When I entered the field of virtual reality - this is back more than thirty years ago - almost all of the companies involved in the work had some sort of relationship with the defence sector. This was just at the very end of the Cold War. The Soviet Union had ceased to exist. The famed ‘End of History’ had yet to be announced.
No one quite knew what might happen next. At that moment it looked as though America and its allies had won the long, slow war against Communism. And that all would proceed into an undimmed future of liberalism, democracy, and freedom. 9/11 changed that. So did the rise of Putin.
And Xi Jinping. And Donald Trump. And social media. And the Supreme Court. And the war in Ukraine.
And I could go on and on. Interestingly, although the world has grown fairly obviously more dangerous over the last billion seconds - which no one predicted at the time - although that happened our culture, and, most specifically, our material culture hasn’t acknowledged that fact. The USA got a ‘Cold War dividend’ as defense spending was wound back and turned into tax cuts. Continental Europe didn’t need as many soldiers stationed on its soil to defend against a Soviet threat that had ceased to exist. So everything got a bit cheaper - and a bit slack. It was a long, lazy summer afternoon.
But winter was coming. And so here we are. What do we do? G’day, I’m Mark Pesce.
The coming next billion seconds will be the most important in history, as technology transforms the way we live, work - and fight. We’re going to spend this episode in conversation with the one individual most closely identified with this shift in our thinking - and ask whether that shift portends a greater shift in the focus of our culture. That’s ahead on this episode of THE NEXT BILLION SECONDS. To come back to the world of thirty years ago - at that point, defense spending drove technology development.
And had - since the start of the Second World War. There’s a bigger argument that war has always driven technology development. I’m not discounting that. But it really took off during the Second World War, and continued through the Cold War. After the Cold War ended, the engine of technology development switched - very quickly - to consumer entertainment. Video games and the like.
Sony’s Playstation was the first of a new class of devices - toys, really - that pushed the boundaries of the possible. And then along came the smartphone, and that really made it a completely universal experience. Half of humanity uses a mobile, most of them use smartphones, all of us experience this advance in technology marketed to consumers. The smartphone cut the cost of the core components for a virtual reality by a thousand-fold.
The kinds of virtual reality that cost millions a billion seconds ago cost thousands ten years ago. And the first person to work that out was Palmer Luckey, back in 2012. When Palmer Luckey was just nineteen years old, he founded Oculus - the most successful virtual reality company in history. The company that made virtual reality real. There’s no way to overstate what a big deal that was.
Virtual reality was dead, buried and forgotten, until Palmer Lucky came along. In the beginning, he was just trying to make a better gaming system for himself. I mean, I actually did start by playing around in my garage. I mean, the thing about Oculus is, for years before I founded the company, I had been doing it as a hobby and what what I, the way that I started was actually as a PC gamer, building fancier and fancier PC gaming rigs with more and more monitors. And eventually, I realized, geez, the next the next step is just
more monitors or better graphics. That's actually not very interesting. What 32 monitors is, it might be the next step. But it's not the final step. What's the final step? Where is this all going? In the end, it certainly can't just be 100 monitors. And I realized, of course, where this is all going is virtual reality. And so I decided then as a teenager, that I was going to as a hobby work on the final step of gaming, rather than things along the way. And
after years of work, I, we can get into technical details if we want. But I figured out a couple of key key ways to make virtual reality headsets, cheaper, lighter, and better than most of the ones that had come previously all all at the same time. I said, Oh, man, I like I've actually got something here. And you know, I'm 19 years old,
I'm not doing too well in school. I'll never get a better chance to to pursue this than now. And so when you took that very first, the Oculus, I guess the DK one was the very first one that went up on Kickstarter, and it just exploded. That's right. So I mean, yeah, you asked us to I expected it to blow up. No, I thought it was going to take much more time. I mean, remember, I've been living in this world where people weren't really talking about virtual reality is something that they were a huge fan of, or, you know, they weren't in the virtuality scene or community because one didn't really exist. It was just this thing that was in science fiction that everyone liked as an idea independently. And so I had no idea that it was going to take off so quickly, but really, the time was, right. I mean, you gotta you gotta put yourself back in time into
summer of 2012. We were at the end of a game console generation. But the next generation hadn't even been invented yet. This was also the longest generation there had ever been you had, you know, the, the Wii U had the Xbox 360, the PlayStation three. So you had these very old consoles that had been around for eight years, but the next generation hadn't even been announced yet. And so people wanted something new, they were excited for something interesting. And interesting it was. Oculus became the leading edge of a rebirth of virtual reality, launched in 2012, then purchased by Facebook just two years later for three billion dollars.
A huge sum which made giants like Sony and Samsung and Apple - take notice. Oculus ate Facebook - which Mark Zuckerberg acknowledged when changed the name of his company to ‘Meta’ - from ‘metaverse’, the universal virtual world. Long before that had happened, Palmer Luckey left Facebook.
That’s a whole story in itself, and if you’re interested in that, go back and listen to our interview with Blake Harris, and read his book The History of the Future. So what comes next when you’re a twenty-four year old wunderkind? How do you top Oculus? Do you even try? So there's a few things you know, not not a lot of people know this but before I started Oculus, I worked in the Mixed Reality Lab at the Institute for Creative Technologies in the University of Southern California, which is an army affiliated Research Center, working on programs like the Army's brave mind project, treating veterans with PTSD. And it's not that people don't know, because it's a secret. It's not a secret actually talked about it all the time. It's just the media doesn't talk about it all of that much. I think that military applications of
any technology just aren't what most mainstream outlets spend their time writing about. So I was actually familiar with virtual reality technology being used in the military before I thought about doing anything else. And that had always stuck with me. So Oculus did some work with the DOD, I was really proud of it. But what got me interested in starting Adderall, which is my new company,
is three things that I noticed at the same time. The first was that even as our adversaries like Russia and China invested in cutting edge technologies, like artificial intelligence, and robotics in their military, I saw the United States falling behind our major defense primes were not equipped with the incentives, or the, or the talent that they needed to build these technologies. So that's one issue. The people who really build this stuff for our militaries were, were not able to pull it off. Second, the companies that couldn't pull it off the ones that had a near monopoly on talent in areas like artificial intelligence, sensor, fusion, networking, you name it, the big tech corporations, were almost entirely opting out of working with the Department of Defense. And there's a lot of reasons for that some of its ideological, some of it is driven by a desire to not upset China, where their manufacturing and investment is largely based. And then the third and the third issue was normally in a market like this, where the people who are doing it can't and the people who could won't, you would see startups joining to kind of disrupt things. But for you, there's only been two defense
unicorns in 30 years, it's almost impossible to raise money for a defense startup because of that. So it's hard to raise money, it's hard to hire good people, it's hard to make a difference. And at least in the United States, we haven't had a major success story in the defense industry in decades. And so nobody wants to get into it. And nobody will invest in those three things together made me realize that someone needed to start a company that had a different business model that would use his own money to decide what to build, how to build it when it's done. bypass all of the government morass, all the government red tape bypass the years or decades of slowdown that that can introduce. And unabashedly put the best people
in the world to work on the most important problems in the world, which I think are largely defense problems. And that that was that was how I decided to start Android I started it right after Facebook fired me because I knew there was nothing more important I could be doing. Let's come back to this point you talk about and I think it's a salient point, which is why I want to sort of draw it out a little bit that the Defense Department With the primes, as you call it, and I think maybe if you want to enumerate them, because you probably know them off the top of your head, it would be useful are using second rate, AI technologies, because I think there is a broad perception that the defense sector has the best of everything. When it comes to tech. I think that's partially because there's conflation between the next national security sector and the defense sector around this. But could you can you unravel that, please? Because I feel like this is a major point here. Sure. I mean, most western militaries are using old computers, old technology, old weapons, and the stuff that they're getting that is their next generation is less cutting edge than stuff consumers have been using for years. I mean, the
DoD used to be way ahead of civilian technology, and that lead has entirely eroded. The best artificial intelligence in the world isn't in military systems, at least not in the West, it's in Snapchat, it's in Facebook. It's in John Deere tractors. I mean, these are the companies that have certainly in self driving cars. I mean, those are the places where good engineers go to work, because those are the places where they're allowed to work quickly and allowed to make an impact quickly, which is what engineers really want to do. I think you're right, people do have this misconception that the DoD is way ahead. But it very rarely is true. There are certain areas where they're very, very far ahead. But those do not include the ones we've been talking about.
Now, you say that, yeah, we need to get the best and brightest engineers working in defense. And the thing is, this was pretty much the case reliably until sort of the end of the 1980s. Right as the Cold War started and of the cold war that was laying down. So how does that become the case once again, and what happens if it doesn't work? So I think that traditionally the idea of since the end of the Cold War, the idea has been to get people by saying, Oh, aren't you patriotic? Don't you want to help your country? Don't you want to work on these cool problems. But that only goes so far right? Like everyone who is working in the defense industry, it as it currently exists, is doing so because they think it's important because they want access to these really cool, important problems. But most of these jobs are not jobs that engineers want to have. They're not they don't pay as much as they would make in the private sector elsewhere. They're usually stuffy workplaces. They're working on
very long timelines where it will take years for their work to get fielded, Because why would they do that when they can start their own company and move quickly and have a huge impact, or they could go to a big tech company, and they could work on all kinds of cool projects, and you're not be held back artificially what we've done it Andrew is not, you know, we don't have a magic way of getting people to believe in our mission 100 times more than any other company, for the most part, we say, Listen, you come here, you'll be allowed to work fast, you won't be held back by the government contracting process, you won't have to wait five years in between grants to try something out. And you're not allowed to work on it unless the government's paying for every penny of the test. And that's where people want to work. That's what the defense industry needs. You ask, What can we do to get people into the industry, we need to make defense industry jobs, the type of jobs that people want to have? What happens if we don't do that? Then we're screwed, because other countries do not have this problem. I mean, sure, they have it to some extent, but like, in Russia, and China, working in the defense industry has prestige, and it is a good job to work. And like relative to all of the other options. In particular, it's a really good place to work. And so if we can't shift it around, I think one you're going to see all of our best talent, continue to build whimsical, play things up until the moment that our entire world crumbles.
Does he take an existential threat, like Russia's invasion of Ukraine, to focus minds, and more importantly, to focus budgets on the importance of defense? I think to a certain extent, it does like one thing I've said for many years, when I was starting, and or a lot of people really rejected the entire premise of building a modern defense company. They're like, Oh, this is a huge waste of time. There's no reason there's never going to be these major conflicts. Russia invading Ukraine has at least ended that ridiculous line of thinking like, I'm not a river. I'm not a fortune teller here. I've had people say, Wow, Palmer, it's incredible that you saw this all coming. You know, you're a real visionary. I'm like, you know, anyone with a brain saw it coming unless you are purposely doing pretzels to contort your way around the way that humanity has been for 1000s of years. Like, I did not
predict the future. I just looked at the past and assumed that that things weren't going to change. I feel like it's probably not enough to change people's thinking in the long run that you know, people I think that the Ukraine conflict has definitely changed their thinking. But it's really easy for people to forget about it. I think you're already seeing this, you know, as you get less news coverage, less people talking about it on social media. I wouldn't surprise me
if a year or two from now if this conflict drags on, that a lot of the people who were so shocked by the conflict will kind of go back saying well, that was just a one off of And you know that that was a black swan event that happens once in a century, it's never going to happen again. And that's that's the mistake they're making the mistake they're making is thinking that this is a Putin problem rather than a human nature and human incentives problem. [ In a moment, we take a look at the future of the defense - of Australia ] We know well here in Australia that we sit at the boundary between two great powers - America and China. We know that we’ve made a decision, as a nation,
to align with America, even as we do most of our trading as a nation with China. Which puts us in an difficult spot - both politically, and strategically. Does technology offer any sort of answer to that? Or is that more a strategic question that has to be answered with statecraft and diplomacy? For Palmer Luckey, diplomacy and statecraft both rest on a strong defense, and a strong defense means a strong development of new technologies of defense. I asked him what Anduril does - what it makes... And we're building a huge suite of products. So we don't have the luxury of many companies where we can focus on just one thing and really dialing it to the absolute utmost of Polish, we have to build a bunch of different systems because the only way we're going to be the next major defense prime, the next major defense contractor is if we're able to tackle a whole bunch of different projects, there's just simply not enough money in any one vertical for a company to achieve scale only tackling one. So we build unmanned aerial vehicles, from surveillance drones to aerial
interceptors that knock other drones out of the sky, we build ground based systems that tell you where all the vehicles are all the animals where all the boats are all the drones are at all times communicating with each other and making sure that all the humans and all the machines have the right information at the right time. We build underwater vehicles, where they're able to dive up to 6000 meters deep all the way to the bottom of any part of the ocean that doesn't end in trench or crevasse. And those are those are really powerful tools for understanding what's happening in the sea, following things that are happening to see scanning what's going on. We're also are building a lot of tools that allow us to control what's going on in the electromagnetic domain. So jamming things, sniffing things, hacking things going going after things under this broad umbrella of the term electronic warfare, where you think you're gonna end up having entire conflicts in the future. And I don't mean whole wars. But there's certainly going to be battles of the future that take place solely in the electromagnetic domain, which is good, which is pretty fascinating. It's a it's a sci fi idea for sure. And we're also
I can't talk about the details, but getting into getting into areas like space vehicles, and also some really interesting, very fast, very capable air vehicles. And we've got some got some stuff coming in the near future that people will want to keep an eye on. But I guess the broad strokes of what we're doing is, we're making machines that allow people to understand everything that's happening, so that they can make really good decisions, and then respond with the best possible tools. And we're making technology that is a part of every step of that. Alright, talk for a minute about the project that you're going to be working on with the Australian Defence Force, the XL-AUV. So this is the XLH view that extra large autonomous underwater vehicle, it's essentially a very large autonomous robotic submarine that's able to do things that in the past could only have been done by a man submarine, there's been a lot of lot of unmanned subs in the past, like, the idea is not new. But what we're bringing to the table is very, very large size, very, very smart, artificial intelligence that's able to process sensor data in a very capable way.
And we're designing them in a way where we can actually deploy these at scale, you know, this is the goal is not to build just one or two of these vehicles, it's to build very large numbers of these vehicles, so that you can send them out there without adding more manpower without taking on more risk. And you're, like I said before, you really want to understand what's going on. Like, if I am a military, it is helpful for me to understand everything that's on the surface of the water, and where everything under the water might be hiding. And the vehicle that we're building is the tool that will allow Australia to do that. So Australia has a massive naval boundary, It practically doesn't get bigger.
And so how would something like this work in the context of Australia given that we have a limited number of submarines and yep, won't be getting new submarines for a while for a variety of reasons. What does this mean for how it would affect Australia's ability to be able to monitor each border? Well, it gives you the ability to do a few things. One, it gives you a much better ability to understand what is hiding beneath the waves right now. Most anti submarine warfare is very targeted. You can find submarines in small areas you can protect a carrier group from a submarine
within short range What we're trying to do is give Australia the ability to know if any submarines are anywhere close to Australia anywhere around that massive maritime border. And then it's not just submarines that are in the area, it's also to scan the seabed and introduce on a regular basis. So right now, people think of scanning the seafloor, as this kind of thing you got, you do an expedition to do it, right, like, we're gonna go to this area, we're going to scan it, it's a big event. And we're gonna do it one time. And now we have all this data we can use,
and they'll use it for years and years. But what if you had a vehicle that could scan the seafloor and high resolution over and over and over again, maybe even every single day, now all of a sudden, it becomes much harder for your adversaries to hide things on the sea floor becomes harder for them to tamper with your cables, your internet cables, it becomes harder for them to either break them or to, or to sabotage them or even just to listen in on them. And it makes it harder for them to pre place things on the seafloor that might become relevant in a conflict, potentially years from now. And so that those are those are two of the capabilities. There's a whole bunch that I can't get into because the specifics of them get that inappropriate to discuss in public pretty quickly. But there's a lot of things you can do when you take the capabilities of what used to be limited to a manned submarine. And then you deploy them by the hundreds or the 1000s. And you distribute them much deeper than any man submarine can go much further than any man submarine can go.
This is where the future rises up to meet our present. Because we know we need more submarines to patrol our borders. We know that. And we know we’re along way away from that because of a series of policy missteps by previous governments. Which has put us in a terrible place. Could we have hundreds - maybe even thousands of these drone submarines doing the job for us by the end of the decade? Would that at least take some of the pressure off the delivery of a whole new class of nuclear-powered submarines that Australia will at some point get as part of the AUKUS alliance? If drone submarines can be proven to be a workable solution, Australia can be more relaxed about its defense posture - simply because it will have a better ability to monitor its borders.
But drones have limits. And I asked Palmer about those limits. What is something that a man submarine would be tasked with doing that an unmanned submarine would not? Oh, well, I mean, there's, there's quite a few things that are still going to be left to man submarines. So I think for example, one of them is going to be pretty much all strike capability. So whether you're carrying really large, really powerful weapons, and you want those to be in the hands of a of a human crew that is able to think for themselves and also follow the chain of command and the rules of engagement very closely. That's kind of gonna be that realm. Also, another one is things like diver insertions. So this is something that a lot of submarines do is they can go places and drop a drop, drop a team of people out of the submarine to go and do to go do clandestine missions. You know, those are things that an unmanned submarine definitely is not going to be doing. And then I think there's also just carrying a lot of tonnage, like as cool
as the submarines were building are, they are still a small fraction of the size of these very, very large, manned submarines. And so when you're carrying very, very large payloads, those are the ones that you're going to want to be doing the job. And I think what you're going to see is going to be pretty interesting is, I think you're going to see manned submarines, working in tandem with robotic submarines very closely together so that the man submarines are able to keep themselves in a greater standoff away from danger and keeping their crew safe, while putting forward a bunch of robotic submarines to feed them back information about where the enemy is, where they should be targeting, where they should be hiding from. And that that's really going to be the magic mix is all of these systems are working together and talking to each other man, Dan down, man. We've experienced this 30 year periods 92 to two times and a two, which is the same number of years you've been alive. Technology was consumer led by my math, really, the PlayStation, the original PlayStation is kind of the crossover point in that.
What do you think it looks like 30 years from now is, is the defense sector, once again, the primary engine of technological development in the early 2050s? Yes, I would say it's not even just defense, I think that the government, by the way, this is hard for me to admit, I gotta admit, this is I'm I'm I'm a libertarian at heart. And so for me to say this, it's truly painful. But it's true, the government is going to end up being kind of the the Dynamo of, of innovation in the West again, and I think it's going to be defense, it's also going to be space travel and space exploration, in the same way that the space race generated. So many innovative technologies that have changed the way we live, I think we're actually going to see that in, in space. And I think we're going to see that from defense,
we're we're finally getting back into the point where there's a lot of technologies that currently don't make sense for consumers, but do make sense for defense, I can't talk about all of them today. But there's a lot of things that I'm building right now, like a lot of the drone technology that we're working on, it would never make sense in a consumer drone, because you can buy a consumer drone that's 80% as good, or, you know, a 10th of the cost. But those technologies that we're building are going to become like they're going to trickle down to the consumer space over the coming years. And so I totally
agree. And in the next 30 years, I do think you're going to see government led innovation initiatives become if not dominant, at least a very important and significant force again, alright, you, you lead perfectly into my next question, which is really about the leakage of these very advanced tools and techniques and androl. And now a whole range of new defense startups are making, how do we prevent those technologies from falling into the wrong hands? And that, that doesn't even have to be a state actor anymore? Right? That can be just any sort of threat actor? How can we do that? And how do we ring fence them against misuse? Sure. Well, I mean, there's kind of two parts of this question first is like, literally our stuff falling into the wrong hands, like the actual physical stuff, like, what if they got one of the US Marine Corps drones that we sold them, and that I'm pretty actually comfortable with, I think it's not hard you and you encrypt everything, you have access tokens to everything, you make it really, really hard for them to get access to any of the stuff that really matters. You program the systems in a way where it's very easy to disable them. If if you have if you have an unauthorized user, I mean, these technologies are luckily not as, not as, as fungible as let's say ak 47 is in a box that the Soviet Union handed out, I mean, those things, you know, they they handed them out 50 years ago, and they're still killing people today, the technologies that we have, that you it's pretty easy to make them where they kind of fall apart once they're outside of the US war machine. Now, the second part of this, though, is when you
like technologies, in the broader sense, like how do we keep artificial intelligence in general, like, you know, are academic AI innovations? How do we keep those from falling in the wrong hands? I don't think we have a good answer at all. I think there's actually been a little bit of denial of the problem for a very long time, you have a lot of private companies that come up with very powerful innovation that has massive strategic implications. And then they open source it and they give it away because that's their ideology. Now, I understand that I'm an open source guy and I have been since I was a teenager, but it once you start working with the military, you realize, oh, my God, these guys are giving away technology and in the past, this would have been instantly classified and hidden away and never allowed into the hands of our strategic adversaries.
Now our adversary adversaries are basically taking the results of Western innovation in our academic systems and in our in our in our corporate systems, and then just taking those innovations and applying them to their war machine. I don't know how we're going to stop that. One of the perils of living in an information-rich world is that it is very hard to keep any key technology completely hidden from an adversary. That means everything Anduril does will be copied - for good and for ill.
That’s why they call it an arms race. And it’s beginning to look like - we’re back to that, after a bit of a break. A race that may well last the next billion seconds.
If you’re listening to this episode on its release, you may be interested to know that Palmer Luckey will be giving a talk in Sydney on Thursday the 18th of August, 2022, at the ArtHouse Hotel in the CBD. You should come along. I might even be there... Details can be found on our website at nextbillionseconds.com This episode of The Next Billion Seconds was written by Mark Pesce.
Produced by Stuart Buckland for Ampel. Audio production by Justin McArthur. Big thanks to Palmer Luckey for joining us on this episode - and a shoutout to his support crew who made it all seamless. For more background Anduril, Palmer Luckey - and his speaking event in Sydney, please visit our website at nextbillionseconds.com The Next Billion Seconds is now powered by Ampel Audio. Follow the show on Spotify, Apple Podcasts, Google Podcasts, Outcast - and many other podcast platforms.
If you like this show, please, share it with a friend - and if you can, leave us a great review. That helps bring new listeners to our show. This is Mark Pesce - thank you for listening.
2022-08-10