with plans. People took issue with how the web integrity API would bring DRM to the open web. Google says that it heard your feedback. It heard your feedback. Everyone working there also did and also said that the web environment integrity proposal is no longer being considered by the Chrome team. Okay. Instead, it's developing a new Android web view media integrity API that is narrowly scoped and only targets web views embedded in apps. So just for phones running Google web services. All right. We're going to talk about Apple's earnings call a little bit. We don't usually do conversations about earnings on DTNs. For an earnings conversation to be worth it because we're looking at you, the consumer and saying, here's what's important. A company has to report something surprising or maybe talk about something in the earnings call that's of interest to us as tech users and consumers. Apple, however, gets a little more leeway on this since it is in fact the biggest company in the world. Just in front of Microsoft and Saudi Aramco. It's bigger than an oil company. It's bigger than a Saudi oil company. Apple's a very big company. I think some of us forget that sometimes. Especially those of us have been following it since it was a, you know, little up and comer, you know, behind hoping to someday compete with Microsoft. Apple's market cap is around 40% bigger than alphabets. So yes, Apple is big. What it says and does has an outsized effect on the world because of that compared to smaller companies. Yeah. I'm one of those people who has to remind myself that Apple used to be a little startup just trying to compete with Microsoft back in the day because it's been a while. Okay, so let's let's set the current stage a little bit. Apple reported its revenue was down 1% on the year. That's not what investors want. They wanted to go up. That's how these things work. So what made it go down? Few things, everything but the iPhone and services. The new iPhone pushed sales up 3% on the year. Max were down 10% though. Wearables and home category was down 3%. Services, those are things like Apple Music, Apple TV plus, etc. Bright spot here. They were up 16% and beat expectations. And Apple's very happy about that because it wants services to be part of its, you know, margins going forward. But sales were down 2.5% in China, which not that long ago was Apple's hope for growth and expansion. Think of all the people that could be reached. National sentiment against the US has affected Apple there as it has other companies as well. So what do we think this all means? Nate, what are your takeaways? Well, I've been I've been looking through a lot of the numbers, particularly as it relates to China. And if you actually look at the amount of money that Apple's been making in China over the last three or four years, if you exclude last year, it is still almost double what it was in 2020. I think that the dip is very slight. It does represent a couple of billion dollars in the region. And there's been a lot of stuff affecting people spending there as well as competition from Huawei and things like that. So I'm not massively surprised. And let's not forget like the revenue from one quarter for three months fell to eighty nine point five billion dollars in three months. You know, it's pretty much in line with what people expected. It was really just the China thing that caught people off off guard. And it's still almost as high as it's ever been there. So that's not me as an Apple apologist. I don't think any company needs 90 billion dollars of revenue in three months at all. But if you are going to have it and you are going to pick apart the numbers, then I would say it's probably worth waiting another two or three quarters, maybe even a year and seeing how this how this tracks because right now it doesn't point to something catastrophic. Yeah, the entire world economy is a little unsettled to be mild about it. So, you know, Mac sales being down not should not be a huge surprise. The fact that iPhone sales are up also isn't a surprise because they released a new iPhone, but they're not up maybe as much as you might have expected again, because people just aren't buying devices as much sales are down outside of Apple, too. Like you say, the China market, given the fact that there has been all of this trade restrictions backlash against American companies shouldn't be too much of a surprise. And Tim Cook during this past quarter went to China charm offensive. And it seems to have worked. China has kind of softened its rhetoric against Apple because of that. So maybe that bounces back. But I think the bigger point is that China is a mature market now. The days of China's double digit growth for its entire economy are probably over. And so Apple is getting to the point where, yes, it can still grow in China, but if it really wants to get those those eye watering marks and hedge itself against the future, it needs to be expanding in India. It needs to be expanding in Africa. So we are seeing them pivot to India a bit. I expect to see more of that. Services revenue up 16% is great because that's where they're pivoting. It's not enough to make up for this downfall in hardware right now. But if it keeps going the way it is probably will be. And you've got new hardware categories coming. You've got the Apple Vision Pro. You've got other things in development on the earnings call. Tim Cook made a big deal about how, yeah, we don't call things AI, but we have a lot of AI and we have more AI products in the pipeline. So, yeah, I think given the fact that the world economy is down, this is not too, this doesn't signal the doom of Apple or anything like that. Yeah. I mean, when people say we've got AI in our products, that's what I would expect someone who doesn't have much AI to say. But the India, you know, it's interesting. I think they actually hit a new revenue high in India specifically. Yeah. For the phone certainly. I'm not sure about other devices, but that's pretty significant because Apple's really, as you said, been trying to win hearts and minds and, more importantly, money in India. As someone hosting a show for Bloomberg about AI, what did you make of Cook saying like, look, we already have the AI in the stuff. We just don't call it that. Well, I mean, my knee-jerk reaction was, well, you might do, but it's not very good. At least it's not very good at the things people wanted to be good at. It's very good at identifying objects and photos and processing things, but that's happening in the background and that's not what people want to see. The stuff people want to see is a S-I-R-I that knows how to deal with natural language responses a bit more fluidly right now. Well, we talked earlier in the week about YouTube cracking down on ad blockers, and that seems to be having a ripple effect in a big way with some ad blocking companies saying a lot of people now are uninstalling their apps following YouTube's decision to start warning users who use ad blockers. Ad Guard, that's one such ad blocking company, told Wired that more than 11,000 people have uninstalled its Chrome extension on a daily basis since October 9th compared to 6,000 uninstalls per day before YouTube implemented its change. So it was happening anyway, but they saw a spike. Ad Blocking Company Ghostry also said that during the month of October, they saw three to five times the daily number of installs and uninstalls. Ghostry also says 90% of its users who completed a survey about why they uninstalled the product said that they did so because the tool no longer worked on YouTube. Ghostry also told Wired that Microsoft's Edge installs went up by 30% in October compared to September. Yeah, so we've been talking about why people are so upset about this and Anthony wrote in with a little bit of data, did a little little footwork for us. Anthony says, let me preface this by saying I haven't seen an ad on YouTube in years since I'm paying for premium. But looking online, most of the outrage that isn't YouTube should give me free video seems to say YouTube is abusing their monopoly on user-provided video to show too many ads to people. So Anthony says, I went searching for the ad rates, not how much they charge, but how often they run on YouTube per watch time and other video providers such as Hulu or Fast Services. I couldn't find anything for fast, but for stuff like Hulu, the average was 7% of content was ads in 2020. This one guy who tracked time on YouTube in March 2023 found the highest ad rate was 4% for short videos on mobile. So if he was off by 50%, YouTube serves ads at the rate of other providers who also ask you to pay and watch ads. In other words, Anthony's making the argument that it's just that you're seeing ads now that your blocker is off. It's not that they actually are showing that many more ads than other people in the business. Thank you, Anthony, for doing a little bit of legwork on that. It's not exactly apples to apples comparisons, but I like the way you framed it of like, you know, this is back of the envelope calculation, but it doesn't seem like they're all that abusive. So Nate, it's possible people are saying they're mad more than they actually are. We talked about that earlier this week. What do you think? Is the uninstall rate indicative that YouTube is winning this? I'm actually almost more interested in the fact that Ghostry telling why that Microsoft Edge installs went up by like 30% in a month. Like people are saying, well, if my ad blocker isn't going to work in Chrome, then I'm going to install Microsoft Edge. Like, that's a pretty hardcore switch there. I don't know. I mean, that's probably what I would do if I was like, well, crap. The way it was working is not working anymore. You know, let's try something else. Until somebody comes up with another tool and then they'll all go back because it's whack-a-mole. It always has with these sorts of things. My general view on YouTube is that it's too expensive to pay for. And if you look at the cost, it's comparable with an entry-level cost of something like Netflix. And I think Netflix and YouTube are actually very, very different products for most people. And it's probably about 50% more expensive than it should be for most people. That's a total back of the envelope guess. It's not even an envelope guess. It's just me plucking out of my head. I would pay if it was half as much, but I don't use it enough to justify the cost. I don't know if you've got the balance quite right there. But I also think this will be a story in about two weeks when someone comes up with another way to get around the blocks. I used to be where you are. I used to not use YouTube that much and wonder if it was worth paying for premium. For a while it was worth it because it gave me Google music. Then Google music turns to YouTube music and I don't use YouTube music as much. But as that happened, I started watching YouTube more and more people have talked about how they're watching YouTube more often than they are regular television. So I don't dispute your calculation, but I think that calculus is changing for people. And I wonder if YouTube knows that senses that and is one of the reasons that it's going ahead and doing this now. I just don't enjoy using YouTube. And I think YouTube is great and I do use it. I mostly use it for watching drum videos and things like that. But it's not the place that I spend a particularly large amount of time and the stuff that I do go for it for, it's not worth it to me to pay for it. So it's a difficult one. But I would hate for YouTube to go away. So if they start enforcing things that make some more money that makes them stick around for longer, then I suppose I will sign up and I will be a part of that as I've done for other places. But I'm not sensing an existential crisis here yet. I think it's notable that they are not just getting around the ad blockers. They could do it where they sense an ad blocker and then they route around it and show you the ad. That happens all the time with ad blockers and people get upset, ah, the ad blocker stopped working. Instead, they're just cutting off the service. I think that's another thing that's upsetting people is they're used to companies just showing them the ads and then them having to play whack-a-mole that way. But YouTube is putting up the notice like, no, this is on you. You figure it out. We're not going to start showing. We're not going to fix it for you. You've got an ad blocker and we're not going to show you the content anymore. That has not proved to work very often. Other outlets have tried it and they usually end up going back, Facebook being the most famous of those and they just go to showing you the ads instead. I'm wondering how long YouTube will hold out. The most annoying thing that YouTube does is block picture-in-picture on Macs and iPads and potentially other platforms as well unless you're paying. Even if you're using it in the browser, even if it technically works for a few seconds, it blocks it so you can't do it. Well, because it's a perk, Nate. I was going to say, yeah, exactly. You say block, Sarah and I say you don't get it because you don't pay for it. Right, yeah. It's a D move, whatever. No, it's exactly the same as like, I don't know, my car saying, well, pay a subscription and then you get heated seats in the winter. Do you see it the same way? I don't know if I see it the same way because the heat unit is built in. Well, okay, maybe it's like a little bit of a stretch comparison, but same idea as like, the capability is possible, but you're just throttling capabilities. I mean, the capability is possible not to show you ads too, but they make you pay for that. Well, that's true. Yeah. Well, folks, there's only one thing to do when you get frustrated with all of this stuff. It's think about robots. And that's why I have brought you Tom's Top Five this week entirely about TV robots thanks to our producer Roger Chang who decided that we should honor the television robot for inspiring us throughout the decades. You think you know which popular TV robots made this list, but you won't know for sure until you watch and then you can leave a comment telling us why we were wrong for not including the one you love. You can find that all at youtube.com slash Daily Tech News Show. Wednesday, we mentioned in the quick hits that representatives from government, business and academic institutions met in the UK and announced the Bletchley Declaration named after Bletchley Park. It says AI should be safe and human-centric. Used the term Frontier AI which open AI uses a lot to refer to models and development. Nate, you've been following this event in AI in general. China and the US are usually seen as the leaders in AI. So why did the UK decide it should host this AI safety summit? The great thing is they aren't mutually exclusive statements. China and the US are seen as as leaders in AI and we're hosting this summit despite that. And I think a big part of this is that the UK wants to be some kind of a Switzerland in the world's development of AI. We do not have massive AI companies. We created DeepMind and we very quickly sold it to Google about 10 years ago. And we have a lot of great academics and scientists and a lot of interesting stuff coming out of AI. But we're not making the big companies here. Neither is Europe really for that matter. And so I think there's something of a Trojan horse move in here to say, well, if we can't build the big tech companies then boy are we going to try and come up with ways to keep them all in check. And I think that's basically what they tried to do here is to get a lot of people together and say, well, you know what, we respect Britain enough for its history in code breaking in science and creating some interesting artificial intelligence over the years. And so we'll come along and we'll do this. But none of this stuff that's come out of it none of it's legally binding, none of it is regulation, none of it is even that new. We've seen things from the US, from China, from Europe from lots of places, lots of non-profits NGOs who have basically said it's a good idea to have a statement that is signed by a lot of notable people that says we think there is great harm and potential for AI and therefore we should all work together and make sure that the good stuff is great and the bad stuff is limited at most. So I don't really know what we've achieved here other than something of a diplomatic coup in making it look like Britain has more of a sway over the future of AI than actually it does. And that's coming from a Brit. I'd love us to be big in AI and we're great at a lot of stuff. You want to create companies that other big companies buy, come to us. We are good at that. We'll sell you a Shazam. A lot of people, that's what they're doing. That's all they could hope for. And that's great. But notable as this summit is I think it will be interesting to see six to twelve months down the line what good it did. Whether it happens again, because they're talking about it being annual, and frankly whether anything that comes out of this is held up in any kind of hall of power to say well you said this so stop doing that and I don't think that will happen. But at the same time, I don't think it made anything worse. I sound like a skeptic I'd love Britain to be doing more with AI but generally speaking getting a lot of people very smart people, influential people into a room with one notable exception who I won't mention but he was there generally doesn't make things worse if it broadens people's understanding. There was a spanner in the works this year but I do think on balance it's good to have these summits and I'm glad that the UK is respected enough to be able to host one. Yeah, cynically I could look at this and say well the Prime Minister wants to use this in his next campaign and he will, I'm not wrong about that but that's probably not all that's going on specifically because they have scheduled follow-ups there's going to be one in six months in South Korea that will not be in the UK even though it ends in a K, SK in that case. There will be one a year from now in France but it doesn't have a K in it at all. So this is all part of a plan that is clearly meant to continue the conversation while the UK gets to claim credit for kicking it off. Looking at it from that perspective, Nate what do you think success would look like if you were to change your mind and say oh you know what this was worth doing? Success would be there is a controversy with a company launching a new model or something and a company saying well we said we do this so here you go or conversely somebody raising a red flag about something and saying well hang on didn't you say this and then going yep fair enough we did yep good call, good shout we did say that in the UK at that summit so we won't do it that. Realistically that's the biggest impact that's going to come out of this because as I say none of it's legally binding, none of it translates immediately to regulation or anything like that so I think just name checking the fact that it happened as a reason to do or not do something is probably the best outcome that we could see from this. It kind of feels like it's somewhere between like a G7 summit where they don't pass regulations but they all sort of compare notes and agree on ways to do things and something more serious like a nuclear summit where we're not there yet but this could pave the way for treaties that are meant to you know prevent this use and use in military and that sort of thing this could be a venue for that down the road too right. I agree the difference is that at the G7 summit all the G7 leaders show up whereas here most of them didn't but you know China was represented the US was represented the EU was represented like a lot of big players and small players were represented at this and that's no mean fee that's pretty good going. So I do think it was worthwhile but as I said I think the real sense for whether it was worth doing and how it would change next time will be to see if anything gets held up and said you said this so stop it. Yeah UK is in a settling mood these days it's a kinder gentler competition and markets authority over there they just approved the Microsoft merger with Activision Blizzard and now have settled with Amazon and Meta. Amazon has agreed to give independent sellers access to the buy box let independent sellers negotiate directly with delivery partners on rates and no longer use marketplace data from third-party sellers in its own market research while Meta has agreed it will not use advertiser data to improve Facebook marketplace and give companies an opt out on that kind of data collection all together. So that I don't know real quickly date seems like the UK CMA is out there striking deals. Yeah it's a powerful body I mean again if there's one thing we can do well in Britain it's tell American companies what they can and cannot do like we might not be making the big companies ourselves but man we can we can tell you off. A tradition dating back to the 1600s. Yeah exactly. No I think it's good I mean the CMA is well respected here and it is powerful and it is a big market and we have a lot of influence in that sense so I'm not surprised to see this happen but yeah hopefully one day you guys can really kick us for doing something when we're big enough for you to care. Don't worry. A company called AdNose wants to be big enough for you to care it's a startup based in Los Angeles and testing a machine in Bakersfield California if you're not familiar it's about a hundred miles north of LA give or take this can take carbon dioxide and water out of the air at least that's what the company is testing the procedure is called hybrid direct air capture or DAC uses a chemical reaction to remove CO2 which can then be stored underground to be used to make products like concrete or even aviation fuel This is interesting there's a lot of efforts like this this is just another one to keep an eye on but if we can get enough of these working efficiently and cost effectively it is one way to reduce the amount of carbon in the atmosphere and that's not a bad thing right? No I think that's the goal I think the conversation is sort of like how effective is it right yeah that's why they got to do these tests yeah exactly AdNose wants it to be very effective and for a variety of reasons humanity does as well so yeah we'll keep our eye on it big fun of the atmosphere yeah and as someone who spells carbon dioxide every day I would like a way to mitigate that speak for yourself Tom you never exhale it's so weird I really want to I'm waiting Sarah has no carbon emissions it's the strangest thing only that were true alright well let's talk to somebody who is admitting amazing art Len Peralta what a huge honor for us today that was a nice bridge there we're professionals Len I love it I love it I haven't made the switch to YouTube you were talking earlier that more people are watching YouTube instead of just watching just regular streaming services you know but I think that this odd and blocker thing is one of the reasons why it's keeping me away from it and if they're moving it they're really sort of creating a zombie like problem and this week being Halloween I thought I'd draw something that's a little bit this is called Nightmare Night of the the Undead Night of the Undead and Blackers it's like I see these ads as sort of like monsters that are attacking somebody and there you have BigBed YouTube throwing an ad blocker away going there you go and look at Little Target or Target Target Uber and Dunkin Donut they're all just keeping my feed anyway this image is available right now on Patreon you get it at the DTNS Lover level or you can go the old fashioned route just go to my online store buy it that way you know by the way I am doing it is that season I am doing custom drawn holiday cards for people so you may want to consider putting that on your holiday wish list I'd be happy to do one for you so think about it that'd be great well good stuff as always Len also thanks to Nate Langson for being with us it's been a minute Nate we're so glad to have you today and let folks know what you've been up to in the meantime I've been making a second season of AI IRL which you can find wherever you find things on the internet just pop that in with my name and text message is back after a rather long hiatus of several months because I was filming it's back UKTekShow.com it's quite good I recommend both of these AI IRL even though this season doesn't have me on in it is still really really really good probably better so go check that out and text message is a must listen on my playlist every week folks thank you join me patrons stick around for the extended show Good Day Internet it's Friday so we are going to do something fun like we usually do and this week we're doing the GDI debates again join us as we tackle some of the most perplexing questions of all time just a reminder DTNS is live Monday through Friday 4 p.m. Eastern 2100 UTC that's the last time I'm going to say that for another four months find out more at dailyteknewshow.com slash live we're going to do a time change in the U.S. if you're confused by that we are back on Monday give or take with Chris Ashley joining us have a great weekend this week's episodes of Daily Tech New Show were created by the following people host producer and writer Tom Merritt host producer and writer Sarah Lane executive producer and Booker Roger Chang producer writer and co-host Rob Dunwood video producer and Twitch producer Joe Coots technical producer Anthony Lemos Spanish language host writer and producer Dan Campos science correspondent Dr. Nicky Ackermanns social media producer and moderator Zoe Deterding our mods Beatmaster W. Scottis 1 BioCow, Captain Kipper, Steve Guadirama, Paul Reese Jay Stevens a.k.a. Gadget Virtuoso and J.D. Galloway mod and video hosting by Dan Christensen music and art provided by Martin Bell Dan Looters Mustafa A.A.Cast and Len Peralta live art performed by Len Peralta A.Cast adds support from Tatiana Matias Patreon support from Tom McNeil contributors for this week's shows include Scott Johnson, Chris Christensen and Justin Robert Young our guest this week included Charlotte Henry and Nate Langson and thanks to all the patrons who make the show possible this show is part of the Frog Pants Network get more at frogpants.com Diamond Club hopes you have enjoyed this program