• Why does Instagram want to show you stuff it thinks you'll like instead of letting you pick for yourself?
• And why is Instagram focused on getting people to share photos and videos privately?
• The two ideas are connected, Instagram boss Adam Mosseri explains: Normal people simply aren't sharing as much in public as they used to.

Adam Mosseri's official title is head of Instagram, Meta's massive photo and video app. He also runs Threads, the Twitter clone the company launched two years ago.

Unofficially, he's become one of Meta's chief explainers, frequently jumping on social media to defend and proselytize on behalf of his employer.

So when I got a chance to interview Mosseri, I had a long list of questions about… lots of things: I wanted to know how Mosseri felt about the company's recent pivot to Trump-friendly policies, and how he looked at TikTok, and a million other things. I didn't have enough time to get to everything, but I got to a lot of it, and you can hear our whole conversation on my Channels podcast.

In the edited excerpt below, Mosseri and I go over some big-picture stuff that tells you a lot about the current state of social media: Like why Instagram, Facebook and every other social media platform rely on algorithms to show you stuff they thinks you like, instead of relying on users to program their own experience. And why the company is gung-ho on getting users to privately send each other photos and videos, instead of its initial focus — getting them to post stuff on a public feed.

And I also wanted to know about the backstory behind Threads — the text-based social network it launched just as Elon Musk was taking over Twitter. Mosseri was happy to talk about all of it.

Peter Kafka: In the first few years of social media feeds, users would see a list of everything that everyone they were following had posted, in chronological order. Now, the standard at every app is a curated, algorithmic feed. Why does everyone who runs a social media product think that's better?

Adam Mosseri: It's because it's the only way to grow these experiences.

The amount of content people post publicly in feeds is going down across the entire industry, because people are moving more and more sharing to stories — which you could argue is a different kind of feed — but even more into messaging, group chats, one-on-one chats.

On Instagram, there are way more photos and videos shared into DMs than into stories, and way more photos and videos are shared into stories than into the feed. So if the amount of content you have to rank is decreasing — how engaging the feed is is also just decreasing. It's just getting worse.

We show recommendations because you might follow 200 accounts and one in 10 of them posted. So we've [only] got 20 things [to show you]. And we can reorder those 20 things 20 factorial ways, but that's only so much upside.

Whereas if we look at the billion things posted in a given day and we find something you're interested in, there's more upside.

Instagram has been encouraging messaging. It's something you've been talking about for a while. It's something users were doing on their own, and now you guys are responding to it?

Oh yeah. It's a paradigm shift.

The thing you hear is that people are going to chats because they feel like that's safer or they can have more candor. But are regular people literally thinking about how their posts are gonna be received? Is there some other reason people are sharing more privately versus publicly?

The foundational reason is that there are more things that you would feel comfortable saying to somebody one-on-one than things you would feel comfortable sharing publicly.

This is a weirdly sad example, but you could think of sharing in-feed as standing on top of your roof, yelling something at a hundred people, and hoping that 20 people hear it. There's some things I would do that for. But the average thing — the amount of things I would say to you on a phone call, my wife on a phone call, my best friend on a phone call — there's a lot more of those things. I think that's the most important reason.

How does that shift affect the business of Meta?

It moves more and more of that friend content into private experiences. And then the question is, can you either make those private sharing experiences symbiotic with the ones that we monetize — like feed and stories? Or can you monetize those experiences directly?

For Instagram, the thing that has been amazing is that we have leaned into video in a way that actually grows messaging. When I worked on the Facebook app, we leaned a lot into video in 2014, 15, 16. We were very focused on trying to catch up with YouTube, and growing video grew the amount of time spent in the Facebook app — but it decreased everything else. It decreased messages, comments, likes, and revenue — because there's less ads per minute.

[But] with Reels on Instagram, because they're short and because they're entertaining… I'll see a standup comic doing a bit that I love and I'll send it to my brother, because I know he's going to enjoy it.

Or I'll see a piece on politics and I'll send it to you. Because I think you might be interested in it. And then you and I talk, maybe you look at your feed, maybe you engage with something else. Maybe you send that to somebody else.

So there is a private messaging part of the experience, [but] we've managed to build it in a way that's very symbiotic with the public context — like feed and stories and reels, which we monetize directly with ads.

We're going to show you engaging stuff, you're going engage in it, and we'll be able to monetize your eyeballs like we always have — and then you'll share it with other people.

It's a positive feedback loop. And it's important particularly for Instagram because we are about connecting with your friends over creative things. I mean, for some people, we might be a pure entertainment-based or public content-based app. But we want friend content to continue to be a core part of the experience for most users.

And this allows Instagram to stay social, but still grow as a business.

I wanted to ask you about the Threads origin story. I didn't realize that it was originally supposed to be a feature within Instagram.

We were talking about different ways to compete more directly with Twitter…

Why? I know that back around 2010, the two services were fiercely competitive. And then basically that competition stopped, because you guys just lapped Twitter over and over and you won. There were many more people who wanted to engage in a Facebook and Instagram-like experience than they did on Twitter.

So why bother going back to Twitter?

I think Twitter's a great app in a lot of ways. I use Twitter a lot, still. I think it's better for public conversations.

Even though it's not the biggest app, there's a lot of cultural relevance. There's a lot of really vibrant, amazing communities there — NBA Twitter, black Twitter there. There's these insular networks like VC Twitter and crypto Twitter.

And part of what we care about at Instagram is being a place where creatives do their thing.

And the initial thought was to bolt it onto Instagram?

Around that time we really accelerated our work on broadcast channels on WhatsApp and on Instagram and on Messenger — which by the way, are a big deal in a lot of the rest of the world, particularly popularized by Telegram. We looked at and had a bunch of designs for building something like Threads as a tab into Instagram. And we did consider and ended up building a separate app, and there were a lot of contentious debates.

What did you want to do? Where did you want what's now called Threads to live?

I was excited about channels. But Mark [Zuckerberg] made the point — and I agreed with him — that channels are not going to be a place where you keep up with tons and tons of culturally relevant people. They're going to be a place where you subscribe to the five or 10 you care about most.

I was more bullish on building something within Instagram. Mark's point was that a separate app will be harder — but if it was successful, it would be a more valuable thing to create in the world.

A lot of what Mark does is anchor us really high. And no matter how strong a year we have, the question is always — how can we do better?

It was late. I was in Italy for my anniversary with my wife, and [Mark's] like, "Well, if you were gonna do something bigger, what would you do?"

So I was riffing and I kind of pitched a version of Threads: We'll lean on Instagram's strength with creators. We'll use Instagram identity. You can bootstrap it with [Instragram's social] graph, but we'll focus on basic replies and threads. I called it Textagram as a joke. Which unfortunately stuck as a name for months before I managed to kill it.

And Mark's like, "Yeah, that's a good idea. We should do that." And I was like, "I don't think we should do that." And in the classic Mark move, he said, "OK. But if you don't do it, I'll have somebody else do it, and it'll be built on Instagram."

And I said, "OK. Sounds like I'm signed up." So he gets the credit.

• Charter, a big cable and broadband company, is buying Cox, a smaller one.
• Is there an antitrust issue here? Maybe?
• But Charter is hoping it can get on Donald Trump's good side by pitching the deal as Great for America.

Charter, one of the country's biggest cable and broadband companies, is buying Cox, a smaller cable and broadband company.

If you're a customer of either company, you might be vaguely interested in what the deal means for you. And what might you think if you're the president of the United States?

Well, Charter is hoping you'll think this is a deal that Makes America Great Again.

It's a real sign of the times in the Trump 2.0 Era: A pretty standard proposed merger is being framed as an explicitly pro-American deal.

But don't take my word for it. Consult Charter's press release, which says the deal will produce "powerful benefits for American employees, customers, communities, and shareholders."

Charter also promises the deal will "deliver high-value products that save American families money, and we'll onshore jobs from overseas to create new, good-paying careers for US employees."

And in case you didn't pick up on it the first two times, Charter is happy to underline the point. It says this deal "puts America first by returning jobs from overseas and creating new, good-paying customer service and sales careers."

Charter is also happy to say the same thing in reverse: It says this deal is bad for bad people who don't live in America. "The combined company will retain its industry leadership in protecting the security of US communications networks from foreign threats," the company says.

The responsible, fair-minded journalist in me needs to note that at least one part of the Charter pitch doesn't seem to be constructed solely for President Donald Trump: Charter has previously pushed to bring customer service jobs it used to outsource in other countries back to America.

That was something Trump liked hearing from Charter the first time he was in office — even if it was about plans Charter had made before Trump's election.

Fine. And it's certainly not unusual for big companies to frame M&A deals in a way that's explicitly meant to please politicians and regulators. But those pitches were usually about whether those deals would reduce competition (standard line for any old-world company buying another: "We need to do this to take on Big Tech.")

This is … very different. We also have no idea whether it will work: The Trump 2.0 Era has been pretty scattershot in terms of what kind of deals clear antitrust or other regulatory bars, and which ones get opposed.

But at a minimum, it's raising eyebrows. "It's a MAGA press release," someone at a Charter competitor muttered to me Friday. Left unsaid: Maybe that's a good approach?

• First, there was HBO. Then there was HBO Max. Then there was Max.
• Now, Warner Bros. Discovery is going back to HBO Max.
• That's pretty funny! But behind the scenes, there's a serious story: an acknowledgment that a huge merger has been a flop.

Remember when HBO used to be called HBO, and then it became HBO Max, and then it became Max?

And how everyone except the people who owned the iconic TV brand thought it was a terrible idea to demote an iconic TV brand?

Turns out everyone was right.

Warner Bros. Discovery, the company that owns Max, now says it will rebrand the service and call it … HBO Max.

That's the brand it operated under from May 2020 — when it had a different owner — through May 2023. That's when current ownership flipped the name to Max, which it's now ditching.

And if you think that's a pretty funny example of sweaty corporate pivoting and flailing — the kind of stuff that regularly got flayed on HBO's "Succession" — you are not alone. The folks at WBD also acknowledge the silliness of the whole episode, and are distributing a mea culpa meme to poke fun at themselves:

So that's the fun part. There is some more serious stuff going on behind the scenes, though.

For starters, this is yet another acknowledgment that the thesis behind the merger of what used to be called WarnerMedia and Discovery hasn't panned out. The thesis was that combining HBO's programming with reality TV programming would make a streaming service with broad enough appeal to take on Netflix.

Not that the WBD folks are saying that exactly in public. But you can read between the lines in the press release announcing the change, where the company says its streaming service is thriving because of "investment and re-focusing the strategy on the programming that is working best like HBO, recent box-office movies, docuseries, certain reality series, and Max and local originals, and de-prioritizing other genres that drive less engagement or acquisition."

Translation: We thought HBO was a brand that meant a lot to some people but not much to a much bigger group of people. Whoops! Turns out people like HBO. Also, they like other shows made by HBO people, that for some reason weren't called HBO shows, like "The Pitt." And they do like a few things from Discovery, like "90 Day Fiancé." But a lot of the Discovery stuff — think Food Network and other lifestyle programming — really isn't working on a service that also brings you "The White Lotus," and we're done pretending that it's a good idea.

It's also important to recognize that WBD's rebranding of its streaming service isn't the only acknowledgment that things haven't gone as planned.

It also did that late last year, when it reorganized the company, doing an on-paper separation of its studio and streaming business — the stuff it thinks is going to grow — from its old-school cable networks like Discovery and TNT.

That move was made so WBD could one day split itself up for real, echoing what Comcast is already doing. CNBC reported last week that the split could come "in the not-too-distant future."

If that happens, don't expect a funny meme to accompany the announcement. But it's still going to be the same story: The people who insisted that pushing two companies together was a good idea will be telling you that they're better apart, after all.

• Donald Trump wants Apple to make iPhones in America.
• There's no chance that will happen, says Patrick McGee, a journalist who just published a book on Apple's deep ties to China.
• McGee also argues that Apple's end-around on Trump's China tariffs — saying that some iPhones and other products are made in India and Vietnam — is misleading.

You probably know that your iPhone, and just about any other Apple product you own, was made in China. And that Donald Trump wants Apple to move all of that production to the US.

But do you know how, and why, Apple ended up so dependent on China — and why that's so unlikely to change?

Patrick McGee says he does. He's a journalist who just published "Apple In China: The Capture of the World's Greatest Company" — a detailed look at all of the money and effort Apple spent over decades to enmesh itself in China.

McGee, who has covered Apple for the Financial Times, explains why this has been enormously helpful to Apple — because it created an ecosystem that lets it make ultra-complicated devices at vast scale. But he argues that it was even more helpful to China — because Apple gave Chinese engineers access to valuable technology that has let them build other high-value supply chains.

And that McGee posits, has created both a problem for Apple CEO Tim Cook — because he can no longer practically extract the company from China — and for the US — because its adversary is now using American know-how to compete with American companies.

(I asked Apple if it wanted to weigh in on McGee's book. Via a rep, the company said that "claims in the book are untrue" and "filled with inaccuracies" and that McGee didn't fact-check the book with Apple.)

I talked to McGee for the newest episode of my Channels podcast. In the edited excerpt below, we talk about why he thinks it's impossible for Apple to move iPhone production to the US. And why McGee thinks that Apple saying it's moving some production to India and Vietnam, in order to escape some US tariffs on China, is deeply misleading.

Peter Kafka: The Trump administration says it wants Apple to move all of its manufacturing to the US. You and anyone else who knows anything about Apple saying that is literally not possible when it comes to the iPhone. Why?

Patrick McGee: We're lacking so many things. The density of population is one. Lots of people know a factory town [in China] might have 500,000 people just putting together the iPhone. The thing that people don't understand is they're not doing that year-round. They're doing that for three or four months.

And then they're moving on to another project. So Apple doesn't bear the cost. It's using the likes of Foxconn to do manufacturing as a service.

There's an analyst quoted last month who said it would be like if in the city of Boston, every person dropped what they were doing and just worked on iPhones. And as quotable as that is, that understates the challenge. Because it would like the city of Boston transporting itself to some other place, like Milwaukee, assembling iPhones for a few weeks and then moving on to some other project.

China has this floating population — that's literally what it's called — and that workforce alone is greater than America's entire labor force. So we're never going to match them in terms of density of population and, more especially, dynamism of the population.

Let alone that it's happening at way lower labor rates. Let alone it's got way better machinery and automation. It's not a matter of willpower and cost — that seems to be what the MAGA dream is based on. It goes so much beyond this.

We often say Americans don't want to do these jobs. The Chinese don't want to do these jobs. But there are so many people that would rather be doing that than toiling in the fields for 14 hours a day. We just don't have a base of labor that would do that.

One of the other arguments you and others make is that China has people, but there's also just huge infrastructure: a whole series of plants and subplants and subcontractors that all are sort of built around getting Apple the products it needs, at a drop of a hat.

Yeah. In the amount of time that it would take China to build a new factory, we would still be doing the environmental paperwork.

But in Apple's most recent earnings call, the company said that for the next quarter at least, every iPhone they sell in the US is going to come out of India, and most of the other electronics they sell in the US — AirPods, etc — are going to come out of Vietnam.

So what am I missing here? It makes it seem like Apple has gone ahead and figured out how to move this stuff out of China.

Not at all. Think of it like this: If there's a thousand steps in making an iPhone and the final one is now in India, you're avoiding tariffs. The final assembly is considered "making it in India."

Like if I took every step of baking a cake except for putting the icing on or ...

Putting it in the box or something.

Honestly, not much is happening in India. That might change in the next five to 10 years, but the idea that there is actual production happening in India is just wrong.

If you buy an iPhone next year, it'll say "made in India." I think that's a near-certainty. But that phone will be no less dependent on the China-centric supply chain than any other iPhone you've ever purchased.

On that earnings call, Apple also said that the existing tariffs will cost them $900 million in the next quarter. That may sound like a big number, but Apple makes $100 billion in profit a year, so it's not. If that was just the only impact from the tariffs, that seems like a pretty solvable problem for Apple: They have to move final assembly to India, and eat some costs, but they could do it.

Yeah, absolutely.

Where I think things are much dicier is that the political ties that Apple has with China are unbreakable. I shouldn't say political ties — I really mean the business ties. They are not going to leave China anytime soon.

Yet the technological transfer that is engendered by designing cutting-edge products every year and building them in China inherently causes a technology transfer from America to China on a crazy level. And if you think of China as a threat, if you think of them as America's biggest adversary, it is insane that the world's greatest company is equipping China with this technological know-how year in, year out.

The Wall Street Journal just reported that Apple is thinking about maybe tacking on some of these additional costs to the next round of iPhones they start selling this fall — passing those costs on to the consumer. Does that sound right to you?

Yes, because the other alternative is that you're squeezing out more from your suppliers. Some analysts have suggested that, and it's kind of laughable. Because if there's anything to squeeze out of the supply chain, you damn well better know that Apple's already done it. Apple pays its suppliers very slim margins. There are not a bunch of fat cats out there that they can just be squeezing

• Later this year, you'll finally be able to subscribe to ESPN without paying for other cable TV channels.
• The new service will be called ESPN and cost $30 a month.
• The fact that Disney, which owns ESPN, has taken a decade to launch this tells you a lot about the state of the TV industry.

Here's a scenario: You don't pay for cable TV, but you love sports. And you hear that ESPN will now let you buy a streaming version of the sports channel. So you sign up, for $30 a month.

And here's an alternate scenario: You pay upward of $100 a month for cable TV, but you're really only doing that so you can watch sports. So when stand-alone ESPN comes along, you drop your cable subscription and move to ESPN's $30-a-month plan.

Both of these scenarios are good for ESPN's owner, Disney. Either way, the company gets a monthly subscription fee from you.

But for now, Disney has to maintain in public that it's really interested in the first scenario.

"Our priority is looking at the 60 million-plus people that are on the sidelines," ESPN's boss, Jimmy Pitaro, said at a launch event Tuesday morning — referring to the pool of people who don't have a TV subscription.

But the truth is that both ESPN and the rest of the TV industry know there are people who might stop getting cable TV once they can just get ESPN. Which means they know the new service could help speed up the erosion of the cable TV industry.

And that also explains why this launch announcement — the service itself will come online sometime in late summer, in time for the NFL season — is taking place in 2025. Even though there's been intense speculation for a decade about a streaming-only version of ESPN.

That's because Disney, along with other TV network operators, has spent years trying to keep a foot in each canoe: offering some of its best programming on digital-only services like Disney+ and ESPN+, while keeping other core offerings on its traditional networks, like ABC and ESPN.

Because while old-time TV networks are fading away, they still generate meaningful revenue and profits for Disney and every other cable TV owner.

So in 2015, when Disney CEO Bob Iger first freaked out the industry by acknowledging ESPN's subscription base was starting to shrink, the company was loath to move to an ESPN-only option.

Fast-forward to the present: It's now commonplace for big cable channels like HBO to sell their programming as stand-alone streaming services. And the companies that own traditional cable channels are trying to figure out how to get rid of most of them. See, for instance, Comcast's plans to jettison most of its cable properties into a separate company, and Warner Bros. Discovery maneuvering so it can do the same.

Will you pay $30 a month for a stand-alone ESPN?

So while stand-alone ESPN is a big milestone for Disney and the TV industry, it's a muted one. We've been expecting this forever, and now it's finally here.

Meanwhile: Do you actually want to pay $30 for a stand-alone version of ESPN?

Because while that will give you a lot of sports, given ESPN's rights deals with the NFL, the NBA, and many of the biggest college football teams, it won't give you all the sports.

Notably: NFL fans — the most important group of sports fans, given the NFL's TV dominance — will still have to turn to other outlets to watch all the games, which are spread out across Fox, Paramount's CBS, Comcast's NBC and Peacock, and Amazon and Netflix. So ESPN won't be a one-stop solution for them.

That's a big reason Disney, Fox, and WBD teamed up a year ago to put together Venu, a bigger bundle of sports offerings. That one was supposed to go for about $50 a month, and its existence was a tacit admission that Disney itself didn't know how big the demand would be for an ESPN-only streamer.

Venu was supposed to launch later this year. But in January, the three companies pulled the plug on the joint venture. Now, Fox is launching its own sports-heavy streamer, and Disney and Fox may end up in some kind of deal down the line.

So on the one hand, the future we were thinking about 10 years ago is finally here: You are going to have lots of ways to pay for sports without having to sign up for a cable TV bundle.

On the other hand: Now that we've got it, we have no idea how many people are going to want it.

• Google stock tumbled Wednesday after Apple's executive Eddy Cue said AI rivals were cutting into the search giant.
• Google responded by saying that's not the case.
• It's possible that both arguments are correct. The stakes are very high.

Is Google screwed?

That's the $2 trillion question the tech world is trying to understand following Wednesday's blockbuster news: A top Apple executive said search queries on the company's Safari browser were declining because people were using AI engines like ChatGPT instead.

Investors immediately acted as if Google's astonishing run at the top of the tech heap was over, and slashed the company's stock by more than 8%.

But a day later, Google's stock was climbing back up a bit, and there's a healthy debate about what Cue's statement means — as well as why he said it.

Spoiler: I'm not going to solve this one today. But let's at least look at the argument.

The most obvious way to view Cue's comments was the way Wall Street did: that Google search dominance was being eroded by AI competitors.

After all, fear of being usurped by AI is what pushed Google to fast-track its own AI efforts, even when some of those efforts created embarrassing results.

But later on Wednesday, Google put out a statement that basically said Cue was wrong, without actually saying that out loud. Instead, the company said it was continuing to see increasing searches, and "that includes an increase in total queries coming from Apple's devices and platforms."

So that looks like two of the world's most powerful and valuable companies are disagreeing over basic, knowable facts.

But people who pay attention to this stuff are focusing on three key words in Google's statement: "total," "devices," and "platforms." And the absence of another word: "Safari."

And that's leading them to translate Google's statement this way: "Maybe Apple really is seeing fewer searches on Safari, the default web browser on iPhones. But you can use Google in other ways on iPhones — namely, via the Google app, but also via Google's own Chrome browser. And people are using those more — enough to counter any decline elsewhere."

Assuming that this translation is accurate, that should reassure Google and its boosters a bit, though not completely: Cue said the searches on Safari were down for the first time ever, and that's not the kind of signal you can just wave away.

And even if Safari Google searchers are really moving to things like the Google app instead, that also underlines the fact that people who used to just type something into their iPhone browser know now they can get results other ways. And there's no reason they couldn't also be searching on Google competitors like ChatGPT.

A Google rep declined to comment; Apple hasn't responded to my request for comment.

Google investors, by the way, don't seem 100% convinced by Google's statement: The stock is up 3% on Thursday, which means Google is still worth 5% less than it was Wednesday morning, when Cue started testifying in the US vs. Google antitrust trial.

Which brings us to the second question Google and Apple watchers are speculating about: Why did Cue say what he said in court, after all?

I'm an Occam's razor guy, so my first take was that Cue answered the questions he was asked in court.

But there's also a 4D chess argument, put forth by folks like MoffettNathanson's analyst Michael Nathanson. It goes like this: Cue has an incentive to portray Google as a wounded animal.

That's because Google pays Apple at least $20 billion a year to make Google the default search engine on Safari (that's the reason Cue has insight into Google's search activity), and a federal judge has already declared that Google has an illegal monopoly in search.

And one of the remedies the judge could push for would be to prevent Google from paying Apple for that valuable real estate — which would mean Apple could lose all of that high-margin revenue.

So, the theory goes, convincing the judge that Google no longer has a stranglehold on search, because of AI competition, might allow those payments to keep flowing after all.

That theory also helps explain Google's muted response on Wednesday night, where the company tried to walk the line between tooting its own horn (which bucks up investors but could damage its legal argument) and acknowledging that it has real competition (which could help Google in court but hurt it in the market).

Which brings us back to where we started: Is Google really starting to lose out to the ChatGPTs of the world, and entering a permanent decline, just like pay-TV networks a decade ago? Or is it holding its own despite the competition? Depending on where you're asking the question, Google might give you a different answer.

Correction: May 8, 2025 — An earlier version of this story misstated which company the Safari browser belongs to. It's Apple, not Google.

• Google has been worrying about losing search share to AI engines like ChatGPT for a couple of years.
• It looks like that's started to happen, an Apple executive testified in court.
• Google shares immediately fell.

Ever since ChatGPT burst onto the scene in 2022, investors have wondered about the implications for Google. Mainly: What happens to the company if lots of people start using AI engines to answer questions instead of Google's dominant search engine?

Now it looks like that might actually be happening.

Eddy Cue, an Apple executive, said searches on Apple's Safari browser shrank for the first time ever in April — a change he chalked up to people using AI instead.

Cue made that disclosure on Wednesday while testifying in the federal antitrust suit against Google's parent company, Alphabet, because Apple receives more than $20 billion a year from Google to make it the default search engine on Apple devices.

He also said Apple would likely add AI engines as search alternatives on its devices over time, Bloomberg reports:

[Cue] noted that searches on Safari dipped for the first time last month, which he attributed to people using AI.

Cue said he believes that AI search providers, including OpenAI, Perplexity AI Inc. and Anthropic PBC, will eventually replace standard search engines like Google. He said he believes Apple will add those players as options in Safari in the future.

"We will add them to the list — they probably won't be the default," he said, adding that they still need to improve.

Cue's testimony neatly explains a major reason that investors have been pouring money into AI companies like OpenAI at increasingly huge valuations: They're hoping that at a minimum, they'll be able to carve out some of Google's ownership of the stock market — the primary reason Google is worth $2 trillion today.

That prospect is also what has prompted Google to turn itself into an AI company, by turning conventional searches into queries it answers with its Gemini AI engine. Early stumbles in those efforts generated a lot of mockery — see glue pizza — but Google has stuck with it, insisting that users like the results.

On the company's earnings call last month, Google CEO Sundar Pichai said its efforts were working and that its AI engine had helped increase search volume: "Nearly a year after we launched AI Overviews in the US, we continue to see that usage growth is increasing as people learn that Search is more useful for more of their queries," he told analysts.

Cue's testimony suggests that those efforts haven't been enough to protect Google's market. Google shares fell more than 7% on Wednesday.

Google released a statement late Wednesday disputing Cue's assertion and saying it continues to see "overall query growth in search."

"That includes an increase in total queries coming from Apple's devices and platforms," the statement said.

• Epic Games CEO Tim Sweeney — the guy behind Fortnite — has been fighting Apple over its App Store rules for five years.
• Last week, Sweeney won what could be a far-reaching victory — if it survives Apple's appeal. It may also bring Fortnite back to iPhones.
• Sweeney says he pursued the case for business reasons — but that there's also a moral component to his fight.

There aren't a lot of people who can say they've beaten Apple. Tim Sweeney may have just earned a spot in that club.

Sweeney is the CEO of Epic Games — best known as the company behind Fortnite — and he won what may be a very meaningful court victory last week, by forcing a significant change in the way Apple runs its App Store.

Apple is going to appeal that ruling (and Sweeney is in a parallel fight with Google over its app store rules). But if the ruling stays put, it means the five years and the enormous amount of money Sweeney says he spent and sacrificed by challenging Apple and its CEO, Tim Cook, will have paid off.

Explaining why Apple's App Store rules are so important — to both Apple and the developers who complain about them — can be a drag, though I keep trying. I wanted to hear Sweeney's take on it directly because he's made the fight a core part of his job for half a decade.

And I also wanted to know when I'll be able to play Fortnite on my iPhone — something I haven't been able to do since 2020, when Sweeney first started fighting with Apple. (I've asked Apple for comment, but they haven't expanded on the statement they made last week expressing their disappointment and plans to appeal.)

You can hear our entire discussion over on my Channels podcast. The following is an edited excerpt of our conversation.

Peter Kafka: Why was last week's ruling important to you and Epic? And why should a normal person care about it?

Tim Sweeney: This is really one of the issues at the heart of our digital freedoms for the future. We live our lives on our smartphones. We're connected constantly to people. We work on them. We play on them. And our futures are going to be ever more connected there. So the freedom for consumers and developers to do business together is of paramount importance. If you have one monopoly gatekeeper who dictates what people are allowed to play, see, hear — and takes exorbitant fees from every transaction that everybody does online — we're going to have a much less free world than the one that we grew up in.

I started programming back on an Apple II when I was 13: You turn the computer on, you get a BASIC programming prompt. Anybody can write code, anybody can save it to a floppy disk, you can share it with a friend, you can sell it. Those digital freedoms are essential to the future.

I subscribe to Netflix. I subscribe to Spotify. Neither of those is done through Apple because in both cases, neither of those companies wanted to pay Apple's fees. But I use Spotify and Netflix on my phone.

I could maybe argue that it's a bit of a hassle for me to have to deal with Netflix on a website instead of directly through its iOS app. But it doesn't really seem like it's a sort of life and death situation for me or any of the companies involved.

Apple has two tiers of rules. They have one tier of rules for what they call reader apps, which are basically apps operated by multi-hundred-billion-dollar companies — Amazon Video, Netflix, Spotify, and a number of others. Apple lets those apps do business outside of the app. And they've previously obstructed those developers from telling users about the better deals [you could get by going to those sites directly].

But even with that restriction, which is now being taken away, it seemed like life was OK for me, life was OK for Netflix, life was OK for Apple. Everyone was getting what they wanted.

It was not OK for game developers. Because that reader app exception only applied to streaming video, streaming audio, and ebook sites. Apple forced all games, all social media apps, and everything else, to only do business through their app. So Apple imposed a rule on all game developers, saying if you sell anything for your game anywhere in the world on any platform, then you must sell it on iOS, and you must use our payment method, and you must pay us 30% if your revenue is greater than a million dollars. So the game developers did not have a choice, and everything there was just marked up 30%.

What happens given the ruling last week?

It means now all users are free to learn about better deals from all developers, and all developers are free to not just accept payments outside of the app on the web, but to tell users about those alternative ways to pay and to give consumers better deals. That's a key economic gain here.

Now developers will be able to send users to the web to give them a better price, and then to make a little bit more money for themselves, too.

But that's just the first-order effect. The second-order effect is that you can expect if Apple continues to offer such a horrible deal, that everybody's going to move away and steer their customers towards iOS payments on the web. So I would hope that Apple would step up and compete, give developers a much better deal than 30%, and actually engage in competition. But whether Apple chooses to compete or not, the court has enabled developers to make the choice for themselves.

Apple says they're going to comply with the judge's ruling, but they're also going to appeal it. So it's possible the rules get changed again. Do you think a meaningful number of developers are willing to take advantage of this window, knowing that it can get shut down?

It's 30% of revenue, so all major developers will support alternative payments. Spotify was the first major app I saw that already has done it. Fortnite will do it later this week. And many, many apps are doing it.

You said Fortnite is going to come back to iOS. You guys were kicked off the platform in 2020 for violating Apple's rules. There's nothing in the judge's ruling that says Apple has to reinstate Fortnite on iOS. Have you talked to Apple? How do you imagine Fortnite will come back to iOS?

Epic has a valid [Apple] developer account in good standing. Our subsidiary Epic Games Sweden opened up an account in order to distribute Fortnite in the European Union.

Our dealings with Apple on that account have been managed by their developer relations team, who have been cordial.

Do you feel confident that I will be able to play Fortnite on my iPhone later this week?

I believe so. I would be very surprised — well, I wouldn't be terribly surprised if we had a bug that took a day or two more to fix — but I would be very surprised if Apple decided to brave the geopolitical storm of blocking a major app from iOS.

We've told Apple what we're doing.

How much has it cost you to engage in this five-year legal fight?

We've had legal bills in the matter of Epic vs. Apple of over $100 million.

I assumed it was much more. You were hiring top-shelf lawyers and …

Well, yeah. Well over $100 million, just in legal fees.

But if you look at lost revenue, that's another story. We can't predict exactly how much we would have made on iOS, but in the two years that we were on the platform, Fortnite had made about $300 million on iOS. So you could have projected hundreds of millions of dollars of lost revenue as a result of the fight.

And that's just from people who were playing and couldn't play. I'm thinking of the future players you would have gotten, who didn't get exposed to the game because they don't have access to it via their phone. Roblox has tons of young players. The majority there are teenagers or below. They're all getting to it via their phone. Those are all people who could have played Fortnite for the last five years.

That's right. Metcalfe's Law is a real factor here. You're much more likely to play a game or use a social network if your friends are there. So Apple cutting off Epic from access to the entire iOS audience, that not only affects the players that are directly denied access to Fortnite, it also affects all of their friends who might have played Fortnite more or might have played Fortnite but didn't, because their friends weren't able to play.

So you could easily imagine that there's been a billion dollars or more of impact to Epic in this time.

I think freedom cannot be purchased at too dear a price. The world needs to change here. And if it doesn't change, then you're just going to have Apple and Google extracting all of the profit from all apps forever. And there will be no proper digital economy. It will just be monopolization.

I understand the logic and emotion behind that argument. On the other hand: You're running a for-profit company. You have a lot of investors. They put a lot of money into you. Did they come to you at any point in the last five years and say, "Tim, I know that freedom cannot be purchased at too dear a price. On the other hand, I've invested a lot of money in you because you're a games company, and your game is banned from mobile phones. Could you just settle this up and declare victory and move on?"

Other than one investor who exited Epic right quick, everybody has stood by us, because nobody invested in Epic because they want to make a 30% profit flipping the stock.

They have invested in [us], believe in our vision, believe in our potential, and believe that if we succeed in building the metaverse and growing Fortnite from a game into an ecosystem, into an open platform serving literally billions of players, that it will totally have been worth it. They all realize that if Apple controls the spigot, the revenue spigot at the top of the funnel, they will use that control to extract all of the profit that will ever be made from this space.

Do you imagine this is the rest of your professional life — running a business, coding, and then also having legal fights with platforms?

There's a game and a meta game here, right? The game is making awesome software, which is awesomely fun, creatively and technically. I love that. But there's a meta game of ensuring that we have the right to do that, and that we can profit from the fruits of our labor, and that all developers can. So much of our business is not just Epic profiting from our games. It's Epic helping other developers succeed and profiting from the success of thousands or hundreds of thousands of different developers themselves.

Epic is one of the few companies in the industry that's positioned in a way that really forces us to fight for everybody. And I don't feel bad about this. I put a lot of brain power into coding over the years. I put a lot of brain power into figuring out how to defeat the monopolies that are blocking us.

What good is coding if you don't have the right to release your product? You have to mix the love of the art together with your defense of your right to engage in the art.

• When you see a movie or a TV show, do you think about where it was made?
• Lots of people in Hollywood do — they're seeing more and more productions move outside the US.
• Donald Trump says he wants to reverse that. But his proposal is hard to understand.

There are many stories out right now about Donald Trump's call for a "100% Tariff on any and all Movies coming into our Country that are produced in Foreign Lands."

But let's give the concision award to Variety, which noted that Trump's Sunday night announcement generated many questions in Hollywood, "starting with: Huh?"

Let's also note that Trump frequently changes his mind about things, and most definitely about his tariff policies. So it's entirely possible his Hollywood tariff post leads to nada.

While we're throat clearing, let's also note that, unlike some of Trump's other tariff pushes, this one doesn't imagine a world where work that left the US long ago comes back to the country. Movie (and TV) production remains a huge business in the US, employing millions of people.

And lastly, Trump is correct in noting that film (and TV) production has been leaving Hollywood for years. Sometimes it has gone to other places in the US: Disney has made more than a dozen Marvel movies in Georgia. "Sinners," one of the year's biggest movies, was made in Louisiana.

But there's a clear trend in international production, driven by lower labor costs and tax incentives. Production spending in the US fell by 28% between 2021 and 2024, but rose just about everywhere else. "Thunderbolts," Marvel's most recent movie, is also set to be the last one filmed in Georgia for the foreseeable future — most of Marvel's production has moved to London.

So what would Trump's plan do to correct that? No one seems to have any clue.

"Hollywood studio executives scrambled Sunday night to determine what the announcement would mean for their business," The Wall Street Journal reports. "As is often the case with Mr. Trump's declarations on social media, it was not entirely clear what he was talking about," The New York Times deadpans. Stocks of studios and streamers like Netflix and Warner Bros. Discovery were down Monday morning.

If you take Trump's post at face value, it does indeed pose all kinds of questions. Like: Would the tariffs apply to American-owned/produced movies, or to movies from studios all over the world? Would it apply to American productions that are mostly filmed in the US but have some scenes shot in other countries? What about movies where some postproduction work, like visual effects, is handled outside the US?

And at the most basic: How, exactly, do you tariff a movie or TV show? They don't arrive in this country via cargo ships or planes. US Customs and Border Protection doesn't sign off on their import.

My sneaking suspicion is that Trump doesn't know, either. It's just that he seems to think tariffs are the solution to just about any problem.

Otherwise, if Trump were truly concerned about encouraging more domestic film (and TV) production, he might go about it the way just about everyone else does: with tax breaks and other financial incentives.

Which, it turns out, is exactly the pitch Trump heard from the actor Jon Voight and his manager, Steven Paul, this weekend, per Bloomberg. Voight — one of three actors Trump said earlier this year would be his "special ambassadors" to bring back work to Hollywood — and Paul spent time with Trump at Mar-a-Lago, and suggested a pretty normal plan, Bloomberg says: "more federal tax incentives for US film and TV production," which involves "expanding existing tax credits and bringing back ones that have expired."

Voight and Paul didn't propose tariffs, Bloomberg reports. But Trump did. So here we are. Let's see if it goes anywhere.

• You probably don't spend much time thinking about Apple's App Store fees.
• Apple does: The fees are a major part of the company's revenue, and it has been fighting efforts to cut into them around the world.
• A new ruling from a federal judge may cut into them. If it holds up, it will be a major change for Apple.

A federal judge just slapped Apple around: Yvonne Gonzalez Rogers said Apple was in "willful violation" of a 2021 ruling she had made, and that she would refer the company for a possible criminal prosecution.

That's pretty newsworthy. But what about the rest of Rogers' ruling?

Well, that could be pretty newsworthy, too.

It's possible that this could finally be the thing that fundamentally changes the way Apple operates its App Store — an increasingly key source of the company's revenues.

Or, it might not.

Let's review.

This week's ruling comes out of a court battle between Apple and Epic Games, the company that operates Fortnite, that started back in nearly five years ago.

In a nutshell: Epic doesn't like that Apple requires Fortnite players and anyone else using iOS devices to make in-app purchases via Apple's homegrown App Store — and that Apple can pocket up to 30% of each transaction. In the summer of 2020, Epic deliberately violated Apple's App Store rules, which led to Apple essentially kicking Fortnite off of its iPhones and iPads, which led to the civil suit.

Epic appeared to have lost its fight in 2021, when Rogers ruled against it on almost all counts. But Epic did salvage one win: Rogers said Apple had to let developers like Epic tell customers that they could leave the app and head to another website, where they could make transactions without Apple's involvement.

This week's ruling holds that Apple violated both the letter and spirit of the original ruling and says Apple has to comply with it immediately. Meaning, in theory, that companies like Epic will be able to tell their customers using iPhones that they can get a better deal somewhere else, and that Apple won't be able to charge developers an onerous fee if that happens.

An Apple rep says it will comply with the ruling, but will also appeal it.

So on the one hand: This could be an enormous issue for Apple. If big players like Epic routinely convince customers to do transactions with them outside of Apple's app, it could cut into Apple's growing "services" business — an increasingly important part of Apple's income statement, as its core iPhone revenues flatten out. And it comes as Apple is facing similar battles around the world — the European Union just fined Apple hundreds of millions of dollars because of the way it operates the App Store in that territory.

On the other hand: As noted above, Apple will appeal Rogers' ruling. So it's possible that the buy-outside-the-App-Store option won't be an option in the US for long.

Just as important: What percentage of Apple users actually want to leave Apple's App Store to buy stuff for the games they're playing? We have no idea.

Perhaps a lot of them will be motivated to do it, since they can theoretically get more for their money if Apple isn't taking a cut for itself. Or maybe most of them won't want to deal with the headaches of jumping out of an app, pulling out a credit card (or asking their parents for their credit card), and making purchases on a different platform.

In theory, we're going to find out soon. Epic CEO Tim Sweeney says he will bring Fortnite back to Apple's App Store next week. It's not clear, however, if Apple has agreed to that. I've asked both companies for comment.

• If dire warnings about the impact of tariffs on the US economy come true, ad spending will crater.
• But so far, it's business as usual, says Smartly CEO Laura Desmond.
• One reason for that: So much ad spending has shifted over to digital, which is much easier to change on a dime.

How worried are US businesses about the impact of the tariff wars?

On the one hand: An increasing number of business leaders, like JP Morgan's Jamie Dimon, are warning about the risks of a recession. And retailers like Target and Walmart have reportedly told Donald Trump his policies could result in empty shelves in their stores.

On the other hand: Advertising in the US — an industry that's quite sensitive to economic swings — seems to be holding up. For now.

That's the takeaway I got from a recent conversation with ad veteran Laura Desmond, who has a pretty good point of view on the ad industry. That's because Desmond used to run Starcom Mediavest, a giant ad-planning business. And now she runs Smartly, a smaller business that focuses directly on digital advertisers, who tend to be more nimble and reactive to trends than those in traditional media.

Desmond says her clients are thinking about what might happen when Americans really see the impact of tariffs, perhaps in a month or so. But for now, they're mostly acting as if it's business as usual.

And when it comes to other big potential changes to her industry — like the potential for an actual TikTok ban, or government-mandated breakups of Google or Meta — there's even less appetite to break out the crystal balls.

You can hear all of my conversation with Desmond via my Channels podcast. Below is an edited excerpt of our chat:

Peter Kafka: It seems to me that your industry could be dramatically affected by US government actions. There's a theoretical TikTok ban-or-sell law that was supposed to start in January but has been delayed. The US government is also in court trying to force the two biggest ad companies — Google and Meta — to break up. But it doesn't sound like your clients are spending much time thinking about that.

Laura Desmond: It is business as usual for brands to be focused on their business, what they need to sell, how they need to build campaigns, have companies like Smartly orchestrate those campaigns, and focus on business, focus on the job to do. That is the state of play.

So people who are spending money on TikTok today are not coming to you saying, "Do you have a plan if TikTok goes away this summer?"

Were there conversations like that with some of our customers? Yes. Were they significant or dominant or overwhelming? No. And that's because our technology gives advertisers the opportunity to shift in real time if they felt like they needed to.

It's not like the way ads used to be, where you would buy months in advance, sometimes a year in advance, for television.

That's the era of Mad Men, and we are no longer in that era.

What about tariffs? I was listening to the Comcast Q1 earnings call. They were asked about tariff effects on their business and they said they hadn't seen any yet.

We have not seen any effect.

Even though I'm reading that manufacturing is changing and Shein and Temu ad spending has cratered. That seems like a real change.

Well, a lot of that has to do with the fact that there is very little shipping going on between China and the US right now.

But that seems like a meaningful change. One that would filter all the way through to all of your clients.

I think the next month to six weeks will be key to watch. You saw a couple days ago the big box CEOs from Walmart, Target, etc., talk about a real concern over shelves that will not be full because product will not be able to make it to the stores.

Digital spend tends to be more resilient because it's loved by consumers, they engage, it's trackable. You know what a purchase looks like, where it comes from, and how it occurs. And so you can make more precision decisions about where to put the next dollar, or what creative will work.

And with so much digital spend now commanding the budgets of big brands and even medium-sized brands, you look at them continuing to spend.

But the next four to six weeks will be a big decision point. Because if there's no product on the shelves, then that's gonna change anybody's advertising campaign. And it should.

What about the notion that consumers might not feel as good about spending under current conditions?

All indications right now are that consumers want to be resilient, too. And while sentiment is going lower and lower by the week, [consumer] spending that our clients are telling us about is staying solid.

Does anyone come to you and say, "We're still spending, but we're gonna pause a little bit," or, "We're going to delay a decision for a week or a month because we want to see how this shakes out?"

I think there's scenario planning that largely is happening now that will be kicked into gear, if it needs to, over the next four to six weeks.

But the point on consumers is important. If interest rates go back up, that is going to cut into pocketbooks. That's going to cut into people's ability to feel like they can purchase one more thing or have one more experience or take one more trip. And that will directly impact advertising.

Some of the data that I've seen predicted digital ad spend to grow around 12% for 2025. And we haven't seen a lot of down-ticks to that. Maybe a point or two.

But if tariffs really kick in across the board, as sweeping and as large as what we've been hearing, you could see advertising forecasts drop as much by 50%.

That's five-zero. And that includes digital, right? Digital does not get out of this unscathed?

Yeah, you could see it.

So day-to-day, then: Do you just go say, "We're just plugging ahead. We've got plenty of stuff to take care of — we just cannot spend much time thinking about what might happen in a month or a week?"

That's a CEO mindset. That is a focused mindset: Control what you can control, and do your best to scenario plan. Understand where you're going to spend your next dollar. Understand how you're gonna make your creative even more effective, so that it converts consumers and people engage.

That's what you do if you're a CMO. That's what you do if you're a CFO and you're CEO. And that is what we're seeing across the board.

• The president says polls published by The New York Times and The Washington Post, along with ABC, are "fake polls."
• He says those publishers should face "election fraud" investigations.
• That makes no sense. And maybe he doesn't mean it. But his recent track record of attacking media companies means we can't be sure.

Donald Trump doesn't like a new set of polls that show his popularity eroding. In a Truth Social post, he says the news companies that published them should face "election fraud" investigations.

This is the kind of thing Trump has said many times. Up until recently, it was easy to ignore. After all, it's certainly not fraud to publish a poll someone doesn't like.

Right?

Except, of course, things are different now: Trump is already suing The Des Moines Register, its owner Gannett, and the pollster Ann Selzer for publishing a poll he didn't like during the 2024 election.

Trump filed that suit after he won the election last year, but before he was sworn in as president in January. And since Trump's inauguration, Brendan Carr, Trump's choice to head the Federal Communications Commission, has announced probes into Disney and Comcast over their diversity, equity, and inclusion practices.

Carr has also opened an inquiry into an interview that ran last year on Paramount/CBS's "60 Minutes" with Kamala Harris. That's theoretically separate, but quite parallel, to a lawsuit Trump filed in 2024 over the same interview. That story got new attention last week when Bill Owens, the top producer at "60 Minutes," said he was stepping down because he'd lost his editorial independence. Subsequent reports said Paramount's owner, Shari Redstone, who wants to sell her company to Larry and David Ellison, had been weighing in on programming at the show and CBS News in general.

So. On the one hand, you'd be excused for ignoring a social media post from a president who says things on social media and elsewhere that he may not actually mean — or may mean at one point but then decide that he doesn't mean, after all. (Trump now says that his promise to solve the war between Russia and Ukraine on his first day in office — something he brought up dozens of times in 2024 and 2023 — was actually made "in jest.")

You might also point out that even if Trump is serious, it's not clear which federal agency or official could carry out his wishes. While Carr theoretically gets to weigh in on the likes of Comcast and Paramount because they own broadcast licenses, the FCC doesn't have any oversight of the Times or the Post. (I've asked both Carr and the White House for comment.)

But one thing we are learning about 2025 is that things Trump writes or says — even if they are illogical or impossible — sometimes get turned into action, anyway.

If I'm running a media organization — or simply someone who thinks the federal government shouldn't be threatening media organizations because it doesn't like what they publish — I wouldn't brush this off completely.

• The companies that sell you internet access — think Comcast or Charter — want to sell you phone service, too.
• And guess what the phone guys want to sell you? Yup: internet access.
• This is good for you because you get more choice. Is it good for the cable and phone guys?

Most of you get your broadband from one company — probably from what used to be called a cable company. And most of you get your mobile phone service from a different company — probably from what many of you still call a phone company.

Guess who would like to change that?

Time's up! The answer: The cable guys want to become your phone company. And the phone companies want to become your broadband companies.

This is good news for consumers, who traditionally haven't had much choice when it comes to wireless providers, and even less choice when it comes to broadband.

Is it good for the broadband and wireless companies? We don't know yet. But we do know they are beating each other up, quite a bit.

Background: For the past few years, broadband companies — think Charter or Comcast — have been trying to sell their customers mobile phone service as well. (Both Charter and Comcast are essentially selling rebranded access to Verizon's mobile networks.) And at the same time, the phone guys like T-Mobile and AT&T have been trying to sell their customers broadband service, through what's called "fixed wireless" — internet service that gets beamed into your house via a box you put in your window, instead of cables buried in the ground.

You can understand the logic behind both pushes: For starters, it offers both industries the possibility of new revenue streams as organic growth stalls. There's also the thought that customers who get both broadband and wireless from the same provider are less likely to churn out.

It's also happening as most of — but not all — the cable guys have become less interested in selling you what used to be called cable TV, because that business is eroding every day. Meanwhile, the telcos, which have taken stabs at becoming video/content companies — see AT&T's brief ownership of what's now called Warner Bros. Discovery, and Verizon's brief ownership of AOL and Yahoo — have decided they don't want to be in those businesses, either.

Meanwhile, both industries are growing at the expense of each other. Analysts at MoffettNathanson say the mobile industry has signed up 12.7 million fixed wireless subscribers as of the end of Q1 2025 — up from 11.8 million 3 months earlier. During the same time period, the cable companies have grown from 18.2 million phone subscribers to 19 million.

And if you want to see what that means for a particular company, check out Q1 earnings reports from Comcast and Charter — the two biggest cable/broadband companies in the country this week. Both reported declining numbers of broadband subscribers, and boosts in their wireless subs.

• Imagine making an extra $8 billion and not really caring about it.
• That's Google, right now: The company says the value of one of its investments increased by $8 billion this quarter, but won't say which one.
• I have some ideas.

Most companies would make a big deal if they found an extra $8 billion in their couch cushions.

Google is not one of those companies.

Tucked away at the bottom of Google's earnings' release Thursday is this note bit of accountantspeak: "OI&E of $11.2 billion for the three months ended March 31, 2025 included an $8.0 billion unrealized gain on our non-marketable equity securities related to our investment in a private company."

Translated: We invest in private companies and one of them is worth a lot more now than it was before, so we're noting that here.

On the one hand: Even for Google, adding an extra $8 billion of paper profit matters. It helped push the company's net income to $35.5 billion in the last quarter, up from $23.7 billion a year earlier.

On the other hand: No one seems to care. At least on Wall Street, anyway. I just listened to Google's earnings call and there wasn't a single question about the $8 billion. No one seemed remotely interested to know which of Google's investments had just zoomed up.

That makes some sense. If you're in the business of analyzing Google, you want to know what's happening to its core business — selling ads. The fact that an unrelated business it took a flyer on is worth much more doesn't really figure into your analysis.

Also, the analysts likely figured that Google wouldn't say anything if they asked, anyway. Which is what happened when I asked Google comms to shed some light on that gain — specifically, which company they were talking about.

But I care! So I did some quick looking around and came up with four likely suspects that Google has invested in and which have gained value:

Anthropic. Google owns a reported 14% stake in the OpenAI rival. And Anthropic's value, like other AI platforms, has been rocketing recently. At the end of last year, a funding round valued the company at $41 billion, per Yahoo's private company tracking service. But a new round valued the company at $61.5 billion in March 2025.

SpaceX: Google invested in Elon Musk's rocket company — making a $1 billion investment, along with Fidelity, in 2015. A funding round in late last year valued SpaceX at $350 billion. Its valuation the year prior was $175 billion.

Databricks: This is one of those companies that no one outside of Silicon Valley knows about, but people in tech are definitely tracking, because the analytics platform also has a crazy funding trajectory. At the end of 2024, a $10 billion funding round valued the company at $62 billion, up from $43 billion in the fall of 2023.

Stripe: This one's a bit of a wild card. The online payments company has been enormously valuable for a long time, and is a perennial IPO candidate. But Stripe also doesn't seem that interested in going public anytime soon. Its valuation isn't driven by funding rounds, but by secondary sales that let existing investors and employees cash out. The value of those deals is up and to the right, too, though: The most recent ones reportedly peg Stripe's value at $91.5 billion, up from $50 billion a couple of years ago.

• Europe has fined Apple and Meta $800 million for violating antitrust rules.
• The Trump administration had already warned that it won't let Europe push around US tech companies.
• On the one hand, maybe Trump will back Big Tech against the EU. On the other hand, Trump is causing plenty of pain for those companies himself.

The European Union has fined Apple and Meta a combined $800 million for violating antitrust laws.

Is that a big deal?

On the one hand, not at all.

If Apple and Meta end up paying the fines — both companies say they will appeal the rulings from the European Commission — the financial impact will be minimal to the tech giants' bottom lines. Apple generates $93.7 billion in profit a year; Meta does $23.9 billion.

On the other hand, both Apple and Meta are positioning the judgments as fundamental attacks on their businesses. Meta even argues that Europe is attacking America itself.

"The European Commission is attempting to handicap successful American businesses while allowing Chinese and European companies to operate under different standards," Meta comms and policy head Joel Kaplan said in a statement Wednesday.

Apple also weighed in: "Today's announcements are yet another example of the European Commission unfairly targeting Apple in a series of decisions that are bad for the privacy and security of our users, bad for products, and force us to give away our technology for free."

The specifics of Europe's complaints about Meta and Apple have to do with the Digital Markets Act. Those rules are meant to constrain the power of giant tech companies — meaning US companies.

In Apple's case, Europe is fining the company because it says it's not complying with rules meant to force Apple to open its powerful App Store to competition. In Meta's case, Europe says the company didn't offer a version of its services that uses less of consumers' personal data.

Both complaints preceded Donald Trump's second presidential victory. But both Apple and Meta are clearly hoping that Trump sees them as something that can be negotiated away as part of his administration's tariff wars. Something like "Europe drops these charges against US tech companies, and the US cuts back on the 20% tariff it's planning to levy on Europe."

At various times, that has seemed like something Trump and his team are interested in pursuing. Like in February, when Trump issued a memo, written with Europe in mind, vowing to "defend American companies and innovators from overseas extortion."

And there's speculation that the EU, which could have fined both Apple and Meta up to 10% of their total annual revenue, came down with much smaller fines because it didn't want to aggravate tariff tensions.

Except … that same Trump administration has been causing headaches of its own for Big Tech companies.

Its on-again/off-again tariffs could cause the price of Apple products to skyrocket, depending on how or if they are implemented. They could also damage Meta by cutting off billions in ad dollars from Chinese companies.

More to the point: The US government itself is currently in court against Meta, arguing that the company should be broken up because of antitrust violations.

It's a pretty baffling set of contradictions. Perhaps the most generous way of interpreting them would be something like: The White House wants to keep Big Tech in line — but it wants to do it itself.

As we've learned, trying to predict what the Trump administration is going to do about just about anything — and especially on trade — is a very difficult task.

On Wednesday, for instance, markets are surging in part because Trump just signaled that he's going to soften his approach to China. But maybe that will be different Thursday or next week. So it's certainly too early to tell what Wednesday's actions mean for Big Tech will ultimately mean.

• Roblox is an enormously popular digital playground with a very young user base. It's worth some $40 billion.
• A key challenge for Roblox CEO David Baszucki: figuring out how to police a user-generated content platform where many users are under 13.
• It's a tricky question. How much responsibility should Baszucki have for kids' safety and behavior on his platform — and how much should parents have?

Do you let your kids play Roblox?

Many, many parents do. The gaming platform has a huge audience — some 85 million people visit it daily — and about 40% of them are under the age of 13.

But Roblox's youthful user base is also a question mark for the company. Some people worry that the platform, which hosts millions of user-generated games and encourages kids to chat with each other, is an attractive target for predators. Others simply worry that there isn't enough oversight at the giant digital playground, which allows kids to play everything from dress-up games to ones that mimic school shootings (Roblox recently shut one of those down).

Meanwhile, Roblox is trying to convince investors — who currently value the company at $40 billion — that its future growth will come from older teens and adults.

It's a complicated question for Roblox CEO David Baszucki, who co-founded the company back in 2004 and launched it in 2006. On the one hand, Baszucki is trying to convince regulators and parents around the world that Roblox is safe because his company spends a lot of time and effort policing the platform; on the other hand, Roblox owes its success to the fact that it's a platform — just like YouTube, or Facebook, or TikTok — whose users decide what they want out of it.

I talked to Baszucki for my Channels podcast, and our conversation ended up touching on a wide range of topics, including the company's relationship with Apple and Google, and its approach to intellectual property. This edited excerpt focuses on Roblox's double-edged age issue:

Peter Kafka: Roblox has a big, young user base. You get a lot of criticism about it. Sometimes the concerns are about grooming on the platform. Some parents just think the games are uncouth or just don't like the idea of kids talking to other kids in an unregulated way. Has your thinking about the issue of kids on your platform changed, or has it been consistent since you started?

David Baszucki: I think in retrospect, when we think about starting the company for all ages, 18 years ago, we're very glad we did that. It was a really hard thing to do. It's much easier to build a gaming platform that's 13-and-up, which is where many social media apps are today.

And when something's built for 13-and-up, it can create a situation where you don't go straight after the real big challenges. For us, literally in the first few months of being live, we started building our first safety systems and made it a top priority. There was a time when the four of us who were the Roblox founders were in the room moderating. Each one of us took a day.

That has evolved over the last 16 to 18 years to the development of over 200 AI systems, automatic filtering of all text on the platform, automatic filtering with human supplement of all images on the platform. I would say over time we have gotten better, better, better, better, better. [But] any single issue for us is one too many.

And we do treat any issue as one too many, but we're very optimistic that we're going very much in the right direction and that the value of embracing this prevents what happens when 8, 9, and 10 year olds are on a 13-and-up platform that doesn't have these same ways of maintaining safety and civility.

So it's a hard challenge. We've embraced it.

Do you feel like the perception of the brand has changed over time? I can talk to my coworkers who've got young kids, and they say, "I don't want my kid to get on there. I want them to stay on Minecraft. I'm worried about Roblox." And they might not even be able to articulate what their concern is, but they've just heard it's bad, or they're worried about it. Does that filter back to you? I'm assuming you guys are hearing that all the time.

We take that very, very seriously.

What we have seen over the last four to five years — so many parents recognize the benefits and differences between a 3D connection platform versus maybe a social media platform where you're watching videos or you're sharing pictures of yourself.

And during COVID many, many, many parents around the world said, "Oh my gosh, this is a way for my kids to stay in touch with their friends" in a way parallel to maybe when I was younger on a rainy day, I used the telephone and I'd call my friend up and we'd hang out on the phone for half an hour. People are doing that on Roblox right now.

I feel there's a general recognition in society that connection is a positive. We see it all the time on Roblox. And I do think parents are getting more savvy about that type of connection versus short-form video by yourself or getting catfished by sharing your picture on a social media platform. Once again, we take everything very seriously, but the vast majority of parents we run into are very supportive of our platform.

You talked to the BBC recently and you were quoted saying, essentially: "If you're not comfortable, don't let your kids be on Roblox."

On the one hand, that totally makes sense to me. I'm a parent, I get the logic of it. On the other hand, I could imagine parents saying, "Wait — you're putting all the responsibility on me and you've built this platform. Isn't it your responsibility to control this thing?"

I would put a bracket around that single statement. And that bracket was a dialogue we were having around just so much we do, because we know not all parents are able to get on the platform with their kids and set parental controls. There are many parents who are so busy in their life — they hand their youngster an iPad and say, "Go play Roblox."

So we have to be ready for the parent who isn't able to be involved. And we have to be, I would say — even from a company values and moral responsibility — driving the vision on that to be a great place for civility and optimism.

In the middle of all of that we do, I would say definitely to parents: "We're doing a lot, like we're gonna focus on it whether you're an involved parent or not. If you're uncomfortable with your 12-year-old in any situation, whether it's Roblox, whether it's the community pool, whether it's the playground, whether it's anything … we stand behind you."

There's a debate going on now — it's really between Apple and Meta — about who should be responsible for determining how old a user is. Where do you come down on this? Should this be managed on the device level? Should it be the application?

We would love it if every device in the world said the user of this is exactly 11.2 years old and it's been validated. The reality is we can't wait for that. And the reality is we're not sure if and when we will have that.

We've taken the notion that we will get better, better, better, irrespective of that. And if we get a signal like that, we will welcome it. We are leaning into our own age estimation. We are leaning into, I think, a really interesting area, which is not just 12-and-under, but the 13-through-17 area. And the 13-through-17 area is — independent of age estimation — very sensitive because that's a very sensitive part of the life of young people.

And in most platforms right now, they can chat unfiltered with whoever they want. A lot of things happen in that area.

So I think we're moving to a point where, for older people who we know who they are — you could imagine you and I are going to play poker and we're going to talk about whatever we want. We're going to not be filtered, possibly not be recorded, like let's embrace free speech and the laws of the physical world.

But for 13-through-17-year-olds, we're gonna be very thoughtful about who they chat with, and if and when they get to know who that person is in the real world.

• The Supreme Court told Donald Trump to bring back a man his administration has deported to a prison in El Salvador.
• It doesn't look like Trump is going to comply — or even try to comply.
• Checks and balances among wings of government are built into the US system. What happens if that breaks down?

The Supreme Court has told Donald Trump to do something. It looks like he's not going to do it.

What happens next?

And by next, I mean two things:

Most immediately: What's going to happen to Kilmar Armando Abrego Garcia, the Salvadoran national the US says it mistakenly deported to a notorious prison in El Salvador?

But really, what's going to happen to the United States?

Because we have entered uncharted waters: The president, who is supposed to govern alongside Congress and the court system, now appears to be acting with next to no constraints.

I don't want to get into the weeds about the Abrego Garcia case, and the US government's conflicting explanations about why it sent him to El Salvador and why it says it can no longer get him back. I also don't want to debate the merits of Trump's mass deportation campaign (I think it's awful; many Americans feel otherwise).

But I do want to underline the big picture: We're supposed to live in a country with a system of checks and balances. And right now things seem very unbalanced. Donald Trump is doing mostly what he wants to do.

Some of what Trump is doing is a super-charged extension of what presidents have been doing for decades — expanding powers originally meant to be at least partially the domain of Congress, and relying on executive orders instead of trying to get congressional sign-off. (Punchbowl News, on Tuesday: "Trump has signed fewer bills into law at this point in his presidency than any new president taking office for the last seven decades, according to government records.")

Ignoring court orders is a completely different ballgame, and a very rare one, as many legal scholars note with increasing alarm. That's why people who say Trump should do that, like Vice President JD Vance, have to go back to an 1832 case to find a precedent.

It may also explain why Trump himself says, repeatedly, that he wants to obey court rulings — particularly from the Supreme Court, as he said last week.

But on Monday, Trump made it clear that he intends to ignore the unanimous Supreme Court ruling telling his administration to "facilitate" the return of Abrego Garcia to the US.

The reasons for that stance depend on who's talking. Sometimes they argue that courts can't compel Trump to do anything that relates to foreign policy, as Secretary of State Marco Rubio said at a Monday press event in the Oval Office. Other times they'll say it's simply up to the government of El Salvador, as Attorney General Pam Bondi said at the same meeting.

In reality, if Trump wanted to comply, he'd simply tell Nayib Bukele, El Salvador's president — who sat next to Trump at the Monday event in the White House — to pull Abrego Garcia out of prison and put him on a plane to the US.

So here we are.

Again: Maybe you don't care much about what happens to Abrego Garcia, or anyone else the Trump administration wants to expel from the country. Maybe you like what Trump is doing.

But if we keep heading down this path, you're eventually going to find a place where Donald Trump wants to do something you don't like. Maybe he'll want to stop a deal you want to do. Something where you'd like Congress, or the courts, to push back, to create a counterweight — the system we set up way back in the 1700s, in place of a king. What happens if we abandon that?

• Donald Trump is suing some media companies. But he's also open to deals with them.
• That's the suggestion a Trump ally recently made to Warner Bros. Discovery, which owns a bunch of cable channels including CNN.
• There's no evidence that WBD has moved forward with that suggestion. But the fact that it has come up at all tells you a lot about the state of things in 2025.

Donald Trump has a long history of attacking media companies. But the man who spent years as a primetime TV star before he became president is also very interested in media companies, and the power and influence they may still have.

Which brings us to this New York magazine profile of Warner Bros. Discovery CEO David Zaslav, written by Trump biographer Michael Wolff. It says someone "in the Trump orbit" has made some suggestions for ways WBD could make Trump happy: Offer money, programming or both.

WBD confirmed that a company representative recently reached out to the Trump orbit seeking advice about how the company might advantageously interact with the White House and improve its Trump-age odor. The reported message was to look at the example of Amazon and Jeff Bezos paying Melania Trump $40 million to participate in a documentary about herself. Don Jr. might like a hunting and fishing show on the Discovery Channel, they were told. And that CNN could have more pro-Trump voices — suggestion provided.

This is one of those stories that would have been unimaginable in other presidencies, but certainly rhymes with what we've seen from Trump and moguls who want to be on his good side (see: the Amazon/Melania Trump deal referenced in the excerpt; along with payouts to Trump in lawsuit settlements from the likes of Disney and Meta). And indeed, a person familiar with the details of that anecdote says it's correct. (WBD declined to comment, and I've asked the White House as well — though White House comms head Steven Cheung has previously described Wolff as "a lying sack of shit [who] has been proven to be a fraud.")

There's no evidence that WBD has acted on any of those suggestions. But it's certainly worth noting that last summer, Zaslav said he was rooting for a president that would allow the media business to consolidate — something Joe Biden had opposed. And that the day after Trump's election last fall, Zaslav said he was hopeful the new administration "would provide a real positive and accelerated impact on this industry that's needed."

On the flip side, Trump is a frequent critic of WBD-owned CNN, and has sued the news organization — unsuccessfully — multiple times. And during his first administration, Trump's antitrust officials sued to stop AT&T from buying Time Warner, WBD's predecessor company. Media executives in and outside of Time Warner believe that suit, which didn't succeed but took years to litigate, stemmed from Trump's distaste for CNN; Trump antitrust officials insist that wasn't the case.

Meanwhile, Trump continues to make it clear that he both consumes traditional media and gets angry when it doesn't flatter him.

On Sunday night, following an episode of CBS's "60 Minutes," Trump posted a rant on his Truth Social complaining about CBS, and commanded Federal Communications Commission chair Brendan Carr to "impose the maximum fines and punishment, which is substantial, for their unlawful and illegal behavior." Carr is currently reviewing a pending sale of CBS owner Paramount, and Trump is already suing Paramount over a different "60 Minutes" episode he doesn't like.

• Apple CEO Tim Cook has navigated Trump's China tariffs before.
• Can he do it again? This time around, Trump is even more aggressive about punishing China — which Cook depends on to make his iPhones.
• One thing in Cook's favor: Apple is so big that the ripple effects from its tariff troubles could affect lots of people.

The tariffs are paused, except the ones that aren't. Which includes a whopping 145% for products shipped from China.

What does that mean for Apple?

Yes, lots of giant tech companies have deep ties to China, from Amazon to Meta to Tesla. But Apple is fully enmeshed in China, where it has spent years building up the supply chain for its iPhones, which are the company's core business.

If those tariffs stay in place, it could jack up the price of an iPhone by hundreds of dollars. Maybe more.

So now what?

Spoiler: No one seems to know. (An Apple rep declined to comment; I haven't heard back from the White House.) But if you're an Apple optimist, you are probably wishing for one, or both, of these plans.

Plan one: Tim Apple to the rescue.

After Trump's first election in 2016, Apple CEO Tim Cook basically wrote the playbook for business leaders hoping to stay afloat in Trumpland. He frequently engaged with Trump privately, never criticized him publicly, and was willing to play along when Trump wanted to use Apple as a symbol of Big American Companies That Are Coming Back to America.

That included keeping mum when the president falsely claimed that Apple had opened a MacBook plant in Texas during Trump's reign (the plant had opened years before, during the Obama administration).

And that work paid off when Apple got exemptions from the China tariffs Trump enacted during his first term.

Now Apple bulls are hopeful Cook will find a way to wriggle out again. They're especially buoyed by Trump's comments on Wednesday suggesting he will give certain companies some kind of tariff relief.

"Some companies, through no fault of their own, they happen to be in an industry that is more affected by these things than others," Trump said. "You have to be able to show a little flexibility, and I'm able to do that."

On the one hand, it would seem much harder for Trump to give Apple a pass this time around, since his administration has consistently talked about getting Apple to build iPhones in the US. Exempting Apple from some or all of his tariffs makes that even less likely.

On the other hand, Trump is consistently inconsistent. For instance, while it is engaging with China in a trade war and talking about the need for the US to stay ahead of China in the AI arms race, Trump's administration has reportedly given Nvidia its blessing to sell its top-of-the-line chips to China. Prior to that, Trump was reportedly set to halt those sales.

Plan two: The short-term end-run

Maybe Cook convinces Trump to give Apple a pass, or a partial pass. But in the meantime, Cook has been trying to give himself as much flexibility as possible, by reportedly shipping planeloads of iPhones — perhaps as many as 1.5 million units — from China and India to the US in advance of new tariffs. That would give him the ability to keep selling the current versions of iPhones at the same price, at the same profit margin, at least for a while.

But then what? Apple usually unveils, and starts shipping, new iPhone models in the fall. It's almost impossible to imagine those getting made anywhere but China, no matter how hard Apple scrambles to find extra production capacity in lower tariff countries like Vietnam or India. And those 1.5 million older model phones won't satisfy demand for a company that sells a reported 220 million phones a year around the world.

And … that's kind of it, as far as options go. Note that there's no real consideration of Apple building up a brand new supply chain infrastructure that's fully separate from China — certainly not in the short to mid-term.

Meanwhile, even if you don't own an iPhone and/or never plan on buying a new one again, Apple's iPhone dilemma is probably still your dilemma. Even if you don't own Apple stock directly, you are almost certainly exposed to it, because the $3 trillion company makes up a giant slice makes up a giant slice of the major stock indexes.

As journalist Patrick McGee notes: "If your retirement is invested in index funds, Apple is your single biggest investment."

The fact that Apple's stock price only dropped by 4% on Thursday — compared to 7% drops for Meta and Tesla, and 5% for Amazon and Nvidia — suggests that investors feel reasonably confident that Tim Cook can navigate this one. Maybe they're right. Then again, these are the same investors who were surprised by Trump's tariff rollout last week. I wouldn't feel confident about any of these outcomes.

• Donald Trump loves Fox News and Fox News loves Donald Trump.
• That's a long-standing symbiosis, rarely interrupted.
• But on Wednesday morning, Trump's favorite network pushed back on his tariff push. He changed course a few hours later.

Rupert Murdoch wanted Donald Trump to change his mind about tariffs.

So he communicated the best way he knows how: through Fox News.

That's the takeaway I got Wednesday morning when I saw clips of Fox programs raising the alarm.

Here's Steve Doocy on "Fox & Friends" relaying the story of an American small business swamped by China tariffs:

And over on Fox Business, here's JPMorgan CEO Jamie Dimon telling host Maria Bartiromo it's "likely" that the US is headed for a recession.

Let's spell out why it matters: Murdoch owns many media outlets. Some of them — notably, The Wall Street Journal — have criticized Trump at various times, including in the first few months of Trump 2.0. And Trump definitely sees some of that coverage (check out this photo of Trump reading Murdoch's New York Post over the weekend.)

But the Murdoch outlet that matters the most to Trump, by far, is Fox News.

He not only inhales Fox coverage but also has staffed his administrations with Fox hosts and people he watches on Fox. Which is one reason Pete Hegseth is now the secretary of defense. It's also why people who want to get in front of Trump get themselves booked on shows like "Fox & Friends," which is what the Meta executive Joel Kaplan did in January, to announce the company's pivot to Trump-friendly policies.

And generally, people on Fox say things about Trump that Trump likes to hear. (A notable exception: When Trump complained that the 2020 election had been "stolen" from him, Fox initially resisted that narrative, prompting Trump to pump up would-be Fox rivals like Newsmax, which embraced Trump's made-up story. Fox quickly pivoted back to Trump's narrative — which ended up costing the network nearly $800 million in a defamation suit.)

So it's notable to see any Trump pushback on Fox networks, period. After the markets swooned following Trump's tariff announcements last week, Fox generally supported the moves, or ignored them.

But on Wednesday, when I saw Fox questioning Trump's tariff war twice in one morning? It made me think there's a there there.

What effect did it have? Good question.

After consuming the Dimon interview Wednesday morning, Trump focused on (what he thought) was the upside of the chat: "'Fixing Trade and Tariffs is a good thing!' Jamie Dimon, JPMorgan Chase, Chairman & CEO, on Maria B Show!" he posted on Truth Social.

But a few hours after that, Trump announced that he was going to keep tariffs on China but pause them everywhere else, sending the markets soaring.

You can imagine a lot of reasons Trump may have changed his mind — most notably, a series of deeply negative indicators suggesting a freaked-out investor class. And there's no telling where any of this goes next. The thing I'm most sure about: He's going to keep watching Fox.