Lauren E. Petrulo (5:54)

I do, yeah. TikTok's not even here.

Ralph Burns (5:59)

Not even here.

Lauren E. Petrulo (5:59)

Okay.

Ralph Burns (6:00)

Not even here. You know, to your point, that's sort of international investment. So that could be a whole other show. Here's the interesting part. The companies in a variety of AI boosters say the investments are necessary. Sorry. For machine learning systems. Okay. But the key to all this, and this is the thing that's coming is AGI, which is artificial general intelligence. Right now we have artificial intelligence, we have generative AI, but artificial general intelligence is a state in which they are smarter than humans. That's where the thing is going.

Lauren E. Petrulo (6:30)

That's where the puck is going to singularity.

Ralph Burns (6:33)

Hoarding.

Lauren E. Petrulo (6:33)

Yeah. Yes.

Ralph Burns (6:36)

So you think you need a lot of compute right now when you replace the human brain or even make some of these algorithms even smarter than the human brain, I. E. Bots, I. E. Agents that you say, hey, I want you to create a webpage for me. You know, this is actually too far away, but I want you to create an entire 27 page website on these five prompts. And all of a sudden it goes out, figures it out, programs, it actually finds the programmers, wireframes the thing up, puts in the HTML, boom. The thing is done within 10, 20 minutes. Like that's like the agent in our space. We're not quite there yet because the human is going to have to do some of the programming. Although that's getting less and less with a lot of the tools that are out there. Point is, is like that's where a lot of these companies feel like all of this is going. And they're putting their money where their mouth is. So you follow the smart money. There's always somebody that's out there that knows more than you do. When it comes to the stock market, when investing, I always sort of say that. But the point is, is like these companies are investing so heavily into this, it's mind boggling. So this was a question I had my team actually ask me. I'm like, what are they actually spending this stuff on? Well, it's this. Not dirt. This Is if you're watching this over on perpetualtraffic.com YouTube this is a site for a new metadata center at Holly Ridge, Louisiana. Do you know where Holly Ridge, Louisiana is? I have no idea.

Lauren E. Petrulo (8:05)

No, but it sounds like Holly Grove, which is where Lil Wayne is from. But that's close to New Orleans anyways. No, I don't know that.

Ralph Burns (8:12)

No idea. Like I guess we could probably look it up, but it doesn't look like there's any cities around there. So this is basically just a big site of dirt. This is data centers, massive facilities holding thousands of servers. Google said its capital expenditures for the full year would jump from. For this year. We talked about meta a bit. Would jump from 85 billion to 91 to 93 billion in investments just this year alone. And direct quote from Google last week, we're already generating billions of dollars from AI in the quarter. They actually announced record earnings last week. Primarily because of cloud services, obviously, but mostly. Yep, advertising. And across the board we have a rigorous framework and approach to where we evaluate these long term investments. That is Annette Ashkenazi, Google's chief financial officer. The CFO says all of this investment, as much craziness as it is 93 billion, they're actually getting a return on it immediately in advertising dollars because of the algorithms being so good and the advertisers still flocking to the system. Crazy stuff. So that's what that was. One of the questions like what are we investing in? Well, what eventually happens is they turn into these things right here. And this is an Amazon data center that's in Ashburn, Virginia, if you know much about these data centers. So these are just basically just big warehouses, air cools, tons and tons of servers all with all of these, you know, Nvidia Blackwell GPUs and sort of the next generation Nvidia is always sort of coming out with a sort of the next generation of a gpu, which is a processing unit that is able to process multiple things all at once. I'm going to leave a link in the show notes to. I think probably the best explanation for a difference between a cpu, which is on your computer. Unless you have like a gaming computer.

Lauren E. Petrulo (10:09)

And yeah, I was like, oh, gamers out there use GPUs all the time.

Ralph Burns (10:12)

Absolutely. Because you have to, because you have so much compute for a. You know, I don't do a lot.

Lauren E. Petrulo (10:18)

Of gaming, but if you're streaming, you need a gpu.

Ralph Burns (10:22)

Yeah, for sure, for sure. You need a graphic, you need a gpu, graphics processing unit as opposed to just a central processing unit. So otherwise you're not going to be able to get that, you know, that experience. And that. That's how Nvidia transition from a graphics company into a AI company, because they figured out a way to be able to process everything all at once, as opposed to in a linear fashion. So in order to do that, you have to create, like, these massive data centers that when you're on Gemini or you're, you know, using Meta AI, you're actually tapping into these centers. These centers are the ones that are processing all of that information and then shooting it back into your phone in a split second so it doesn't just magically happen. So the cloud is not really the cloud. The cloud is actually this big building probably around the corner from where you live. I know somebody who lives in Ashburn, Virginia. They say these things are like, absolutely massive. And unfortunately, when they're built next to homes, they make a tremendous amount of noise, apparently, because they're like the air conditioning units are on all the time. So there's issues environmentally, there's issues with power, there's issues with water, all these other sorts of things that go along with it. But the point is, this is where this stuff is being invested in. Makes sense.

Lauren E. Petrulo (11:34)

It makes total sense. I also just think of this as like, wow, if there's one thing you wanted to mess up with another company, say, I was building my own data centers. I would just make this fake news blasted Everywhere, spend what, $200,000 across the ads on Meta, talking about how Meta's data centers blow up and Meta AI doesn't work anymore. So now advertisers are switching from Meta ads to Google and be like, showing fake footage of Meta's data centers all collapsing and just like this terrorist attack, now we all have to go to Google to just sabotage Mike. That's all I'm thinking about. Like, who cares about, like, the Pentagon anymore? It's going to be like this. Whatever. Someone else is thinking this as well. Yeah, it's like, that's the new.

Ralph Burns (12:13)

I wonder what the. You know, it's interesting. I wonder what the security is like with these things. I have no idea. I mean, it's. It's pretty crazy that there has to be.

Lauren E. Petrulo (12:24)

I mean, they talk about corporate espionage and the ethics and AI, and like you said, the security has to be pretty tight because if we're coming up with it, and we are not people with dastardly ideas or like, trying to hack our ways into those type of things. But if you can come up with it on the like, oh, I'm looking at this and that's a very big target. Someone who is actually with that intention, man.

Ralph Burns (12:46)

Yeah.

Lauren E. Petrulo (12:46)

I can't believe they're publicly saying, here's where my data centers are. We'll see.

Ralph Burns (12:51)

Well, that's an Amazon data center right there. I mean, we see all the Amazon warehouses. Like when I was down in Florida the last time when Alex says baseball thing, I can't believe, like, in and around, I would say south of where you are in Orlando. First off, the development is just off the charts. I've never seen so many developments in my entire life. But then there's all these Amazon centers, like the Amazon distribution centers, but now even more so. Those are just big warehouses that are empty without, like, cooling systems and, you know, billions of dollars worth of servers. It's like those are just sort of empty warehouses that are just for distribution. But so like, the amount of land that's now being scooped up by these big tech companies is pretty astounding.

Lauren E. Petrulo (13:36)

I think one thing that's really interesting is while Amazon continues to develop all these data centers, Walmart, which isn't even present on this discussion, like, and in terms of like, we're talking about like, E commerce. And of course, when think of Black Friday, Cyber Monday, Walmart and their distribution centers having the physical stores, the brick and mortars, they go to have so much more distribution power than Amazon does. But I think that this, like, secret killer, like we're talking about, like new seller incentives for plus or premium buyers is like, everyone's trying to give people access to aws. And I think, like, as part of these bigger conversations, and if you're looking at these companies that we are buying traffic from that we're partnering with for advertising, it's again, you said chase, where the money goes. Amazon is developing into the aws. Amazon's developing into these data centers and they're building these distribution centers. But Walmart, again, one of the biggest suppliers of E commerce in the United States, at least has all these distribution centers. So I'd be curious as to where those sleeper brands are doing and how they're investing their money to compete with the Amazons of the space. Or is Amazon just trying to go into its own category and go really deep on aws, still continue to be the destination for someone to find whatever they want anywhere in the world. Those are just like the small things that are coming to my head when we're showing this. And I'm like, oh, Walmart's distribution centers, massive Amazon having to build all these warehouses to keep up. I just can't wait to see what happens next year. I'm like, I'm ready with my popcorn.

Ralph Burns (15:05)

I don't know as if Amazon breaks down I think in 2024 for. We don't, we don't have a, I don't have a breakdown for this for 2025 but it's interesting because AWS, which is Amazon Web services by the way, I mean we use a fair amount of it so. And that's actually one of the larger bills that we pay every single month. Hey, are you struggling to connect the dots across your marketing? Well, Adroll's connected advertising platform turns complexity into, into clarity with AI powered campaigns and seamless integrations. Advertise smarter, move faster, achieve more, learn more@adroll.com PT that's adroll.com forward/pt because of the hosting that we use through tier 11 data suite. But according to 2024 earnings, AWS generated about 16 to 18% of revenue for Amazon, which is an incredible amount actually. Yeah, 75 to 80% of revenue was on the retail side. Third party sellers, online stores, physical stores as well. Physical stores, yeah, I guess there is like physical pickup spots they do but that is growing at a pretty large clip.

Lauren E. Petrulo (16:25)

So I would guess that aws will occupy 40% of Amazon's bottom line in the next two years is my like my estimate as. Because they're going to see like if the AI that they continue to expand into rolls up under that system. I think that's going to be. But like again if you're hearing that you're like holy smoke, 16% of Amazon's total revenue is coming from AWS and you don't even know what AWS is. Again it's just say like there's so much happening, no one can stay on top of all of it. But this like the intersection of all these different investments into data centers because those data centers have to support aws, they have to the computing needs of AI. So for me it's like, I mean it. Would it be crazy and wild to say that Amazon could deprioritize their selling space, the everywhere store to being like the everywhere answer and like going against the search engines of the world. Like who knows. But it's just say like again like no one can possibly keep up with all this. We can barely stay on top of like awareness of AWS as a product that has been around for quite some time and has creeped up into such a high contribution to their bottom line or even again if you're not even thinking about Walmart's distribution capabilities. Walmart, when they launched Walmart.com, they had their like Walmart plus they took 5% of total e commerce sales in one year of the launch. Amazon and Google own the lion's share of all e commerce transactions. TikTok is making an aggressive force as it comes to like TikTok shopping and then live. Everyone is like how else can we do it like that? Like Woot had a massive acquisition from Amazon. There is whatnot is another space in the live shopping all that to say I know I'm going on a bit of a tangent and we can get back to the AI piece. It's just like there are so many moving pieces as it relates to E commerce. But what is not moving is how much dependency there is on computing power and AI to make those solutions more efficient for you.

Ralph Burns (18:25)

In 2025, Amazon has about 38% of the online sales. Like we say about 40%. I think it's safe to say it's probably around 40%. 40%. So four out of every 10 things bought online is bought through Amazon, which is incredible to think. However, Walmart's only at 6.4.

Lauren E. Petrulo (18:47)

I'm surprised people listening can't even believe they have 6%. You think it would be more Ralph, have you ever bought from Walmart.com?

Ralph Burns (18:54)

I never have, see but I've bought plenty of stuff in store.

Lauren E. Petrulo (18:58)

Right.

Ralph Burns (18:58)

So but I mean the percentage of overall retail is much higher than 6.4% that's for damn sure.

Lauren E. Petrulo (19:04)

Correct. Well they have grocery.

Ralph Burns (19:06)

Oh yeah, absolutely. So to get more specific, on aws, this is Amazon Web Services. This is where like let's just. This is where other companies borrow their compute to be able to start like Salesforce and Citizens bank for crying out loud. You know the Amazon outage from just a week or two ago, you know like I was trying to like get into one of our citizens accounts and they're like yeah, we're good because we're not on aws. But you know what was on AWS was the two factor authentication was hosted on aws. So I couldn't any of my accounts on that day. And we just so happened to be doing payroll that day which was lots of fun. Oh, AWS is absolutely tremendous. Yeah. So just to give you a breakdown, third quarter, 2025, their AWS revenue increased 20%. That is up from the previous quarter of 17%. So it's growing and that's at about 33 billion in revenue. Like these numbers are mind boggling. Like how much compute is being used.

Lauren E. Petrulo (20:17)

I mean we're just playing with monopoly numbers at this point.

Ralph Burns (20:20)

This is crazy amount. Like I'll, I'll leave links in the show notes on the chart of like the, the growth trajectory. Like it's a hockey stick on aws. So yes, it's coming. It's all powering AI. It's obviously it's powering all the websites that you and I probably visit every single day or the back end CRM like Salesforce and HubSpot and go high level. I'm sure they probably host on either AWS or Google Cloud or maybe you know, Microsoft's. I forget what Microsoft's thing is. But anyway, the point is, is like that's where the power of the Internet actually comes and it comes from these physical centers. And if you're watching this over on YouTube, actually we've had this screen share up for quite some time, but this is basically what they look like. And a lot of them are in Virginia because oh by the way, probably the largest utilizer of computer is in the Washington D.C. area for some of those three letter agencies that we're all so fond of. Me especially. All right, so what's this mean for us? This was the question that I had to the team last night when I talked to them about this and our group call on our group video. Well, it's really, it's this, it's if you have stuck your head in the ground and you've done. Is it the ostrich that does that? Yeah, I've never actually seen an ostrich do it. But if you have stuck your head in the sand and you're like, all right, AI is just kind of a thing. All these people are talking about it all the time and they say, oh, go play with AI. Go try these new tools. Well, go find a task that you're doing all the time that you don't want to do anymore. I used to have a little label on one of my laptops way back when actually it was in this office right here. I said, what did I do today that I never want to do again? And this is when I was like me and Trish. Trish is my webmaster still with tier 11. And that's how I scaled out the company. Think about it that way. Start with one thing. Like for me recently I found a tool for a recommendation of a friend of mine that creates landing pages like that, like wireframes in literally seconds. Now it's not Unbounce. We still use Unbounce. By the way, great sponsor of the show, love Unbounce. But I found a tool that can do it even faster and quicker and cheaper. So Google, whatever it is, what's that thing that you do every day that you don't want to do anymore or that you feel would add value to your business if you could do it quickly and just do a quick Google search? Start with just one thing, and that's innovation. Because as Peter Drucker says, one of the greatest, you know, management consultants, management gurus on the planet said this years ago. This is 34 years ago. Innovate now or die. Because if you're not innovating or if you're standing still, you are falling behind. And I would encourage you all to pick that one task because none of this stuff is going anywhere. We're not in a bubble right now. You know, whether you agree with that or whether you don't agree with that, you need to adopt something within your business and use it. Maybe you are using ChatGPT, maybe you are using Gemini, maybe you are using Siri, even though it's crappy. The point is, pick one thing that you're doing is start there. And I think that's where the adoption really happens for AI. And I think that's the thing that stops people. Because everyone who's into AI, like all these AI nerds, and I've got plenty of them on staff, they're like, go play with the tools. Don't play with the tools. Pick something that's useful for you. Like, pick something that you hate to do. I guarantee you there's an AI tool out there that'll help you do it better, faster, and probably a hell of a lot cheaper, especially if you figure out, like, what your hourly rate is. Thoughts, ideas, concerns, confessions.

Lauren E. Petrulo (24:16)

I mean, I think there's a lot of people here that just like, email to find the I'm youth button and you have emails. It's like, there's a lot of really good tools that again, you don't have to figure it out or use ChatGPT or Claude. Like you said at the beginning episode, thousands of tools come out all the time. And there's tools and with AI where it can read your emails and it can send you a summary of, like, here's what's important, here's the things you need to get back to. Like, you can read your emails and a friend of mine is using this tool and it's like 20 bucks a month and it's just saying like hey, here's what I'm looking at inbox. Here's the top 25 higher priorities based off of like you can prioritize who was in your your emails or like how many times you have replied back and forth. Like there are smart interfaces that are leveraging the AI tools that are like a cloud or like a Gemini or even as deep as Perplexity. They're leveraging these tools to create interfaces that can remove some of those daily menial tasks that you're like I would rather punch myself in the face than have to do again. So you don't like if you I love your idea of write down that one task, you're like destroy this task forever. And then I would go to ChatGPT AI and like spend 30 minutes. I will say that like people that are doing five minutes or like two to three word sentence prompts aren't using AI correctly. I spend 20 to 30 minutes on each prompt and like have a dialogue back and forth chatgpt as if you're like hey, help me find. Research the tools that will do it for me so you can use AI to find the AI solution that's easiest for you. You're going to pay more because you're paying another company that's leveraging that AI. But if the interface makes it easier for you, then go for it. Like we all pay more for things because it's easier. Accept the convenience and figure out what is that task you wish you could never have to do again. Work with AI to find out what are the options and then narrow it down. And if you're depending on what tool you're using or if you have other people around you, I would set it up and ask it to do like in a debate style and tell me which tool, not just a versus page like you see with HubSpot versus high level. Like I want it to be debate style. Tell me which model is going to work best for me and then ask me a question one at a time so that you can make a recommendation based off of my best needs. That's how I would recommend anyone to start with.

Ralph Burns (26:31)

Simplifying their AI that lists pros and cons. Like I was doing it this morning like you've you've switched over to Mint Mobile. I did it this morning. I just entered it into Gemini because we're going to switch over to Comcast Mobile and they I never signed the contract. These bastards. And so they started charging me and my admin's like what are these additional charges For Comcast, I'm like, did we ever switch over to mobile? She's like, no, it was like $260. So it's been like an hour and a half on the phone, by the way, which was total pain in the ass. And while I'm doing it, like, Comcast, sell Comcast Mobile versus Verizon versus Mint. Because I know you're on Mint. And I literally typed it into Gemini and it gave me this summary. It's like, you know, if you are this, then it's great. If you do this, it's not that great. If it's like there's pros and cons of each. And it gave. I was so much, I felt so good. I'm like, all right, we're going to check out Mint. Hey, are you struggling to keep up with marketing tasks? ActiveCampaign's autonomous marketing platform eliminates the busy work automatically. Building and optimizing email, SMS and WhatsApp journeys or all for you. It's all powered by billions of data points that show you what drives revenue so you can launch campaigns in minutes instead of weeks. Extend your team with AI agents that handle campaign admin and tedious tasks that you know your team doesn't want to do. Focus on strategy and let the AI do the rest with data driven decisions, clear next steps and on brand messaging across every channel. Try the next era of marketing for free@activecampaign.com you know, I mean, you've obviously.

Lauren E. Petrulo (28:11)

I would say I don't use Mint. So it's like Roberto uses Mint and for how he uses his phone and his usage, it makes the most sense. Yeah, but with how much I travel, like I'm actually looking up a Tesla phone for Starlink whether or not I.

Ralph Burns (28:25)

Do it or don't do it. There were some cons there for sure, like international travel, you know, you know, priority usage. Like there, there's, there's, you know, there's catches to all of it for $15 a month according to our buddy. Anyway, the point is, is like use AI to figure out what AI task you can actually avoid doing or do less of. Like, that's a brilliant suggestion.

Lauren E. Petrulo (28:54)

I would say, can I give you my favorite thing that I do with AI? If you're comfortable spending, like, you're willing to spend 15 to 20 minutes a day. I use chat. That's my default one. And you can have it send you daily tasks or daily reminders. So like I have it sending me a notification every day of a new way to say, give me a Kiss in a different language. So that's like a small use case if you want to like work on something or get in motivation or watch Ralph's spit take of me saying how to learn. Give me a kiss. It was Icelandic yesterday, Turkish today. You can have chat GPT. I don't know if a lot of people know this, send you notifications. So what I like to do, and I did this with make like a year ago. But how you don't have to do all the extra steps that I did. You can say, hey, chat, I would like a 15 minute conversation with you every day where you're essentially just dumping all your priorities and you're like, okay, I am going to talk to you. I'm just going to like vent for 90 seconds to five minutes at a time. I need you to collate everything that I'm saying and then I need you to ask me questions, push me one question at a time so that at the end of our 15 minute discussion you can put a summary that I can give to my executive assistant or I can give to my team. Hey, here's what my boss is thinking about at the top of her head. Because how many times, Ralph, do we have business owners that are not communicating what's on the top of their head and expecting their team members to read their minds all, all the time?

Ralph Burns (30:19)

So that work for my wife.

Lauren E. Petrulo (30:22)

Oh, your wife needs to be able to read her.

Ralph Burns (30:25)

No, no, no, I'm supposed to be able to read her mind, by the way. That's, that's how it works. So I'm supposed to know what's going on in her head even if she doesn't say it. Is there an AI prompt for that? Like, tell me what my wife was thinking right now even though she hasn't told me about it. So no, that.

Lauren E. Petrulo (30:41)

Well, then you can make a companion.

Ralph Burns (30:43)

Damn.

Lauren E. Petrulo (30:45)

No, no, I, I mean you could, you could make a companion where she could chat every day and just like mind dump. Everything's at the top of her mind. And then you collate it to a report. Here's what's on the top of your wife's mind. So Jen can be like, hey, this is what I need to get done. Here's what I'm worried about. And then you can have AI systematize what are things that you can delegate to Ralph, Things that you can delegate to your sons, things that you can delegate to her friends or things of that nature. Like I have it sent and it can send it into Slack. You can. Then you have to use web hooks. But you can have this whole report collated, sent to you, copy and paste to your team, or you can have it sent as an email, or you can put into Slack, or you can have it create ClickUp tasks automatically. But if you're like using it, just have a conversation. Just know that like, the more you use AI, it's not less work. For me at least, it's a lot more work. It's increasing the quality. And I'm having it diverse. Like discuss back with me, ask me questions to build a. Here's Lauren's high priority list.

Ralph Burns (31:41)

Here is, here is where we're at with this right now. That is all very useful. Like, this is a perfect case of like, why Jen should watch this presentation here because I can't even get her to use Gemini, let alone I've been trying to get her to use LastPass for like seven or eight years, like some kind of 1Password or whatever it is. Anyway, that's going to be a longer selling cycle. But the point is, is this is. This show is about trying to get those people who have been reluctant to adopt this technology to at least adopt it. I think with my wife, it's going to be probably a much harder sell than it is for people internally at tier 11 who are definitely far along on the continuum here. But it's like, how do you push people to even be more on the vanguard and push the edge? That's where it gets a little bit challenging. There's a whole issue with, you know, AI and utilizing that with clients and branding and all these other sorts of things we've talked about. We could do a whole show on that. Point is, hopefully you got a lot from today's show to show you the magnitude of what is happening right now with these large tech companies. How much investment is being done in this thing and it's not going away and it's just going to get even greater and greater and greater and I don't see an end to it. At some point there will be a bubble that probably bursts is my guess. I don't think we're close to it right now. So adopt one of these things. Pick the one task, get AI to figure out what that task is, that you don't have to do it anymore, and then let us know how you do. So of course, wherever you listen to podcasts, leave us rating or review, we really do appreciate that. And of course we are still running our buy one, get two free special over at tier 11. Creative diversification. Get the creative diversification easy for me to say pack and get your media buying and your tier 11 data suite which is 99.4% accurate to get all your last click first click all your click data so we can read all that and leverage AI and then meta Andromeda update using Creative diversification. So head on over to tier11.com apply. Get that. I think we only have seven left right now. We've already sold like four of them so you better get in quick. Anyway, on behalf of my amazing Vegas style casual Hanging in the Mansion co host Lauren E. Petrulo, ciao till next show. See ya.

Lauren E. Petrulo (34:08)

You've been listening to Perpetual Traffic.