Marc Andreessen and Sheryl Sandberg: Tech Is Not Driving Income Inequality

This morning at Fortune’s Global Forum conference in San Francisco, Fortune interviewer Alan Murray got quite an earful from the guests on his panel: Facebook COO Sheryl Sandberg and venture capitalist and Facebook board member Marc Andreessen, who pushed back hard on the notion that technology is exacerbating income inequality.

It was a riveting chat that touched on what’s next in mobile, whether Facebook might restructure itself a la Alphabet, and why Andreessen has seemingly been promoting Facebook competitor Twitter by spending so much time publishing to the platform. Some highlights follow.

On the changes brought by mobile. . .

For his part, Andreessen talked at some length about the “smart phone wars,” and the fact that “gigantic manufacturing capacity is being built up worldwide” – from screens to chips to batteries – which has driven down the cost of making smart phones to $25.

That’s great for smartphone customers, of course, but it’s also great for investors, he suggested. The reason: The same components are now used to help produce electric cars, drones, virtual reality hardware and connected toys, among other things. There are “thousands of categories that weren’t possible before that will use smart phone components,” he said.

Sandberg meanwhile addressed how mobile is changing life for business owners, who now have a way to connect with their customers all day — and who have different expectations to meet as a result. It isn’t easy, particularly given that 35 percent of U.S. small business owners don’t have a web presence and that mobile is even harder for them (given the complexity of app development, integrations, and so forth). But Sandberg said Facebook is making it far simpler for them to reach their users online, including by helping them run personalized ad campaigns. Sandberg also noted that one million small businesses have filmed and uploaded video to Facebook. Very few of them would have been able to produce a TV spot, she noted.

On the most exciting things happening in artificial intelligence . . .

Andreessen has an interesting and increasingly common vision of the future with regard to AI. Most notably, he said he thinks that sensors in our phones and “adjunct devices” will be fundamental to our health in the future. His firm’s investing thesis, as he described it, is that the quantified self movement is akin to a “hobbyist beginning” and that 10 to 20 years from now, “the idea that you don’t know what’s happening in your body all the time” will seem “primitive.”

Indeed, Andreessen expects we’ll understand not only our sleep patterns and nutrition but also our genome and biome; that we’ll have algorithms that help in making more healthful decisions and aiding with early detection; and that we’ll have back-up data that helps doctors reconstruct the sequence of events when things start to go wrong.

On the future of virtual reality . . .

Virtual reality is “becoming reality,” said Sandberg, who talked about the power of pictures to make us feel far more “human emotion” than is possible when simply reading about others. Facebook-owned Oculus VR, whose technology enables users to have more immersive experiences, is just the start, she suggested.

Andreessen agreed, saying there’s a “pretty good chance” that telepresence will get to a point in the next ten years where “we’ll be close online to what the real-world version is.” (Goaded by Murray, Andreessen went on to joke that his appearance at the Fortune conference was itself virtual. “I’m actually home in my breakfast room having a bowl of cereal,” he said, eliciting laughter from attendees.)

On whether technology is driving inequality . . .

Here, the exchange between Murray and Andreessen grew slightly testy, with Andreessen arguing that technology is in no way driving inequality. (As an aside, I’d love to hear Andreessen and fellow investor and futurist Steve Jurvetson – who thinks technology is accelerating the rich-poor gap — discuss the issue.)

As far as Andreessen could tell, there are more jobs than ever, and we’re seeing the biggest reduction in poverty that the world has seen. (He’s right, according to the World Bank, which said last month that the number of people living in extreme poverty is likely to fall below 10 percent of the world’s population for the first time this year.)

While Andreessen observed that “global inequality is falling not rising,”  he did concede that “within countries and industries,” inequality is an issue to be addressed. Pressed on that point — Murray hinted at the vast and growing gap in pay for executives and the rank and file — Andreessen asked, again to laughter: “Is this Fortune magazine? Did I stumble into an International Workers Party conference?”

Sandberg was less cavalier, noting that inequality, particularly when it comes to the accessibility of a good education, is a “huge issue in our country and the world.” But she, too, fought against the notion that technology itself is creating negative economic impacts for some in society. In her view, “technology creates a cure and a treatment” for a growing number of the world’s woes, including by helping to measure progress around education, the treatment of malaria, and to sell crops for more competitive prices.

On whether Facebook – whose holdings include WhatsApp, Instagram, and Oculus – might restructure as has Alphabet, the new parent company of Google . . .

Sandberg said the answer to this question is no. Partly, that’s because Google is “way older and bigger than we are,” she said. Facebook is also “lucky to be founder led,” she added, suggesting that by keeping Facebook and its subsidiaries somewhat distinct – with Facebook CEO Mark Zuckerberg running Facebook, Instagram cofounder Kevin Systrom running Instagram, and Oculus cofounder Brendan Iribe continuing to run Oculus — the company’s “structure works for us right now.”

Before he let his guests go, Murray asked Andreessen about Twitter and why he famously spends so much energy on the platform instead of on Facebook . . .

“I believe I’m doing valuable competitive analysis,” kidded Andreessen, who went on to suggest that he goes where he can engage with the press, and that’s still Twitter.

Naturally, Andreessen’s response begged the question from Murray: Might Facebook acquire Twitter?

“We’re never discussing M&A [publicly],” said Sandberg. “Jack [Dorsey] is a friend, and we’re excited to see where he goes at Twitter.”

Update: Fortune has posted video from the portion of the interview where Sandberg and Andreessen discuss inequality and the role that tech does or doesn’t play, both in terms of output and opportunity. It’s worth watching if you have a few minutes.