Aloha, and welcome to Hawaii Together on the Think Tech Hawaii Broadcast Network. I'm Keely Akina, and today we have a most fascinating guest. He's had a career that is just, I have to say, interesting. At one point, he flew helicopters for the United States President Bush, and then for President Obama. He retired as chief of staff of the United States Marines here in the state of Hawaii, and today he is involved in education. He's also worked for the Department of Education as an assistant superintendent. Our topic today is going to cover a great many issues, because Ray LaRue, whom I'm going to welcome in just a moment, decided that he would no longer be a private citizen but would throw his hat into the rink and become a political figure. So he decided to run for governor of the state of Hawaii in 2018. Well he didn't make it, but he certainly got his ideas out there, and people know him now. So I'd like you to welcome to the program with me today Ray LaRue. Ray, welcome. Good to be here, Clee. I'm just looking forward to this.  I know it's not a political issue. I know it doesn't have to deal with the future of Hawaii, but what was it like being the pilot for President Bush and Obama? Well, I get that question a lot. It was, first of all, it was a privilege, and the work itself was fascinating.  You have to be on call constantly. You're on call throughout the calendar. But you know, when you start looking at just the flying aspect of it and having the relationship with the first family that you're privileged to have and seeing the places that you get to go that the first family does travel to, but just from a pure piloting perspective or that part of the job, you know, when you're flying up the Potomac River, Clee, and you make that right turn at the Washington Monument, and you set up the land on the backyard of the White House that never got old. You know, you've experienced what it is to be a Marine in battle on the front lines, and you've also experienced administrative heights being a chief of staff. What was it like when you were flying for the president? Did you ever think that you might yourself someday become a political figure? Never. Not even remotely. But it all comes back to, as we were discussing earlier, you know, as you're groomed through the course of your career, the trajectory of your career, is leadership. And you start assuming different roles at different levels, and you almost matriculate into those leadership positions, and you look for the next challenge. So I think after I retired, and you altruistically try to give back to the community that you've chosen to be your home, and I think it was just a natural progression for me to end up in that as the next step in how do I take, you know, what I've learned and the jobs that I've had, the capacities that I've had, the leadership roles that I've had, and take that to the next level. In observing President Bush and President Obama, you were able to see a transition of power. Were there any lessons you learned, even from your vantage point? The lesson I learned is that it's a, you know, when you start looking at this country and how constitutionally it is arrayed, and that transfer of power, and you've got to look at that and bifurcate every single one of those words, what does that really mean? And to us laypeople that would watch that on television on January 20th on a sentient year, it really doesn't happen, you know, in the ceremony after the EO. There's a point on the clock that that transfer of power is in full effect, and that brings it all the, all that that has to bear on that person that is sending into that role, and it's actually quite fascinating. Well you've certainly earned your retirements from a good many careers, and you've chosen Hawaii to be that place. You could be walking on the beach enjoying sunsets with your wife, and doing all the retirement activities, but you decided that you would put yourself in the public eye, and you decided you'd run, not only as the candidate for governor, but as the Republican candidate for governor. What went into that thinking? What motivated you? The motivation was, you know, somewhat altruistic, and I don't want to be Pollyanna-ish about it, but after working in the state for the years that I did, and specifically within the Department of Education, and that's my passion, but you know, when you started to look at the state of the state, and certainly public education is one of those areas where I think we as citizens of Hawaii really need to pay attention, but as you can't wake up any morning and not read the paper or listen to the news and understand that the issues that face Hawaii are not getting any better, or they're not finding the courses of action that are going to bring us to some sort of solution to these things, and as I looked at what the candidate field for this particular November's election and all of the offices that were being sought after, I didn't see any notable or meaningful solution that was going to bring change into some pretty prolific issues facing our state. In other words, to me, it looked like we were just going to cast a vote for the same old, same old or a very, very, you know, uninventive solution to addressing some of these issues that are driving folks away from Hawaii. It sounds like back then you couldn't find somebody on the ballot whom you could wholeheartedly vote for, so you decided to become that person. In a way of speaking, yes, absolutely. And there are many issues that you did address during your campaign. What was one that was really dear to your heart? Dear to my heart, I would definitely say public education. And when you look at our school system today, as it delivers public education, it's the 10th largest district in the country. It is the only state-run district in the country. It currently has an operating budget of $1.9 billion, a spread load over 257 schools, 185,000 students, about 20,000 employees. And then there's another billion on top of that that goes into the fringe benefits. So you're really looking at a $3 billion operating system. That doesn't even speak to the capital budget, which is a different part of money that goes to the facilities, new facilities, et cetera. You know all this because you were the assistant superintendent over facilities. This is a massive system. Huge. There must be certain benefits, economies of scale, from being so big, but at the same time there must be some inefficiencies that occur. I think there's a lot of inefficiencies. And let me just start with the capital side of things, or forget the operating budget, which is actually the delivery of public education, because when people look at the state of our facilities, forget what's happening inside them for a minute. And that's your first impression sometimes.  It could be a very top-performing school, but you don't know that because you're looking at the facade and you're making an assumption. The capital budget for our facilities, spread load over 257 schools, is about $450 million by any means. So that's a two-year budget cycle. That means divide that by two. So what's that about? $225 million per year going into 257 schools, repair, maintenance, new classroom buildings, new libraries, new cafeterias. Forget for a minute that you wanted to add a new build school to that. You can see where you're going to spend that money pretty quickly. Let's make the assumption that we trust the Department of Education right now. And the guy that's sitting in the seat I used to be a good guy, and there's no reason to distrust him or think there's malice. And he submits the budget to the Board of Education based on the requirements. The emergent requirements, the Department of Education said that it needs to spend safety and security, capacity, programs, and whatever they say is needed. That's furthermore, say, we trust the Board of Education that says, you know what, that looks about right, and they chunk it to the legislature for that process and that budget process, it'll come out on the back end with about the same amount of dollar spend for those facilities, but I would say almost 70 to 75% of the content project-wise is not what we have already just said. We trusted the DOE to tell us it's legislative work. In other words, and you know, God bless legislators because they want to do what's right for their constituents, but when there's scant resources to begin with, and we have become very, very good at getting to the 35% solution versus the 90% solution, we're going to end up in a stated decay, which I would say we're already there with regards to our facilities. You know, what I'm hearing from you is that the story is not just about a lack of resources. It's really not about a lack of money, but there's something underneath that, the way that money is being used. In fact, we'll talk perhaps in the second part of the program about a ballot initiative at the general election this year, supposedly to increase the money for the education system, but do you think money is the problem? I don't think money is the problem, well, specifically within the Department of Education because we don't know. If you sat through any of the testimonies of the department through some of the legislative process, either the Education Committees, the Finance Committees, Ways and Means Committees, the DOE sometimes has a very hard time expressing in those gross numbers, $330 million for that, $200 million for this, very large numbers. And you wrote a recent column with Randy Roth and the Star Advertiser in which you pointed out that it's the use of the money, it's the actual strategy in that matter. And the governance of that money as well. So when you've got a structure that is this big, that large, and a teacher, for instance, coming out of the College of Education just full of the passion that brought him into that profession in the first place, walks into their first classroom, already has selected the material that she thinks for that community and that grade for those kids, this is what I want to put in front of them. Yet he or she has no idea what the resources available to them are to provide for those kids in that seat. What I am suggesting is that when you look at this public education system, that kid in the seat is the focus of effort. That's the center of gravity and all the concentric circles that emanate from that kid in the seat are in direct support. Ray, you're obviously very passionate about this. And you have an idea as to what needs to be done. You have a view of Hawaii in a broader sense in terms of the cost of living here, which is driven in large measure by the economy, the government's role in the economy. You had some strong things to say about that in your campaign. I did. And if you look at our economy, and I think the economy drives everything, the cost of living, our school system, our homelessness issue. A lot of it can be the tentacles of our economy drive a lot of that. If, for example, let's just say the cost of housing, if we took housing out of the equation of our cost of living, it's not that unmanageable. With the advent of the big box stores like Costco and Sam's Club, it is not a very unreasonable task for family to put food on their family's table with those kinds of costs.  Add housing to that. And we have just become almost untenable with regards to how are you going to get your young people to stay here? What would you say is the fundamental problem with our housing? Availability at the levels where people's wage and the capacity for them to earn a wage lets them into that entry-level housing market. What do you think needs to be done? I don't think you're going to change that, because the market is not going to change. The market's not going to take a home that's currently valued at, I'll use easy math, a million dollars, and devalue that. The last time that happened, the economy crashed pretty significantly, and that's just an entirely different conversation. You've got to put more disposable income in people's pockets to be able to afford that. And that goes back to the functioning of the economy. Exactly. I'm sure you'll share with us in the second part of our program. Your ideas for small business, but for greater prosperity. But with regards to some of the, I think, key demographic populations within Hawaii that are having a hard time at that housing market, if we've got time, I'll just say that, we've got this Hawaii housing rental revolving fund within the legislature in this past session. They just dumped another $560 million into it. A lot of that was tax breaks for developers to build these affordable housing units, but affordable for who? If you take an entry-level teacher, they can't afford what we are defining as affordable. So why, and we're giving a lot of that money away in grants as well, instead of a revolving fund, which connotes that it replenishes itself, why don't we just use it the way that it was designed and provide either zero interest or very, very low interest loans for the deposit for people to get into these, sometimes the barrier. Ensure there are solutions if we can get to that. I think the barrier sometimes for families to get into a house or an apartment is that upfront costs. They could probably handle the month-to-month expenditure. And I'm making an assumption here. Well, we'll come back and talk a little bit more about housing. You've talked about education, housing. I know infrastructure. It's a big issue for you. And I'd like to get your views on the political scene in Hawaii as well, Ray. Absolutely. My guest today is Ray LaRue, former candidate for governor of the state of Hawaii. We'll be picking his brain when we come back and talk about the political climate in this state. I'm Kelea Akina with Think Tech Hawaii's Hawaii Together. Don't go away. Aloha. I want to invite all of you to talk story with John Wahee every other Monday here at Think Tech Hawaii. And we have special guests, like Professor Colin Moore from the University of Hawaii, who joins us from time to time to talk about the political happenings in this state. Please join us every other Monday. Aloha. To one of the guests. OK, here we go. Welcome back. We are on Think Tech Hawaii's Hawaii Together here every two weeks. My guest today is Ray LaRue. A lot of times, people look at the political landscape in Hawaii and just throw their hands up into the air and say, the incumbents are entrenched. There's only one party. There's no way things will change. Well, Ray LaRue is the man who said, I'm going to try to do something about it. And he's still active in doing so. We're going to chat with him a bit about what he has discovered here in Hawaii in terms of the politics of our land. Ray, you ran for governor. I did. You ran as a Republican. We'll talk about that in a bit. But you ran in a state which is absolutely Democrat when it comes to the hold on power in the Congress, in the House, in the Senate, in other institutions as well. What did you learn from that experience? I learned, and I didn't get into this with any kind of grand illusion that I was going to change that. And I knew exactly the landscape that I was embarking on. But when I, again, looked at the political landscape that said, this is a very blue state, I mean, even our congressional delegation is all one party. And certainly here in our own legislature to include our executive branch, it's for the most part all one party. Where I think that rips off the voter or rips off the citizen, and one of the chief reasons I decided to run on the GOP side is that I honestly believe in that two-party system, that beautiful dissenting voice that can have debate and look at two sides of an issue. And I really do believe as well that the Hawaii voter needs that option, deserves that option, should have a different opinion or a different set of ideas, a different solution set to the issues that face Hawaii versus the same methodologies that have been tried and not done so well either over the last six decades. You know, when we talk about two-party system, or even words like bipartisanship and so forth, they mean different things in Hawaii, because elsewhere, very often there's a 50-50 battle, or 40-60, or maybe 30-70. But in Hawaii, it would be like 99.5% to half a percentage in terms of a two-party system. How does that dynamic effect there being anywhere in the near future a viable two-party system? I don't know that we'll ever get to a viable two-party system, but we have to have that dissenting voice such that there is compromise that then matriculates into legislation being passed. The situation that I think we're faced with in Hawaii, where you've got one party making all policy, making all of legislative action, is actually a more detrimental situation, because I think the fracturing inside that governing body within the same party means that they're kind of fighting each other to get their own legislation passed versus the big ticket items that need to be passed and need to be voted on that are going to help the people of Hawaii are not getting looked at. If you look at this past legislative session, for instance, everybody came out and slapped each other on the back because it was one of the most progressive sessions that they've had in a long time. But what did they accomplish? What did they get done? To me, one of the more prominent pieces of legislation that should have come out of the 2018 session was the airport coalition bill, for instance, that failed for the third time even though the governor supported it. To bring a public-private partnership and the management of our airport rather than purely government. Correct. You've spent your life in government. You know what that kind of management is like. Now, we have one of the lowest voter turnouts in the nation, the lowest voter participation. Why is that? Is it because people are content with the government we have, or people have just decided there's no use to being part of the voting system? I think it's a little of both. And I say that because when you talk to people, they're as frustrated as anybody else. But you have this apathy factor as well. What difference will my vote do? Because it's the same nothing new will happen. Nothing's going to change. And you can look at there. That has borne out a little bit. But I think to get people excited about getting back into a voting booth and pulling a lever, you have to give them purpose. You have to give them reason. And we haven't done that as a state. They would kind of throw up the same old candidates that will do the same old method of governance, if you will. And nothing really does change. So we've kind of fed into that a little bit. If there was an excitement to get people into, and I fear that on November 6, it'll be one of the lowest voter turnouts that we've ever seen just because there's nothing exciting to get anybody into that voting box. And the way we vote today as well, a lot of it's mail-in. In fact, those ballots drop here very shortly. The dynamic of that has changed. And most people are just struggling. Two jobs, three jobs. They're not gonna take the time out to just get to a polling place, or maybe they've moved a few times or they're not gonna get a ballot mail to them. I don't know that the Office of Elections has done all it can do to get people energized to come and vote. I do believe there has to be almost a campaign in its own right, not just during a political season to get people out to vote, make it exciting again. What happened to civics in school, getting people energized at a very young level that you can make a difference, but it has to happen consistently and it has to happen en masse. You know, very often when candidates end their political campaign and don't succeed in moving on to a general election, they just drop off the map. You actually, I think, from my observation, have become even more involved politically and much more known in the public eye because there's an issue that you have kind of taken by the horns and that has to do with a ballot measure. Sure. Our voters on November 8th when they show up at the general election are going to vote on whether or not we will have our state legislature given the ability to add a surcharge to property taxes supposedly in the name of education. You've taken a lot of exception to that. I have, and I'll start with saying, you know, I'll erase the word surcharge out of your vernacular and just put tax because that's exactly what it is. It doesn't say that. No, it doesn't say that. It's extremely confusing and even on the ballot question as people will see as they vote this November or earlier in October, you know, it'll say investment properties that pertains to education, very confusing language, but it isn't. And if you look at the way that Senate Bill 2922 came out of the session and introduced the concept, then voters will have a choice on November 6th to either give the legislature two blank checks to either define what real investment property is and then define the amount that that would be assessed. Now, what's the basic problem? If we go ahead and pass this measure at the polls, what will be the consequence? The consequence would be that now the legislature, with the enabling legislation that still has yet to be written, will define what investment property is. When the bill went through the mill, and at first, you know, it's only gonna be offshore investors. If you and I were just living in California, but we had investment property on Oahu and it was assessed over a million dollars, we would be the taxable entity in that situation. When the bill came out of the session at the end of it without a hearing, a public hearing, that all got scraped out of the bill such that the legislature can then define through the enabling legislature what investment, just buying a home is investment. So it could have the full gamut of anything that is real property. In other words, you're saying that when the legislature conceived of this idea in the original language, the focus was on quote, unquote, taxing wealthy investors, but when the legislature passed the bill, that language dropped out. So there's no limitation on the legislature. It's as if we're giving them a blank check to tax the average homeowner. Now, are just homeowners affected? I've heard you talk a lot about how renters will actually be at the brunt of this. I think it's gonna be everybody. It could be people that own strip malls. How will renters be affected by this? For instance, if Kalia Hakina owns a four-story walk-up that him and you and your wife bought years ago as investment property and maybe give your kids something to hang onto, I mean, that is investment property. And you have a full complement of tenants that you care for and they love the relationship.  So therefore you're going to pass it onto the renter who's already struggling just to keep ends, meeting all the commitments that they have. So their rent will go up, which is gonna adversely affect their cost of living and their ability to continue to live in Hawaii. So in a sense, the target group that this measure appeals to or on behalf of, teachers, will be a group that is actually impacted because most teachers, I know, are either moderate income homeowners and they'll get affected by this bill or they are renters and they'll get affected by this bill, not bill, but this measure. This measure may actually make it harder for them to live in Hawaii. If it passes, it actually could hurt the very group that they're trying to assist. Okay, now that's the point that I wanted to discuss with you. What kind of political sense does that make? I mean, what's going on here? It makes no sense. The electorate. Yeah, it makes no sense at all, but people are very passionate, they're very empathetic and they do have an understanding of what a teacher's plight is with regards to the cost of living. But any professional, every profession in Hawaii has that same plight. I mean, if you have a young attorney that comes right out of Richardson Law School and gets a very entry-level job, not with a big firm, they're also in that income bracket that is struggling right out of the chute. When you listen to the opposition with regards to the proponents of this measure, they would even come out and say, and they're on record as saying that there is not even a guarantee that this added revenue would be put into education. So it really is a blank check. It is a blank check. Calling upon us to trust our legislation. And the more dangerous thing that people don't think about, but you have to, and that's why all four counties have come out against us and even filed suit, is that in the last constitutional convention in 1978, a very well-fought battle gave home rule for property tax to the counties. That is the only source of revenues that the counties have to raise money to provide for essential services. So we'd actually be taking money and power away from our counties, which will ultimately hurt us in terms of fire services. They're borrowing power, yeah, all that stuff. You know, we've got a minute left. It's gone by so quickly. You've got a vision of how Hawaii could be. What is that vision? Well, that vision is certainly one where a parent does not have to worry if you are a parent that their children are not gonna have the same swing in the bat that perhaps they did, that they would stay on island, find meaningful employment, and meaningful employment that allows them to stay on island with a functioning economy such that that keeps on perpetuating itself. Otherwise, we are going to be losing our young people at a cyclic rate and one of the fundaments of a functioning growth economy is keeping your young base in place. Growth economy. Yeah. At our one industry economy, sometimes, fragile, fragile, tourism, then we've got military. But what do you think we could do? I think it absolutely resides in the tech sector. And if you start looking at the advance of technology, there's the mobility revolution that we're gonna be in the middle of and how nanotechnology and biotechnology, for instance, are going to influence everything that we're gonna touch in five years, maybe sooner. If you can write an algorithm for a task right now, that job is gone. So why can't Hawaii be in the front? We're not gonna be a manufacturing base, but we can be in the tech sector. So technology also pulls in the education sector, which are both like that. Why not have a think center in Kono? Very good. Well, Ray, thanks for being on the program today. Always enjoyable. We'll keep up the dialogue. My guest today was Ray LaRue, sharing with you some of the reasons that he decided to run for office. And those reasons are still there. And the conversation needs to go on. I'm Keeley Iakina on Think Tech Hawaii's Hawaii Together. We'll see you next time along.


We were at the Hotel Niko when Biggie them came when I was with her the night that Biggie got killed. Really? Yeah, we were supposed to be going to the Peterson Hotel over to the Peterson Museum and she was upstairs getting dressed. Genuine and Missy was in the limo and I went up to get her and Captain Shahid called and told me, man, don't come over here, Biggie just got shot. Yeah, we on Boss Talk 101. Yeah, I wanted to ask you, I seen somewhere where you, you knew Aliyah's uncle? Oh, yeah, yeah, I work Black Ground Records. I worked for Barry Hankison. I worked for Black Ground Records. And you when Aliyah died, you was with the uncle or you? Yeah, I was with him. Yeah. Explain to me how that how that was. When he when he got the when after Aliyah passed and the the insurance paid the insurance policy. And so I was doing a personal with Barry at the time. Okay. So I was his personal security when he got the got the settlement and he kicked back and his her mother had got a settlement too. She was I think she was in New York or I think she was in New York at the time. You know, so he got about $90 million for a day. Wow. You know, for royalties and stuff like that. Wow. So yeah. Yeah. And it had but it still was just just had to be tough on because that was so sudden. I remember when that plane, I guess they said it was over the load. Overloaded overloaded and it caused that plane to go down. Right. It didn't even hardly make it away from where they were. You know where they was at. Right. It was I don't know what I know. They was out of the country. They were in the Bahamas. Yeah. Yeah. Man, I was and she had such a bright future, but she did more than a lot of people ever doing a lifetime even when the time she was here. Yeah, she was amazing. She was amazing. She did movies. She did all kind of stuff. I'm a big fan. I love to go back and see our movies.  I watch them. We were at the Hotel Nico when Biggie them came when I was with her tonight. The biggie got killed. Really? Yeah. We were supposed to be going to the Peterson Hotel over to the Peterson Museum and she was upstairs getting dressed genuine and Missy was in the was in the limo and I went up to get her and Captain Shahid called and told me, man, don't come over here. Biggie just got shot. Wow. You know, and we had just saw him early and the atmosphere was like, man, do not come to Cali do not come when we saw him pull. He pulled up by two o'clock jumped out of the limo him and puffy and jumped out the limo. He had on a white walking suit and a white mink coat. He jumped out smiling Captain Shahid walked up to Captain Shahid, the captain of the West Coast of the Nation of Islam and cap walked up and asked Biggie, Biggie, you need any help? Biggie and these two are detectives. L.A. Detectives like Shahid Muhammad. Yeah, we got this. You know, don't worry about it. But if you look at it, Russell Simmons, Biggie, Spike Lee. Uh, death row records as long as the Nation of Islam was on detail. We didn't lose one. Wow. When they thought they were bigger than the nation, they start falling on.


Thanks everyone for being here. This is joint work with several friends and co-authors from Toulouse, Doshin, Yassine, Yassine Lee. And we started on this several years ago when I was visiting Toulouse. Again, I'm sad to say it's still preliminary, but I hope that with kids' vaccines over the horizon, I am soon in France finishing this up with them. So to motivate this paper, let me start with an observation. I think you can find many definitions and lots of sort of public interest in the idea of product ecosystems. Many of the big platform sponsors have them, right? Whether it's Apple's collection of iStar devices knit together by their software or the Android ecosystem, sometimes the definitions you find on the web are kind of built around user groups the way we often think of platforms, other times they're sort of built around devices. But I think it's fair to say that most of the multi-sided platform intuition that we bring to thinking about these ecosystems is based on models of platforms with two sides. So here's a collection of sort of seminal papers from the early to mid-2000s that build out that intuition. A second observation, sort of a related but slightly different starting point for this paper, is that the literature on platforms has a great deal to say about the cases of monopoly and competition, but a little less about provision of complementary inputs to a multi-sided platform. And so those two observations sort of beg a series of questions that you might think of as questions about complementary ecosystems. Things like how does the position of a device within an ecosystem, here you think of meaning a product network, how does it influence equilibrium prices and demand? Or what happens to prices and demand when complementary multi-sided platforms serve user groups that completely or partially overlap with one another? And those are going to be the starting points for our paper. We're also going to motivate it with an application and in some sense this is where we really began the process of writing the paper. We're thinking about overlapping complementary platforms and we're thinking about it in the context of licensing and specifically licensing as it applies to the the internet of things. So here's a way to build up the application that we're going to take with us all the way through the presentation today. Here's maybe a very stylized view of the 2G world. There's a monopoly input provider, think of it as Qualcomm. They own a bunch of patents that you need to use for CDNA. They license two downstream goods. So they provide an input into handsets and into network infrastructure and there are demand externalities between these two goods. The better the network, the more demand for devices that can use it, the more devices, the more the incentive to roll out a network that uses them. So this is a really familiar kind of notion of a platform. Now imagine we take this hypothetical monopolist into the world of the internet of things. In the internet of things there's still handsets and infrastructure but these wavy lines represent both the limitations of my ability with PowerPoint and the idea that there's network externalities amongst all of the downstream devices which extend from cars to electric meters to appliances in your kitchen and whatnot. To the extent that they all use the same radio interface, the owner of patents that read on the radio interface can charge a price to the handset provider and another price to the infrastructure provider and another to the cars and the appliances and so forth. We might be interested in how those prices internalize all of the downstream network effects amongst devices. And then lastly, because we're interested in complementary platforms, you might complicate this model in a somewhat realistic way and say, well, what if there are multiple owners of essential patents? So not only do we have Qualcomm but we also have say Ericsson licensing patents that are necessary to use the radio interface for all of these IoT devices. This is the setup that we're going to study in this paper. A set of providers of essential inputs to perfectly competitive set of downstream industries whose products have network externalities amongst them. I'll come back and talk about why this is or is not a great way to think about the real world of standard essential patent licensing but for now let's take the setup as kind of the motivation for the paper. So with that in mind, what do we do? We build first sort of a model of pricing in that kind of a world and the trick behind the paper is we linearize demand to keep the whole thing tractable. And then the first application of this is going to be what I think of as ecosystem pricing. We'll study the case where there's only one upstream input provider who's a monopolist and we show how prices and quantities are related to measures of network centrality. So this is a model of how do you set the prices for your device ecosystem. Then we'll add sort of more platforms and in that world we can study how sort of basically the Cournot problem. So we'll think about Cournot compliments for multi-sided platforms and in particular we'll sort of show that at least for a single device within that network you can kind of overturn the Cournot intuition. You can get prices falling as the number of complementary input providers increases. And then lastly kind of at the edges of what we've gotten finished for this paper we'll talk a bit about partially overlapping platforms. So a world where say you have two upstream providers that overlap on one part of the network but have monopolies on other parts of the the device network and there we'll show how they have incentives to sort of overextract rents from the shared device and that distorts us away from what we think of as the baseline prices in this model. So that's that's where we're going. So let me talk about the setup first the model and then we'll do the monopoly case. The competing or actually not competing complementary platforms case and then overlapping and then conclude. So the setup I think I hope is pretty simple. There's end devices or sides produced by perfectly competitive downstream industries with zero marginal cost. Upstream we have the platforms or the licensors in the general case there's M we'll start with K equals one. Each platform licensor holds essential patents for every device and charges P sub I super K to downstream sector I. So this is the device charged by platform K for inputs to produce device I. All right aggregate demand the total demand for each device is given by this linear demand system. There's an intercept device specific less the sum of the input price charged by all of the platforms that are licensing inputs to that device plus a set of demand externalities from device J to device I. Okay. You can express this in matrix form. Right so if you write it this way the vector of demands equals the device specific intercepts less the prices right here prices is an end device by M platform matrix was multiplied by ones plus the externalities. Okay. And so to make this thing stable so that there's no sort of profit pump kicking around in our demand system we have to assume that the largest eigenvalue of this entire matrix of downstream externalities is less than one and in that case you can write the demand system this way right it's the bring this the externalities over here and then invert this matrix pre multiply by the the linear demand system and there you have it. Okay. And then there's one more thing to to the set up before we get to actual results let me I'm sort of going to pre define the initial notion of centrality and this is something that we borrow from the literature on social networks. All right so Katz Banasic centrality here will denote it by C centrality for Katz Banasic an asset I'm not sure how to pronounce it is equivalent to the identity matrix less this thing a plus a prime over two inverted post multiplied by the intercepts so what is this thing one way to think of it is it is a fixed point or an eigenvector of the average undirected externality matrix so the average undirected externality matrix is just a plus a prime over two it's the inbound externalities from devices j to i plus the outbound externalities from device i to all the j's divided by two so you can think of it as you know sort of as though we don't care what direction the externalities are going in you know sort of we want the average strength of them as between devices i and j right that's what this matrix gives us okay that's a way and the dimensionality of this thing is n by one so every device has a Katz Banasic centrality a different way of thinking about this that you can pull from the literature on networks is that if we take this average undirected externality matrix call it b then a device's Katz Banasic centrality is its own demand intercept plus the value of all k step links to each device weighted by a what that means is you can think of a step as one multiplication by the matrix b right so we say the steps value is the value of the externalities inbound and outbound okay and so you have a one you can get to from one device to any other device by sort of a one step link or by taking two steps on the network or by taking three steps on the network or four out to infinity okay so weighting those steps by the demand the kind of baseline demand for each device that gives you this geometric sequence okay and this geometric sequence will converge if the biggest eigenvector of b is less than one and that's Katz Banasic centrality okay so this is something that shows up in the literature on social networks the literature on pricing on networks it's going we'll use it immediately all right and I think that's all we need for setup let me stop many clarifying questions about the setup okay then first result okay in this world what's the prices charged by an ecosystem monopolist right an ecosystem monopolist the upstream think about the the slide with you know one license or licensing many devices it sets prices equal to this expression one half a plus one quarter a minus a prime post multiplied by the Katz Banasic centrality vector and the equilibrium demand at those prices is one half the Katz Banasic centrality vector okay a bunch of remarks about this then how do we think about it what does it mean there's three parts to each price there's the baseline okay one half a that's exactly what you would get in the simplest you know monopoly linear demand no network effects kind of model okay this vector of prices then there's two pieces that are really familiar going on in the deviations or distortions away from the baseline price one is value extraction okay so one quarter times this a matrix which you can think of as an upward shift in the demand for each device because of the network effects from the other devices in the ecosystem feeding back into it right post multiplied by centrality and then there's an externality internalization that's a mouthful an internalization effect which is minus one quarter a prime right so you subsidize devices if they produce a lot of outbound network externalities that increase demands for other goods in the downstream ecosystem and again post multiplied by the centrality measure okay so that's basically the decomposition of prices first result I mean this shows up in the the various papers on two-sided platforms or you know kind of a next next comment rather than first result is that symmetry means we just get the baseline prices right so if the externality matrix of the ecosystem that characterizes the ecosystem is symmetric equilibrium prices are the same as you'd get in a model of independent goods linear demand monopoly prices second we go into some detail about this in the paper there's a link between what we do and Armstrong's model in 2006 right so Armstrong characterizes these distortions here in terms of these externality weights multiplied by demands or in fact utilities if you go all the way back to kind of principles in his paper you can see right away that our paper if demand is the same thing as one half of centrality okay substitute this into here this is the expression in our paper for the distortions away from the baseline price okay so our model of ecosystem pricing is essentially Armstrong we just express everything in terms of primitives here as opposed to endogenous care you know features of the environment like the demand for the other goods okay I think I've already said this but you know there are there are links that we build out in the paper to a literature on pricing on a network or social networks and games and lastly to sort of try and think about what in the real world this may give us some intuition for I think it's interesting to think about what might be central devices in a in a product ecosystem right maybe it's phones or things you know I'm interested in echo or nest these things that Amazon and Apple Google may be selling us to sort of try and sit in the midst of all the other devices and connect them together okay so let me now sort of provide three examples so we get a feel for how network structure relates to pricing all three examples are going to have the following kind of common features the externalities are going to just take one of three between any pair of devices will take one of three values new data or zero general think of new bigger than data we'll set all of the device specific intercepts to one and we'll define this term D is equal to the diff the positive difference between new and data okay so first example will be a star right what does a star network look like sort of graphically you can think of it like this there's one device in the middle that produces the big dark arrow externalities to n peripherals and each of the n peripherals produces small externalities back onto the star device i equals one and then there's no relationship amongst the star these two themselves okay in terms of the matrix there's a column of news here and there's a row of it eight is here and everything else is a block of zeros so that's a star network what are the prices you get from a star so for the star good you can see as long as D is bigger than zero you subsidize it and you subsidize it more the more peripherals you have and for the peripherals you can see we charge above the baseline monopoly price of one half and the extent of the markup you know kind of the rent extraction that you take on each of the peripherals depends on both D which is the this difference between our two parameters new and and the cat's banash its centrality of the star device team uh team before you move on uh david has a question uh it's in the chat with baby david can unmute and just ask about the central devices yeah it seems at least in the telecom application the central device might be the the network access like yeah there's any iot and to this example with the subsidy the hand it might be a model that's sort of another model explaining why people give away the handsets to that and an interpretation because the handsets provide a lot of create a lot of application usage on the network yeah i that sounds good to me um i i'll be you know to be honest i find it not a priori easy to know what this the central device is which is something we should think about a bit but i you know i kind of i think that interpretation sounds plausible um okay let me let me return to a couple more examples just to sort of give intuition here's a here's a different structure okay so in this structure there's n devices and they exist in sort of a hierarchy right so device number one produces the most outbound externalities okay device number two produces the next most outbound device number you know all the way down to n which produces the weakest outbound externalities and gets therefore the most inbound in matrix form it looks like this right so the first row the outbound externalities from good one to goods two through n um is a row of eight us then the second row has a mu and then some eight us and the third row has a couple news and then some eight us okay i think i said it backwards um but the math is right okay in this example one thing to notice is that um a a plus a prime is symmetric so that the cat's been asked its centrality of every device is equal right asymmetry and pricing comes only through the difference between a and a prime and not through centrality okay and what do you get out of it so you can derive the expression for each goods its price is one half minus d over four times this expression times centrality and this expression is um negative if n plus one is less than two so we subsidize the devices that produce a lot of outbound externalities and we exploit or raise the prices of those that produce few outbound externalities relative to inbound okay and uh every device gets a different price and then a last example this one i don't i can't think of a real world network that would look like this but i think it's useful for intuition imagine a ring imagine you know sort of a set of devices that are that are linked and sort of a ring structure where each one has one inbound um externality of size eta and one outbound externality of size mu and then you see these guys in the corner here make it a circle okay that brings us right back to sort of the baseline prices right so if the externalities are you know sort of if if there is a symmetry here turns out this is a ring type of a symmetry as opposed to a reflective type of a symmetry we often just get the baseline prices okay so let me you know what do we take away in general from these examples i think um we see this familiar trade-off between external extraction of rents and internalization of externalities that are that are there and two-sided pricing kind of models but we see the structure of the ecosystem in terms of externalities between devices matters through centrality um nevertheless we still seem to sort of the general intuition that you want to subsidize devices that produce a lot of positive externalities under other devices that that intuition still seems to hold and then in general symmetry sense pushes us back towards these the kind of baseline world okay so that's compliment you know so that's the baseline set up that's a monopolist now let's think about complementary platforms right remember this world this was our motivating example right so now we're going to we're in a world where there's just one upstream provider licensing or setting prices for end sides that were interrelated now let's add this second upstream provider okay and i promised i would say a few things about actual whether this actually applies to licensing um i think there's a tradition of papers that take a Cournot compliments type view of standard essential patent licensing there's good reasons for this one is that you know sort of if these firms own patents that cover sort of a radio which is sort of an ip that reads on many devices and they have to be used and all of the devices are going to communicate with each other then in some ex post sense all of those patents are known to be that they are complementary okay but there's also some reasons to be kind of cautious about pushing this line of thinking too hard in the real world most of these standard essential patents are subject to commitments to license at fair and reasonable rates which many people think is less than what could be charged by an unconstrained monopolist and they also say that the rates will be non-discriminatory which means that there might be sort of constraints on your ability to set the price for one device differently than the price for another device and you know sort of even if we did think that there were the patent provided like an unconstrained monopoly i think there's legitimate questions about whether the price itself is something that's negotiated subject to threat of an injunction on downstream devices which might give us towards this sort of unconstrained world versus reasonable rates that would be set by a judge and then who knows where these prices come from so all of this is to say we're going to contribute to a literature that views licensing of essential patents as a corno compliments problem but with being sort of cautious about taking our model to literally for a way that these kinds of prices are set in the real world all right so to get to what the model says we need to adapt our definition of cat's benesity centrality right so it turns out that the the network used to compute centrality when you have multiple upstream platforms is this you know so instead of a plus a prime over two right we have this expression that puts more weight on the outbound externalities associated with each device okay and here's how it factors into the symmetric equilibrium prices right so define lambda here is one over m plus one right in a symmetric equilibrium every platform is going to charge this expression lambda times a small a plus a second lambda times this difference which is exactly the same as in the monopoly expression times centrality defined according to this different matrix which puts more weight on outbound externalities than inbound externalities okay a couple of remarks about this right so these baseline prices lambda a that's the that's the solution to corno from 1838 okay that's the baseline that you get without any of this downstream externalities just a corno compliments okay oops the weight right in this expression you can think of these as weights m over m plus one and on this matrix one over m plus one the weight on outbound externalities here is in the centrality matrix is going to increase as you add more upstream monopolists right so the more severe the corno problem the more weight we put on outbound externalities I think the intuition for that is that the many monopolies problem leads to dissipation of inbound externalities right what does that mean inbound externalities you can think of them as sort of raising the intercept of the demand curve for any individual monopolist right so the output of other goods in the ecosystem is translated into more demand for the focal good okay but the more monopolist you put into the system right they're charging a rent themselves on each of the devices in the ecosystem and that's a downward shift in the intercept of the demand system right so the many margins problem um is going to dissipate you know sort of the inbound externalities on here right these are the ones that cause you to raise your price right and so our notion of centrality is going to put more and more weight on outbound externalities as in uh in the way we compute centrality okay but but for that you know so you can see that this is exactly the same expression we had for the monopolist but for two pieces right one is this corno term and one is the different notion of centrality all right extending the the comparison to corno a little further right we can say but the aggregate baseline prices right this is kind of the corno result m times lambda times a right this is what we would have absent these are the prices absent any downstream network externalities this expression increases in m right this is basically this part is m over n plus one which is increasing in m okay then an interesting question is for a particular device right somewhere in the downstream ecosystem could you flip that result right could you have some you know some device that gets cheaper uh as we add more upstream monopolists turns out the answer is yes okay and to to show that we use an example of what we call an augmented star network okay so this is it's a star network because we're going to have one device that sits in the middle and generates outbound and inbound externalities is in the prior star example but we're going to augment it by we're going to sort of increase demand for the star relative to everything else right we're going to set its intercept to beta bigger than one okay so theorem three in the paper core knot is that for the augmented star network when beta exceeds this value five thirds times root n minus one the total price of a peripheral device is smaller when there are two upstream monopolist than when there is one the intuition for this is the following right with this kind of augmented star network what the monopolist does is subsidize the star and extract rents on all of the peripherals we saw that earlier when we talked about the star network for a monopolist right they raised the price of all of the peripherals above one half and they dropped the price on the star to sort of generate aggregate externalities right when we go to two upstream monopolies you can think of both of those things moving towards the middle okay right so it's going to reduce its subsidy to the star device and it's going to reduce its rent extraction on the peripherals and for these parameter values that reduction in rent extraction will end up being larger than the increase in price associated with the basic multi margins problem right the corner effect okay and then again to link this back to applications i think it creates an interesting question think about internet of things patent pools right now we're we're starting to see patent pools forming up to license say cars and the next thing will be you know appliances or electric you know whatever right if you take the phones as already said new pools are forming to license different kinds of peripherals i think it's an interesting question for policy whether we should think about you know sort of platform pricing incentives in antitrust review of those pools just a clarifying question a couple of times you you mentioned when we have two monopolies so so just to clarify when you say two monopolies you mean like chrono with two firms right i mean chrono i mean input they each have them their monopolies in the input market not downstream throughout the the ecosystem throughout this paper is provided by perfectly competitive zero marginal cost producers of each device okay yeah because two monopolies is just something that doesn't often come up yeah i it sounds like i'm using terms that are oxymoronic throughout i hear you okay last this is sort of the last example kind of question that we deal with in the paper a bit thus far symmetry sort of both you know mainly symmetry on the network effects but also sort of symmetry amongst the upstream monopolists has tended to push us towards baseline pricing right so the bait where baseline is what you would get in either independent monopoly pricing of each downstream device or in a world which is equivalent to corno you know so the simplest linear demand corno what happens if we break the symmetry by allowing the upstream platforms to have partial overlap that is you know sort of they each have an input that they monopolize and you know sort of two inputs are required for some of the devices but only one input for others okay so consider a model where there's two upstream input monopolists and three downstream devices okay each of the upstream input monopolists is a true monopolist downstream on one device but they overlap on the other right i'm reaching for an example that i think is getting used in too many papers these days but think about apple and epic they both charge for gains but they seem to have exclusivity in other things right so epic has this graphics engine that apple doesn't sell and it licenses it to developers apple makes a phone or app store or whatever piece of the ecosystem you want to say you know pick and and they don't overlap in those areas right so that sets up the following kind of a problem right so there's a star device both firms charge for the star right um then each has its monopoly over one peripheral okay um i don't know if andre is on here but um another motivating example for this is a hbs case he wrote about a company called gree which i teach and i find pretty interesting i think gaming is a setting where you might find these kinds of partial overlap um right do you want to comment i see you unmuted i mean i can only say yes that is true um so in this example right just to simplify things let's let's actually make this symmetric even let's let's set mu equal to eta okay and what are the equilibrium prices it turns out for the star device the equilibrium prices are one-third which is the corno baseline price plus an additional markup right so that on on device number one the star we charge something above the corno baseline and then on these non-overlapping goods right we each charge what we would you know sort of the monopoly baseline um for a you know a good without a corno problem we charge a half okay so what's the intuition for this what's going on neither platform fully internalizes the externalities from subsidizing the star device okay we don't subsidize in some sense device number one sufficiently because when platform one lowers the price on the star device it's producing some externalities for platform two and conversely when platform two subsidizes the star device it's producing some externalities for platform one that don't get internalized okay so in some sense platform this is a in this example we see how partial overlap kind of exacerbates the double marginalization problem here right the aggregate price for the the star device where we overlap is even larger than it would be in a corno world without these network effects downstream okay and with that may conclude i think i got one minute left what we try to do in this paper is build a tractable model of complementary ecosystems with multiple upstream input monopolists and multiple downstream devices that are interrelated to each other through network effects and ask about how prices relate to not only the magnitude but sort of the structure of the downstream network externalities and out of that comes this sort of prominence of cats been asked such centrality and then we use it to to ask questions about how platform pricing interacts with double marginalization problems a lot of the tradeoffs that you see in the baseline monopoly case are familiar from the existing literature on multi-sided platforms i think that's good but again sort of i think our contribution is to create this link to centrality and i think when we get to a world with complementary platforms we have some interesting things to say about how you can get sort of perverse examples if you're thinking you know sort of that the corno problem always predominates right in particular we show that you can get prices for one side in any case declining with the number of upstream monopolist liars of inputs or you can show we can show how partial overlapped leads to partial internalization of externalities even when you know kind of the network effects are symmetric and so you can kind of get exacerbation of the corno problem as we saw in that last example and that's it i think i'm more or less on time and looking forward to the discussion thank you very much team this is this is excellently right on time so thanks for for measuring time so exactly now we'll have a alex white discussing before we open it up for general discussion alex okay uh can you hear me yes thank you very much are you are you sharing slides or not no slides okay no slides thank you very much to the organizers and tim when tim and i first discussed this talk about a month ago we had a little conversation about the paper he was talking about some issues of patent licensing and i asked him some questions and it turned out i was all wrong and then i looked at the paper and there's a lot of matrix algebra which i'm not very good at so it's the whole thing seemed at first kind of like oh jeez what am i going to do with this um and so i'm really pleasantly surprised having spent some time with the paper because in my opinion this is a beautiful simple model that illuminates the theory of i o and quite a fundamental way um and so you know i learned a lot but i plan to continue studying this paper and hope to you know expect to learn to learn more um just to put it in context um you know you start off with basic oligopoly theory corno the corno substitutes versus corno compliments and you know if you do a good job you study these two models and understand the the driving forces behind each one that leads uh when you go from monopoly in the direction of substitutes it leads prices to go down and when you go in the monopoly from from monopoly in the direction of compliments it leads prices to go up and as tim alluded to we've been spending years you know decades a couple of decades extending the sort of oligopoly model to the case where there are network effects and um summarizing sort of what we know about all the network effect competition with substitutes when you increase the number of firms on the one hand that causes market power of firms to go down so that pushes prices down but on the other hand there's a tendency under monopoly to to provide users with a discount to discount prices in order to internalize externalities and as you um add more substitute competitors the incentive to provide this externality discount goes down it kind of gets the discount gets divided roughly speaking by the number of um competitors um and so in particular there's a recent paper by Tan and Joe in the restud that um illustrates this point very very cleanly and one of the things that the Tan and Joe papers are their main result is the possibility of what they call the perverse pattern where if you take the price of equilibrium prices in a um in an oligopoly model with network effects and you increase the number of competing firms you might get prices to go up because the um reduction in the externality discount resulting from additional competition may outweigh the reduction in market power that comes from um additional competition and so what you know what you can see this model is doing is looking at the same question but going in the direction of compliments um at a very high level they're saying when you go from having a monopoly and Tim is using the word I think it would be clearer to use the word like components producers of multiple components or something like that rather than saying two monopolist three monopolist when you go from having centralized control with a single monopoly platform to decentralize control of the components in terms of pricing of course we get the one effect of double marginalization pushing prices up but we also get a stronger effect for prices to go down due to the externalities so as you increase the competitors the strength with which price uh externalities drive the prices down goes up and so it really has this very nice um almost symmetric relationship to the world of substitutes and that's sort of a good way to think about it at a high level um and to sort of convey how fundamental this is but at the same time it's a lot more it's a lot subtler and more interesting than just that I think Tim mentioned that the key for them to be able to move forward from a technical perspective is to linearize the demand um and by doing that they can even in the monopoly case so usually when you have a setup like this under monopoly taking uh maximizing with respect to prices doesn't really get you anywhere it's not tractable but under this linear setup it becomes tractable and they get this very nice decomposition of the network effects into um outbound and inbound externalities so that in and of itself seems to me is kind of as a bit of a contribution it's not really a new solution to a problem but it's a different it's a different view on a solution to the monopoly problem where there's this decomposition between outbound and inbound effects which people have been aware of but it's really the linearization of the problem that makes um that that kind of gets you over the over the hump and seeing what's going on and the key insight you get there um well okay so so then you go you go from that basic setup in monopoly to the compliments world and then you you see that the um the due to this decomposition when you decentralize control from monopoly to multiple compliment producers the force of the the relative force of outbound externalities increases compared to the force of inbound externalities so the importance of outbound externalities grows with the number of producers but the importance of inbound externalities stays the same so you get this nice um increase in the um in the weight of the externalities that's proportional to the number of producers which is exactly the mirror image of what we see in the substitutes in the substitutes world where where you also get something that's proportional to the number of producers but the effect is getting smaller and smaller so I'm very excited to try to understand these different forces better um they have nice examples um comparing the star network where you tend to you know assume positive externalities the hub you have this hub and spokes you can think about that way right so the in the star network the hub tends to get um discounted and the spokes are the the cash cows or they're the they're the ones that the sellers try to exploit um and that that all makes sense that's kind of a reality check whereas in the ring structure what they find is that the prices don't change compared to the no externalities case um a couple of questions minor questions there um is is that result about the prices not changing um purely due to linearity that would be interesting I suspect if you had a non-linear world you'd still get the prices the same the symmetric across the different um devices but that they wouldn't necessarily stay at the one half level so these are types of things that'd be interesting as robustness checks if possible but I understand that you have to be linearizing in order to make it tractable um but I think the sort of final bigger point I would make is can you go for a bit of a deeper result in terms of the um comparative statics on prices as you increase the number of complement producers because you're going for this thing where you where you looked for the possibility of a price drop for one of the devices um and you know a nice thing to notice about this is that we actually do have variable usage here right so in the tan and joe substitutes model in order to make the uh the model tractable they have to assume full market coverage so they can look at prices going up and down but no matter what happens to prices it's always you know a measure the same exact set of consumers who are consuming the goods but here in this complement setting you get for free the fact that as prices change for each device the usage goes up and down so could you come up with a relevant measure of aggregate usage and um you know convince come up with a convincing explanation or convincing justification for why this particular measure of aggregate usage is the right one or a relevant one and then look for conditions under which um as you add um go go for monopoly towards more complement producers the aggregate usage goes up as a result of this strengthened externality effect something like that would really i think make this paper extremely strong and very important you know it would help help um help build the the contribution of this paper so i probably henna i probably used up my time so well twice but uh but i'm sorry if you're if you're wrapping up you know i think it was worth it yes okay well thank you thank you very much um so i really enjoyed it


What is going on everybody? Welcome back to another video. I have a very special guest today. I'm sure you are no stranger to Luke Barus. We are here at the Content Creator Meetup in Salt Lake City. I have the very rare privilege of being able to talk with him and meet him in real life. It is a honor of mine. I promise you. He is a fellow data YouTuber. He is an ex Navy Submariner and someone I consider a friend. He is somebody who has hair that I am jealous of. He's one of the fastest growing YouTube channels in the data space right now. Our guest, Luke Barus. Thank you for being here. No problem at all. Thanks for having me on Alex. I was super appreciative whenever you told me about this. I'm like, yeah, I want to be on Alex there on this show. Like heck yeah, like get me on there. Throw me in coach. Well, you know, I just never get to like with my schedule. I never get to bring people on to my channel that often because either it's just really hard to schedule or like I work really late at night and no one's like wants to stay up to like 11 o'clock and do an interview. It's like most of my stuff. I only have like one interview on my channel. I think I don't even remember who it was. I only have like one. Yeah. It's like this is like a different style totally for me.  They've never usually talked to you. They're just like, Hey, would you do an interview? Right. And they ask like generic questions, which I've had a lot of those and I don't mind them at all because it's a lot of the same question. So hope I'm hoping to kind of get to know you as a person more and kind of find some more insights like into how you got to where you are and like your personal journey there. Yeah. So if you're here to like learn more about like data analysis and stuff like that, you probably aren't going to learn that much, but this is much going to be much more personal, which you know, maybe I'm just being selfish.  So I'm just going to kick it right off. Awesome. Yeah. I just have a question for me. I'm just going to be reading out there. When I think about like my journey, I think about like who's influenced me, not just in the data space, but like in my own personal life. Yeah. Who would you say has been like your biggest influence in your personal life and in like your YouTube journey? Oh, wow. This is like a deep question. Oh my goodness. I told him beforehand this. So this is not like a shocker like. Who has been most influential? So in data and also YouTube? Yeah. You know, it could be somebody who's like a book you've read or a person you've met or a family member who's influenced. It could be anything. Yeah. Okay. Well, I'll get a little personal then. Yeah. So me. So this is, I'll get, so I'll talk more about the YouTube content creation and stuff like that. Because it's sort of, it's sort of what inspired me to get into that. Don't me. I just got to fix it. Oh, yeah. Go ahead. Well, actually, let's start with data first. So data first, I would say you and Kenji were actually some of the first people on YouTube and I was trying to actually find out.  So I'll get that. I also feel ancient when you said that you're like one of the first people I'm like. Well, I would say that you and Ken, because I was, I mean, that's one of the reasons why I started my YouTube channel is because there wasn't a lot of content. Like I was working as a data analyst, but not under that title. Right. And I was like, what, like, like, what, what am I, like, what, what do I, what am I called? What do I do? And then I'm like, like, like watching Ken's channel and your channel. And yeah, just like it was a slow realization of like, oh, this is this is what I do. That's what I do. That's what I'd like to do. And like, if I have this question of what this field is and like what tools I need to learn and I'm learning the wrong way and I need to learn in the right way, where obviously other people are going to have this question too. So that was like a big motivator for me was to get into the YouTube content creation. And I guess, personally, like why like videos and stuff like that, like when we were growing up, we were all about like family videos. And my dad was always had a camera and like filming. And I never really like noticed it at the time. But then afterwards, after the fact, like for some reason, I was like gravitated toward a video camera. And it just happened that way that I got into YouTube and enjoyed making it. Do you need help with that? You're right. No, I'm going to fix it live. Don't mind me. We have some malfunctions. Yeah, let me let me help you with that. I finally figured out which way I'm supposed to turn this thing. But okay, so like while we're fixing this, while you're fixing actually because you're better at this stuff, something that you were saying, which is you didn't really know. So it's interesting from my perspective, because I started making content and this type of stuff because like tutorials, I focus on a lot of tutorials. Whereas you don't do a lot of tutorials, you do a lot of like what to focus on, what to learn that kind of style. Is that is that because like what you just said, which is when you first started, you didn't really know what you were, you weren't sure and you wanted to teach people that so that I feel like that's influenced like your content. Right. Yeah, actually, that's a good point. But actually the real reason, oh my goodness, this mic is too far away. But actually the real reason why, so I started off making tutorials, but then nobody was watching. And I was like, they were pretty bad. I like go back and watch them now. I'm like, oh my gosh, these things are not good. Very awkward. Like what up data nerds? Hello everyone. Yeah, exactly. And so I was like, all right. And then I guess my first like out of the box video was how not to learn Python. And it was more instead of talking about the tutorial aspect, it was more talking about my journey about it. Right. And I actually found compared to do because I did actually had a Tableau tutorial and like a Python tutorial initially started off. And they were fine. They were good to make. But then I found like sharing the journey and I like really like telling a story. Right. And that's how the channel has just evolved because I really like enjoy the creative process and creating a story. But now you'll see like I used to be able to like with a tutorial, pump out a video and like, you know, like three, four, five days. Now with this, like trying to tell a story and make sure it's like succinct. I mean, I'm like at like two, well, I haven't made a video like three months, but I'm like, it's a much longer lead time. But I really like enjoy that. And like, it's fun. It's interesting. So, you know, it's interesting that you say that because I feel like your quality of video is high far exceeds anything that I probably ever put out like every single one of your videos, which I'm sure is why people are like drawn to your type of because it's very techie, very like really well edited was mine or not at all. So it was like that like an intentional style that you chose or you're like, did you do research on that? Or did you just like figure it out? Yeah, no, that's actually a good question. So we had talked about yesterday, you had talked about your your watch channel, right? And I talked about my meal prep channel. So I before I got into data analytics on you tell us I was doing people giving like meal prep advice because I'm like into physical fitness and meal prep. That space is like completely saturated and like there's too many people there. So I was like, I get out of here. Anyway, for that, I was making a lot of like Instagram content. And also, I was making YouTube videos of like overhead shots of like cooking and stuff. Interesting. So you can like, oh my gosh, I probably shouldn't put the name out there. But it'll be in the description. I promise. It was called, I think meal prep made healthy. And then I renamed it to macro fit meal prep. So it's like, like a super targeted niche. Yeah, yeah, yeah, very targeted. And like I was showing these videos of like, and that's where it started with like this editing. And I was picking up with my dad gave me a book on food photography. And that was like the first thing. And so I learned about lighting and a little bit about video and then getting into you. So with the meal prep, I was making that and then I gravitated into mine towards making the tutorials and very easy and super easy to shoot, right? And super easy to edit. But every time I make a video, I'm always aiming to implement a new tactic or a new thing. So if you like watch my first, like, how not to learn Python, it's like, sort of cringey. And now it's like, it's just evolved over time. It's just I always add like something, I learned something and try to implement it in the video because I really like that aspect of it. And I feel like people want a, you know, it's like, dad, it can be sometimes boring. It's like, how I completely disagree with continuum. It's always exciting. Well, sometimes I'm like in my room, like, or in my office, like shooting the shooting content or whatever. I'm like, okay, how can I get this shot of the computer? And it's like, how can I get this nice shot? And it's just funny how you can like do certain things to try to like entice people. So yeah, and, you know, honestly, like I am somewhat jealous just because if I had the skills and I have to know how or like the ability to plan ahead like that, I would try to shoot mine like yours. But now you've already done it. So like I had, I wish I'd done that before, because I would have loved to do that. Like I wish I could learn that. But now, now I feel like you and I, we kind of work in parallel. We don't cross over too much, which is, I mean, for the most part, very complimentary. Like peanut butter and jelly. Exactly. And so like, when I see your content, I'm like, dude, he kills it. I just do very different stuff. And mine is also like way simpler. So like, we have a lot of crossover, but our content that we create is also very different, which lends itself to not making us like hate each other. Because we make very similar, we're in the very small niche. So it absolutely could happen. But it hasn't happened yet from what I know. I think it's great. It's like, oh, I may make a video on how I use Power BI, but then it'd be like, oh, check out Alex's tutorial on Power BI, because it's really great. And you get even more in-depth into it. But yeah, no, I think so too. I like I really enjoy your channel and I mean, I've learned a lot as far as the different tutorials as well. So I really like how you do it. Oh, man, I appreciate that. So you've been on YouTube doing data analytics for what, two years? A year and a half, two years? Yeah, a year and a half-ish too.  You get into it and you're like, oh, it's slow, slow, slow. And then it like hits you. Right. And you go like warp speed, right? Correct. That's how it's been for me. And I've seen it with your channel. You know, two years is two years to get to where you are. It ramps up. But now you're at the ramped up phase. Like what do you see? Where do you see your channel going? What do you see yourself doing for let's say the next five years? Like, do you have any goals or ideas of what you want to accomplish with what you have right now?  Do you really? No. I'd watch it. No. Actually, yeah, me and Tina were talking about this recently as well for your content shift, if you will. My goal, I would like to, I want to continue to grow the channel. I want to try to, so right now, really focused on data analysts. And I really love data science and I love how much it's helped us and how it can help companies. And a lot of the stuff that we're doing is mainly trying to help like some company or some business, if you will. I don't really feel like it's for individuals. It is individual development, but I don't feel like it can be used for individuals. So what I would like to shift to is like, sort of back to my meal prep thing, but shift to how can you use data in your personal life and to basically reach sort of a bigger audience to see like, hey, this is what data science is. And this is how you could potentially use it in your life. So maybe you some like, oh, like I like to track myself on my Garmin watch, maybe something along that lines of how I can use that data to improve my lifestyle. Yeah. No, that's interesting.  I've done it with maybe my finances. Yeah. That to me is like maybe one of the only ways that I've used it like really genuinely. I can find other ways. Right. But that's one that I've actually used. Yeah. So yeah, and there are people who are super into fitness or health or like all these other things. And you can, I'm sure you can use it. I just haven't really thought about that. It sounds like you have. Yeah, I mean, like, well, I, yeah, I'm like trying to brainstorm and like how actually I'm like, it's like testing me. And that's what a lot of my videos do. Oh my goodness, I'm trying not to burp. That's what a lot of my videos do, like I'm learning on the spot too. And I'm like, oh, like that we have this good data, like how can we use it? Like I want that analyst, I should know. Something you just said and something I asked a lot, which is do you, how do you learn? So you said, I'm learning this on the spot, right? Which prompted me just to say, when I make my tutorials, I don't know everything perfectly. Right. I usually know, like if I make like I'm doing like a Power BI series, I know like 90% of that 80%. Some of those topics I'm like, I never use this or I haven't used this in a long, long time. I kind of forgot and I have to like research it. Is there like a portion or a lot of research that goes into it? Or do you know most of the topics that you make when you're making them? Yeah, I would say a lot. And I'm actually curious to hear about your prep period. A lot of like, so like my, what I do? Oh yeah, my recent Excel video. That one, I knew, I would say basically being in our job, we've been able to be exposed to a lot of things. So we know, hey, what are the main things? So for example, this Excel video, what are the main things people should focus on? So now I know high level what I want to focus on, and that's going to get us there. But then when it comes time to like actually make it, now I'm diving into power query and what's the functionality of power query? It's like, Oh, I got to do some prep work for this, because I got to make sure that I get it right, that I don't say anything wrong. So like that, that Excel video actually was a little bit too excessive, that probably took me about two weeks to write to write. And I still had to shoot it and then edit it for another week. So a lot of prep work. What about for you? I would say pretty similar.   And you don't want to forget something that's important. Because early on, I kind of, I was like, this is what I know. This is great. But then I would be like, someone would write in the comments like, Hey, what about this? And I was like, I absolutely should have included like, how could I not include that? I just didn't do enough research. So now like, I learn a lot about these tools from teaching other people. And you know, it's always like the best student is a teacher.  You don't want to give people bad advice. You want to make sure you're giving them a whole complete view of it. And so you really dive in super deep, more deep than I probably did when I was even like studying it or like using it in my job. Now I'm like, I don't want people to be like, dude, Alex, you don't know what you're talking about. Like you totally missed this like crucial piece. Oh, yeah. That's the worst feeling. Oh, it is completely that. It's like, that's like, will probably hold me up the worst because I'm just like fact checking, trying to fact check everything, double checking everything. I'm like, I do not want this to be wrong. Because to your point, I think of vivid example, I did a comparison to Tableau and Power BI, like a year and a half ago, completely didn't talk about DAX in Power BI. Yeah. And everyone wants to know about DAX. And it's like, this is actually pretty major that I didn't talk about this one aspect. Yeah. Same things happen to me. It's like, it's not uncommon.  Yeah.  Like for me, I didn't use a lot of like, like just like random, like in a sequel, I don't, I didn't use a lot of like store procedures. But I'm like, Hey, people need to know about this. They need to learn about it. I've done it to this extent. But, you know, if I don't use it that much, I may not even think about adding it to like my content. Right. You know. Yeah. And it's like, that's an also a problem I run into because I'm like, I don't use this, but I need to like go research to see if other people are using it. So if I need to talk about it still for others to know about. And usually you can find something online. So you're 100% right. All right. Let me see.  And how would the, how would that person, if they were here, how would they describe you to like everybody out there? Oh, really? Well, just because I asked that because, you know, we, we, we create these videos and sometimes we share about about our lives. But we definitely are like, we talked to a camera, right? Right. Yeah. So it's very different than like a best friend or like a partner or whatever. Right. It's very different how they view us because my wife views me completely different than everybody out there. I promise you. Yeah.  Yeah. Yeah. No, I would probably go with my, I have two Navy friends. They'll probably be watching this. Yes. Alex and Dave. And they, it's funny because they're just like, like you're completely different on camera. This is not your person because I'm, I'm like, yeah, I'm an introvert, but like if I, especially with people I know, I'm very talkative and I feel like sort of outgoing and probably say very inappropriate jokes and just like, like always messing around and just like trying to have a good time with people I don't know so much and not the, not the same. But I would think, yeah, I would say that's how they would probably describe me.  Okay. All right. No, that's great. That's great. I love that. All right. We don't have too many more. I'm trying to keep this intentionally like not super long because like we're in a house with a bunch of creators and they all want to like come get breakfast.  So you were in the, how long were you in the Navy? And like, so I come from a military family. Yeah. I know that how much they travel, the type of work is involved. You know, how has the Navy impacted your career and just like your personal life and also like YouTube journey? Like how big a part of it is it played in your life? Yeah. So I was, I was in for seven years. I was in the submarine force of the Navy. Did you actually in submarines? Yeah. Yeah. I spent like two years of my life underwater. That's why I'm also socially awkward too. That's great. How many people, how many people are like down there in the submarine? Like a little over a hundred. So it's, there's a lot of you. Yeah. Okay. There is. Yeah.  Okay.  That's wild. It's definitely, yeah. It's definitely a shock because it makes you, somebody whenever I was first getting into the submarine force and this will lead into your question too.  They were like, Hey, you're going to learn to appreciate things more. And I did. And I'm like, what? And now I get back and like, like I have in my office, I have to have a window. I have to see outside. I like, I want to be outside. I want to see the grass. Like, I'm like, I have to see the outdoors. And like, I appreciate the outdoors now from being in this metal tube. So that's what one is giving me an appreciation for that. And then obviously the military aspect of like structure and getting a job in a task done, sometimes without clear instruction has really propelled me in like just getting my, just getting YouTube and also my job done. It's giving you a little bit more of a self motivation, you would say? Yeah, exactly.  It's just like, okay, I just do one small task at a time. I have little small goals along the way. I don't actually write up my goals, but little small steps along the way that I know I need to hit. And then eventually I'll just get to the goal. And it's very much what I've learned from the military and it sort of drew into YouTube. Yeah. No, that's awesome. Again, I didn't join the military, but I come from military family and they all are very similar things. Like my dad, my dad was is like the person who I am probably closest with who's in the military. And he'll talk to me about it all the time. He's done several tours in Iraq. I ran Kuwait. And he will always tell me he's like, when I got back to the US, he's like, I never appreciated things more than I did then. The military just gives you an appreciation for like the simple things. He's like, it was like 125 over in Kuwait. He's like, we didn't have our own bathrooms, our own showers. When I got back and I took a shower in my own shower, he's like, it was like the best thing he's ever experienced. So I totally understand that idea of that. But that's, I mean, that truly is like a pretty life-changing, like not a lot of people can say they've done what you've done.  I mean, I highly recommend it. I mean, I love being in the military, but I definitely had to get out. I wanted to, I have like more of a creative side and that definitely military very structured. Yeah. All right. So totally like last question, I'm not going to keep on you. This is like just kind of an open ended one. Okay. Like what is something that people don't know about you that you think is like really interesting that you're like, you know, I've never talked about this, but I actually think this is really interesting about me. Oh, wow. Really? I don't really know that. There's nothing. It's actually nothing else. What is really interesting about me? You should have saved the food prep stuff. What did Ken say? I didn't ask him this question. I told you, I have individual questions for every person. Oh, okay. Yeah. Well, there's like a two or three that I overlap, but I did not ask him this. Really interesting about, I don't think actually, I don't, I would say actually I'm actually very boring and I don't know if this is actually an interesting answer. This is actually the worst answer possible God, but I'm, yeah, I'm actually pretty boring and I guess this will be my answer. I like to, I have a certain like, I guess routine, if you will, every single day. So I like to make sure I try to get seven, eight hours of sleep every night, work out at least one hour a day. And then from there, I base everything on my day around it. And I really feel like it's helped me in my life with having that structure of sleep and activity. Right. And then it's fed into my creativity and also my work as a data analyst. So I hate to say that. That's like the interesting thing about me, but that's like the interesting thing about me is like, I really like fitness and I really enjoy like getting outside mountain biking and using those activities to like fuel ideation and also my work coding or whatever it may be. So I'm actually, yeah, I'm pretty boring, but I mean, I like to mountain bike. I think that's pretty neat. You should just live with that. My bike by itself is pretty unique. All right. Well, Luke, thank you so much for coming on to the channel, doing this interview. Guys, if you have not checked out Luke's channel, which I'm sure most of you guys have, but if you haven't, I'll have a link in the description. Go and check him out. He makes fantastic, fantastic content all around data analytics. So again, Luke, thank you for being here.