 Hey guys, it's Neil I here at the Verge. I'm in our studio and Alexis Ohanian, does this say Reddit on your badge? Just says Reddit on your badge. It does, it does just say Reddit on my badge. But also General Bon-Vivant, man about town, internet bro, just rolled in and demanded to go on air so here we are. Yeah, I got pretty feisty. You guys had nice comfortable sofas and I needed someone to sit down so thank you. Yeah, they're very nice, very comfortable. Anyway, so Alexis you're here actually to be, you just had a press conference with a bunch of senators. You did. You're fancy. Yeah. What happened there? Well, you know, a number of us, Senator Wyden, Senator Moran, myself and Scott Case, we all came there to basically have a press conference about this sort of state of the open internet. Right. Talking about internet freedom and taking questions from the press. But you know, those two senators have been really at the forefront of championing this and you know, they represent very different political parties and yet like so many Americans can agree on the open internet being awesome and wanting to preserve it at all costs. Right, you know I think, I don't know who I was talking to but it was, somebody told me that if you asked Americans to rank their primary needs, they would pick the internet over water in many cases. Wasn't it also over sex? Yeah. Or am I, there is. It's like, you know, it's the hierarchy of needs has been, like the internet has like snuck in over the top. Suck it, Maslow. Yeah, he could have never seen the internet coming, right? He didn't know, man. He didn't have a GS3. He had Maslow at Samsung GS3. He's like, oh. Game change. So I got to change my book. All of a sudden, I'm going to stop writing. Like, who's going to be too busy playing Angry Birds to bother getting it all done? Well, I will say this. I come to CS every year and I, for the past few years I did, I tried to do a bunch of policy stuff. I chased down Julius Genachowski last year. I've talked to senators. I've gone to the panels and not to harsher your vibe but to me it seems like a lot of nothing gets said at CS about policy. Everybody comes here, they take the closed door meetings with AT&T, you know, Verizon waves its hands. I don't get invited to those meetings for some reason. Come on. They do not invite me to those meetings. But how do you, the stuff that you're doing here, the policy kind of stuff that you do, I know that you tell me, you always tell me your policy is very narrow. The internet is good. Yeah, basically. And everybody agrees with you. It's a nice business. But how do you go from everybody agrees with you to making things happen that are good, especially at a show like this? Yeah. And you know, what is a little disconcerting too is everyone here is pretty much on board with this. There's a big echo chamber here because we're all, no matter where we are in our industry, we all pretty much support this. And the people we really need to convince are the ones in Washington, D.C. Do you think the AT&T's and the Verizon's support this? The ones who I actually get to talk to do support it. You're right. I think the challenge for us, and this is why I don't like thinking about policy specifically, is to make this an issue that is just, I don't know, that is being tackled from, I don't know, from all of us doing our various things as voters, as entrepreneurs. And so when I see things like, so specifically, excuse me, we did this Internet 2012 bus tour. We did this bus tour from Denver to Danville to basically show off all of the innovation going on right in the heartland. We came with you. We did a big feature. Yes, TC did a fabulous job. And so we debuted our documentary called Silicon Prairie, which we showed it here, but I'm more excited to be showing it in D.C. on Tuesday at the Newseum and hopefully get all these people in Washington realizing that they all have a digital district. I think that's my favorite catchphrase that's come out of this weekend. Because it's not just, you know, if you're in Silicon Valley. It's every district in America has constituents who care about this. And you know, these policy discussions, they're not going to go anywhere until it is so clear that every American cares about this, that making a decision against the best interest of the open Internet is going to upset all of your voters and make sure you don't have a job. Well, you know what I think is really interesting? It's funny how politics is changing in a place like Kansas City, where Google dropped in Google Fiber, and now there's this like vibrant startup economy in Kansas City that's just happening because there's real connectivity there. Yeah. In a very serious way. And that will change once you get a flood of entrepreneurs in a place where they haven't been, the local community and the local politics will change. And we see this happening, we saw this happening in downtowns all over, where, you know, for decades, these downtowns were derelict. These buildings were abandoned. And startup communities are moving in there because they're getting, you know, large space, great rates, downtown hubs with bars and restaurants all the time. We're seeing these communities be reborn thanks to the Internet economy. And what Google's done has been so great because it's, you know, I think what I like, I like to think of myself as a doer, and I think so many of the people doing great stuff right now, that's the key word, is they're doing it. And so Google actually did what everyone said was not possible, too expensive, we can't have the fastest internet in the world at a reasonable price. But they're doing it. And once you do it, it becomes really hard for all their competitors to hem and haw about, oh, that's not possible. So that kind of stuff is exciting. I want to look to activate more of those kinds of projects because it's going to motivate other people to follow suit and actually realize how big of a deal this is. Do you think, are you getting good vibe at this show in particular? Yes. I mean, again, there is... There's an echo chamber. Yes. Right. We're all, you know, I don't know, get invited to AT&T meetings. But those of us who are here and actively talking about these issues... What do you think those meetings are like? I just imagine them like... Everyone's got a cat on their lap. Yeah, they're all, they're dressed all in black with maybe like a red tie, you know, and it's just like, hmm. Yeah, it's what can we do about data caps? We will take Google Wallet off of the phone. Yes, competition is not cool. Well, no, you know, if you go to Verizon's booth, and Verizon's booth, to be fair, is very impressive. But, you know, if you go to it, what's really interesting about it is the phones are pushed all the way to the back. But Verizon doesn't want to talk about phones. It's, yes, they want to talk about a bunch of other devices, right? Here's a bunch of tablets. Here's like some weird crap for your house. It's all connected to our network. But they don't want to talk about how when they bought the 700-megahertz spectrum from the government, Google basically forced them to sign an open access provision so that any device could use it. And it's been years and years, and literally no devices that use that provision have ever come to the table. And that means that, you know, Vizio announced phones here. They're nice. They're competitive with Sony, right? 5-inch 1080p. They're competitive with any Android phone. But they're going to China to sell those phones because they can't get on the American carriers here. So if the internet's that important, then we need to get AT&T and Verizon in the conversation really in a very proactive, determined way and say, the internet's important. The mobile internet, I think, is more important. Well, when you start talking about, I mean, don't even get me started on the importance of tiny internet. We need bigger phones and smaller internet. I get it. It's so, I mean, when you hear stories like that, and it's like they found more opportunity for their business in China, like that is not a sentence that should, like, as an entrepreneur here in the States, like, it hurts me to hear that uttered. And competition is ultimately going to make all of our lives better as consumers. And we just want better stuff. And yeah, you know, incumbents may not like that. But the spirit of this whole capitalist system is, like, competition's going to cause disruption. It's going to have to disrupt you. And it's frustrating because we encounter this with SOAP and PIPA. We continue to encounter it. And I mean, fortunately, we have a voice as consumers, right? We have more ways than ever to be able to let people know what's what. And what's cool, and we were talking about this earlier, there are more and more new entrants to the world of hardware thanks to things like Kickstarter, thanks to all the new things that are showing up here at CES now that a few years ago were in a garage that started out as a conversation over beer. So we should talk about this because I know, I feel like your foot in the door of the policy world is actually you want life to be better for startups because you're really a startup guy. Yes. And so your policy stuff, I know it's very public, but really you're just trying to make money with your startups. It's very selfish. Which is great. I don't know what I would do with my life if I did not have the startup economy. I would probably be a lawyer. That's terrible. Remember? Those are awful. Let me ask you, here's what I think is a really interesting story at the CES. There is a whole giant collection of essentially Kickstarter projects here that are the story of the show. So the Pebble guys had a press conference this morning, the smart watch. That thing looks amazing. We had the Oculus Rift on our show yesterday. That's a Kickstarter project. The immersive head tracking. We were actually just here with another guy, the Central Standard Timing, World's Thinnest Watch. All these indie hardware developers who are crowdfunded essentially and they're making cool products. I think that's a great story here that there's hardware startups doing innovative things. I think there are lots and lots of question marks about how they go from I'm a guy with a cool idea and raised $100,000 or a million dollars to I'm a company. How do they make that jump? I know the Pebble watch team well because they were in Y Combinator. They had an interesting story because they could not raise money. They went to Angel List. They had had the blessing of YC. They still couldn't raise money because people were scared about hardware. Even though they built prototypes. And they went to Kickstarter and very famously raised $10 million. I hope, I really hope, not just because I'm friends with them, but I really hope that they succeed and really deliver a great product. We're all hoping it is because that's a $10 million campaign that everyone's looking at to see if this means you can start a real company. I think they're going to be able to do it. There are a lot of smart people on both sides who think either definitely going to make it or they're going to crash out. This crowdfunding, the hype bubble will basically pop. I think we are undoubtedly due for a spectacular failure. There's going to have to be some hardware company that raises millions on kick, well actually won't even be able to raise on Kickstarter anymore because of their constraints about like a creative project versus a hardware one. But you know crowdfunding is going to evolve. Someone will crowdfund a ton of money for something out of a garage that's going to be a spectacular failure and everyone's going to be like, dub TF. But I think dub TF. The broader hardware industry is resilient enough and the cost of getting this stuff started keep falling enough that I think consumers, so long as they're prepared with what they're doing, taking a gamble and accept the risk. Beware but beyond that to know that like pre-orderer beware. I think it's going to mean more innovation and more cool stuff and I hope the larger companies look at this and instead of thinking, I mean we all see this right? We see hardware that you know, maybe it's got some shine on it, it's got a little polish, a bell and whistle but at the end of the day no one probably actually wants it. And so let me ask you this, how do you avoid making something no one wants? Well what if you started with this pre-order? What if you started with a demand? So I mean there's two things there that I think are going to be challenges I think for the industry at large. Because I think looking at this CS, I think the vibe of it is very much more like the beginning of like the computer era right? A bunch of guys in garages trying all kinds of crazy stuff, they're enabled by basically smartphone platforms so people are like, now I have a smartphone what else can I do with it and there's like, try all this other stuff. And I think that's where the Pebble Watch comes in, I think that's all the body tracking stuff, the Fitbit. But I also think that there is like, you know two years ago I came to the show and Asus was here and they were kind of a new company. They were just being introduced to the world and they had like a thousand crazy concepts and maybe nobody wanted them but like you put them on the map, none of them ever shipped. Is there a difference? I mean is there a difference between Asus and maybe some other Chinese company here that we've never heard of doing crazy stuff at the big corporate level, Samsung showing off curved phones that are never going to ship and then this like economy of like little guys? I want to believe, I really want to believe that the more people we can get trying crazy shit the better off as long as we know that most of it's probably going to fail. As a start up investor I certainly think about that with software and hardware is still more complex obviously when you have 10,000 broken widgets it's a lot harder than just getting some code. We had Matt Rogers from Nest in here, they're a start up and obviously they're well funded, they've got a lot of very smart people from Apple and he was like to ship our first product, it took 70 people and it's a thermostat. A pretty really thermostat. They're using smartphone part, they basically built a smartphone that can control your furnace and he's like it took 70 people to make that project. I don't know that you can crowd fund your way into 70 people. Yeah I mean it's to be seen. I know the pebble watch team is maybe 2,000 I think? Yeah. I don't know how many minutes and you know we're still, I guess what gives me hope and I'm the, well glass is not half full but it's a quarter full, it's not even close. I'm an optimistic guy and I really want to believe that long term it is going to, thank you, thank you that's very empowering of you. Long term. My glass is now empty. So I just want you to know that my part of this conversation is going to get weird. I see where you're coming from right now. Oh geez. Go ahead. But I absolutely see a future where, you know we are now what two, three years into the Kickstarter experiment. It's still so early, so early that the long term future just, it makes a lot more sense to me that you would build something as intensive as hardware whether it's a thermostat or a watch based on demand as opposed to building it and trying it Hollywood style of just like throwing enough ads and trying to convince someone that you know John Carter is going to be a good movie which I haven't seen. That's probably not fair. So you don't, John Carter is a terrible movie. Is it bad? Oh okay. Based on a classic sci-fi canon. Yeah but the thing is that the other movies that came out after, there are so many other movies that ripped off the book that now John Carter seems cliche. It's like Van Halen. Van Halen guitar solos seem really cheesy to you now and then you think to yourself, he was the first guy. Who rocked out with the guitars. Huh. I've never. The cheesiness factor. The context is. Wow. It's the price of fame dude. Someday people are going to think you're super cheesy because you're so famous. I think they already do. Does that mean I'm super famous or just super cheesy? You're just the mayor of New York. Damn it. It's far off the road. No I mean, let me ask you this. Is there not a danger that if you are Samsung or you are Acer or whatever, Lenovo, any of these huge companies, you're just going to start looking at Kickstarter and you're going to say man, these four kids in a garage are generating a lot of demand for this watch but we're Samsung and we can kick out the watch tomorrow and steal their thunder and we don't have to do focus groups anymore. The. So yes. In theory that makes sense. It's dastardly but it's certainly been done before. I mean I think dastardly is actually the ground state of the industry. Like when things aren't dastardly I'm like something weird is going on. Something's not right. Okay fair enough. The thing that I look at right now and present is that like every one of these, every one of those hardware companies you just named, they probably all sit around the boardroom with their Apple devices and are like so we need to do this. And yeah there's the patent side of stuff which is a whole other issue but like every one of them has an example of how to make this kind, how to design this kind of thing that people clearly want. That's beautiful, that's well designed, that's well thought out okay and yet they still can't really do a good enough job replicating it. Sure. I mean that's, there's been a lot of progress made but it's still like you can't capture that. The Apple Thunderbird has now arrived. No. I mean I own a few Apple devices but it is still, it's hard to capture, it's hard to capture that spirit and I am foreign to the world of hardware but I know for startups we are, we are never afraid of the incumbent trying to copy what we do. So specifically like with Hitmonk, Google launches, Google Flight Search, great job Google, that's awesome, we don't care because they don't care enough about solving this problem as our team does. And I think, and in many ways you're just validating your model. Precisely, yeah and so I think, and I know hardware is a different bugging but I think it's the same way for these upstart companies and if they were to get copied and replicated it still wouldn't, it wouldn't feel genuine, it wouldn't work as well, it just wouldn't, I don't know, I still don't believe they could execute it nearly as well as a team that's so wholeheartedly focused on it. But I mean my response to that would be to focus on the hardware software difference because it's really hard to do software but I think if you are Samsung it's way easier for you to do hardware than any team of indies. And I think the cost and the scale and getting the distribution and going to Best Buy, if you're Samsung you may hunt 1000 or anything, if you're Samsung you can say we're going to make a point and shoot camera that's an Android device and make AT&T sell it even though it's not, even though it's more of a concept car than any kind of real product. Yeah once you bring AT&T to Verizon that just muddles everything. Open internet, see we've come all the way around. This is why it's so important. Well wait, but real quick though, you mentioned something, Best Buy, is that a? To sell hardware, you've got to go somewhere. What is a Best Buy? Is that a, is that a place? It's a place. It's a place. You don't buy hardware. Where do you buy all your hardware from? The internet. You don't buy it on the internet. We've got to go to Amazon. Right. So I'm just, I wonder, I wonder as this world continues to get disrupted, you know the importance of, obviously it's still nothing to laugh at, you get that deal of you're moving hard to get that deal. Where do you buy your Apple devices? The internet. You know where the regular people buy it from? The Apple store. Oh, the regular people? No. Not the nerds. Not the nerds. Yeah. Really? Yeah. I mean, okay yes I've seen the lines and I mean, they're beautiful stores. They're the best apps of the Apple stores around the world. I hear they've done well. Yes, you've seen Microsoft and Samsung racing to copy their strategy. That is like, well and that's, here's another example where, yeah, you know and I've walked by the Microsoft store in New York and it's like, okay it's sleek, it's polished, but I don't know, I mean, I don't see. Well it's because they don't have the hardware. You can't sell software at the store, right? Right. In Apple strategy they sell software online. They're massively successful. Yes. They sell all the hardware products in the store. And when you go to the store to buy software they hand you a gift card until you go online. That's fascinating. I need to spend more time in the real world instead of just buying it on the computer. Get out of your bubble, man. Take your Oculus Rift off and come back to the real world. But this is interesting. I do hope, I mean, again, bring a lot of hope to this table because I got my glass this full. I mean, this is what happened. I empty my glass and now I'm like way in the ground. So long as our expectations are set appropriately as pre-orderers or backers, whatever you want to call it, I can't help but feel like we're going to get better stuff because you know, for decades these industries do, they do a lot of naval games no matter whether it's hardware or software or whatever it is. And to be able to just say like you've got a garage, you can, you know, if you've got a 3D printer, you can get started. I think there is, and we'll end on a hopeful note here. I'll try. I'll see if I can do this. Do you want me to give you some water? Yeah, please. Oh, God, it feels so good. There you go. Oh, yeah. That's amazing. That's it. Give me those glasses. That's the water of optimism. Now you're going to start crying. No, I will say this. We talk a lot as we cover this show. We were here in force. We've got 68 people. We're rolling deep. We talk a lot about how covering the show for us isn't necessarily all about the news. The news is important and the product announcements are great and whatever, but the visceral experience of we're here, the entire industry is here, everybody you could possibly want to talk to is here, and everybody thinks the world is cool and going to do better stuff. We're trying to communicate that to like basically myself as a teenager. That's what I think of my reader as, right? I think of you, like the mass of our readers is people who love technology, who don't have the opportunity to come here, who want to see what's going on. I think there's something far better about let's show them all these startups, particularly hardware startups, doing things like the Oculus Rift. Have you tried this thing on? I have not. You've got to find it. It's this immersive head tracking display. It is like you are in another world. It is the future. For gaming? For gaming. You run around. Is this the one that Carmack pitched for the Kickstarter video or like... Yeah, that's the one. We did it. I mean that thing is amazing. I was at Carmack and I was there. Done. They were here. We had them on our show Top Shelf yesterday and then they set up in the little office in our trailer and we had a line, 30 people on our staff stood in line waiting to try this thing out for a minute each because it is so crazy. I think saying and the inventor, it was the guy who invented it and his product right now, they're here to announce the product to eyes plastic case, but the one that we used was like literally like wires and circuit boards in a box. Yeah. It's like, well that's awesome. I mean that's like, you don't have to go work for Samsung. You don't have to try to get a job at Apple, which is a daunting task. You can just try to make stuff. And what is so important about that storytelling, it's working ladies and gentlemen. What is so important about that storytelling is it is showing and it is showing it when it's just an ugly hack. It is showing it before it's the polish thing that we're all looking at that comes out of the box and smells all new. Because when you look at that and you see the ugly hack, you're like, wow, like this started out as a pretty humble looking piece of hardware and it makes some teenager think, oh, okay, this is accessible. This is how I do it. I show you a finished iPod and you're like, come on, I don't have the connections at Fox Tron. I don't have decades of Japanese miniaturation experience. Let alone an army of underpaid Chinese employees to manufacture it at scale. Soon we'll have those throughout the heartland because of the open internet. Think about it. Wait, what? I don't know. I'm just trying to get you to have your weeds or your empty glass. I will say that. I will say that the thing that's different about the Asus concept cars and the bunch of indie people trying to make stuff and maybe failing is that that story is inspiring. Asus making weird stuff is like, maybe you can buy this, maybe you can't. I don't think there's a lot of kids out there trying to build their own cars after car shows. Probably not. No, but who knows? If 3D printing takes off like we hope it will. Do you have a 3D printer start up in your labs? I do not. Actually down the street from me is MakerBot. They represent Brooklyn. I love talking to 3D printing enthusiasts because they are there. They are 10 years in the future. They are already living in, they know exactly where this is headed. I'm a little bit more cautious in terms of where this is all going. I expect a really hopefully awesome future where the idea of doing manufacturing. Dude, this is true. There's a lot of hope going on here. Where manufacturing does actually start coming back here and actually rapid prototyping can happen for an upstart. We actually met one in Boulder on the bus tour that does all of their prototyping right there. They got a 3D printer. They make these badass 21st century Legos. These little cubes that stick together and start whirring or spinning and rotating. They do all of their manufacturing except for a few basic circuits right there in Colorado. They can do so with some 3D printers. It's still so early but you can get a glimpse into what's going to hopefully be a pretty awesome next five to ten years. Two questions. Sure. One, what's the best thing you've seen here so far? The best thing? Aside from the Verge compound. Damn, you beat me to it. Well, and again I'm biased because I'm chummy with the pebble guys but I am really, really hopeful. I am too. I really think it's going to, I'm looking forward. I got the black one. I'm really hoping it meets and lives up to expectations. So yeah, probably pebble. And then what was your second question? My last question is a question I'm asking everybody. What apps are on your screen? Oh, I do have my phone on me. I think, okay let's see. Evernote. Oh, good. Oh, I turned my phone off because I wanted to be a responsible interviewee. Evernote. Alien Blue, of course, for reading the Reddit. We don't have an official app at Reddit. There's an Australian developer who's awesome and made the Alien Blue Reddit app which you should all download. Nice. And a bunch of random stuff. I only recently discovered Gmail as an app on the iPhone. I've been using the janky mail app for weeks. It's really good. I know. I think it's proof that Google is getting really good at design while Apple needs to figure out cloud services. Oh man, have you tried maps lately? Okay, well we're out of time. Thank you so much, Les, for being here. People who are watching, you should stick around. Top Shelf is coming up at 3, 4, sometime very soon. 3 o'clock. Top Shelf is coming up at 3, so stick around. We're actually going to halve all of the watches that we've been talking about. The Pebble, the Central Standard Timing, the world's thinnest one. We're going to have a bunch of stuff. This will be great. I won't be here. It'll be David Pearson. Some other guys don't know what's good. And that show will surely start on time. You're done. Let's cut this stream. What? No. Cut it off. Oh, I need more water. Can I fire you? You fired me. Can you hire me first and then fire me? You're hired. Thank you. I'm a Pennsylvaniaan, everyone. I'm going to clean up my desk.