Lenny's Podcast: Product | Career | Growth
00:43:34 · Benedict Evans
[00:43:34] S0: Yeah. I mean, there's like a version of the Drake meme of like he says, "I don't like that. I do like this." It's like, "I don't like GPT wrappers. I do like harnesses." So yeah, I did spend some time talking about this in the presentation I did at the end of last year, that if the product is a commodity, then the distribution is what matters. And I wrote a thing about ChatGPT earlier this year, OpenAI earlier this year, how do they compete. Well, there's an obvious comparison that a lot of people made is with web browsers. The fundamentally web browser, and there's a distinction here I think between the web browser as product and web browser rendering engine, in that the rendering engine can be better or worse, but the browser product is just like a really thin wrapper for a rendering engine. There's an input box and an output box. And like, what else? And which is like, what's the last innovation in browser design? Tab browsing, which was 20 years ago, 25 years ago. And every now and then somebody tries to innovate in browser design and it never works because you found the Platonic ideal. It's like trying to innovate in smartphone design. It's a glass rate angle. There's nothing you can do there. And so what happened, of course, is that Microsoft uses distribution to break in. Then of course, what also happens is setting aside the lawsuit, is that it turns out the winning browsers doesn't matter anyway because the value is further up stack. And so Microsoft, we use browsers for like five, six years, and it doesn't matter, and it doesn't get them anything. So clearly what's happening now is that Google is using distribution to drive Gemini. And what's the difference between Gemini and Claude? And if you're using this stuff all day, then you know, but like normal person, there's no difference. And the same thing with Meta, if you look at survey data on which our M people use, even before the news thing, like the Llama thing, Meta was behind, it was up there between ChatGPT and Gemini, which if you're in tech, people have completely written it off, but it was like they sprayed it on every service surface. It wasn't that bad. It was fine.
00:45:30 · Benedict Evans
So distribution of an adequate product when the field is basically commodity distribution on brand become a big deal, you could see that in the strategy, OpenAI strategy late last year was, people called it Everything, Everywhere, Yesterday. And so they were just trying everything to work out how they would get that. How can we get a flyway or how can we get distribution? How can we get something that sticks? How can we get something that people uses before Google, and Meta, and Amazon spray it everywhere and get everybody using that one? And then you've got the inertia and the power of the default and like, why would you switch? Obviously Apple is kind of the last penny to drop here. There was this sort of slightly weird opening idea, and now there's even weirder story that OpenAI want to sue Apple. Good luck with that. The funny thing about the Apple deal thing is just, not to go off on a tangent, but if you go back and watch the WWDC from 2024, the whole second half of it is Apple Intelligence. That was like the most compelling vision of a personal AI assistant, still the most compelling vision I've seen. They then couldn't ship it, but then neither was anybody else. And you watch it again and you're like, "Okay, so you want tool using a Agentic on device, AI with no prompt injection and no hallucinations, and a completely standardized API system across 10,000 apps with intents that all work perfectly." I'm like, "Well, that sounds good to me, but I'm not surprised they couldn't ship it." But nobody else would ship that. But that vision was great. I really want to see what happens at WWDC in a month. Do they actually ship that now, powered by Gemini? But that's also another point, is like, okay, there's going to be the AI intelligence, whatever we call, a Gemini intelligence on Android, and then there's going to be Apple intelligence on iOS, which is powered by Gemini, but it's not going to be the same set of products. The model's just like the dumb thing underneath the, funny way of putting it, the dumb thing underneath that power's a feature. The model is the commodity that powers different decisions about what the feature should be and what different distribution. And in that situation, of course, Apple's got a billion devices that can run this on edge.
00:47:33 · Benedict Evans, Lenny Rachitsky
And Google has this wonderful marketing slogan coming soon to our most powerful devices, meaning it will work on those Androids. So again, distribution questions. [00:47:42] S1: Interesting. Google I/O next week, so we'll see what they launched. [00:47:45] S0: Oh no, they launched the Android and it just shows how modules it- [00:47:50] S1: As it today? [00:47:51] S0: Well, no, they launched it last week, which it just illustrates how much we start paying attention to Android and iPhone. Google did had a whole big thing last week. They're replacing Chromebooks with Google Books, and they've got a new Android intelligence powered by Gemini that will roll out to the five people who bought a Pixel phone. You don't work for Google. [00:48:11] S1: Yeah. I want to go in a slightly different direction. Something that I'm curious if you're following is just the anti-AI sentiment that feels like is growing. It feels like if you've seen these surveys, AI is less popular than ICE, people are trying to stop data centers from being built. I think Eric Schmidt just did a commencement speech and people were booing him every time he mentioned AI. Just like, "What do you think is going on? Where do you think this goes over time?"
00:48:38 · Benedict Evans
[00:48:38] S0: It's interesting. And it's a big sort of fuzzy mass of different stuff, I think. There is tangible, like my electricity bill went up, which applies actually in a very small number of places, objectively, but it did, and this is a question. The water thing is weird because it's just completely fake. And I should explain what I mean here. Data centers use water for cooling. It's mostly closed loop, but the number of data centers relative to the total amount of water use in the USA is tiny. I actually went and dug into this that the Livermore lab did a study at the end of 2024 where they estimated US data center water consumption. And it came out at about 0.017% of US water consumption. Now, obviously if you live in a small town and you've got one well and they capped the well and gave all the water to the data center, then you're really pissed off. But that's a planning problem. That's not a data center problem. In generality, yes, this is data centers of what, like 5% of US energy, and might grow at 1% a year for the next five years, one percentage point a year, but the water stuff is just nonsense. And then you get into more tangible like, well, what is happening with this? Is it taking jobs away? Where you can watch a bunch of three-hour podcasts of economists talking to each other and the main answer is we really don't know yet. There's a bunch of charts that kind of say yes and a bunch of charts that kind of say no. And clearly there's a slowdown in employment of 18 to 24 year olds, but that seems to be the same for people who do and don't have degrees, and the same for people in fields that look exposed to AI and feels that they look exposed to AI. So there's a lot of econometric argument about this. And I mean, there's a broader point here, in fact, which is a different point here, that we have very little data on what's going on in AI, from anyone. The model labs don't tell us anything. They don't give us any meaningful usage information. They give us these weird studies of people, how many people use this for this and that. They don't give us a daily active use number. We do not have a daily active user number for us for ChatGPT. It's crazy. And all the data comes from academic economists trying to back stuff out of BLS surveys.
00:50:46 · Benedict Evans
Or consultancies and marketing agencies like spending a whole bunch of money to survey 20,000 people and saying, "What are you doing with this stuff?" We don't have good data on what's going on and how many people are really using this, but to the employment question, hence there's a lot of people looking through all the stuff that the US census collects and trying to work out, "Well, where can we see this? Can we see productivity? What could we see?" And the answer right now I think is there's no clear consensus that we're seeing an impact on jobs, but of course, politically that doesn't matter. If you're a student and you can't get a job, and that clearly is an issue, whether it's because of AI or whether it's because of Trump and tariffs is a different question. Then you get niche things like people who draw book covers for young adult romance novels are very upset that now you can get a picture of a naked woman on back of a dragon flying through a volcano without paying them. I'm sorry, I'm being deliberately unkind, but there's a little... And particularly novelists, people who write eBooks, there's a huge culture war over whether it's okay to use AI. There's this whole sort of AI slop question, and obviously you show the number that like 30, 40% of your podcasts are generated by AI. There's a big fuzzy massive questions. Some of this, I think it's a little bit like the backlash we had around social, but much more compressed. And like social, some of the backlash around social was true, and some of it was sort of true, and some of it wasn't. Always like exemplified in the whole Facebook sells your data thing, which is just, A, not true, and B, the people who believe it are absolutely adamant that of course it's true, and you're obviously a lunatic for suggesting otherwise. It's like the line from Jonathan Swift that you can't reason somebody out of an idea that went reasonably to. So you get this kind of wide, it was a long answer question, but you've got this wide spread of ideas just as you kind of did with social. There's like 20 different things, some of which are really real, and some of which are really not real. And a lot of which are kind of a fuzzy mess in the middle. All of which means that meanwhile, you've got Trump saying he wants a new executive order on dangerous models, which I actually don't think is the thing that drives the backlash.
00:53:02 · Benedict Evans, Lenny Rachitsky
The worrying about myth or cyber, I don't feel like that's a main street America conversation, but that's the thing that got Trump interested in this stuff again. [00:53:12] S1: Let me go kind of in a tangential direction. Something that I like to ask folks that have kids that come on the podcast, especially people that are thinking so deeply about where things are going, knowing what you know about just where the world is heading, what AI is going to do to the future, how are you changing the way you raise your kids? Just what are you teaching them differently potentially that might help them in the future?