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Under the Radar

225: The Fragmented Future

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0:00:00Welcome to Under the Radar, a show about independent iOS app development. I'm Marco Arment.

0:00:05And I'm David Smith. Under the Radar is never longer than 30 minutes, so let's get started.

0:00:10So today we're going to talk about change, I guess.

0:00:15A very specific kind of change and a general feeling that I definitely have been feeling over the summer.

0:00:20Where Marco and I have both been app developers for a very long time.

0:00:25I think it's whatever, 13 years now. 13, 12 years.

0:00:30It's a very long time depending on how you count it. But either way, a long time.

0:00:35And I feel like for a long time I would say that I've been,

0:00:40because the app store grew up with me in my career, I kind of know it well.

0:00:45I knew it inside and out. And recently there have been a lot of things that are starting to happen in the app store that feel,

0:00:50that are these larger shifts that are coming.

0:00:55And they're coming in a way that is different than they've historically come.

0:01:00Where the app store has evolved and developed and changed over the years.

0:01:05And it's typically, it's like Apple responding to pressure or

0:01:10forces within the community, within the ecosystem.

0:01:15Whereas I feel like now we're getting to a place where the app store is starting to change from forces outside of the app store.

0:01:20And in some ways that's a good thing. In some ways there are some positive changes that are coming from that.

0:01:25But there's definitely also in the back of my mind this weird feeling of like,

0:01:30outside people who may not understand the app store, may not have my interests certainly at heart,

0:01:35are coming in and making changes.

0:01:40Not that necessarily I'm saying Apple had my interests at heart for the last 13 years.

0:01:45But at least I think our interests are closer to each other than potentially lawmakers or

0:01:50lawyers whose interests are different.

0:01:55And specifically, I'm making reference vaguely to the settlement that was announced last week

0:02:00that isn't approved yet. So this is always one of those things where it's like,

0:02:05a preliminary sort of outline and the details are a bit unclear, but at a high level,

0:02:10there was a couple of developers, or really it's a law firm

0:02:15found some developers to sue Apple and has

0:02:20tried to have a class action lawsuit, which for Apple's practices within the app store. And Apple has

0:02:25said they've settled with these people and will set up a development fund, a

0:02:30small developer assistance fund, I think they called it, which is kind of a funny name for this.

0:02:35But they're putting $100 million into a pot and they're going to give it to developers who made less than

0:02:40a million dollars over the last few years to compensate them for Apple's

0:02:45policies within the app store. And they have a few other sort of things that they're going to

0:02:50continue doing. So like the small business program is one of them. They're making a very minor change

0:02:55slash clarification to the anti-steering rules. And they're going to say that app store

0:03:00search and the small business program are going to stick around for a while. And

0:03:05when I saw this news, I mean, there was a whole story that I think is not particularly interesting from our

0:03:10sort of in our domain about the way this was sort of a PR spin tool

0:03:15and allowed Apple to sort of say that they were conceding things when they weren't actually really. But from

0:03:20my perspective, I think it is more instructive as I don't really know what this is. It's interesting what this means

0:03:25for myself and you as small

0:03:30US developers, which ostensibly, this is a

0:03:35settlement that is directly targeted at us. And specifically it's US developers.

0:03:40But I think they said there were 67,000 US developers who would be covered

0:03:45under the class or something along those lines. And it's weird.

0:03:50Like I don't, on the one hand, it's like it's in some ways

0:03:55it's like essentially Apple is saying, hey, some of our policies in the

0:04:00past may not have been the best. You know, we're not going to admit to anything, any sort of wrongdoing,

0:04:05but instead we're just going to give you some money and hopefully we'll all be good going forward.

0:04:10But at the same time, it's also kind of like they're just giving developers money and then

0:04:15essentially, the developers have to agree to not sue Apple

0:04:20for, I imagine, a meaningful amount of time about things related to the App Store, which

0:04:25is also weird and dubious. But it's very strange for the App Store policy

0:04:30to be coming from a legal filing rather than

0:04:35from WWDC or through the developer program itself.

0:04:40Frankly, I always resist any efforts that

0:04:45groups put in to try to classify developers as one block of people

0:04:50or one interest or one group. There is no developer

0:04:55association. There is no union of developers. We're just, we're all independent and

0:05:00we all have different thoughts and feelings on things. And so the whole idea of this being like a lawsuit that represents

0:05:05developers, like I kind of take offense to that because no one asked me what I thought and no one speaks for me but

0:05:10me. And so that angle of this kind of rubbed me the wrong way. But I think, you know,

0:05:15the larger picture of this, which again, we need to get too much into the specifics of this because honestly, I don't

0:05:20think this suit matters at all. I don't think the settlement matters at all. I don't think the rule tweak

0:05:25matters at all. Apple's making a big song and dance. It doesn't really matter at the end of the day.

0:05:30The amount of money Apple is putting into this is negligible to them.

0:05:35The developers who accept the settlement and actually get paid, it might be a

0:05:40real amount of money to some of us, probably not most of us. And so I think this is

0:05:45overall a big bunch of nothing. But it does point to, you know, and

0:05:50there's other things going on too, like the news just came out that South Korea passed a law

0:05:55that effectively requires Apple and Google to allow

0:06:00third party payment systems and apps. But that would presumably only apply

0:06:05either to apps that run in South Korea or apps that are run by South

0:06:10Koreans or maybe both or the intersection. I don't know. But I think we're heading

0:06:15towards a world of fragmentation. And that, you know, we've enjoyed

0:06:20for the app store so far, we've enjoyed a few luxuries

0:06:25that are easy to overlook but that I think we're going to lose soon.

0:06:30And some of them we already have lost. You know, one such luxury that

0:06:35we've had for a long time is that we can pretty much just submit

0:06:40one app to the store and make it work the same way everywhere. And

0:06:45there weren't that many regional variations of what apps can and can't do legally.

0:06:50There wasn't much that most apps had to worry about. Most apps, unless you were

0:06:55doing certain types of things, most apps could work the same way everywhere, could offer the same

0:07:00features and services to everyone, and whatever minor variation that existed with things

0:07:05like even taxes and stuff. Apple took care of that for the most part. And so we were able

0:07:10to not have to worry about all these different variations that actually exist in the real world

0:07:15all over the place. So it made it easier for small

0:07:20developers like us, you know, one person shops, two person shops, it made it easier for

0:07:25small developers to operate without having to worry about a lot of the stuff that really big companies

0:07:30have to worry about when they try to have something available to the whole world. And

0:07:35in general, I think that time is

0:07:40certainly eroding. I don't know if it's coming to an end, but that's eroding. But that's also

0:07:45part of a bigger theme that's always kind of bothered me, that the app

0:07:50store started out being really great for independent developers. But as time went on,

0:07:55as it got bigger, the world got bigger, Apple got bigger, it started to represent

0:08:00a bigger and bigger part of the economy of the world. And so much

0:08:05important commerce happens through apps now. It's increasingly

0:08:10a place made for big companies. And a lot about the app

0:08:15store, some of which is Apple's fault, some of which isn't, has seemed to be

0:08:20fairly hostile and exclusionary towards independent developers, whether it's because

0:08:25it just requires a lot of staff to

0:08:30engage with a certain feature or to maintain a certain type of marketing or

0:08:35data analysis or legal requirements or whatever, or just stuff that just requires money.

0:08:40You know, like the increase of things like paid search placement being more and more important,

0:08:45or Apple making deals that only happen to apply to big companies in certain ways.

0:08:50There's more and more of that stuff coming to the app store, and this has been a multi-year

0:08:55transition. But I feel like the combination of that along with

0:09:00what seems like the dam being about to break with regards to antitrust

0:09:05regulation in various countries or states, I think we're

0:09:10in for a near-term future and possibly a far-term future where

0:09:15it's increasingly difficult for independent developers and small

0:09:20companies and small budgets to even just keep up with all the stuff that's going on

0:09:25and to possibly be able to handle it all ourselves. Because the simplified

0:09:30world that we've mostly been operating in for the last 13 years is

0:09:35slowly and then possibly quickly eroding.

0:09:40In some ways that was inevitable, I think. That's just the nature of

0:09:45the app store brings in tens of billions

0:09:50of dollars, I think, each year. It's sort of the general estimates that I can

0:09:55find. That is a massive thing. And the role

0:10:00and the importance of smaller developers is

0:10:05just shifting. And it is kind of a funny thing. In these lawsuits, they have to

0:10:10put in some numbers, and so you kind of get a little bit of some insights where I think they said there were 67,000

0:10:15developers who would be part of the class. So essentially

0:10:20developers in the US who made less than a million dollars over the last

0:10:25five years per calendar year. That sounds low. There are 586

0:10:30companies that do not meet that criteria. So there are only 586 companies

0:10:35who made more than a million dollars in a calendar year for the last

0:10:40three years as far as I can tell from their numbers. And I feel like

0:10:45it's weird because on the one hand, it's like, "Oh wow, there's a lot of developers." As a proportion, it's like

0:10:5099.1% of developers are eligible for the small business

0:10:55program, essentially. Basically, that's what those numbers seem to indicate. But at the

0:11:00same time, I imagine the 586 developers that do not meet the criteria for the small business

0:11:05program make up the vast majority of the interest,

0:11:10of the value, of the place where

0:11:15the big moves are going and where the big moves are oriented towards.

0:11:20Because while there may be a number of small developers, we're not the

0:11:25show. The show is these giant companies. This is the

0:11:30Epics and Netflixes and Amazon and all these other companies for whom

0:11:35the apps are part of these multi, these massive

0:11:40100 million, billion dollar deals and content situations and all the things

0:11:45going on there. And we're just sort of there in the side. And in some ways, when I see this lawsuit,

0:11:50almost in my mind, I see it as Apple saying, "Look, we are going to focus on

0:11:55these 586 developers who are probably going to continue suing us and are going to be working

0:12:00with Congress to get laws passed and they have a lot more on the line. We're just wanting

0:12:05to settle with the rest of you. We're just going to close off that front of this war. Here's

0:12:10some money. Hopefully you feel good about getting some money and we can just

0:12:15mark off that part of this thing." And in some ways I think that makes sense.

0:12:20And I think Apple has been very shrewd in some ways in this settlement where they clearly, I think they, based on, as far

0:12:25as I can tell, they would not have lost this lawsuit if it had gone to trial. It seems very

0:12:30unlikely they would have lost. Instead, they're just using it as an opportunity to close

0:12:35off a front on this battle they're fighting and then they can focus

0:12:40in another direction. But it's weird when you're in that front and where

0:12:45it's like the App Store is just sort of a slightly different place.

0:12:50I think it's, in some ways, mostly there's a part of me that just emotionally feels weird about that.

0:12:55That the thing that I've, you know, my professional career is very tied into the

0:13:00App Store. I care a lot about it, but it is increasingly not something that is

0:13:05oriented around me. Not that it ever was like, you know, indies first. It's like

0:13:10indies were part of the discussion and were a big, it felt like a big part of the

0:13:15development of the App Store. And it's like now we're kind of more being shifted, even more so into

0:13:20the side and there's going to be these big shifts that are going to come through and like, who knows what they're going to do?

0:13:25I just don't like the uncertainty of that. I really don't like the fact that there might be

0:13:30this law in South Korea. As far as I can tell, it doesn't seem to directly affect me. But who knows

0:13:35when there isn't one that's going to come in the EU or in the United States or

0:13:40places where it would have a much more meaningful impact on my own business. And it's like, I kind

0:13:45of like that generally speaking in the App Store, what I have found is it's like the rate that my business

0:13:50decays to the degree that it does decay is like mirrors the degree to which it

0:13:55rose. So if I have like a crazy spike in sales, it'll kind of come down around the same rate. And if I have

0:14:00a slow, steady buildup of sales, then I can kind of expect to have a slow decline of scales.

0:14:05And what I really don't like are when there's these abrupt sort of discontinuities in that because

0:14:10even if when they're disrupt, sometimes when they're positive, it's like it means

0:14:15that I can brace myself for a big drop on the other side. Or I think about a law

0:14:20coming into effect and it's like, who knows what the unintended consequences of those are and what they might mean for

0:14:25the viability of being a small developer. But at some point it's like, do I need to have a lawyer

0:14:30that I have on retainer to handle some kind of compliance thing that's going to come about

0:14:35as part of these laws and that's going to cause a lot of trouble or raise the bar to entry for

0:14:40being a developer in the first place, such that only large companies are able to be

0:14:45in the App Store at all. Like, who knows? That's kind of a scary thought.

0:14:50That to me, that kind of thing is the biggest threat, I think. Because there's always been

0:14:55clear assumptions made by Apple and by the App Store that

0:15:00oh, of course everyone out there is going to have a full-time designer. And of course everyone out there is going to have a full-time

0:15:05marketing head or marketer or whatever those are called.

0:15:10And when you're like a single developer

0:15:15and you don't have these other full-time supporting roles that everything about the App Store seems to assume

0:15:20that you have, you can kind of feel unseen or left out or

0:15:25excluded or feel intimidated. Like, I guess I can't make an app

0:15:30because I don't have this kind of skill or this kind of help or this kind of budget. And so anything that

0:15:35raises that either real or implied or perceived floor of

0:15:40what's the minimum that you need to really have an app in the store and compete at all,

0:15:45anything that raises that above what one person can reasonably do

0:15:50significantly excludes a lot of people. And I hope that somebody in Apple

0:15:55has that in their mind of like, let's make sure we don't exclude people as things get more complicated.

0:16:00But I don't know how much that weighs in because these decisions, as you said, they're

0:16:05so big and they involve such big companies and big budgets and big parts of commerce and big governments

0:16:10even. And it's hard for the interests of the independent developer to be maintained there.

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0:17:35I think something that's kind of a funny aspect to this too is how

0:17:40all of these changes, all these things that people are talking about, or like laws that are being proposed,

0:17:45or all these directions, almost all of them when I see them are things that I don't expect

0:17:50I would particularly avail myself of in terms of like having alternative payment

0:17:55processing that I might be theoretically allowed to do when my users are in South Korea

0:18:00now, that I could have them subscribe through something else. And it's like, I probably wouldn't.

0:18:05Apple has been giving me a pretty good deal. And in some ways that's

0:18:10like, I don't know if that's a counter view to a lot of the prevailing feeling, but it's like

0:18:15overall, I feel like Apple has given me a pretty good deal the last 13 years and they provided a lot of

0:18:20infrastructure and a lot of tooling and a lot of opportunity that I've been able

0:18:25to take advantage of and work towards. And so all these things that are changing and sometimes

0:18:30the small developer is held up as the reason for this and it's like we're the reason why people

0:18:35are going to have to come in and whip Apple into shape. And it's like, I look at these changes and I'm like

0:18:40I don't know if those are actually good for me. And I am a small developer the last time I checked. So

0:18:45it's kind of a funny place to be. Yeah, it's like

0:18:50I largely wouldn't do like my own in-app purchase system or anything like all

0:18:55these, you know, the new freedoms that we might get

0:19:00if regulation does go into effect or if Apple changes its policies, which by the way,

0:19:05I don't for a second think that one or two laws in different places would make Apple

0:19:10change the rules for everyone. I think Apple would comply with these laws in the narrowest

0:19:15possible way. And so, yeah, maybe your app would be allowed to use in-app purchase methods other

0:19:20than Apple's in South Korea. But certainly they wouldn't allow you to do that anywhere

0:19:25else. I wouldn't for a second assume that they would give any more than they have to on these fronts.

0:19:30And so you have fragmentation then. You have different things you can do in different countries. And again,

0:19:35that's terrible. But I'm even worried like my biggest concern is

0:19:40if Apple's, you know, stubbornness on holding on to the in-app purchase

0:19:45thing causes much more severe regulation

0:19:50that would force them to take away other parts of the app store that I think are actually

0:19:55not good to take away. Like one of the biggest areas of this, I am super

0:20:00not into the idea of anything that could create alternative app stores

0:20:05or sideloading. Because that to me, like as a

0:20:10user, sideloading scares the crap out of me. Because all you need to do to think about, you know, hey,

0:20:15would this be a good idea? Just think about what would Facebook do? And you can see it.

0:20:20You don't have to use your imagination too much because Facebook has done lots of terrible

0:20:25things through the existing app store ecosystem. You know, things like the Onava VPN

0:20:30thing. Like the investigation of possibly using exploits

0:20:35to spy on people even more than the app store allows them to. Facebook does some really creepy stuff even

0:20:40within the limits that Apple places on them now. And if we enter a world of

0:20:45alternative app stores, guess what? We're all going to have to put our apps in the Facebook app store.

0:20:50And that terrifies me. Because like, you think Apple's bad. You think

0:20:55paid placement, paid search ads in the app store, you think that's bad? Just

0:21:00wait. If there's ever a Facebook, and as soon as alternative app stores are allowed on iOS,

0:21:05I guarantee you we are going to have the Google Play Store on

0:21:10iOS, we're going to have the Amazon app store with no space in it on iOS, and we're going to have the Facebook app store.

0:21:15And then we're going to have to put our apps in three or four different app stores. Every single time

0:21:20we have to keep up with all three or four different app stores, deal with their own rules

0:21:25that will all be slightly different from each other, and pay them to show our apps to their users.

0:21:30Now, you might think users, well, on iOS we can just stay in the Apple app store

0:21:35because that's what most users will have, right? Well, as soon as there's a way to get alternative

0:21:40apps or app stores onto your device outside of Apple's app store, Facebook is going to say,

0:21:45well, you know what, if you want to put Instagram on your phone, or the Facebook app on your phone, you're going to have to get it

0:21:50from our store now. We're going to pull it out of the Apple store. And Facebook has enough clout in the world

0:21:55that people will do that. So everybody will have the Facebook app store installed on their

0:22:00phone. Everybody. And that will become, you know, Facebook will use its rules, and its lack of

0:22:05rules, and its control, and its share of the ad-driven app install market

0:22:12to heavily leverage people to use that entirely. That would be

0:22:18where everyone went to get their apps. The Apple app store would become like the Mac app store. It would become

0:22:23the place where some people go sometimes, but it's not going to be where most distribution happens.

0:22:28So that's the world that will be created if we get sideloading in a way that enables alternative app stores.

0:22:33And that, I do not want that world to occur on iOS. Trust me, you don't want that.

0:22:38I know that's how the Mac works. The Mac is in a different environment. In many ways,

0:22:43it's a very different world. You do not want that world on iOS. Trust me.

0:22:48And as a developer, I'm afraid that as Apple has, you know, they're keeping their grip so tight

0:22:53on the in-app purchase rules because they make so much money from them, that I'm afraid that

0:22:58heavier regulations will come down in response to Apple's inflexibility on that,

0:23:03that possibly we will be stuck with

0:23:08that kind of world that occurs. I don't know. That concerns me greatly.

0:23:13Yeah, I feel so, I mean, I certainly don't want to go down that road either.

0:23:18I feel like I would, yeah, and I've, over the years, I remember,

0:23:23in the early days of the app stores, when I was still trying to work out what kind of a business I wanted to be in,

0:23:28I launched some apps on the Google Play Store and I launched some apps in the Amazon App Store.

0:23:33I even launched some on the Microsoft Windows Phone Store

0:23:38way back in the day. And it's like, it very quickly dawned on me that it's like, I don't want to be in the

0:23:43multi-store lifestyle. Like, the multi-store lifestyle is a bad, is a bad scene.

0:23:48It's complicated, there's too much to keep track of, and it becomes, like we were saying,

0:23:53it's like, now I need, I would need to have a person who was dedicated to that, who was going to

0:23:58Google I/O or Facebook F8 or whatever the

0:24:03events are, and understanding what's happening, and being aware of the news, and what I should be doing, and it's like,

0:24:08it becomes very, very quickly becomes untenable to do this as an indie developer.

0:24:13And so, like, I want to have one place that I can focus all my expertise and effort and try

0:24:18and become, you know, it's like an expert in one thing, and that feels sustainable and manageable, but

0:24:23becoming an expert in like five things isn't. And it's like all of those things, it very quickly,

0:24:28yeah, it loses a little bit of the sense of, like,

0:24:33one of the things that attracted me to the App Store initially is that,

0:24:38and this is certainly one of those things that is not 100% true, but it's like 80% true,

0:24:43or sometimes 60% true, but who knows, but we're like, there is definitely a thread

0:24:48within Apple that cares about good experiences, and cares about design, and cares about quality,

0:24:53and if you do things the right way, there are people within Apple who seem to care

0:24:58about elevating that work in a way that has made lots

0:25:03of small developers who really sort of sweat the details be able to have careers.

0:25:08And it's like going into a different world where it is entirely,

0:25:13you know, A/B test, sort of big money driven,

0:25:18and it's all about analytics, and it's all about engagement, and it's all of those types of metrics are the things that you

0:25:23start to optimize for. It's like the world becomes a thing that I don't, I just have no interest in.

0:25:28I get no excitement from that, and any time I've gone near that,

0:25:33I always just very quickly say, "Nope, this isn't me." And if that's where the industry goes, and that's where my

0:25:38business has to go, then it's like, well, I might need to be finding a new business, or I'll just like make do with,

0:25:43you know, I'm sure there are some people who, you know, sort of, it's like your Mac

0:25:48App Store example, in some ways it would burn, and in some ways it's just like, well, if that's where I found myself,

0:25:53then I guess that's where I'd be, and I would just hope that it would work out, you know, for long enough

0:25:58for me to make it work. You know, the App Store has gone through lots of seasons, and I would hope I would be able

0:26:03to sort of weather that one, but yeah, it's like, it just makes me nervous, and I just,

0:26:08I have this feeling that I don't like that

0:26:13these changes are coming externally. That's like, wow, there are lots of problems,

0:26:18there are lots of things that I wish Apple had just done differently over the years. It's like overall, I think

0:26:23they've been a reasonable steward of the App Store, especially when you understand that it's like Apple first,

0:26:28customer second, developer third kind of thing. Like, you understand your place in that, you understand what they're

0:26:33trying to accomplish, and you can align yourself with that, like, you can make that work, and

0:26:38it's like, overall, it has been alright, but I just, yeah, I don't like it, and I'm

0:26:43less optimistic about the future of the App Store, and about sort of the,

0:26:48you know, the way that I make my living, and the way this business works than I have been

0:26:53certainly in the past as a result.

0:26:55Yeah, but that's, I like the way you just put that, that I, you know, there, if the world moves

0:27:00in these more complicated directions, you know, if it continues to move in these more complicated directions,

0:27:05we aren't necessarily required to go along with it. You know, in many ways this happened in podcasting.

0:27:10You know, there's, podcasting started out being, you know, shows like this, mostly, you know, and then there were a couple

0:27:15like, you know, public radio produced shows that were like really nice, but, you know, for the most part it was a lot of stuff like this.

0:27:20And then as podcasting got much, much bigger, it became way more like, big companies

0:27:25coming in, big productions, big budgets, big staffs doing big things with, with other big

0:27:30companies and making deals, and the whole world of podcasting has kind of moved in, in massive way towards that,

0:27:37but we are still able to do this. We are just no longer like the, the, the bulk of what podcasting is, if, if we ever were.

0:27:45And that, you know, as long as we are able to do this, there might be this massive other world happening off, you know, in this other place,

0:27:53but we aren't required to do what they do. We aren't required to be in it, and its existence doesn't make it impossible for us to also exist.

0:28:01We just aren't as big as it. And, you know, that might happen to apps too, like if, you know, if, if the world goes to this, in this direction where, you know, in, in five years we have

0:28:11five different app stores everyone has to be a part of and everyone is spending six dollars per installation, most of it just goes into Facebook, like that sucks,

0:28:19but if we can, if we can just still do this and be, you know, only in the stores we want to be in, only in the platforms we want to be on,

0:28:27and only spending the money or lack thereof to pay people to install our apps that we want to spend, I, I think as long as we can keep doing what we're doing,

0:28:36what the giant rest of the world does, doesn't necessarily need to preclude us from doing that.

0:28:42Yeah, I think that's a fair point. I mean, and I think that is honestly, that is the part of this that in the end I feel slightly like the best about, is that

0:28:49if the app stores go in the directions I don't like, and at a certain point it's like, I have agency in this, I can just keep doing what I'm doing and hope that

0:28:57there are enough, you know, app used, app consumers, app users out there who will enjoy what I do and there don't need to be that many of them for me to make a nice sustainable living,

0:29:08and who knows what's going on in like the other part of the world and it's like, there might be money to be made there, there might be fame and fortune, like who knows,

0:29:16but if I can make a living and that's what I want to do and that's the industry that I enjoy like being a part of, then it's like as long as that exists and hopefully in all this it would, you know, survive well enough to allow that, then like that's okay.

0:29:27And I guess we'll just, you know, we might become less relevant, but it's like, oh well, you know, that there are worse things.

0:29:33Thanks for listening everybody and we'll talk to you in two weeks.

0:29:36Bye.