E171: DOJ sues Apple, AI arms race, Reddit IPO, Realtor settlement & more

**Jason Calacanis** (0:00)
Has anybody else seen Dune 2 in IMAX?

**David Friedberg** (0:02)
No, don't say anything.

**Chamath Palihapitiya** (0:03)
Oh, don't say anything about Dune.

**Jason Calacanis** (0:06)
All I want to say about Dune.

**Chamath Palihapitiya** (0:07)
No, don't say it.

**Jason Calacanis** (0:08)
It is fantastic. And I want to see it again in IMAX. That's all I'm saying, is that it's worth seeing twice.

**Chamath Palihapitiya** (0:14)
I don't even want to know that you think it's good.

**David Sacks** (0:17)
It's overrated.

**Chamath Palihapitiya** (0:18)
It makes me, ah!
Stop, both of you. He didn't see it.

**Jason Calacanis** (0:22)
He didn't, Sacks didn't see it.

**David Sacks** (0:23)
No, I saw Dune.

**Jason Calacanis** (0:24)
Dune 2

**David Sacks** (0:25)
Yeah, I saw it. It's overrated.

**Chamath Palihapitiya** (0:27)
Okay, stop, stop.
Okay, stop, everybody, you both did the two. It's not overrated.

**Jason Calacanis** (0:31)
There's like five great scenes.
All right, everybody, welcome to the All-In Podcast with me again, the Chairman, Dictator, Chamath Palihapitiya, David Sacks, the Rain Man, yeah. And the Sultan of Science, David Friedberg, it's your boy, J Cal here. And we have so much to go through. The DOJ dropped a Sherman X suit on Apple today, right as we were about to tape the program. It seems like Thursday is the big news drop day now. So this DOJ suit outlines five alleged abuses and they claim, obviously, that those abuses reduce competition while limiting consumer choice and raising the prices that consumers pay for their iPhone. We talked about this actually just a couple of weeks ago. We talked about peak Apple.
The five categories are very quickly super apps, cloud gaming apps, messaging apps, smartwatches, and digital wallets. If you don't know about super apps, that's the one that maybe you haven't heard of if you're listening to this.
In Asia, they mentioned how Alipay, WeChat, and Paytm are super apps. What does that mean? You get like five or six different functions in one app, social media, images, purchasing, getting rides, you know, all that stuff. And when you have that, you can move from one platform to another super easily. And when it comes to messaging apps, we've all experienced the green bubble friend.
So, the main argument of the lawsuit, pretty interesting. They explain, and it's a really well written document. I read it this morning, that when Apple faces new competition, instead of lowering prices for consumers or offering a better deal to developers, they would quote, meet competitive threats by imposing a series of shape shifting rules and restrictions in its App Store guidelines and developer agreements. I've faced this every time I've invested in an app startup. They complain about the goalposts moving by Apple and Apple shares down about 3% on the news today. I'm sure everybody's got some interesting thoughts on it. Chamath, you were talking about peak Apple just last week or the week before, I think. What are your thoughts on the lawsuit that dropped today?

**Chamath Palihapitiya** (3:03)
To be honest, I haven't read it and I don't really know the odds of these things just because it seems like some of this stuff is so clearly political.
And I think that these things have seasons to it in the sense that there are moments where these things are more likely to go in the favor of the company and more likely to go in favor of the government. The one thing I'll say is that these guys have been losing a fair number of these things. So they're kind of 50-50 in their fight with Epic. They've basically lost against their fight with Spotify.
They definitely are in a moment where people are looking at the profitability of these devices the source of their long-term cash flow. And I think they realize that there's not a lot of growth because they haven't entered a bunch of new markets. So the real question is, knowing all of that, did they do something beyond what they've already always done to try to lock people in? And can they prove it? I think that that's really where the government's case will come down to because then it's clear that Apple probably understood that their market was kind of solidifying and they introduced these blocks essentially into processes that force people to stay. That's probably bad news for them, but I don't really know because I haven't read the laws.

**Jason Calacanis** (4:27)
Yeah. Sacks, did you get a chance to read it or do you have any thoughts, generally speaking?

**David Sacks** (4:31)
I haven't read the filings but I read some of the press coverage about it. I would say based on the press coverage that I read that there's not really a smoking gun here. At least the press hasn't reported one. And what I mean by that is let me give you a couple of examples that were in the press. One is that apparently the filing made a point about when Tim Cook was confronted some time ago by a user saying when I try to send a video by text to someone with an Android phone, it just doesn't work very well. It never works. It was a guy trying to send a video to his mom.