Episode 335
January 12, 2024

BURLYCORE in ‘24: Bring Back the Hackers

Kicking off our 2024 season of the podcast, Phillip and Brian discuss the storylines of the upcoming NRF Big Show. PLUS: the spatial computing hype cycle is upon us, as is a new handheld device revolution. Listen now!

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Kicking off our 2024 season of the podcast, Phillip and Brian discuss the storylines of the upcoming NRF Big Show. PLUS: the spatial computing hype cycle is upon us, as is a new handheld device revolution. Listen now!

The Year of Spatial Computing

  • {00:09:54} - “Shopify has conquered down market, and so naturally, the most obvious place for growth is in the enterprise, and it's just where they have to go. And then, one of the reasons why Shopify struggled mightily trying to sell to the enterprise initially is because they didn't hire what I would consider to be truly enterprise-grade sellers, and they didn't give the toolbox to be able to sell.” - Brian
  • {00:13:18} - “Even if you don't go to NRF, the halo around The Big Show is now big enough to incorporate all of these brands that survived the tech and SaaS recession over the last year and a half. The companies that have come out the other side are now stronger for it. Even the ones that have received some critique online.” - Phillip
  • {00:26:55} - “I think what we see in an AI-centric future is not just a gesture. It's not just, "Hey, Siri." It's not just language, it's "And this doesn't require an Internet connection for it to work.’" - Phillip
  • {00:35:36} - “Every AI use case, every one of them, even OpenAI, in the opening demo is a commerce-centered use case. It is "Order me an Uber." It is "Get me a pizza." It is "Put this on my shopping list." Commerce is such a requirement for human existence and our connection with each other that you have to have commerce at the center of these experiences.” - Phillip
  • {00:46:43} - “In the current state of the world, you have to capture mimesis before you actually create product market fit.” - Phillip
  • {00:47:57} - “There's a reckoning on multiple fronts with app stores, in that app stores are about to become democratized. And they cannot be the walled gardens they have been in for 15 years. App stores are about to get disrupted.” - Phillip

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Clip From Ghostwriter: [00:00:00] How about letting me write about the hacker for the next issue? Do you know anything about hackers? Can you jam with the console cowboys in cyberspace? What? Ever read Neuromancer? Huh? Never experienced the new wave? Next wave? Dream wave? Or cyberpunk? I didn't think so. I'll handle the hacker stories. Yeah. I guess you should. Where'd you learn about all this hacker stuff? In there. It's a world where you're judged by what you say and think, not by what you look like. A world where curiosity and imagination equals power. We need more paper. Let's go, people. Work with me here. Work with me.

Phillip: [00:00:49] Hello, and welcome to Future Commerce, the podcast at the intersection of culture and commerce. I'm Phillip.

Brian: [00:02:06] I'm Brian.

Phillip: [00:02:07] And it's a new year. New year, new me. New glasses, if you're watching.

Brian: [00:02:11] New glasses. Special glasses.

Phillip: [00:02:14] I have needed glasses for 10 years. I had glasses. Do you wear glasses, Brian?

Brian: [00:02:20] Well, technically, yes. I don't need them to drive. But when I sit in the back of the class...

Phillip: [00:02:27] What do you use them for?

Brian: [00:02:27] When I sit in the back of the class, I can't see very well.

Phillip: [00:02:30] Feels like you should be wearing them when you drive.

Brian: [00:02:32] No. No. No. No. No. No. Actually, I go in every time I have to renew my driver's license. I actually go into the actual physical location. Because even though I could renew online, I'm always like, "I wanna make sure that I pass the visual test," and I always do. Barely.

Phillip: [00:02:50] Good for you. Good for you. You memorized the task, I think.

Brian: [00:02:55] I squint.

Phillip: [00:02:57] Yeah. You told me this before. Like, "I just squint."

Brian: [00:03:00] I just squint. It's a total George Costanza move. Yeah.

Phillip: [00:03:03] That's a total George Costanza. I was badly in need of glasses. I didn't realize how much I needed glasses, but I did need them. I've had glasses, but the prescription was way out of date. Never wore them. But then the Ray Ban, the meta Ray Bans. Remember we had the episode a few months ago where they announced the meta Ray Ban Facebook glasses?

Brian: [00:03:29] Yeah.

Phillip: [00:03:29] I think we we titled the episode, "I Do Not Consent to Your Livestream" because I was gonna make T-shirts that basically was... {laughter}

Brian: [00:03:35] Then they delayed the the release. Right?

Phillip: [00:03:39] Something like that. I can't remember how it all worked out, But they basically came, they started landing right before Christmas. Everybody was posting this content. Brian, the content was blowing my mind. I got duped. I was like, "You know what? I'm gonna get them." Commerce got me. So I bought these glasses, and I would say the best part of the glasses is being able to see.

Phillip: [00:04:07] Impressive.

Brian: [00:04:08] The 2nd best part of the glasses is the livestream and the video is wildly good.

Brian: [00:04:16] It's so crazy. Wow.

Phillip: [00:04:18] I can't wait to use these at NRF. I'm really excited for it. Yeah.

Brian: [00:04:21] That's so cool. That's really, really cool. I can't wait for you to use those. Yeah.

Phillip: [00:04:26] I don't know how to keep it up. {laughter}

Brian: [00:04:26] No. That's the real question with glasses. I was talking to my wife about getting new glasses, and I was like, "Maybe I should do disposable contacts."

Phillip: [00:04:39] Do it. Do it. Do it. That's the commerce. Something disposable, so you have to keep buying it. Well, I'm excited to use these. There's a lot that we can cover here today. This is sort of a don't count this as our 1st episode of the year. We'll count this as, I don't know what episode this is.

Brian: [00:05:00] Who knows when this will come out?

Phillip: [00:05:02] This is the old wind up. This is us coming back from a few weeks.

Brian: [00:05:05] I like this. It'll just sit in queue for a few days.

Phillip: [00:05:11] Maybe. NRF is really kinda where things kick off. I like dropping our predictions episode sort of right on the NRF hump too because that always gives a real big bump. We get a big brand lift. I want that. So who knows when I don't know... This was probably in that intermediary no man's land time. For those who aren't familiar, and I feel like everybody should be familiar, but the NRF Big Show is going to actually be a big show again. One of the interesting things about NRF is it's kind of recaptured the attention or it's captured the attention of the Shopify crowd for the very first time. And I want your sort of analysis of why you think that is, and I wanna give my perspective on why I think that is and what might be in store for the first time that the Shopify community is really going to descend. Why is that?

Brian: [00:06:05] Two reasons. Last year, Shopify made a bunch of big announcements at NRF about Commerce Components. That was the big release of the Mattel win, although it wasn't live, I don't think, and I don't know that it is, actually. That's a good question. Oh, this is a good question.

Phillip: [00:06:26] Yeah. Something we should know. Let's go and check it out.

Brian: [00:06:29] I don't think it is. So, with that sort of, it was the kickoff to Shopify trying to enter the enterprise space again, maybe the 3rd time.

Phillip: [00:06:41] It is live. Mattel Creations is a small collection of limited sale, limited offering, products. Not unlike the bungie thing where they have those sort of merch.

Brian: [00:06:53] Yeah. Although I will say this about Mattel, my understanding was that they were taking on the whole Mattel catalog, Like all Mattel sites. So I don't know if it's just that one.

Phillip: [00:07:03] That's gonna be a long time. {laughter} Have you heard about how the enterprise does technology, Brian?

Brian: [00:07:10] I have. Yes. I have. In fact, this is exactly what... Well, this is what I'm talking about. NRF is very much built for an enterprise audience, And so Shopify has, I think, made some really smart hires and investments, in the enterprise commerce space. And I believe that it is going to see attrition from some of the classic enterprise tech providers in a meaningful way. Like the Oracles and the Salesforces of the world, foresee some offboarding and onboarding onto Shopify, and that's where a lot of eCom replatforming is gonna take place is traditional, larger retailers are going to continue to be under duress to cut spending in 2024. I don't wanna get too far into my predictions episode, but I think 2024 is gonna be another choppy year. And so there's gonna be a lot of pressure to cut technology teams, and there's still a lot of space to do that in some of the larger companies out there. So the first look is gonna be SaaS.

Phillip: [00:08:34] Do you listen to the All In podcast?

Brian: [00:08:35] No, not that often.

Phillip: [00:08:36] Because everybody in the eCommerce space that does listen to the All In podcast right now is trying to make the same prediction as if it was their own. I think that a lot of folks are having this really, to your point, are having an existential crisis about the fact is most SaaS, most vertical SaaS, has stopped innovating because the problem spaces are solved. We've been talking about this for two or three years now.

Brian: [00:09:01] Yes. Long time.

Phillip: [00:09:01] There's not really much more to do. You even see, to your point about Shopify, Shopify as an organization, we noticed last year when we were at the open store live event that Kaz, the CRO over at Shopify was very intentionally not saying eCommerce or web commerce or even omnichannel. It was the entrepreneur's toolbox. Right? That is the line they're using now. And so the idea of things needing to innovate... So this is the question is that Shopify's matured, but NRF kind of feels like it is a very small part of a much larger story.

Brian: [00:09:46] So I think the last thing before we wrap up that Shopify enterprise story, I think there are two more components to it. One is that [00:09:54] Shopify has sort of conquered down market, and so naturally, the most obvious place for growth is in the enterprise, and it's just where they have to go. And then finally, I mentioned hires. Friends of the pod have been hired over at Shopify, enterprise sellers. I think one of the reasons why Shopify struggled mightily trying to sell to the enterprise initially is because they didn't hire what I would consider to be truly enterprise-grade sellers, and they didn't give the toolbox to be able to sell. [00:10:37] So, it was a lot of like, "Oh, let's just hire some salespeople who are familiar with direct to consumer," which is not enterprise eCommerce. And so, there are a few hires that they've made and some investments in intellectual or knowledge around how to engage, and then the final thing is they opened up for doing RPs. So just a lot of things that had to happen this year, and I think there's been a ton of movement in the ecosystem toward Shopify, and I'm not just saying this based off of all these productions. I've talked to people in the ecosystem who are in positions where they know what the funnel looks like in terms of replatforms or new technology, and I'm hearing this from other people as well.

Phillip: [00:11:30] And the only thing to replatform too, at this point in time, like, okay, your post BFCM. You're looking for the eCommerce... Let's see, what what has the eCommerce story been post COVID where you had a boom year, a boom year and a half, sort of a pullback, and then sort of, I would say, a technology and SaaS recession. So all of those... The ecosystem where the incrementality that comes from software was really the incrementality was in specific solutions. It was in, what, media buying? It was, like, analytics, media buying, attribution software.

Brian: [00:12:18] Yep.

Phillip: [00:12:18] It wasn't in feature and functionality. And what you're seeing now is we're also, and this is the thing I kinda wanna about when you talk about when you talk about future commerce, just today, the official launch date of Apple Vision Pro was announced for February 2nd. And who has been beating the mixed reality and spatial commerce drum harder than Shopify?

Brian: [00:12:50] Right.

Phillip: [00:12:51] So when you're thinking about...

Brian: [00:12:55] They're beating that with Facebook, not Apple.

Phillip: [00:12:59] You know what's really funny? They are beating that with Facebook and not Apple, and that's a thing that I do... Apple's doing them a lot of favors, which by the way, I have a whole thing. I can actually pull all this together in one big blob. We'll make sense of this in a second. [00:13:18] Even if you don't go to NRF, the halo around The Big Show is now big enough to incorporate all of these brands that survived the tech and SaaS recession over the last year and a half. So here's what happens. The companies that have come out the other side are now stronger for it. Even the ones that have received, you know, some critique online. [00:13:40] So let's say, the Yotpos of the world. The Yotpos, maybe the Bloomreaches, the Recharges, they're seeing growth naturally, in these Shopify brands that have also survived this really tough season. And those companies are now ready to reinvest because they're feeling much more confident. It was a stellar Black Friday/Cyber Monday.

Brian: [00:14:03] Yep.

Phillip: [00:14:03] Right? Incredible growth. I think the NRF itself said something to the tune of 7.5 Percent year over year growth. Monster consumer signals coming out of 2023. And all of your technology partners are going to be at this show. So number one, that is one feather in the cap. The other thing is Shopify has its own US headquarters of sorts in New York City in SoHo.

Brian: [00:14:30] Yes.

Phillip: [00:14:31] Just down the street. And they are holding town halls. They're holding events. They're holding evening mixers and happy hours. They're holding open houses. They are doing things with partners during the week of NRF. Even if they don't go to The Big Show, the show around the show is big enough to support the Shopify ecosystem making an excuse to be there.

Brian: [00:15:40] And you know what's super interesting about this is, the show around the show, that's such a... It's probably more true at NRF than anywhere, any other show, because one, it's impossible to control. There's shows in Vegas, and those are much easier to kinda control the show around the show.

Phillip: [00:16:00] It's true.

Brian: [00:16:00] It's built for that. But the show around the show at New York is always gigantic.

Phillip: [00:16:08] We've been part of it in years past. We're doing our own thing this year. Last year, we had an Archetypes pop up at Industry West.

Brian: [00:16:14] Yes.

Phillip: [00:16:15] There's a a huge... There's a lot of that that's going on.

Brian: [00:16:21] Right. And that's because you can do it with locals. Like you said, they've got an office. So it's just it's so much easier to connect with the New York community than the Las Vegas community because there's a lot more eCom community in New York than there are in some of these cities that are built just to have conferences in.

Phillip: [00:16:38] Let's tie it all back. There was a picture that was posted from Mark Zuckerberg about riding dirt bikes or dune buggies or something. I don't know if you saw this. Did you see it?

Brian: [00:16:49] It was like mud riding or whatever. He had mud all over. Everybody had mud all over.

Phillip: [00:16:53] Everybody had mud on their face.

Brian: [00:16:54] Mud on their face. Yeah.

Phillip: [00:16:55] Toby Lutka, on the right, looking very chummy with Zuck. Those pictures are not posted thoughtlessly.

Brian: [00:17:05] No.

Phillip: [00:17:05] It also is posted the same day as the Apple Vision Pro announcement, which got my gears turning because remember we wrote, when Apple Vision Pro was announced last year, they very specifically did not say augmented reality, virtual reality, or mixed reality. They didn't say AR, VR, XR. What did they say?

Brian: [00:17:26] They said spatial computing.

Phillip: [00:17:27] Spatial computing. Right? And what was the first real world use case besides meditation?

Brian: [00:17:35] eCom

Phillip: [00:17:36] They showed an eCommerce website. But I got to thinking when I saw that picture with Zuck. Zuck has Oculus, or now the Meta Quest. Zuck has a device that will be the chief competitor, the one longest in market against Apple. Zuck is in a picture...

Brian: [00:17:58] Did you say chief competitor or cheap competitor?

Phillip: [00:18:02] Apparently, the Meta Quest 3 is very good and does mix reality quite well. I haven't done it.

Brian: [00:18:08] Sure does.

Phillip: [00:18:08] I haven't used it myself. I have a Quest 2 or the was it called before the... Whatever. The Oculus Quest 2. We have one.

Brian: [00:18:17] I think it's Quest 2. Yeah.

Phillip: [00:18:18] Remember, there was, it was the device of last Christmas.

Brian: [00:18:22] A VR gamer.

Phillip: [00:18:22] Yeah. It's a whole thing. Kids play Beat Saber, whatever, Rec Room, or whatever the heck. I forget what they... They do a lot of stuff with it. Mostly Beat Saber. They love it. I have not had glasses, so I found it hard to use. {laughter} Some IPs I don't know if you know this. You can get, like, custom insert eyewear. It's crazy. Anyway...

Brian: [00:18:46] You know what's super funny about this? How many of us millennials, all of us millennials, every single one of us had parents who said, "Don't hold that screen so close to your eyes."

Phillip: [00:19:00] "Move away from the TV."

Brian: [00:19:10] Move away from the TV. You're going to ruin your eyesight. Here we are, strapping them to our children's faces. {laughter}

Phillip: [00:19:10] Literally, an inch from your eye. Not even. Half an inch from your eyeball.

Brian: [00:19:15] Not even. Yeah.

Phillip: [00:19:16] Unbelievable. But I just don't think that it is a mistake for Toby and Zuck to be in a picture the same day that the Apple date announcement drops, which is the 1st day of CES. It all happens in a very calculated way. What else did that make me think of? It made me think of the first use case, the first real world use case that they show, which is Safari in a browser, in the Apple Vision Pro announcement video. What do they show? They show a WordPress eCommerce website. Not a Shopify website. WordPress eCommerce website. Designed and delivered by Human, which is a creative agency helmed by Rachel Yeager, who is a Future Commerce, contributor, once and future, Future Commerce contributor and was a panelist at our VISIONS symposium at MoMA back in May of '23. But

Brian: [00:20:15] She's amazing.

Phillip: [00:20:16] I don't think that that is... She is amazing. I don't think that that is a mistake. I think all of those things are thought about deeply and in a calculated way, and that somewhere, somehow...

Brian: [00:20:29] PR baby.

Phillip: [00:20:30] It is PR.

Brian: [00:20:34] You know what I love about this?

Phillip: [00:20:36] What do you love about this?

Brian: [00:20:37] Do you know what else is intentional about this? It's a 100% right in line with a trend that I'm just trying to start to spin up myself, but it's something I haven't said on the show yet. It's called Burly Core...

Phillip: [00:21:00] {laughter}

Brian: [00:21:00] I'm in fact, right now, right now, I'm rocking Burley Core. Mudding absolutely falls into Burly Core.

Phillip: [00:21:13] Yo. It is Burly Core. You're right. {laughter}

Brian: [00:21:18] {laughter} It's alt name is, ChewieCore, named after Chewbacca.

Phillip: [00:21:29] Wow.

Brian: [00:21:30] I got a hat tip to Jesse Tyler. Well, he had a good laugh with me about that earlier. He was like, "Dude, your vibe right now is Chewbacca."

Phillip: [00:21:41] It's yeah. Very. {laughter} All you need is a bandolier, and you're on it, dude. You've got the look right now. Are you gonna get a haircut before NRF?

Brian: [00:21:49] Oh, yeah. Yeah. Or at least I'll trim my beard. I don't know.

Phillip: [00:21:53] Trim the beard.

Brian: [00:21:53] Yeah. I'll trim the beard. I feel like I'm on to something right now. It's definitely not my fashion prediction for 2024, but maybe there'll be a subculture or counterculture that follows me down this road.

Phillip: [00:22:05] Down the Burly Core. You need a... Yeah. There's so much to talk about there. Let's just to put a a big fat bow on it, I think that tools... It's not just that Shopify has had one or two town halls or Twitter spaces around the toolkit that they're doing for spatial. They've released some tools that use things like Nerfs and Gaussian Splats, things we've written about on Future Commerce. Things that allow merchants a very, very soft on ramp To doing more 3D imagery production, and 3D model, you know, sort of, I would say 3D video and spatial models so that you can have more immersive content on your Shopify site. But I also think that there is a going to be, you know, conversational commerce 2.0 is upon us. I think spatial commerce is going to be the next big thing. Everyone's gonna be beating the drum about it while no one has any devices to do it, and that'll happen for the next 18 months to 24 months. That'll be the next hype cycle. And it will begin at NRF with companies like Shopify who will say...

Brian: [00:23:24] That's a great prediction.

Phillip: [00:23:25] This is all happening right now in front of us. It's all coming right now. It's because Shopify has things to talk about that they've been making in small, steady, incremental investments. I think I reported on this for future commerce in the senses a few months ago, but I was doing some background research on Shopify spatial, investments, and Toby was an original Meta Quest backer.

Brian: [00:23:54] Yes.

Phillip: [00:23:54] Or the original Oculus, the very first Oculus, the Palmer Lucky era Oculus pre Facebook era Oculus, he was like I think he has headset number 3 or something. He has been in this game for a very long time and will very softly make investments and hedge the bets to future proof themselves in their business for the next phase of whatever comes out of this. But Apple will set the tone. Right? And this is the thing, because I think we're also in the middle of a bunch of device launches, around AI pins and AI handhelds.

Brian: [00:24:37] Which, by the way, you also predicted.

Phillip: [00:24:42] That's oh, that's a whole other thing we can talk about. Yeah. I love being right.

Brian: [00:24:47] It's fun. It's fun when your name is Future Commerce and you actually get things right, and I'm really excited about our predictions episode because we got a lot of stuff right.

Phillip: [00:24:56] I know. I know. We got a lot of stuff right. Oh my gosh. We got stuff right.

Brian: [00:24:59] This comes out before or after, I love it. It's like either a victory lap or like a...

Phillip: [00:25:04] No way to know. We have no way of knowing when this episode's coming out, Brian, it's impossible. It's physically impossible to know. All of these AI devices that are coming out are also creating a little bit of pressure around what is the modality of language models in the future? And Facebook already has. They've put their foot into the open source bucket. They are saying that the future of large language models is small portable models that are open source backed that are able to be built on by a number of plurality of developers. So the GPT 4 capable language model is now less than, I think, less than 2 terabytes. You could have a GPT 4 equivalent large language model, a llama, a Facebook llama, which by the way, I don't know if the word llama gives you PTSD or not.

Brian: [00:26:05] A little bit.

Phillip: [00:26:06] But you could have this large language model portable in a Facebook assisted large language model future. Here's what's interesting about that. That is how Apple has approached privacy. Apple has approached privacy and their security, especially around fingerprints and face ID, in a similar way, in that all of these things happen on your device with specialized chipsets that are able to securely take things like bio information, like I said, face ID, fingerprints. These are not things that are synced to the cloud, and it doesn't go to Apple, and that has been their differentiator for five years. They've been beating the drum around privacy. [00:26:55] I think what we see in an AI-centric future is not just gesture. It's not just, "Hey, Siri." It's not just language, it's "And this doesn't require an Internet connection for it to work." [00:27:07]

Brian: [00:27:07] Correct. A 100%. Yeah. This is actually what Roemmele was kind of going on about in the last episode with him. Well, his implementation was, like, "Okay. How do we get there as fast as possible?" Here's a very shortcut way, or not short cut way, but it's like a very first iteration type way. I think the actual answer is exactly what you said, localized device. Our phones, we're adding more and more storage to them. You can get it to terabyte personal phone now. It's incredible. Putting something at this level into a personal device is I think that you've called it. We're talking a little bit still, I think, far future. We don't expect it next year, but as we see Apple work their way into the AI conversation, you nailed it. They have to do it in a way that's consistent with their differentiator, their moat, and that is privacy, and there's a lot of naysayers out out there. And a friend of mine recently commented on some Twitter stuff about how Apple doesn't have the data or the sign or the capability, the intellectual capability to go after this. But the argument that I've seen floating around that I absolutely buy into is that they're going to use their moral code as a way to set themselves apart. And in fact, it is the right way to do it. We're seeing a lot of data gets scraped. A lot of data be used in ways that it probably shouldn't be used. That's how a lot of this AI training has happened. It's just honestly unethical. It's with datasets that are...

Phillip: [00:28:53] Well, not according to a court of law yet.

Brian: [00:28:55] Well, it's gray area at best.

Phillip: [00:29:00] That's how Google... Let's play devil's advocate for a second?

Brian: [00:29:03] Yes.

Phillip: [00:29:04] Isn't this just what Google and everyone else has done for years is scrape the open web, including the New York Times, including Getty, and Index that information without having to store it completely to provide access to it in an index? Is that not what they do?

Brian: [00:29:20] In an index, absolutely, but not as a, like, you can't get the full picture of the data. The problem right now is that you're getting synthesized data out of that data, whereas Google is just providing you with previews and getting you links to that data. So if it is gated, if it is gated...

Phillip: [00:30:39] Just a statistical model. It's like the likelihood of one word following the next. It's really not... It's an interesting thing. I don't know.

Brian: [00:30:47] It depends on if you consider synthesis like intellectual property.

Phillip: [00:30:52] I mean, it depends. Right? I think it depends on how you see search. There are so many lawsuits right now. I think the New York Times one won't even make it to a court. I think there will be a a $100,000,000 plus settlement. I think there's gonna be a huge vig. Someone's gonna have to pay it over...

Brian: [00:31:12] And it's going to set precedent for how AI data is trained in the future, and the way that I see it happening is most data will be gated. If you want access to that data in your AI model, you'll have to pay for it.

Phillip: [00:31:24] But I want you to say the thing that we said on Twitter that was poo pooed is who is the best in the world at creating content partnerships?

Brian: [00:31:33] Apple. Absolutely.

Phillip: [00:31:34] There you go. There it is.

Brian: [00:31:35] No question. Yes. The answer is Apple. Yes. And they also have the device footprint. This is the other reason why they're gonna win.

Phillip: [00:31:42] And the app store. And yes. They have it all.

Brian: [00:31:45] They have it all. That's right.

Phillip: [00:31:47] Can I make one totally... It's orthogonal at best, observation about the Meta Quest glasses. No. The Meta Ray Bans that I'm wearing literally right now. If I had to make one observation, there is an unexpected incredible feature on these that I haven't heard anyone talk about, and my tweet on the matter got zero traction. They record in spatial stereo. My phone does not record in spatial stereo, But these glasses record in spatial stereo. They do something that is shocking. When I watch a video back that I have taken from this first person view from this camera, from the camera built into these glasses, the audio sounds... Because it's open ear. I don't have headphones in. The audio sounds like it's literally happening around me. It throws me off every time. I watch a video of me with my kids. We're walking down the street, and I'm just looking down, like, oh, look at our sick sneakers, Jackson family with our hype kicks. But I hear the kids talking, and it sounds like they're literally right next to me, and I can hear it spatially. I can locate them in space. It is so surreal. Now give it five years, and I'll be like, "That sounds terrible." But we are... It is right now, it's good enough to fool me.

Brian: [00:33:26] But it's directional. It's at least directionally, you have a sense of, like, where this is gonna be in five years from now, and it's already good enough.

Phillip: [00:33:35] And it is so good. The fact is is that every AirPod, AirPod 3 and every AirPod Pro 2 has spatial audio built in. iPhone 15s right now have VisionPRO compatible 3D video, spatial video, built in. So the device leap to this next immersive level of media capture isn't insane. And this is where I think... So what does commerce have to do with all this besides the fact that you buy the devices? Commerce legitimizes a new communication medium. And this is something I've talked about for years since I read the Victorian Internet. The Victorian Internet is a phenomenal read. If you've never read it, it's the history of the telegraph. What is amazing about the back half of the book is it talks about the proliferation of the worldwide network that was required to make the telegraph ubiquitous. And the thing besides military uses and naval ships and commanding forces and foreign lands and colonial and imperial, you know, rule of the United Kingdom. What made the telegraph ubiquitous was commerce. The ability to create demand and exercise economic growth across borders. So I've thought about that for now 6, 7, 8 years since I read the book. I've thought about that whenever we have a new channel emerge. What is the commerce capability of the channel? The thing that has blown my mind is it doesn't matter what pin or brooch or pendant device is being announced. [00:35:36] Every AI use case, every one of them, even OpenAI, in the opening demo is a commerce-centered use case. It is "Order me an Uber." It is "Get me a pizza." It is "Put this on my shopping list." Commerce is such a requirement for human existence and our connection with each other that you have to have commerce at the center of these experiences. [00:36:01] And that is the thing that I'm not so clear on is do we want to go on websites on an Apple Vision Pro in order... Does that become a better experience?

Brian: [00:36:14] Is it a discovery experience?

Phillip: [00:36:16] It's not. Not native to the experience, but we do need something. There will be a skeumorphic Period. Just like we had with the iPhone. There will be a skeuomorphic period where for adoption's sake we have the old paradigm, but something new has to emerge after that.

Brian: [00:36:32] Here's the question.

Phillip: [00:36:35] Maybe the Burly Core.

Brian: [00:36:36] Burly Core.

Phillip: [00:36:37] Burly Core could emerge.

Brian: [00:36:38] Burly Core could emerge. I mean, that feels kinda like the opposite of that. But the question that I have is, what is it gonna look like on the process to whatever that is? So there's gonna be a lot of in-between between now and what you're talking about. A lot of it. Maybe a few years, maybe even five years of...

Phillip: [00:37:02] Yeah. 7, 8 years on the iPhone.

Brian: [00:37:05] Right. Exactly. Before it reached the level of ubiquity that it did, took, you know, got a good 5, 6, 7 years. So on the path there, I think there's gonna be a set of use cases and still reasons to invest in the channel and ways to make money. Who's gonna be the ones investing? Well, let's talk about who's buying these devices first. It's gonna be people who have disposable income that are invested in technology and are early adopters of different types of trends.

Phillip: [00:37:42] So me.

Brian: [00:37:44] So Phillip Jackson. So whatever you feel like you can sell to Phillip Jackson is the if you're that company, you feel like Phillip Jackson is going to buy from you.

Phillip: [00:37:55] Yes.

Brian: [00:37:55] Then you need to be investing in this. That is what I'm talking about. Who is the buyer of the device?

Phillip: [00:38:01] Yeah.

Brian: [00:38:01] But I'm kind of dead serious. Like, you're sort of the archetype of the kind of person that whoever is gonna go try to advertise or sell through this new channel, the companies that are selling to you need to be thinking about this.

Phillip: [00:38:14] It's such a funny time. This is the greatest wind up to a true rundown prediction episode ever because this kind of is all the things you want us to say, but not like, we don't have to do it under the auspices of what is happening in 2024.

Brian: [00:38:35] So true. I know. Predictions episode's gonna be, like, pretty bland. It'll be like, "Oh, what did we say last year?"

Phillip: [00:38:41] Gonna be a victory lap.

Brian: [00:38:42] Ok. It's going to be a victory lap.

Phillip: [00:38:44] I'm really excited about reviewing our '23 predictions. My biggest... I think if you look at where devices are headed, so you mentioned Teenage Engineering a few minutes ago. I had a tweet earlier, and I love that it was based on their release of a table, by the way, has nothing to do with anything. Teenage Engineering, if you're not familiar, is an industrial design, I wouldn't even call them a music device company. That's certainly how they started, but I see them as, like, brawn. They are the modern apple, the modern brawn, incredible industrial design, and human-centric objects that began as very expensive and elite musical devices, and some would say exorbitantly expensive. They are the apple of the music and synthesizer world, and people they are as as divisive too. You have people that hate them and know you gotta pay the Teenage EEngineering tax.

Brian: [00:39:48] Yep.

Phillip: [00:39:49] But they are an incredible company when it comes to innovation in design. And by the way, cultural impact for the size, I think the company has something like 60 employees.

Brian: [00:40:00] Yeah. It's tiny.

Phillip: [00:40:02] It's wild. But this company has just done incredible things, and they've partnered with other brands in the past. They partnered with Virgil Abloh. They've partnered with... They've done some really interesting things, and we've covered it ad nauseam, on The Senses. If you're not subscribed, go subscribe to our newsletter, The Senses. I tweeted back in, I think, May. I said Teenage Engineering is the next Apple in 20 years. And I said that as sort of the spiritual successor to industrial design and new human-like, human interface innovation. What I had no way of knowing is that they had been working in secret with a new AI device startup company called Rabbit. And Rabbit has been working on an Internet, not necessary AI device, that is a portable large language model, that is able to beat and best a bunch of benchmarks, including GPT 4, at a lot of tasks. But they just announced that Teenage Engineering is doing their device industrial design, and they had a really sleek... I don't know if you saw it, Brian. Really beautiful, very sleek announcement video. And they're competing with everybody else in the space, Humane and others.

Phillip: [00:41:26] Humane is a pin. They have a really wild innovative projection thing on your palm, that's very gesture-based and voice-based. And possibly, you know, who knows, not even real, completely impossible to exist. What Rabbit has done is rely on the design language that Teenage has brought to other devices, with things that actually kind of make sense like a little jog thumb wheel, an orbital 360 camera, and a touchscreen. And it's hard to explain, but you would have to go check out the announcement video. We'll link it up in the show notes. But the announcement video shows off what I think is really necessary for adoption. Two things. Well, three things. One, portability. No need to have a subscription, which is subscription fatigue is finally real. I think SaaS subscription fatigue is here. No one wants to afford an AI language model as their subscription. So this is an on prem, no Internet required, no subscription required model. But what's the first use case? Order me an Uber. Order me a pizza. It's all commerce-centric. I think that's really compelling.

Brian: [00:42:48] I think it is. Yeah. This didn't make the predictions episode last year, but it was a prediction of mine as well, and that was the rise of gadgets. And again, I think we nailed it again.

Phillip: [00:43:03] What about gizmos?

Brian: [00:43:05] Gadgets and gizmos. Gizmos and gadgets.

Phillip: [00:43:09] The gadgets to gizmos continuum.

Brian: [00:43:12] It's a horseshoe thing. {laughter} But no.

Phillip: [00:43:20] {laughter} It's true.

Brian: [00:43:20] That was, I think the idea that all devices had converged into a single device. It was time for them to break out again. The phones were doing too much and not enough. It's if all innovation in phones is like, "Oh, we moved the fingerprint sign-in to the back," or "We added a new camera with an optical lens, and AI being built into your phone makes a ton of sense. I have the Google Pixel 8 Pro, which you have as well. And you know what's really interesting about this device is AI is sort of, it's I wouldn't say it's like the default way to interact, but it is certainly built-in, and I think Google announced seven years of support for the Google 8, Pixel 8, which I think Apple caught on to this long time ago that actually sets you up for a lot of market domination in the long term, but also I think it's reflective of them seeing AI as key to their future as well and to have a device that's sort of more centered around AI as the first one that they actually provide that level of support on makes a lot of sense to me as well. But, yeah, splitting things out, I guess I'll wait till predictions to talk even more about the implications of this, but that's part of my predictions.

Phillip: [00:44:44] Michael Miraflor on Twitter, friend of the pod, is at CES right now. I think this is, like, his more than 10th year of doing CES tours for executives.

Brian: [00:44:55] Have you been to CES?

Phillip: [00:44:56] I've not been to CES.

Brian: [00:44:57] I've been to CES.

Phillip: [00:44:59] Yeah. I feel like we should be there. It kinda feels like a thing we should be at.

Brian: [00:45:02] Maybe next year, we'll be there.

Phillip: [00:45:03] CES is like so many things.

Brian: [00:45:05] It is.

Phillip: [00:45:08] What we are seeing, though, is AI everything.

Brian: [00:45:12] Yeah. Of course. Yeah.

Phillip: [00:45:14] Lg has a large language model now for, like I don't know.

Brian: [00:45:18] Is it the LLLG?

Phillip: [00:45:24] LLGM

Brian: [00:45:25] LLGM

Phillip: [00:45:28] Terrible. Michael did kind of count sort of, like, deride this idea that AI's in everything. It's a form of trust washing. He called it AI washing. He thinks he coined the phrase.

Brian: [00:45:43] Just give it to him.

Phillip: [00:45:43] I Googled it, but we'll give it to him. I do think that trust washing in general is just the way that businesses evolve to compete. You have to remove objections. So Google's insistence, "No. We have AI. Oh, no. We have Bard, or we have this other thing now." No one remembers the name of it. Gemini? I don't know. I forget what it's called. We've all forgotten already.

Brian: [00:46:07] Please don't call it Duo again. No more Duo.

Phillip: [00:46:10] Perplexity is the new hotness now. Everybody's on to something. For a minute, I think what it comes back down to is what are the built-in... What is the habituation, and what is the mimesis?

Brian: [00:46:27] Yeah.

Phillip: [00:46:27] So you said something in the last You and Me podcast of the year. I thought it was really salient. Probably my favorite thing that I've heard you say on the podcast in a very, very long time. It's such an original and brilliant abstracted idea, which is [00:46:43] in the current state of the world, you have to capture mimesis before you actually create product market fit. [00:46:52] Product market fit's something else. Post mimesis market size, I think is what you said. That is the real thing that is the product market fit, but you have to capture mimesis in order to get to something to make that even viable.

Brian: [00:47:05] That's right.

Phillip: [00:47:05] And it's unfortunate, but we're gonna have to go through a whole mimesis cycle around AI and a whole mimesis cycle around AI devices. And we're gonna have to go through an unbundling cycle of devices that are separate from your phone because those are nostalgic. "I need a camera because that's super cute," and it's got its own aesthetic, or I'm into photography now again. These are all things that, like, we're in the midst of so many different cycles.

Brian: [00:47:36] Gosh. I can't wait for predictions.

Phillip: [00:47:38] I'm so excited for it. There's so much here.

Phillip: [00:47:40] The last thing I'll say is, the only the only reason why I think that you wanna talk about commerce, the thing that I think might be the headwind for Apple is there is a reckoning and maybe for Google too. [00:47:57] There's a reckoning on multiple fronts with app stores, in that app stores are about to become democratized. And that they cannot be the walled gardens that they have been for 15 years. App stores are about to get disrupted, [00:48:12] and I don't know how you have a Vision Pro without an app store that is the de facto trusted source, you're gonna have a bunch of trash in a bunch of third party app stores, most of which will provided by the likes of Amazon.

Brian: [00:48:27] Does anyone remember, like, how bad it was?

Phillip: [00:48:29] No. Everyone's forgotten.

Brian: [00:48:31] Everyone's forgotten. It was awful. In fact, the best way for a long time into App Store Land, it was still better to buy a CD and download your program because everything out there was such garbage. You were putting yourself at risk in many ways.

Phillip: [00:48:57] You know what I just thought of too? The Vision Pro is another good example of how we're gonna go through a whole jailbreak cycle.

Brian: [00:49:05] Yep

Phillip: [00:49:06] We're going to go through a cycle of people that are modding devices and people that are trying to bypass security. We're gonna go through the jailbreak, and the hacker cycle is upon us. Again, it's kind of exciting.

Brian: [00:49:16] I kinda love hacker land.

Phillip: [00:49:18] Yeah. Me too. It's fun.

Brian: [00:49:22] Bring back hackers. {laughter}

Phillip: [00:49:25] Burly Core: Bring Back Hackers. That's the name of this first show of the year. Excited, man. It's great.

Brian: [00:49:32] It's so fun. This is gonna be a crazy year. This is gonna be a crazy year. That's what I wrote about in The Senses while you're out. I was like, "This is gonna be nuts."

Phillip: [00:49:43] Maybe we can leave it here. I do wanna make one mention of somebody I cannot attribute it to, I don't remember who said it. I was just searching. I cannot find it. They said 2024 will be the year of the fastest change that we have ever experienced as humans, and it will never be this slow again. And I think that that's amazing and terrifying.

Brian: [00:50:16] Yeah. I mean, you could say that about the last 10 years every year.

Phillip: [00:50:19] You could say that about every year.

Brian: [00:50:20] That's an easy thing to say.

Phillip: [00:50:22] I don't think so. I don't think so. I feel like it's never been said so succinctly in a way that actually gave me anxiety.

Brian: [00:50:30] Anxiety? Oh, jeez.

Phillip: [00:50:33] Have you seen the EACC?

Brian: [00:50:36] Yeah. Of course.

Phillip: [00:50:37] Effective exploration.

Brian: [00:50:38] Everywhere. Yeah.

Phillip: [00:50:39] I've got EAANX. I've got effective anxiety.

Brian: [00:50:44] {laughter} You need to tweet that. If that's not been tweeted, that needs to be tweeted. That's a win tweet. You know what? But one more thing I'll say is the year of the hacker, bringing in hackers back...

Phillip: [00:50:56] Yeah.

Brian: [00:50:56] You and I, this is the craziest thing. I'm gonna this is probably a bold claim that I'd love for someone to go pick apart, but you and I might be the only podcasting pair in the country that over a certain volume, whatever our volume is, and above that have never owned Apple Phones, iPhones. We have only ever owned Android devices. I think that's pretty wild.

Phillip: [00:51:32] I have an iPad. Does that count?

Brian: [00:51:34] No. I own iPads. I mean, Apple Phones, the iPhone.

Phillip: [00:51:40] We might be. I think there's probably some Windows podcast out there where they're still rocking Windows phones.

Brian: [00:51:46] Yeah. Do you think they have the kind of volume that we have? I actually would contend that the Windows podcast out there, probably on iPhones. They're on iPhones.

Phillip: [00:51:57] I need to find... I'm gonna have to find... Alright. I'm gonna put it in the footnotes. The cold open of this show has to be my favorite thing to ever exist is a 12 year old Julia Stiles in a PBS show called Ghostwriter, where she has a bandana on, and she's like, "Do you know anything about hackers? Can you jam with console cowboys in cyberspace?"

Brian: [00:52:25] Oh my gosh.

Phillip: [00:52:26] It has to be the cold open. It has to be. Alright. Console cowboys.

Brian: [00:52:31] So much more I wanna talk about, but I wanna save it for the predictions episode because I feel like we've got much, and it always ends up being the one that people wanna listen to. But if you're listening to predictions episode and you haven't listened to this episode yet, you should go listen to this episode. Either you need to wait for next week or you need to go back and listen to this episode.

Phillip: [00:52:51] You've so convoluted the timeline now.

Brian: [00:52:53] I have. The timeline's long gone. Dang it. They can't do that on this episode.

Phillip: [00:52:58] You messed up the timeline, Brian. My gosh.

Brian: [00:53:00] I know.

Phillip: [00:53:01] Okay. Well, we have an indeterminate future at Future Commerce. Not sure when this podcast is coming out as you've probably very well figured out already.

Brian: [00:53:08] Back in time and listen to the very episode that I'm telling you to listen to this episode on.

Phillip: [00:53:12] Or wait until next week to catch the predictions.

Brian: [00:53:14] Predictions episode. Go catch it. I'm gonna say this on the predictions episode. This is my future. I'm telling my future self to tell people to go back or go forward and listen to something.

Phillip: [00:53:26] You've created a paradox. I swear. We're gonna, like a black hole is gonna open up and suck you right away.

Brian: [00:53:31] You know what is crazy, is we could actually, like, copy and paste this out of this episode and into the predictions episode, and then we would really, really mess with the timeline.

Phillip: [00:53:41] We have officially jumped the shark.

Brian: [00:53:43] Alright. Let's go.

Phillip: [00:53:44] Thank you, Brian. Thank you all for listening to Future Commerce. If you want ad-free episodes of this podcast, you can get it for free, one low monthly price by supporting Future Commerce. Best way you can do that, go to FutureCommerce.com/Plus and become a member of Future Commerce Plus. You get ad-free episodes. You get discounts on print and merch, which you'll need because our brand new Muses Journal bundle just launched. We're getting low on stock on that preorder too. So MusesJournal.com. And, you know, if you join FC Plus, hey, you're gonna save a little scratch. Get a little discount. 15% on print and merch. Priority invites to things like our Future Commerce salons, which you'll get, you will have a seat. We'll save you a seat next to Brian while he reads French poetry, and drinks really expensive wine. And you get all of that and more, so much more. It's all listed for you to read, at your leisure at FutureCommerce.com/Plus. And, that's it. Until our predictions episode or who knows? It could have already happened. Thank you so much for listening to this episode of Future Commence. Have a great 2024, people. Amazing.

Brian: [00:54:55] Lost in space. Let's get it.

Phillip: [00:54:57] Somewhere. Somewhere in time and space. It's unknowable.

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