Ethen: Welcome to the Bed Tech show. are so happy to have you all here with us. We're host Ben and Ethen, and we're going to be a little unhinged today, and we're not quite clear what we're going to talk about. We've got a lot of stuff on our minds, and just going to hit it out there.

Ben: we got some news. We some news. We got news ⁓ on gaming world. Got some more conspiracy theories because we love conspiracy theories. Get that tin foil hat, ladies and gentlemen.

Ethen: And you all like that, so based off our last video. So we're going to keep up the conspiracy theories.

Ben: I love conspiracy theories. I had a conspiracy theory night with friends in our neighborhood and my wife and I, we won conspiracy theory night. It was pretty sweet. Yeah. So let's dive in, dude. Let's first talk about what we were just talking about before we started the pod, which is talk about Xbox with Netflix. And then in conjunction with that, why Sony isn't going to be taking games or why they haven't been taking games to PC. ⁓

Ethen: Nice.

Ben: So first, Xbox to Netflix. What do we know about this deal? What does this look like? What did you hear?

Ethen: Yeah. From what I've heard, and this is very minimal, what I've heard, Xbox is joining Netflix to their cloud gaming be a part of the next ecosystem, part of in such a way they will have different tiers of their gaming experience. You have a paid subscription version in which you own nothing and are still happy, allegedly. Or you can have a free version with ads where you still own nothing are because you own nothing and ⁓ get little ads sprinkled in with your games. So it would be as if you are playing Tomb Raider and Lara Croft walking through the forest taking a nice stroll. And then all of sudden you see an advertisement for a whopper from Burger King and I don't even know how it's going to work, how they will do that in games. Because what if you're playing a multiplayer game? It's not like you can just pause mid gunfight and have ad come up. So I don't know how that's going to do unless everybody has to pause during the gunfight. Say, on, I got this ad.

Ben: Yeah. That'd be funny. You're in like a battle royale and all of sudden everyone just pauses because we're all just watching the same ad.

Ethen: There might be, I think of it might be like the Hunger Games, everybody is just off on their own thing. And then all of a sudden, a big ad comes in the sky that we all have to watch as if like propaganda from Panem.

Ben: Yeah. Yeah, honestly, that's probably the case. bet it's like, you know, I've ever seen like live streamers and like when you, when someone donates to a live streamer, something like pops up on the screen, even though they're still like, they're still doing their live. I bet that's probably what it's like. You'll be in game and mid game. There'll be like just a little ad in the corner or whatever. Maybe not though. Maybe it's like a full blown pause because I feel like

Ethen: Mm-hmm. ⁓ yeah.

Ben: If they're to do ads, they probably just don't want it in the corner. They probably want your full screen dedicated to the ad, you know.

Ethen: It reminds me of Ready Player One where they say we can sell up to 75 or 70 percent of the screen before people start having seizures. And so maybe that's what it's going to be.

Ben: Yes, dude. Dude, that's like literally I did think about that. wanted to say that before we started the podcast that it reminded me so much of ready player one because it's so true. They're trying to just maximize. trying maximize revenue from ads gosh, it's so stupid. It honestly is infuriating. So, anyway, ⁓ kind of going back this rounding this out. Xbox, you know, they're going to have tiered versions of Netflix with ads. And lot of people are like, I'm just going to go to steam and just buy games off steam so that like I don't have to deal with ads and game pass. And that to a conspiracy theory we might have, which is why PlayStation isn't selling games on PC. ⁓ And it's not because of their competition with Xbox, but it's with Steam. Any thoughts there, Ethan? Any care to expand? Tell me about this a little bit more, because I want to get your insight here.

Ethen: Yeah. From what I understand, Bluepoint Tech Boss suggested that Sony is scared of Valve and the reason why they are pulling away from having single player releases on PC. For the last year or so, been, Sony has releasing a of its Sony games on Steam. Albeit, you there's been a little bit of a delay before. Steam is able to get those, but we've been able to get Sony games and it's been nice. I've been able to actually play a few of games on my PC without having to get a PlayStation, been able to play Marvel's Spider-Man. Wonderful game. ⁓ Nice it's, yeah, nice that it's not gate kept by Sony here and that it's on Steam. However, because

Ben: Nice. Slinging.

Ethen: Sony is really into their consoles and they think that's the way of the future here. By having their games on Steam, there's really no incentive to buy a PlayStation because Steam is also entering into the console market where they are going to have entertainment system the living room.

Ben: Way of the future.

Ethen: which is primary forum where they want to have their content. so with even though Valve hasn't released their hardware for the Steam Machine, I think it's almost to say that may have won the console war already without releasing a console. Valve just seems to be crushing it as of late. mean, rather than doing what Sony is doing with their dynamic pricing ⁓ games. I don't know if you've heard about that.

Ben: No, I hate dynamic pricing that's becoming such a big thing nowadays among companies They're doing dynamic pricing which just means hey we can change the price whenever we want. I freaking hate it, dude Honestly, it's so stupid. I didn't know someone was doing it

Ethen: Yeah. And Sony has taken it to the H &L, whole another level. where for that regularly buy games, loyal fans, they will be increasing the prices for their loyal fans. And for those that do not often buy games, they will lower the price to incentivize you to buy a game. So it is truly a disloyalty program that they have.

Ben: Wow. That is ridiculous, dude. That's so crazy.

Ethen: And where Steam, they've got their spring sale on now. Everything has got ridiculous discounts, it's wonderful. And they hope people just buy games and never play them, which is generally what people do on Steam anyway, because you just want to have as many games as you can, but never have enough time to play them.

Ben: How does how does steam? This is like a genuine question that I was thinking about this the other day because PlayStation Xbox they obviously they want to make their margins their games right and I feel like what I've heard in the past is that consoles are ⁓ of loss leaders the actual hardware themselves or the consoles and consoles don't have really good margins they price them. or at least they used to price them at a point where it was pretty slim margins. then Xbox and PlayStation would make up their profits on the games. How steam get away with heavy discounting? Is it because they won't have to worry about a loss leader like their hardware? And so they can just price and everything's so they can price it whatever they want. So it's not a significant. it's not a significant cost to them. I'm trying to think like, how did they do that?

Ethen: Yeah, so right now everything that is on their platform, in order to list on Steam, the developers agree to a 30 % cut of the sell price going to Valve. So Steam takes 30 % of whatever you pay. And so I think that's the reason that they can do these sales is because they have such a high margin them anyway. And so they can offer a little bit of a discount on margin and still, get people buy it.

Ben: I also can't imagine there's a lot of expense in pushing digital version of a game to like an end user on a computer, right? And so there's probably not a lot of cost increment. There's not a lot of incremental cost for or like unit based cost for selling a digital game on Steam for ⁓ game producer and valve.

Ethen: Mm-hmm.

Ben: because valve probably has like their server fees, their hosting fees. Everything's digital and it's probably all consistent and maybe fully fixed costs, but close to it. And so they could be really aggressive if they need to. I assume that's gotta be it. Whereas Xbox and Sony.

Ethen: Mm-hmm.

Ben: Microsoft and Sony they probably have a lot more variable costs because they have a lot more hardware. They have a lot more products. have a lot more. They have a mixture of digital and hard copy games. So. ⁓ I also wonder too if like Steam gets a lot of value or lot of margins out of the other things they sell that aren't just games. Like I think I bought wallpaper, what it? Wallpaper engine ⁓ on my computer from Steam. like that a very, I would assume simple software. The interface is pretty straightforward.

Ethen: Mm ⁓ yeah, I think with that, I mean, really, think to with Valve and doing that, ⁓ got the file for the game on their servers, you download it onto your so it's local on your machine. And that's really about it. Maybe push an update, but there's not much traffic other than that initial download from what it is because you're not necessarily streaming anything from there so there's not constant traffic it's more of a front load that front load the traffic and then it's done.

Ben: Yeah, that makes it a lot simpler. Yeah, man, crazy. They can just be so much more aggressive because of it. ⁓

Ethen: really, with Steam, it's not like anybody owns anything anyway, since it's a digital You're just owning the license, which doesn't get you anything.

Ben: Yeah, I still I still don't like that either. We're just at we're just paying to use everything on a monthly basis. That's how it is for everything these days. It's it's convenient because you have it on demand at any time, assuming you have service unless you've downloaded it and in an on prem situation. But it's also annoying because you're right, like we don't own it and it's

Ethen: Mm-hmm.

Ben: consistent payment required to continually access it.

Ethen: Yeah.

Ben: that it makes profits better for companies.

Ethen: I know.

Ben: Speaking of profits, sorry, unless you had something else, I was going to switch, switch topics here.

Ethen: No, let's switch. Let's go for it.

Ben: Speaking of profits, let's of dive into like AI companies a little bit and talk about some of their motives and what seeing the market and what they're doing and what that looks like. AI deepfakes are a thing and they're pretty fun for the most part. Sometimes they can be used for harm or misinformation. And there is ⁓ pretty slow response from AI companies, especially around implementing regulation and implementing any kind of safeguards. Do you think this is on purpose or do think it's just that complex?

Ethen: is a good question.

Ben: They're slow, they're like slow rolling, slow walking, any kind of regulation around like deep fakes and misinformation and stuff like that.

Ethen: Yeah, I'd.

Ben: Granted. Go ahead, sorry.

Ethen: I don't think that it's lack of that it's not possible to create regulations or laws regarding I think it's it might purposeful because there's really been to put any at this time. And it's not like deep fakes aren't ⁓ a new concept. been for

Ben: Mm-hmm. Yeah.

Ethen: I mean, they've been around for a long time and now they're, I mean, they're starting to gain a little bit more traction because it's easier for these AI models to produce them and generate them. I mean, it, I know it with government, does take a while to get some regulations, but I don't think it takes this long. And somebody was really motivated, we could we could get something. I just don't think anyone is motivated enough to stop it, because maybe it hasn't caused enough harm. What are your thoughts?

Ben: Yeah, I agree with you. yes, there's like a lot of red tape in government regulation, but you don't need the government to, to, you don't need the government to set up safeguards around harmful things in your, in your company. Like you don't need to wait for the government to pass a law that requires it. Right. And so.

Ethen: Right.

Ben: If some of these, some of these companies, given how fast they're innovating on the AI, like they could probably execute on safeguards quicker if they really wanted to. I think a lot of people use these AI to generate deep fakes. They use ⁓ and they money to use them to generate deep fakes. And sure they. All the large AI tech companies have done analysis on what product is being used for, right? Like categorization. Is it used for image generation, for video generation? If so, what type of images and video generation, if it's used for conversation, what are those conversations made up of? I mean, these are billion, multi-billion dollar companies. They're not going to be just dilly-dallying and zero understanding of what the users are doing with their product. They are definitely learning because that's how they innovate. That's how they iterate on their ⁓ and they make a better version next time, which happens a lot. I mean, they're all constantly publishing updates, right? ⁓ so if that's the case, they're getting their information on what to prioritize and what to publish somewhere. And that's usually, ⁓ not always.

Ethen: Mm Yeah.

Ben: That's usually, if not always user information, user data. so in my mind, like, they're doing their slow rolling safeguards out on purpose because they don't want to restrict the profits that they're getting from people spending money using their software to deep fakes. but nowadays you are scrolling your social media and like, Was that AI or was that real? ⁓ Did you see the video with, is it, is it the actor Alan, Alan Richardson, Alan Richardson? He's the guy that plays Reacher in this Alan Richardson. Alan Rich and did you see the video of him and his interaction with his neighbor?

Ethen: Yeah. Unrichs... Richs... Yeah. No.

Ben: So his first piece the video came out it shows Alan beating up his neighbor Yeah, ⁓ allegedly that's a key word there and then Released he body footage camera. He was riding his motorcycle. So he had like a body cam and he released the video footage prior to the actual moment when he's like Whomping on his neighbor

Ethen: Allegedly assaulting his neighbor. Mm-hmm.

Ben: And neighbors started attacking him first actually. But my point is so many people are debating whether or not his body cam footage is AI or not. And it's like ⁓ it's sad that we're at a stage in life where we cannot trust video footage released by the author.

Ethen: Wow. Yeah.

Ben: because we've just been indoctrinated to question everything and say, this AI? This looks fuzzy. This looks hazy. This looks weird, whatever it might be.

Ethen: Yeah, and I find it really frustrating is you know, you go to YouTube to learn something and you can't tell if it's true or false or ⁓ really hard. I have to perform those mental gymnastics just to try and learn something true. And so I find it really frustrating and annoying that

Ben: Hmm. Yeah.

Ethen: you know, half of the news that I get or may not be true and or maybe false.

Ben: Yeah, I'm all for free speech, but I also think there is a problem with deception and misinformation. And I think like you were saying, it's frustrating because people are deliberately lying through their social media content in order to just get clout and money to get views and clicks to get paid.

Ethen: Mm-hmm.

Ben: for the consumer that's really frustrating exactly your point like i don't i don't want to question everything i want to know what the answers right And I think AI companies can stop. I think there is a solution there. I just don't think they want to solution it because it would restrict their profits. That's my opinion. It's my tinfoil hat thought.

Ethen: Yeah, I agree with that. They don't have any incentive to be ethical.

Ben: Yeah.

Ethen: And so it, they're just in it for the money. They're in it for the data. And with this, they can get as much data. The more of these deep fakes that come out or false things, that's just more data to them that they use to train their model. It's kind of like what Pokemon Go has been doing for the last years.

Ben: Mm-hmm. ⁓ yeah.

Ethen: Pokemon Go when it came out in 2016 was a huge success. you were anybody you had Pokemon go and you were out searching for all these Pokemon. In the background the real reason that they did this was to gather Street information and data from various places the world. It's kind of like Google Street View but now you've got millions of users doing work for you for free to get all this data. Now they're this data to train robots ⁓ deliveries. So it's going to be used for neural for robots so that they can go out and make deliveries ⁓ and knows what else this data be used for. It could be used for anything.

Ben: Yeah, this is actually this is this is pretty interesting and also I mean I have to give hats off to the creators because it is a pretty smart way like man we need data of the world and mapping of the world how the heck are we going to do that? Well we can have people who live there do it well how would we incentivize them we can't pay them well what if we got them on a video game that everyone loves? just kind of spiraled from there. But it does kind of make me worried. Like I caught some Pokemon in my house. Like I don't know if I want my, my house in their database, but it is, you know? So think people don't realize how valuable data is. And more data you give, the more profitable that company can be with your data.

Ethen: Uh-huh. Yeah.

Ben: And maybe there's something to be said of like passing off to the consumer, but I don't think that'll ever happen. I don't think you'll ever get paid for your data. like through your usage data, you know.

Ethen: it. Yeah, it would be nice too, especially if Tesla gave us for the usage data, since every time we drive it's data them.

Ben: See, that'd be amazing. Yeah. Yeah, definitely. Did I tell you about the startup I was at and how were valued over a billion dollars because Microsoft wanted their data?

Ethen: Yeah, you're telling me about that. the for our viewers, maybe you should go into that story a little bit.

Ben: Yeah, the first time I realized how valuable data was, and this is before like AI, right? now even more so if you are involved in any kind of AI or model training, you understand how important data is because you need you need good amount of data in order to have a strong model for training AI and the more data, more good data you can feed it, the better the model will be. So I worked for a software company that collected data on sales calls conversations and like responses, email opens all this data. We're talking like billions of data points that we had collected and we, the company was for over a billion dollars. It was technically a startup and Microsoft wanted to buy it for close to a billion they were under but it was like 900 and something to change and the CEO said no I I don't I don't want to sell for under a billion and they ended up not selling and then over the next three four years they just kept losing clients and essentially it became a fire sale and they sold for like pennies on the dollar it was terrible but the The thing that blew me away was how was willing to pay so much for this company because I knew the product. was with the product with our clients and I'm like, the product is nothing amazing. It's anyone can build the product. It's the data that was behind the product. We had like behavioral prediction features and we had, you know, email cadence models based around

Ethen: Mm

Ben: you know, behavior that was backed by the data. And that was stuff that was so interesting. And there, there, this is maybe five years ago. If more, they're willing to pay. This is, this is actually closer to like eight years ago, willing to pay close to a billion dollars for this data because ⁓ it's so valuable. And if look at all these tech companies and data companies, they collect so much data. And there's not really anything we can do about it.

Ethen: Mm-hmm. Yeah. And I mean, say like Google and Facebook probably know so about us from usage our phones whatnot and usage on internet. They probably know me better than I know myself at this point. And so yeah, the the fact that they're doing all this with our data and how much ⁓

Ben: Yeah, same.

Ethen: The value in is mind boggling. It's to fathom how much it's worth.

Ben: Yeah. Yeah, true. I'm curious if there's a larger play for Pokemon Go and the creators behind it besides just like mapping streets for the robots and stuff, you know.

Ethen: You know, I'm sure that there will be lot of... I'm there will be people that will be bidding for that data. Because, I mean, can help get insight into urban and rural areas that ever been to and we've never met before. with those users, we've... We've got some information on that.

Ben: Yeah, definitely. Definitely. I wanted to talk about another thing in regards to like companies and their motives. I feel like in the past when a company would have layoffs, that was a really bad sign for the company and reputation of the brand went down. The company was struggling and this is maybe two decades ago that I have this opinion. Now, especially in the last five years, we have seen companies do layoffs, multiple rounds of layoffs, even though they're still cash flowing really well, still very profitable. Why? one of the main reasons is, we're AI focused, so we don't need as many personnel. But I think you and I have enough experience limited if it, if it may be But enough to be fair judges that AI can't do everything that your employees that you've let go can do. You just let go 30,000 people or 10,000 people or 16,000 people. You're telling me AI can do 16,000 jobs for 16,000 people? Like, come on, that's not reasonable. It doesn't add up. So what's the motive?

Ethen: Mm-hmm. Yeah, that math doesn't add up.

Ben: Because it's becoming more and more common without any strong repercussions, right? What do you the motives are here? Do think they're just trying to if they have a bad quarter or maybe second half of the year, they're just trying to blame the amount of employees they have that they over hired. So they laid them off. I don't know. What are your thoughts?

Ethen: Yeah. You know, that's a really interesting case. I haven't really thought about it. you know, as I'm thinking about it, it may be kind of in the world of data to see what AI can in that situation. And then if they realize, Hey, it's not capable of the tasks of these 30,000 employees, maybe we'll hire some back and ⁓ There's with all with all the layoffs that keep going on. There's obviously no shortage of people needing work at this point, which is unfortunate. It's kind of an apocalypse out there right now in terms of job market, which is different from what we saw just a couple of years ago, where ⁓ people were or companies were begging for people to come. And so

Ben: you

Ethen: Yeah, now with that, that that may be the case. Maybe it's just gathering data on how how it can handle these situations. And we'll see if it works. And the worst thing that can happen is they just need to hire more people and they get a break on payroll expenses. What are your thoughts?

Ben: I thank you. I'm trying to look it up right now. I have my thoughts and I'll express them in just a I'm just trying to Google it and see if there's any other insight. So my thought initially my just like this is coming from like my accounting background, right? With financial statements, you want to try and make them up and to the right, consistent, regular growth over time. Any sporadic any sporadic or valleys doesn't look good to your investors. And so sometimes what happens is companies will ⁓ have those peaks and valleys and then they'll find a scapegoat for those things and I think often companies will lay off a massive amount of people and use that as a scapegoat as to why they had a poor q3 or poor q4 and they say ⁓ we over hired we had a lot of expenses our overhead and we solved the problem by firing all these people. But the reason why we have this massive dip is because of the over hiring of people, which like I said, there are use cases or examples of tech companies laying off thousands of people, even though they're cash flowing really well, even though the profits are still really good. They just may not have hit their targets that they wanted or, or they're showing a little bit of a dip. compared to what it was the last quarter, the last year, whatever it might be. Right. I do think companies are focusing on AI more. I personally work with two or three companies that are just like AI focused 100 % and they're not hiring anymore. but they're not, they're not letting go of thousands of people because of AI. Right. I think that's a facade and I don't think that's

Ethen: Mm

Ben: truly the reason behind it. think it's an easy reason to say because there's a lot of hype around it.

Ethen: Right.

Ben: Again, I just don't think AI can replace 16,000 people. I don't think it's feasible. Yeah.

Ethen: I don't think it can yet either. I mean, it might be able to replace aspects of the jobs that they can all do, but I don't think it can fully replace what individual does yet.

Ben: Yeah, I, totally agree. I think there's some agents that can run 24 seven, but there's risk involved with that. And you have to have management oversight from an actual human. If you want it to be effective and then an agent, they're not cheap. Like if you're having an agent do multiple tasks in Claude, like the tokens are expensive. I just read a post from a guy saying he fired his sales team and he was having AI do his like outbound cold.

Ethen: Mm-hmm. No. Right.

Ben: call or cold emailing cells. And he's like, dude, it cost me more money than the salaries of the guys that I've had on. And it's not even close to as good. And so to me, I'm like, people just are on the AI hype train. And so they're using it as an excuse, but in reality it's not, it's, not the same.

Ethen: Wow. Yeah, kind of over the AI hype train at this point. Still waiting for it to do what it says it's going to do until then. No, it's kind over it at this point.

Ben: Yeah. Yeah, I think a lot of people are starting to see that it's not as it's not as robust maybe hype plays it up to be.

Ethen: Yeah, it was it was really hyped up to be extremely revolutionary. I think it's good. There's there's some really great things that have come of it, but it's not. It's not a whole whole another level yet.

Ben: And I'm just not using it right. And that might be the case if, listening right now and you feel like, you guys just aren't using it right. This has changed my life completely. Please let us know. Like you tell us in the comments. The caveat is I see on social media people saying like, ⁓ I'm using Claude code every day and it's changed my life. And then I like look into the use case. And they're spending hundreds of dollars on tokens to execute like a research process that I could have done have taken me a little bit longer, but like it wouldn't have cost me money, you know? And so I if you really want to get complex in the abilities of AI, it's going to cost you money.

Ethen: Right. Yeah. But guess people are willing to drain oceans just keep these data centers alive.

Ben: Drain oceans baby, use all that water.

Ethen: Yep. Gotta water cool our components.

Ben: I that argument when people say like, what it? I can't remember the statistic. It was something like the lines of AI used more water Americans drank water bottles. It's like, first of all, that's not a lot of water and like relative to everything. ⁓ Second of all, what an obscure statistic to use to try and fear monger your way into AI.

Ethen: Right. Yeah.

Ben: Is AI using a lot of water for their server cooling? Yeah, probably. But like in all reality, is it like significant? not. I'm open to debate people on that. So if I'm wrong, happy to discuss, but.

Ethen: Probably more water than we're going to have in Utah for the coming summer.

Ben: gosh, dude. I looking at levels of snowpack and too counties have 0 % their water snowpack. And I'm like, what are we going do? I legitimately, I don't know what to do. And I think we're just not going to stuff. I don't know. What do think?

Ethen: Mm-hmm. Yeah. Yeah, I don't know either. Like I mowed my grass today and I'm like, I was surprised at how long it was, ⁓ know, for the first mow, but I don't know how long I'm going to be able to keep it without watering. So at some point I'm going to have to turn on my sprinklers because it's ⁓ so blooming warm for March. ⁓

Ben: Yeah, I just. It's crazy. March in the 80s is stupid.

Ethen: Yeah, good news is when my daughter starts soccer, I won't be freezing while she's playing. So that that that's the upside. She'll be able to play soccer in weather or good weather, I should say.

Ben: Fair point. Fair point. Yeah, I guess there's pros. That's good.

Ethen: Yeah, well, make sure you all hit that thumbs up. That really does help out our channel. If you liked this video, if didn't, that other button seems to work alright as well. Make sure you send this to somebody you dislike. Make sure you're ringling that dingling button so you never miss out on any content as it's posted on the channel. Until next time, stay classy and have a great evening.

Ben: Peace.