All-In with Chamath, Jason, Sacks & Friedberg
01:09:55 · Chamath Palihapitiya
But then this other problem starts, which is, to your point, the composition of ad revenue as a percentage of the overall will fall below a threshold and then they do look like more of a structured conglomerate, where now you'll have a YouTube revenue block, a GCP block, an Other Bets block, and a Search block. None are dominant, which in some ways I actually think is better because then you're more diversified and you're less levered to any one single business. But they'll have to go through this complicated process where a bunch of folks may not wanna own that kind of a business. And there's a different buyer pool. So you have to go through transitioning out the folks that wanted to own a single stock bet on search or ads or whatever it was and now have to move to this other kind of business model. And when you switch buckets like this, a bunch of folks kind of say, oh, it's too complicated. So problem number one is what I would say is if you are Google IR, please read this and refute it or try to figure out how to get in front of it because every analyst now will will try to figure out whether this is true. The second, though, is, very narrow. How do you keep Demis at Google? That's it. That's the only task. Okay. Sacks There's there's nothing else. Pay Thomas Kurian whatever he wants. How do you keep Demis at Google?
01:11:14 · Jason Calacanis
[01:11:14] S0: Sacks, looking at this business, it's been obviously a journey for the past ten years to make Alphabet have resiliency in revenue streams, diversify the revenue streams. You think there's some great risk here and would you be long, short, or neutral to stock?
01:11:34 · David Sacks
[01:11:34] S1: Well, I'm seeing people post that Alphabet's Google search revenue drop below 50% of total revenue for the first time and they're making it sound like that's a catastrophic situation. Basically playing into the narrative that the search business is going to be disrupted by SI. And that's what it seems like on the surface, but when I dug into the numbers, it didn't really seem that bad at all. So it's true that Google Search's relative share decreased, but its absolute revenue still increased. So if you look at Google search revenue year over year, it was still up 12%. It increased from 56,000,000,000 to 63,000,000,000. So it's still a roughly $7,000,000,000 year over year increase in Google search. So Google search is still thriving, I think you could say. It's not growing that fast relative to other businesses, but you're not seeing it deteriorate yet. And again, the reason why the share fell below 50% is because other alphabet businesses are simply growing much faster and the main one is Google Cloud which basically doubled year over year to 30,700,000,000. So it's the rise of the Google Cloud business that has made Google search seem like it's on the decline. But I tend to think it's a good thing that Alphabet is now finally getting some of these other businesses to really work and to really grow fast and to finally diversify the revenue. Diversifying from search has been something they've wanted to do for a long time. They now have all these other segments. You've got YouTube, you've got G Suite subscriptions. So in any event, I tend to think Google's a little bit oversold on this news today.
01:13:20 · Jason Calacanis, David Sacks, Chamath Palihapitiya
[01:13:20] S0: I agree. [01:13:21] S1: Although I'm not... Certainly not telling anyone to buy anything. [01:13:23] S0: Since inception and maybe past ten years, can pull both charts up. We'll go through them real quick here. But this is just... This franchise, the number of searches is still going up. The revenue per search and that issue is obviously the one people are concerned with. But the other side of the coin is absolutely correct, David. The other businesses, they're now only 50% dependent on this business, and that will continue. So for me, I just literally bought some shares. So I'm long. I just bought more shares of Google while doing the show. Just remember, Alphabet owns 6% of SpaceX and, like, 15% of Anthropic as well. I think 85% of Waymo as well. Right? Like, that's the the other piece of this puzzle. Amazon also owns a big piece of Anthropic. They're gonna be a big winner. Alright. Listen. That's our time here. Do you guys wanna talk about the election ahead of Tuesday night and predictions or anything like that? You've been shepherding this. Yeah. What are you guys watching on the midterms? Anything you're keeping an eye on, Chamath? Any big contrarian predictions on what might happen on Tuesday? [01:14:24] S2: It's so interesting. I'm, like, really confused. I've started to stop paying attention just because there's so much misinformation. I thought that we are going to have, and I still think, what Sacks called a spritz. [01:14:40] S0: You know, little spritz?
01:14:40 · Jason Calacanis, Chamath Palihapitiya
[01:14:40] S0: You know, little spritz? [01:14:41] S2: I think it's more of a democratic spritz. But when you look at some of the the early data, you know, and I don't know if Bret Baier was doing this just to kind of hedge his bets or not, but he did a clip which went viral on X where it just looked like it was gonna be a bloodbath for the Republicans, and they were gonna lose both sides, both the Senate and and the House. I think it's still set up to have the Republicans keep the Senate and the Democrats to have a narrow majority. And just going back to maybe where we started, the mandate from the Democrats then becomes obvious, which is how do you introduce FUD? And there's one way to do that, which is to start subpoenaing everybody and start to do disclosure discovery, release document after document after document, and let, you know, the the masses start to churn through this stuff going into '28. So number one, create FUD. And then number two is I think a economic slowdown benefits the Democrats going into the twenty eight election cycle, and so whatever they can do to kind of, like, influence power permitting and data centers, because as we talked about earlier, that's the levered bet. So to me, it almost doesn't matter what happens at the federal level except for the FUD part. I think we now should be paying a ton of attention to what's happening in these governorships and some of these some of these other races. [01:16:10] S0: Sacks, has your view changed?
01:16:10 · Jason Calacanis, David Sacks
[01:16:10] S0: Sacks, has your view changed? [01:16:12] S1: Look. I think that you can't trust any of these polls. First of all, a couple of these polling firms have come out and admitted that they are fake. I mean, we literally have a couple of [01:16:23] S0: Oh, yeah. There was a hoax, right?