When the Machine Finally Goes Too Far

Author Paul Kingsnorth has spent years warning about "the Machine" – society's relentless push to turn life into data and screens.

In his new book, Against the Machine, Kingsnorth argues we've reached a breaking point. He says technology has stopped serving... and is now consuming the very experiences that make us human.

Real conversations replaced by social media... artificial-intelligence ("AI") therapists... a lack of authentic lived experience...

Kingsnorth moved to rural Ireland to grow his own food and homeschool his children. But Americans are fighting the Machine in their own way – by paying up for real experiences: $5,000 Taylor Swift tickets, $500,000 country club memberships, and $1,000 monthly fees for youth sports.

That's not just inflation. It's a sign that the Machine is losing, especially with the wealthy.

And the Machine's most immersive tool, virtual reality, may be what finally turns people away from the synthetic world.

Even as a technology optimist and early adopter, I can spot a loser...

The Reality Rebellion

Virtual reality ("VR") is the Machine's final goal: replace reality itself...

With a headset, you can "visit" the Louvre, "see" the Great Pyramids, or "perform" with your favorite band.

It has been 11 years since Meta Platforms (META), then Facebook, acquired Oculus for roughly $2 billion. And since 2020, Meta has spent more than $60 billion on VR development.

Oculus looked like the future of how we'd connect. But unlike phones, chatbots, or self-driving cars, consumers aren't buying in, especially the wealthy. My own Meta Quest and Apple Vision Pro gather dust in the closet.

This isn't just an adoption problem. It's Kingsnorth's rebellion against the Machine unfolding...

The more our virtual worlds grow, the more people will crave the real one. I call this the "reality premium."

Those who can afford high-end tech aren't using it to escape reality... They're using their wealth on increasingly exclusive, authentic experiences.

The Machine's Failure to Launch VR

VR has gone too far. It's asking consumers to part with three things they value most...

• Physical presence over digital imitation. If you can afford a $3,500 headset, you can afford real experiences. Taylor Swift fans proved it – they'd rather pay $5,000 for live seats than watch a virtual concert.

• Human connection over isolation. VR happens alone, in a living room. But the wealthy are placing increasing value on shared experiences. Country club memberships are at record highs because you can't virtualize the relationships formed during a round of golf.

• Authentic status over simulated achievement. Posting from a sold-out concert or an exclusive resort signals a genuine experience that VR can't replace.

The problem is clear: VR fixes problems the wealthy don't have, while creating isolation they won't accept.

Two Competing Investment Baskets

VR's failure shows the Machine's greatest flaw: It assumes people want easy and efficient over real and human.

But the wealthy – the early adopters who drive technology revolutions – are proving the opposite. They're spending more for real experiences, not digital ones.

That creates a clear split...

There are companies like Meta and Apple (AAPL) betting billions on our virtual future. They're the Machine's last stand...

Meta dominates the headset market. But loses more than $13 billion annually building a digital world no one wants. And Apple is betting on its Vision Pro, hoping people will trade real life for mixed reality.

But even the biggest tech giants know VR alone can't make a business.

Then there are the companies benefiting from the demand for authenticity...

• Cruise lines: Royal Caribbean (RCL) and Norwegian (NCLH) sell real sunsets and real company.

• Live entertainment: Live Nation (LYV) and Sphere Entertainment (SPHR) deliver performances that can't be streamed.

• Luxury travel: Vail Resorts (MTN) and Las Vegas Sands (LVS) give people fresh air and excitement.

• Hotels: Marriott (MAR) and Hilton (HLT) offer true service with human warmth.

These companies win because they sell what the Machine can't – genuine human experiences. And that's becoming more valuable precisely because digital alternatives exist.

VR will still have uses in defense training or education. But as a consumer product, it has already failed. Early adopters are voting with their wallets... and they're choosing reality.

Kingsnorth warned the Machine would eventually go too far. With VR, it finally has.

And the shift away from the virtual world is creating some of the best "reality premium" opportunities of our lifetime.

Good investing,

Josh Baylin