[HN Gopher] How Big Tech got so big: hundreds of acquisitions ___________________________________________________________________ How Big Tech got so big: hundreds of acquisitions Author : kjhughes Score : 343 points Date : 2021-05-04 10:46 UTC (12 hours ago) (HTM) web link (www.washingtonpost.com) (TXT) w3m dump (www.washingtonpost.com) | dkyc wrote: | This is a strange analysis. "Number of acquisitions" seems like a | weird metric, without accounting for their significance (in | purchase price, impact on the business, or any other real-world | metric). | | facebook buying Instagram was probably more significant than all | the other acquisitions combined. | Alex3917 wrote: | > facebook buying Instagram was probably more significant than | all the other acquisitions combined. | | Deja News was probably the biggest tech acquisition by a FAANG | company. The average white collar worker spends ~6 hours a day | in their Gmail, and about 5 min a day using search. | sokoloff wrote: | I'd have estimated more like 10x that on search and around | 1/4 of that in gmail. | jeffbee wrote: | How did buying Deja's hard drives -- they did not acquire the | company, only "significant assets" -- lead to Gmail? | Alex3917 wrote: | IIRC their email parsing code became the basis of Google | Groups, which then became the basis of Gmail. | jeffbee wrote: | As someone intimately familiar with that software, I | doubt this. Every line of the Gmail delivery stack is | home-grown, but if you were to identify an acquisition | that most influenced the project it would be Neotonic, | not Deja. | [deleted] | throwaway3699 wrote: | Gmail started life as a 20% project that was basically a | Frankenstein version of Google Groups. | jldugger wrote: | I mean, the UI/theme was clearly borrowed, but that's not | necessarily any indication of the backend implementation. | And they probably both use bigtable, but so did basically | everything customer facing at the time. | Alex3917 wrote: | Yeah, this is the version I remember also. PB has said | many times that he built the first version that could | only display threads of his own email in a day. But going | from a series of raw email messages to an email thread | that can be displayed conversationally on the web is a | multi-year project, so clearly there was some already | existing code doing the heavy lifting. | | E.g. the email parsing code in Thunderbird dates back to | at least the late 80s, and even after decades of working | on it at a cost of hundreds of millions of dollars, it's | still a work in progress. | [deleted] | mrkurt wrote: | Google buying Doubleclick helped them crush the ad market for | publishers. | | Number of acquisitions is interesting, though, because you can | also phrase it as "number of potentially viable independent | companies that no longer exist". We are better off with more | independent companies. | dageshi wrote: | They all learned from MS. MS tried to buy Netscape but didn't | offer enough and got turned down. So MS set out to use its | position to boost its own browser instead, anti-trust | followed because it was obvious MS was using its position to | muscle out an independent company. | | For the big Tech companies now, small acquisitions are win | win wins, they get the people, they get whatever was | developed and they permanently avoid Microsofts Netscape | situation. | | That being said, I'm guessing no small number of these | startups were setup with the express purpose of being bought | out like this. | pjmorris wrote: | > For the big Tech companies now, small acquisitions are | win win wins, they get the people, they get whatever was | developed and they permanently avoid Microsofts Netscape | situation. | | I have a theory that this is why MS treats its research | division staff and interns so well. It reduces the amount | of competitive pressure MS would face if they were all | working elsewhere/on their own startups. | the_duke wrote: | Many corporate acquisitions have the sole purpose of killing | off/absorbing companies early, before they gain traction in the | market and become viable competitors. | | Focusing on real world metrics will give a very incomplete | picture of the impact acquisitions might have had on the | market. | CarelessExpert wrote: | > "Number of acquisitions" seems like a weird metric, without | accounting for their significance (in purchase price, impact on | the business, or any other real-world metric). | | This comment sounds like the nirvana fallacy striking again. | | There is no perfect metric for measuring something like overall | market dominance. | | Thanks to a series of supreme court rulings, the traditional | approach has been to look at consumer harms. But that metric | alone fails to account for the way modern large conglomerates | make money: not by gouging the consumer, but by dominating | entire industries. | | So how else can you look at it? | | Acquisition are just another lens. Is it an imperfect lens? | Yes, of course. I challenge you to find an analysis that isn't. | | But is it still meaningful? Yes, I absolutely think so! It is | undeniably the case that these tech giants have used | acquisitions as a way to protect their market position. So it | absolutely makes sense to analyze their behaviour from that | perspective. | | Furthermore, this is a news article not a whitepaper. Yes, | there is an enormous amount of nuance in this kind of argument, | and if you were prosecuting these guys for antitrust violations | in a court of law, you'd probably do a deeper dive. | | > facebook buying Instagram was probably more significant than | all the other acquisitions combined. | | How do you know that? There's simply no way to know how some of | these companies would've fared because these anti-competitive | practices have ensured that promising startups are smothered | before they become a threat. | scyzoryk_xyz wrote: | Alot to agree with here - how would Google have faired | without being able to strategically acquire companies that | made specific tech for ads and search? | divbzero wrote: | Yes, I would have wanted to see the graph of acquisitions | weighted by purchase price but that data is hard to find for | many acquisitions. Impact on business ( _e.g._ , revenue | contribution) would be even better but requires subjective | judgment and estimation. | ahartmetz wrote: | It makes some sense. The more acquisitions, the higher the | chance of doing well (that wording doesn't apply to price) in | the metrics you mention. Especially if the perspective is | extrapolating the past to the future. | | The thesis of the articles seems to be: Big tech will stay | dominant because they will keep buying lots of companies and | they will likely continue to win with some. To stop this, blah | blah law changes or something (I only skimmed the article). | richardwhiuk wrote: | I'm always surprised that FAANG - or Big 4, excludes | Microsoft.... | jasode wrote: | _> I'm always surprised that FAANG - or Big 4, excludes | Microsoft..._ | | Because the _original context in 2013_ of Jim Cramer | popularizing "FANG" / "FAANG" was _growth_ and even though | Microsoft was already one of the biggest tech companies, their | stock price wasn 't really _growing_ like the newer FANG. | | https://hackapedia.com/terms/f/faang | | Others later tried to revise the acronym to include Microsoft | with variations like FANGAM -- but it doesn't seem to gain any | popularity in internet discussions or mainstream media. | tempfs wrote: | MSFT not growing? | | https://www.nasdaq.com/market- | activity/stocks/msft/advanced-... | jasode wrote: | _> MSFT not growing?_ | | Are you talking about recently or _circa 2013_ when Cramer | popularized his FANG acronym? Before 2014, MSFT growth didn | 't compare to the newer web dominant companies like | Facebook/Amazon/Netflix/Google. He also left out other | giant tech companies with lower growth like IBM, Oracle, | SAP, Yahoo!, Hewlett-Packard, etc. | asiachick wrote: | In Japan it's called GAFA at least in the news I watch | | https://ja.wikipedia.org/wiki/%E3%83%93%E3%83%83%E3%82%B0%E3. | .. | mrep wrote: | In france, it is GAFAM: https://fr.wikipedia.org/wiki/GAFAM | guerrilla wrote: | > Jim Cramer | | The guy yelling on TV all the time? | Analemma_ wrote: | I think Microsoft likes it that way. It's a little thing, but | it's just one more little piece that helps them go unmentioned | in most of the culture war bomb-throwing about Big Tech. | Closi wrote: | FAMANG doesn't have quite the same ring to it. | truth_ wrote: | I have seen real people using FAANGMULA in official documents | in real life. Some people don't care about the ring. | | U, L, and A are Uber, Lyft, and Airbnb. | [deleted] | annadane wrote: | The fact Facebook used Onavo and lied out the ass about Instagram | and Whatsapp automatically means they should be broken up, in my | opinion | ceilingcorner wrote: | He's uh, not so popular here these days, but I recently heard a | quote by Peter Thiel and thought it was insightful. Not sure | where it was from, exactly. | | "The way to build a big company is to never get acquired." | patfla wrote: | Big Tech got so big because digital technology is different from | preceding industries in that increasing (not decreasing) returns | to scale prevail. In particular, in software where marginal costs | are near 0. It's a different ballgame. I think regulators have | figured this out but for the most part it appears that they don't | know how to act upon it. | | https://en.wikipedia.org/wiki/Returns_to_scale | rmah wrote: | Um, the concept of "econommies of scale" is something that has | existed since the start of the industrial revolution. This is | nothing new to Big Tech. | marcosdumay wrote: | The GP is talking about the second derivative of the price, | not the first one. | | What he talks about is new. And I believe he is wrong, it's | just a negative value very close to zero, not positive. | patfla wrote: | Traditionally, you had _decreasing_ returns to scale. What's | new with digital technologies is _increasing_ returns to | scale. Very counter-intuitive for traditional economists - or | even business people. People like Gates, Bezos, Brin & Page, | Zuckerberg and so on have ridden this for all its worth. | Let's out distance them as much as we can before they figure | this out. Whether competitors or regulators. | | That said, I like the story about someone observing Gates at, | I think, a graduation ceremony where Gates had brought along | a biography of Rockefeller (John D.). Did Gates know before | or after the fact that MS had in fact used a competitive | strategy comparable to Standard Oil? | | Meaning, unlike increasing returns to scale that was | something for which there was an historical precedent. The | basic idea being: when my competitors revenues go up, my | revenues also go up. A fatal long-term proposition for those | competitors. | akiselev wrote: | GP is talking about the marginal benefits of scale. In | manufacturing, there is a floor at which increasing scale | doesn't decrease the cost of making each additional unit. No | matter how much a widget company automates their factories, | they can't bring down the cost of a widget below the cost of | the raw materials. At some point, investing into making | widgets becomes a negative ROI. | | That often never happens with software because network | effects allow each unit of raw material (servers, data, etc.) | to produce more value as part of the whole. It would be as if | a widget factory could make 2 pounds of widgets out of 1 | pound of raw material when it double its sales. | mastrsushi wrote: | How are you guys able to read WP and NYT articles? I keep getting | locked out with subscription ads. | commandlinefan wrote: | I always thought that a tech company buying another tech company | was the strangest thing: if another company makes software, and | you make software, and you want software that does what that | other company's software does... why not just write new software | to do that? But, clearly, these guys know something I don't know. | fakedang wrote: | Acquisition is not about buying the software, it's about buying | the user base. | bhupy wrote: | Because of the time-value of money. | | https://www.investopedia.com/terms/t/timevalueofmoney.asp | wott wrote: | Sometimes they don't want the software that much that they want | the customers. | staysaasy wrote: | I think that this is a very reasonable observation. It's | definitely weird in theory, but the reasons that I've seen are: | | * Very large tech companies build software (relatively) slowly | due to their size | | * Sort of like a toddler, you don't know what you want until | you see that someone else has it. Another company hitting | product/market fit + traction proves the value of a product | that you might have just hypothetically wanted | | * You're often buying a go-to-market motion (marketing, sales, | services, etc) that complements a product | | * In some cases, you're buying talent that would be difficult | to hire + train on your own _fast_. Ie even if you could | theoretically hire 50 traffic mapping engineers, you can get | them onboarded onto your team faster by acquiring Waze | throwaway3699 wrote: | Software is about domain knowledge more than code. | | Also, userbase and customers are valuable. | schnevets wrote: | I'm sure there's some accounting wizardry that helps make this | viable, but it could just be the optimal strategy if a Big Tech | company has a warchest of cash, but knows some of it could be | hemorrhaged by taxes (or the costs related to transferring | funds) if it isn't spent. $20 million to acquire a development | team for a few new features may seem like a lot, but it is a | more surefire thing than spending $10 million to hire, design, | and build a competitor. | munificent wrote: | Two key reasons: | | 1. You want to acquire the existing users of their software. | | 2. Buying them essentially stops progress on your competition. | Let's say you _don 't_ buy them and instead decide to write | your own software that does what theirs does. Maybe it takes | you a year to write a program that does everything theirs does | today. In that year, they've also made a bunch of progress, so | you're still behind. If you have enough resources, you may be | able to catch up and overtake, but they have the advantages of | greater expertise, userbase, and lead time. Because of those | advantages, it's often cheaper to buy them. | | In general, companies don't like to compete. Competition is | spending resources to simply cancel out the expenditure of your | competitor. Zero-sum games like that don't make you richer. | Companies naturally prefer to be monopolies, or at the very | least cabals. That way they can fully exploit their product | area and can control prices as much as they want. | jedberg wrote: | I think it's disingenuous to say that Amazon acquired cloud | computing companies as a new line of business. They built that | unit in house and were well established before they started | buying related companies. Those acquisitions should be on the | "core business" side of the graph. | narrator wrote: | There is an enormous difference in how expensive capital is at | the startup level vs public company level. | | Startups have to convince Angel investors $25k at a time to | invest in their startup through a long and laborious sales | process. Publicly traded companies just have to issue stock and | the market just pays for it out of millions of people's dividend | reinvesting 401k plans. | | The difference also comes into play in real estate. Putting | together the money to do a multi-family apartment building takes | lots of talking to banks, personal guarantees, developing | relationships over decades with other investors, not hitting a | bad market cycle, etc. Once a property becomes worth about $50 | million dollars, usually due to a growing economy in the area or | the neighborhood becoming more valuable, a REIT will come in and | buy it like it's nothing. That's because the REITs have all that | public market money to play around with that they get for a much | lower cost of capital. The REIT doesn't even have to run it that | well because their cost of capital is so low that the | profitability requirements for the project are much less. Same | thing goes for big tech which has bought hundreds of startups and | shut them down or run them poorly. | 1vuio0pswjnm7 wrote: | "You're probably reading this on a browser built by Apple or | Google." | | Nope. Guess again. (Wait, I thought "new technology" makes | websites all-knowing. I guess not.) | | "If you're on a smartphone, it's almost certain those two | companies built the operating system." | | Not using a "phone" either. | | "You probably arrived from a link posted on Apple News, Google | News or a social media site like Facebook." | | Nope. Link posted to HN. | | "And when this page loaded, it, like many others on the Internet, | connected to one of Amazon's ubiquitous data centers." | | Nope. Using customised text-only browser with prefetch disabled. | No suppport for autoloading resources. And I can fetch the page | from archive.org, avoiding AWS, automatically with the loopback- | bound forward proxy I use. | | Clearly those opening statement by the four authors were just | assumptions. Tired ones at that. Not the most creative way to | open an article about what is for many of usan old topic. | | The authors had little power to predict what I am using with | seemingly zero effort. | | (Not to suggest predicting these things would be impossible, but | it is not as effortless as the authors would have us believe.) | | Maybe it has something to do with the software, inlcuding the OS, | I choose to use. But I guess that does not make for an | interesting topic for WaPo. | | The point here is that none of the "technology" developed by the | "talented engineers" assumed by the authors as the driving force | behind the subject "tech" companies was necessary for me to read | the same article as everyone else, without any of the tracking or | negative baggage that comes with companies like Apple, Google or | Amazon and the economic havoc in which they are content to | thrive. | | Choices matter.^1 Tech companies want to (effectively) remove as | much choice as possible. | | They have been very successful at this, to the point where people | can write articles that begin with blind assumptions about what | software readers are using. | | 1. As in "defaults matter". | throwaway823882 wrote: | Mergers & Acquisitions are a foundational part of building any | major conglomerate or corporation. Every industry does it. | Energy, Media, Technology, Healthcare, Finance, Food, Clothing, | whatever. Big _Anything_ can be measured by this, but the sheer | number of them does not mean as much as how much of the market | they suck up through each one. | | The unstated end goal of every capitalist organization is to | become a monopoly. Do people just not want to acknowledge this? | Because that's kind of what every decision of competing | corporations is always leading towards. You can't gain infinite | capital unless you are always absorbing or eliminating more of | the competition. The whole point of competition is not co- | existence, it's domination. | neonate wrote: | https://archive.is/WmkqB | jareklupinski wrote: | ty for the link. i love how the source only shows the url for a | second before replacing it with the root domain to prevent | people like me from copy/pasting the story url into an | incognito tab | | the cat and mouse game goes on, wapo engineers! | brobdingnagians wrote: | Software had the promise of massively decentralizing business; | anyone with a computer and a bit of knowledge could start hacking | away at a new product. It is a bit sad to see big tech becoming a | way of even more centralization of power. I guess it had the | potential for either; individuals being able to easily capitalize | on it, or businesses being able to replicate infinitely and have | huge margins from very little input capital. But maybe both are | happening at the same time. A double edged sword, like so many | other things. | dredmorbius wrote: | That's the myth we were sold. It's the myth many of us | believed. I certainly did. | | In truth, greater efficiencies _don 't_ decentralise, they | _centralise_. The market area expands. Suppliers or vendors, | rather than competing locally, compete regionally or globally. | In winner-take-all markets, there is only one winner, | worldwide. | | There are some twists on this, having to do with regional | customs, language, and law, mostly. There's also the time | element, where tech monopolies tend to be ascendent, then | (often but not always) replaced. Still, a technological | advantage can last a _very_ long time, as with IBM and AT &T. | Two of today's FAANG date from the 1970s, another two from the | 1990s. Dominance can be long-lived. | | There were some who saw this coming. Andrew Shapiro's _The | Control Revolution_ (1999) kinda-mostly saw this coming, and | certainly called out the major aspects. Shoshana Zuboff | recognised at least some of the potential in the 1970s and | 1980s. | | The crowd still believes the lie, for the most part. | api wrote: | In biology we understand fairly well that environmental | complexity leads to greater biodiversity. If the Earth's | environment were entirely uniform there would probably be | only a few species and nothing would ever change. | | Global highly efficient markets are like a polished flat | globe with a uniform climate everywhere. Evolution would | produce only one or two species in permanent equilibrium. | TeMPOraL wrote: | The more I think of it, the more I realize, biology is very | much unlike the market in such analogies. | | In a way, the market is biology flipped on its side, like a | transposed matrix - where in nature, life forms mostly | cooperate within their species (or at least ignore each | other) and prey on other species, on the market, companies | of the same type fight it out, while ignoring or | cooperating with companies of different types. | | But I think the main difference is _scale_. The area of | influence of a life form - where they live, hunt, reproduce | - is _very limited_. Same is true with companies serving | local markets. A local glass factory. A corner market. You | say: | | > _Global highly efficient markets are like a polished flat | globe with a uniform climate everywhere._ | | But it's not just a _flat_ globe. It 's a globe with a | surface of couple dozen square kilometers! It's literally a | single niche. Not even that - it's a cage. Imagine a zoo | that decided to put all its animals in a single, large | cage. You won't have to wait much before there's only one | big animal standing (and a bunch of insects scattering | about). | | On a more general note: biology is a good example that you | can make a complex and robust system by giving imperfectly- | self-reproducing agents a lot of space to play in, and then | throwing calamities at them to keep things interesting. But | I honestly don't like using it as a recipe for designing | systems, because of all the _waste_ that 's involved. Waste | of effort, waste of resources, waste of life. I feel we | should avoid this kind of hard self-regulation whenever we | can. | shkkmo wrote: | > where in nature, life forms mostly cooperate within | their species (or at least ignore each other) | | This is blatantly not true. There are condiserable levels | of intra-species competition in many species. Even in | "cooperative" species, those animals cooperate in groups, | but then those groups compete against each other. Most | predators prey on a very limited subset of the ecology. | You seemly cannot reliably predict inter vs intra species | like you seem to think. | | Also "preying on" is pretty different that "competeing | with" and at the ecological scale, predation looks much | more like interactions between industries than | competition within an industry. | | Thus the correct mapping of the analogy in this case is | between ecological niches and industries. | | Regarding your more general note: I think there is a | trade off between efficiency and robustness. Top down | heirachical structures (most companies, militaries, etc) | are generally more efficient in terms of resources used | but are vulnerable to broken/inefficient/disengenous | nodes, especially for the higher nodes. Bottom up | solutions (markets, grassroots movements, etc) tend to | use more total resources but do better at dealing with | bad nodes and are thus less failure prone. | | I would argue that the best systems tend to layer | combinations of these two types of systems. | | Edit: In the US for example, we (simplistically) have a | bottom up democracy that governs a top down government | that regulates bottom up markets that are participated in | by top down companies that increasingly rely on | outsourcing core functionality to other bottom up markets | that that top down particpants. | mikechen233 wrote: | It depends on the product. But software has stronger the | ecosystem effect and data lockin more so than any previous | technology. Think facebook, youtube, Windows, office, apple | ecosystem of products. They have two market characteristics: 1. | People need to be on the platform that others are in 2. Once | you are in you it's hard to leave. Both creates tendency for | winner takes all economics. And I think many people knows this. | Part of the reason why software companies since the 90s have | higher valuation than other industries. | coliveira wrote: | People didn't think well about the other side of the coin: if | anyone can hack away a product, then what you need to make a | lot of money is somehow gather the best minds that can make | this machine work for you and monopolize their ideas. This is | exactly the strategy behind the FAANG. | api wrote: | Software doesn't favor decentralization at all... at least not | the current software and Internet ecosystem. | | The complexity of software coupled with its absolute rigidity | makes it hard to build systems that talk to each other even | when specifications are public. When things are proprietary | take the difficulty of making software interoperable and add a | total lack of documentation and a possibly adversarial | relationship with the vendor where they'll try to deliberately | shift things to keep you out. (There could also be legal | barriers, but I'm just talking about technical ones.) | | Then consider the added difficulty of opening systems to | interoperability with other systems while maintaining security. | If you allow connections from _untrusted_ systems, now you have | to be particularly meticulous in the design of your software to | ensure there are no exploitable bugs, undefined behaviors, or | holes in your permission system. We still mostly program in | language that are "insecure by default" and make this hard. | | Then there's the Internet itself which is intrinsically | hierarchical. DNS, BGP, and the hierarchy enforced by NATs and | firewalls that separate endpoints from the "real" Internet all | make the network favor a "feudal" client-server model. We | shouldn't be surprised that the Internet produces a lot of | monopolies and closed silos; software built around the Internet | takes on its shape. | | Last but not least there's the use of cryptography to enforce | walled gardens: certificates, code signature requirements, | closed app stores, etc. This adds an artificial barrier on top | of everything I mentioned above. | | Compare this with older mechanical and analog systems. Even | complex mechanical and analog electronic systems are | straightforward to examine, measure, characterize, and | understand. Ignoring patents and other legal restrictions it's | straightforward to build replacement parts or interoperate with | physical systems. | breck wrote: | Big Tech got so big because of Intellectual Slavery laws. That is | the gravity here. | guerrilla wrote: | > Intellectual Slavery laws | | What is this intended to refer to? | breck wrote: | Copyrights and patents. | CPLNTN wrote: | Probably the H1B | alexott wrote: | McAfee is a good example when acquisitions didn't went well... | goatcode wrote: | Reminder that WaPo is owned by Jeff Bezos. | olliej wrote: | As opposed to the car companies, military contractors, airline | manufacturers | kartoolOz wrote: | How big tech got so big, passive funds. | lotsofpulp wrote: | I would rather point to the astronomic profit margins and ever | increasing cash flow for 10+ years. | notacoward wrote: | The article seems to overlook that they also got big by going on | _insane_ profit-fueled hiring binges. Or at least I didn 't find | it skimming through that _awful_ format. | | Tens of thousands of engineers, at salaries that make other | companies turn green with envy, churning out products and | features and supporting infra at an unprecedented rate. Then the | cycle repeats. I think that counts for something too. | jyu wrote: | This is lazy reporting. Where did the money come from to do the | acquisitions? Google and Facebook have great monetization by data | mining their audiences for advertisers. All they needs is to buy | more eyeballs (youtube, whatsapp, instagram, etc). | | Amazon is slightly different. They benefit from the creative | destruction caused by physical retail purchases migrating to | ecommerce and the subsequent value capture by Amazon. Any revenue | increase from them is from behavior changes, efficiency gains, | and death of inefficient retail. | NortySpock wrote: | Under Amazon, I would also include commoditizing compute and | selling you their spare compute cycles (AWS) as their major | efficiency win. | | Finally, Amazon is automating warehousing in their logistics | (first using automated checklists for people walking around the | warehouse, now using Amazon Robotics, formerly Kiva Systems) | scarface74 wrote: | The myth that Amazon "sold their excess computer capacity" | has been disproven for years. | | Just think about it. If Amazon had excess computer capacity | and sold it to other companies, what was it going to do when | it needed that excess computer capacity? Kick others off? | pessimizer wrote: | > death of inefficient retail. | | More like lobbying to maintain a tax holiday for a very long | time. I suspect retail will slowly come back due to the end of | that tax holiday, and Amazon's devaluing of their platform with | counterfeits. | | I'm also not sure that the distinction that you're making here | is super-significant. Facebook and Google are plundering | advertising spend from print just like Amazon took over retail. | miguelrochefort wrote: | For those wondering how big "Big Tech" companies are, I compiled | a spreadsheet of over 600 products and services that illustrates | the scope of their offering. | | https://news.ycombinator.com/item?id=27040162 | gregwebs wrote: | My understanding is that the vast majority of these M&A destroy | capital. The reason to own dividend stocks is not because they | pay dividends but because they don't have tons of cash lying | around to spend on low value projects or M&A. | | It would be a lot more insightful to discuss the aquisitions that | have a known positive impact. The truth is probably that each | company had just a few very important acquisitions (that should | be more closely scrutinized). | | Our current tax laws make vertical integration or even | conglomerates more tax efficient. Greater scrutiny of anti- | competitive mergers is needed, but we should also make separate | companies just as tax efficient (VAT tax, etc) and otherwise | closely examine how we can change economic incentives here. | hogFeast wrote: | Yes, tech firms incinerate capital on these deals (generally, | Google particularly). It is confusing cause and effect: these | firms are large (with little to no shareholder oversight), and | so can spend large amounts of money on useless acquisitions. | | The effect on innovation is the opposite: ppl start up | companies knowing they will get bought (I wouldn't call this | innovation but others would). | | And your point about dividend stocks is wrong. Dividend stocks | are usually cash-generative businesses that have high ROI but | are capital constrained. For various behavioural reasons, | people underpay for these stocks...although you have to factor | in that dividend stocks will generate taxable income, so the | returns tend to be overstated. Either way, it is neither here | nor there...the question is about what you pay and what you | get. You pay a certain price for marginal ROIC, the question is | whether the price you are paying allows a decent return | (generally speaking, I don't like dividend stocks, they are | slow-growth, I will have to pay tons of taxes, and I will have | to work out how to recycle the capital...I would much rather | own a stock that can retain my capital and invest it for me at | a high rate). | | Btw, the reason why M&A happens and destroys capital is because | it is a very easy route to growth, investors aren't | sophisticated about value-destroying deals (if they result in | growth in EPS), and comp is usually based on growth. It is a | pretty toxic combination (you can't push on a string, most | businesses can't grow fast, paying execs doesn't change that so | the execs walk away with a big sack of your money and you end | up with nothing). | taurath wrote: | I'm sitting here wondering whether there might ever be a tax on | user data. It sounds a bit strange but I do feel like we | underestimate how much data consolidation creates uncompetitive | environments. | Kadathan wrote: | Even worse is that all of this data can be used to infer | other data. Once you know enough about a person, you can | start making some alarmingly accurate guesses about them. I'm | hoping for a lot more than a tax on this kind of data, | myself. | dcolkitt wrote: | > My understanding is that the vast majority of these M&A | destroy capital. | | It'd be interesting to see whether the modern tech industry is | an anomaly with regards to this longstanding pattern. In | particular, I wonder there's an exception for the typical | acquisition of smallish, fast growth startups by a tech giant | who can generate synergies by quickly integrating the tech on | to their platform. Historically these types of acquisitions | wouldn't show up in the M&A literature, because the targets are | private companies, and the standard estimation techniques rely | on public equity returns. | Wowfunhappy wrote: | Ideally, we wouldn't have corporate taxes. They're well- | intentioned as a tax on the wealthy, but it would make much | more sense to just tax the _people_ who are wealthy! Tax them | more than we do today, and get rid of carve-outs like Capital | Gains. | dalbasal wrote: | "Destroy capital" is unavoidably speculative, I think. I'm not | sure it's the most useful frame. No need to be abstract if | we're referring primarily to a few large | companies/conglomerates. | | Instagram, Whatsapp, Youtube, Android, Doubleclick, etc.. Those | acquisitions are undoubtedly a major part of how Google & FB | got to here... and here is a good place for shareholders. IMO, | it's hard to argue management destroyed value, but we don't | ever know alternate realities. | | Either way, I think there's a strong case that "competition for | monopoly" is the key dynamic here. A business similar to | adwords-google but with only 1% of the market share is worth | way less than 1% of adwords-google. Think of Yahoo/MSFT's | attempts at adwords' runner ups. How much is reddit worth, | relative to FB? There are lots of examples. Even if the market | does have multiple contenders, the power curve tends to be | mighty in modern, software-centric economics. | | For a variety of reasons, strong pressure to consolidate | appears to be the case often. Whatever those reasons, this | creates/describes a strong incentive to consolidate. We know | empirically that consolidation happened, and acquisitions | played a role. Consolidation also happened in cases where | acquisitions didn't play a major/obvious role. | | Tax laws are one of those reasons, but not the only ones. | There's low interest rates, the laws of other countries, the | business cycles, financial markets, etc. It's financial markets | that have the operative say on capital creation vs destruction. | _They_ value FB highly, and have usually seem pleased with M &A | in terms of demand for the stock. | | There are also "natural" reasons for M&A, and consolidation | more broadly. Software is cheap to replicate/scale and is often | winner-take-most. Media is similar. Ad markets (and | marketplaces generally) exhibit network effects. Networks (like | social networks) exhibit network effects. | | IMO the whole theoretical/legal framework of antitrust is quite | bougus, in 2021. Monopoly isn't just about pricing power, and | whatever else ancient economists observed in previous | centuries. | andrewjl wrote: | > Monopoly isn't just about pricing power, and whatever else | ancient economists observed in previous centuries. | | This understanding of monopoly has only existed since the | mid-20th century. Prior to that, the definition of a monopoly | was more expansive and included analysis of market & industry | structure. | timy2shoes wrote: | The start of this line of thought was Robert Bork in 1978: | https://en.wikipedia.org/wiki/The_Antitrust_Paradox | dalbasal wrote: | cheers both. I thought these were from the 20s. | andrewjl wrote: | The IMO best contemporary overview of the legal issue as | it pertains to tech is this piece[1] by Lina Khan. Love | the subtle irony I did not catch until today in the | title, "Amazon's Antitrust Paradox". It cites and argues | the opposite of the Bork piece in many respects. | | [1] https://www.yalelawjournal.org/note/amazons- | antitrust-parado... | marcosdumay wrote: | > we should also make separate companies just as tax efficient | | Corporation taxes should be progressive too. Huge corporations | are harmful to society, we should incentive many small ones to | take their place. | crazygringo wrote: | > _the vast majority of these M &A destroy capital_ | | Even if true, it's irrelevant. The vast majority of VC | investments also lose money, or as you put it "destroy capital" | -- that's just high-risk investment generally. Nobody knows in | advance what the future holds, which is why you spread your | risk with _lots_ of investments (or acquisitions). | | But as long as you have enough runaway successes, then | acquisitions are an _overall_ profit-making, not profit- | destroying, strategy. Even if the profit only comes from a | small minority of them. | | And that's only if you're counting the direct future | profitability of an acquisition. Many times, the acquisition is | also for key expertise or employees that may otherwise be | prohibitively difficult to get, patents, the only way to | compete in time, or is even strategically defensive -- to | prevent your main competitor from acquiring the same critical | technology/team. | hedora wrote: | I think the point is that there is some real business | subsidizing the failed M&As. If a VC lost money on average | (mean) with each investment, they'd run out of money, and the | problem would self correct. | | If a company is able to print unlimited cash, they can use | the revenue on unlimited ill-advised acquisitions, and do | unbounded damage to the economy. | caseysoftware wrote: | > _If a company is able to print unlimited cash, they can | use the revenue on unlimited ill-advised acquisitions, and | do unbounded damage to the economy._ | | At some point, they're still bound by what lenders will | give them or how much investors will buy their stock for. | | But apply the same to a government that can print unlimited | cash.. | | (We may quibble over "unlimited" but it has been US Fed | policy for decades and appears to be accelerating now.) | crazygringo wrote: | > _there is some real business subsidizing the failed M | &As_ | | Citation needed. This is a common claim, but it flies in | the face of common sense and financial incentives. | | Corporate boards simply do not approve acquisitions because | they've got no better ideas of what to do with cash, that's | a fantasy. Boards are held accountable to investors, and | investors want to make money, not fritter away cash. | Investors want rising stocks or dividends at the end of the | day, period. | | Like I said, acquisitions are investments and investments | can be risky, and so it's super easy to say in hindsight | that an acquistion was dumb and that the board must be | irresponsibly frittering away money instead of returning it | to investors. But hindsight is always 20/20, right? As a | general rule, companies simply are _not_ "subsidizing" | M&A's. It's just not how businesses or boards work _at | all_. | mrep wrote: | Instagram was bought for 1 billion and is now estimated | to be worth over a hundred billion dollars. Facebook has | acquired 89 companies according to crunchbase so even if | all of those cost a billion each which they didn't, | Instagram would have made up for all of them single | handedly. | gogopuppygogo wrote: | And yet the "other bets" from Google don't yet have a hit... | | "The next big thing" is super hard work. | [deleted] | s1artibartfast wrote: | > My understanding is that the vast majority of these M&A | destroy capital. | | I think this would be very difficult to tease out of the data. | Many acquisition are de facto defensive, even if they or not | anti-competitive from a legal monopoly perspective. | | How could one measure the the loss of brand value if the | acquired companies were allowed to mature or be acquired by a | competitor? | RC_ITR wrote: | It's also a 'number of acquisitions' vs. 'value of | acquisitions' argument. | | If you had to guess the 'value' of TurboTax, The Microsoft | Office Suite, Macromedia, Instagram, YouTube, NeXT, Pixar, | VMware, etc. etc., you'd probably find that the good M&A | outweighs bad. | | It's just that bad M&A happens a lot can be really bad (AOL | Time Warner). | iicc wrote: | >Our current tax laws make vertical integration or even | conglomerates more tax efficient. >...we should also make | separate companies just as tax efficient (VAT tax, etc) and | otherwise closely examine how we can change economic incentives | here. | | related: | | "Biggest companies pay the least tax, leaving society more | vulnerable to pandemic - new research (2020)" -- | https://theconversation.com/biggest-companies-pay-the-least-... | -- (https://news.ycombinator.com/item?id=22786371) | andrewjl wrote: | > My understanding is that the vast majority of these M&A | destroy capital. | | The FAANG stocks have very high compound annual returns | stretching over more than a decade. I don't think there's | evidence that those returns would be higher without their many | acquisitions or evidence of capital destroyed. | | It can be argued that whether M&A on net is capital generative | or destructive depends on the management team and their ability | to successfully integrate the acquired company's team, | products, and technologies. Which translates to bad management | destroys capital, which is an obvious truism. | gregwebs wrote: | I agree that returns would not be much different if they had | avoided bad M&A. They have tons of cash and have to do | something with it if they don't give it back to shareholders. | Amazon has historically had the least amount of cash sitting | around and thus has done the fewest acquisitions (FB may be | less, but their market cap is smaller and their business is | less diverse). | | I also agree that returns have been greatly improved by a few | key acquisitions for Google (Double Click, Youtube) and FB | (Instagram). For Apple and Amazon I don't know where they are | benefiting from their M&A (this is likely my ignorance, I | would be interested to know). | | I just think it makes more sense to focus on a few key (anti- | competitive) acquisitions than to complain that big companies | do hundreds of M&A deals over a couple decades. | varispeed wrote: | Not paying taxes, using all possible loopholes and paying as | little to workers as they could get away with... | asdff wrote: | Investing in psychological research to make their product more | addictive, practically buying legislation to further profitable | abuses of labor, the list goes on. | banbanbang wrote: | Share repos afforded by low interest rates really helped big tech | and other profitable enterprises. It allowed them to make | acquisitions and retain talent. | Animats wrote: | As the article points out, weak antitrust enforcement has allowed | companies to become monopolies, or near-monopolies. It's not just | "tech". Look at banking. The US is down to four big banks. Until | 1995, US banks couldn't operate in more than one state. | | Right after deregulation, there are new entrants. Twenty years | later, there are a very few giant companies. See telecom, | airlines, etc. | adrianb wrote: | And the ones you mentioned have major regulatory hurdles to | expand internationally. In industries where a single player can | dominate multiple markets we are down to 2-3 major competitors, | worldwide. See airplane or train manufacturers, beer companies, | computer chips... | | This has all been financed by more than a decade of low | interest rates which fuelled the M&A. | omgwtfbyobbq wrote: | Low interest rates have helped, but I feel like it's | primarily the relaxation of regulations that fueled things. | We had really low interest rates for a decade or two after | WWII, but I don't think we saw the same rate of business | consolidation. | Accujack wrote: | "Relaxation" of regulations has been sliding downhill since | about the 50s, but it reached a fever pitch during the | Reagan presidency. | | The "new conservatives" and religious fundamentalists found | they had a president they could control who was slowly | forgetting everything he knew, and they used that to the | fullest advantage. | | Much of where we are today is due to the processes that | began then, from (lack of) fairness in news reporting to | the permissive corporate laws that allowed private equity | and corporate raiding to relaxation of banking and | securities laws that allowed 2008 to happen. | | There have been some ups and downs between the 80s and | today, and a few Democratic years, but in general the slide | has continued because once money gets into politics, it | won't leave quietly... it has to be forced out. | s1artibartfast wrote: | I think it is entirely the opposite. It is all about | regulatory capture. You put in place firm regulations that | only the largest multinationals can comply with, and in | most cases have written themselves to set the bar high and | exclude competition | coachtrotz wrote: | "Until 1995, US banks couldn't operate in more than one state" | | Can you clarify what you mean? The National Bank Act was | originally written in 1863. | Animats wrote: | See this 1994 article from the St. Louis Fed, "Going | Interstate: A New Dawn For U.S. Banking"[1] | | And then in 1999, even more deregulation.[2] | | [1] https://www.stlouisfed.org/publications/regional- | economist/j... | | [2] https://www.wsws.org/en/articles/1999/11/bank-n01.html | AnthonyMouse wrote: | > See telecom, airlines, etc. | | Don't forget media companies. Everybody forgets media companies | because media companies that have no qualms writing articles | condemning mergers by Bank of America have a different | incentive when it comes time to look in the mirror. | codegeek wrote: | yes it is def. not tech only. telecom, banking, airlines are | great examples as well. One recent example. My phone company | Sprint got acquired by T-Mobile. Btw, Sprint used to be Spring | PCS many years ago which I think was a merger b/w Sprint and | PCS. Consolidation/mergers are endless. | fwsgonzo wrote: | It's my biggest gripe with current society. It's everywhere, | and it's not going away. Nobody is tackling it, or talking | about it seriously. At some point I thought that companies | would become more powerful than states, but I've changed my | mind on that. Nations do retaliate hard if they feel | threatened. Maybe I've just turned naive again. But when it | comes to monopolies I just don't see them ever going away now. | Too much globalization combined with lobbying power and | corporate veils. People talk about companies and never about | the people who make the decisions, and I feel like people have | trouble with accepting that in the end nobody actually wants to | be in a society where companies can do whatever they want and | end up being a negative contributor to society. | an_opabinia wrote: | > people have trouble with accepting that in the end nobody | actually wants to be in a society where companies can do | whatever they want and end up being a negative contributor to | society | | Consumer prices fall, and US consumers' brains just turn off | when you show them slaves in the supply chain. | | Consumer prices rise, and then people hit the street - | everywhere, globally. | | It doesn't really matter if their dollar is going to Amazon | or 1,000,000 small main street shops. Indeed, both are | sourcing the bulk of their goods from places with slave | labor. Your gripe is about _low prices_ , not "society," and | like, what's your solution? | lordnacho wrote: | Something I've contemplated lately is what I call the chaos | monkey economy. Since it's hard to politically gather the | will to fight any given monopoly, we should just roll dice to | do it. | | Every year we look at firms above some size, and if they fail | the saving throw, we liquidate them. Everyone who works there | gets 6 months severance, all supplier contracts are | terminated, everything they supply likewise. Get a bankruptcy | administrator to sell the chairs and real estate, give the | shareholders whatever is left. | | If it's truly valuable what they do someone will find a way | to do it again. If it's just a power position they were | exploiting, we'll be free from their tyranny. | dd36 wrote: | Progressive corporate taxation. Want to be large? Pay a | higher tax rate. | AnIdiotOnTheNet wrote: | > If it's truly valuable what they do someone will find a | way to do it again. | | It is better than that. If it is truly valuable we'll | already have someone else doing it just because of the risk | of it failing its saving throw. | thatguy0900 wrote: | I think an important thing is also using companies as foreign | tools. The nsa would hate to see Google or Facebook broken up | and supplanted everywhere by local companies. Or, worse, | supplanted by a equally large Chinese monopoly. | 1vuio0pswjnm7 wrote: | Perhaps if these companies were not such illegally large | monopolies then they would have less perceived value as | "foreign tools". | aerosmile wrote: | I think we should all hate to see the latter. | Unfortunately, it's already happening with TikTok, and with | the rate of innovation in China, we'll see many more. | FridayoLeary wrote: | Unfortunately, I don't think that influence from NSA has | had much to do with the reluctance of legislators to limit | Big Corporations | HDMI_Cable wrote: | That can be simplified even further, the NSA doesn't care | about Google, Facebook, or any other specific companies, | just the ability to extract data from them. They would | truly hate if the Third Party Doctrine were overturned.[1] | | --- | | [1]: https://en.wikipedia.org/wiki/Third-party_doctrine | rhizome wrote: | _But when it comes to monopolies I just don 't see them ever | going away now. Too much globalization combined with lobbying | power and corporate veils_ | | tl;dr: it doesn't cost a million dollars to effect political | change with money. | | I think politically engaged (and frustrated!) people | overestimate the exclusivity of lobbying and the power of | donations. My understanding (I can't find figures right now) | is that you can get a lot of access for probably less than | you think. Sick of potholes? Donate $1000 to your mayor and | you might find yourself face to face complaining about how | many tires you lose per year. | | I think someone wrote an article about how much it costs a | single person with a single issue to get attention from a | politician ('s team), or how little it costs, as the case may | be. Yes, hiring a lobbying _agency_ is more expensive, but | that 's more of a wide-spectrum approach. | | There is enough money in these HN threads for people to | donate $1000 to each of several politicians in the pursuit of | tightening antitrust enforcement, but there's probably just | as many who support the current policies. I didn't say it | would be easy, but with some money and organization it's not | impossible. Of course that's how every special interest | started... | whimsicalism wrote: | Yeah, because the potholes can't donate $1,000 to the mayor | to keep them around. Perhaps in a future world with | sentient potholes, this will become more of a problem. | | Is it not obvious why this approach doesn't scale to | confronting monopoly power? | Workaccount2 wrote: | The pot holes play a trivial role in the example. The | point is that face time is much cheaper than people make | it out to be, and politicians don't have time to be doing | deep research on the hundreds of applicable topics they | vote on. | | I believe it was Al Franken I heard talking about this, | and he said that often times politicians end up voting | with the lobbyist desires because no one ever lobbied the | other side of the issue. For instance an energy lobbyist | asking for the inclusion of exemptions for it's | potentially overweight trucks on local roads to support | the new gas well jobs created, that "will easily make up | the potential and definitely trivial road repair costs". | | Nobody shows up to lobby the other side of the story. The | energy company painted it perfectly as a 100% good thing, | while someone could have donated $200 and after bit a | research shown it was actually a sham and the official | would have agreed. But no one did. | MomoXenosaga wrote: | US corporations are extensions of US global power. Google is | doing for America what Huawei is doing for the Chinese. | Animats wrote: | Some of it is lack of antitrust enforcement. Something that | isn't mentioned much, though, is that business IT technology | reached the point that planetary-scale companies work well. | Until the 1980s or so, big companies had scaling problems. | Big companies developed huge internal paperwork operations, | huge headquarters staffs, too much middle management, and | were choking on their own operating problems. There were | inherent limits on bigness, beyond those imposed by the cost | of transportation. The classic example was General Motors, | which had a long history of management problems from sheer | scale. | | That's been fixed. Amazon, Google, WalMart, Alibaba, etc. | have worldwide operations without major scaling problems. | Those companies can adapt and change reasonably rapidly. The | knowledge of how to do this is widespread. This is new. An | inherent limit on bigness has been eliminated. | Wowfunhappy wrote: | > But when it comes to monopolies I just don't see them ever | going away now. Too much globalization combined with lobbying | power and corporate veils. | | We've been here before though, in the era of Standard Oil. | They can be broken up, but it won't just happen on its own. | The government needs to take action. | hhs wrote: | > We've been here before though, in the era of Standard | Oil. | | If interested, Standard Oil was drawn as an octopus in Puck | magazine (1904). The Library of Congress notes: | "Illustration shows a "Standard Oil" storage tank as an | octopus with many tentacles wrapped around the steel, | copper, and shipping industries, as well as a state house, | the U.S. Capitol, and one tentacle reaching for the White | House." [0] | | [0]: https://www.loc.gov/pictures/item/2001695241/ | briantakita wrote: | > The government needs to take action. | | The government is taking action. The government is in on | this consolidation via investments, contracts, preferential | legal & tax treatment, etc. Think about this from the | government's perspective. The government would rather | govern a small number of large entities instead of a large | number of small entities, thus the government is | incentivized to favor monopolies/oliogopolies. The | government itself is a monopoly of power in many domains. | | Sure, the government may intervene with a company getting | too big, but the intervention is so the government can gain | a foothold with that company. e.g. any telecommunications | platform will need to have back doors for the law | enforcement agencies or said telecommunications platform | will not be allowed to operate. | Wowfunhappy wrote: | > Think about this from the government's perspective. The | government would rather govern a small number of large | entities instead of a large number of small entities, | thus the government is incentivized to favor | monopolies/oliogopolies. | | According to what incentives? The government's | responsibility is to the country at large. | Mountain_Skies wrote: | It's very beneficial to them for just a few companies to | control everything. Then they can deperson you and say | "It's a private company, not the government, they have to | freedom to do business with whoever they want". That's | quite a bit more difficult when there are thousands of | equally viable competitors. | Wowfunhappy wrote: | We live in a democracy. We are the government. Their | benefit should be ours, or if not, we should elect new | leaders. | | The problem is that in America, a large block of today's | electorate seems convinced that governments can never do | anything good, and so shouldn't be allowed to try. | Perhaps if we actually let the government do its job, | politicians and civil servants could accomplish things | like reining in monopolies. It has worked before, and it | could work again. | dimitrios1 wrote: | This is the conspiracy I personally believe the most. The | founding fathers knew that government always wants more | power and control. Logically following from that, of | course they would use any means necessary to subvert the | checks put on their power. | dd36 wrote: | *people always want more power and control... The same | logic applies to companies. | FridayoLeary wrote: | >The founding fathers knew that government always wants | more power and control | | As a UK resident, i'm astonished how the almost prophetic | wisdom of the Founding Fathers can go ignored for so long | by their spiritual heirs. | HDMI_Cable wrote: | Globalization and Lobbying are not irreversible trends. The | world is already starting to become less "global", with the | Chinese belt-and-road initiative, Russian exclusionism, and | the breakdown of NAFTA (among other things). Many world | powers, including Russia, China, and the US (to some degree) | want the world to be less open for trade and large | corporations. | | as for lobbying, America has been through this before. The | Gilded Age saw lobbying to an even more extreme degree, with | companies like US Steel and Standard Oil able to basically | pay off senators. The same thing happened with slave | plantations in the 1850s. After the great depression (and | even before to some small extent; see the breakup of Standard | Oil), laws were put into place heavily curbing lobbying, | insider trading, among other things (like stock buybacks). | Really, we're in another Gilded Age, and one day the balance | of power between the individual, the state, and the industry | will shift again. | [deleted] | will4274 wrote: | > Until 1995, US banks couldn't operate in more than one state. | | I can't think of a worse example of regulation. People | obviously want to be able to access their money when they | travel 30 minutes away. Your example undermines your point. | mulmen wrote: | Huh? My money stays in my bank. If I want to spend it in | another state that's what Visa and MasterCard enable, or I | can carry cash, or directly transfer to another bank account | in another bank across state lines. My bank can do business | with any number of companies offering the ability to spend | money nationally such as Visa, MasterCard, PayPal, Venmo, | Zelle, Coinbase, etc. Separating these concerns is good for | consumers because it encourages competition and innovation | and banks themselves are incentivized to offer access to new | capabilities instead of preserving the status quo because | they profit from owning the means of spending money. | andrewjl wrote: | > My money stays in my bank. | | That's not quite right. [1] | | [1] https://www.investopedia.com/terms/f/fractionalreserveb | ankin... | [deleted] | will4274 wrote: | Yes, and everybody attends college in state. | | Look, I understand most hacker news readers do banking | online, but the notion that banks are limited to a single | state requires either that people rarely go out of state or | never need to go to a physical branch. Neither is true in | 2021. The former (not traveling) is more common than the | later (not needing to go to a physical branch). | | You seem to be proposing purely online banking. I take it | you don't own a home or a car or a business? Most loans | still require an in person meeting. | BlueTemplar wrote: | And it's not like this hasn't been predicted by the cyberpunk | genre... in the 1980's ? | jean_tta wrote: | See "The Great Reversal: How America Gave Up on Free Markets", | by Thomas Philippon [0] | | [0] https://www.hup.harvard.edu/catalog.php?isbn=9780674237544 | briantakita wrote: | Many people erroneously equate Capitalism with Free Markets. | Enginerrrd wrote: | No, many people incorrectly equate a monopolistic, pay-to- | play, regulation-captured plutocracy with capitalism. | | Fundamentally, capitalism is about handling economic | planning in an efficient way by free-market autoregulation | and policy makers who nurture competition to ensure that | process continues to happen efficiently. | jean_tta wrote: | Your definition seems closer to ordoliberalism [0]. | | If competition and free markets are a necessary | components of capitalism, then you would conclude - for | instance - that the US stopped being a capitalistic | country in the late XIXth century with so many prominent | trusts. Or perhaps it never was capitalistic before WWII, | since policy makers did not nurture competition but | rather attempted to shield local industries from foreign | competitions. | | [0] Wikipedia definition: Ordoliberalism is the German | variant of economic liberalism that emphasizes the need | for the state to ensure that the free market produces | results close to its theoretical potential | rustybelt wrote: | This has had a big impact on the economies of regional mid- | sized metros as jobs consolidated in coastal megacities. | Arguably, this resulted in a lower quality of life in both | classes of cities. | | Good Atlantic article on the subject: | https://www.theatlantic.com/business/archive/2016/04/how-ame... | snarf21 wrote: | Exactly correct. The FTC and SEC have failed us completely in | the 21st century. Things have gone bad ever since the focus of | all companies has been shareholders above all else. | throw123123123 wrote: | I would not call banking unregulated. | avrionov wrote: | Growing through acquisitions is not limited to Big Tech. Almost | every big company has an endless list of acquisitions. Berkshire | Hathaway is a conglomerate of acquired businesses. All big banks | were results of M&A. Same with the oil companies. | h2odragon wrote: | How many companies were started over the last 20 years where the | expressed goal, the "win condition" in the founders minds, was a | buyout? | | The idea of building something neat is a lot more attractive than | running a business that sells the neat thing to customers. The | people who want to run businesses are in the lovely position (for | them) of having more fresh, good ideas offered to them than they | can review, much less use. | rconti wrote: | Most of this tech has strong network effects. And while the | marginal cost of shipping an additional unit tends to be close | to 0 (creating the incentive to grow almost boundlessly), the | costs of complying with regulation in dozens or a hundred | countries is quite high. | | Thus, it entirely makes sense for a founder want to build great | tech and a great product, but NOT want to be in the business of | complying with a dizzying array of local and international | regulations, in a world where they effectively have to expand | globally to "win". | | Big companies aren't typically nimble enough to respond to the | whims of consumer tastes or catch the latest fads. | | So, it's a great symbiotic relationship between "big tech" and | startups. | | Acquisition, cash out, bolt on regulatory and legal framework, | wash, rinse, repeat. | lrem wrote: | Oh my, after all these years I finally understand in what way | Google actually is like a startup :D | spamalot159 wrote: | Its a no-brainer for most. Put in a couple years of work, cash | out big, go live the dream. Every incentive aligns with this | though process so why stop doing it now? | varispeed wrote: | Why would you want to cash out out of something you love? | These kind of businesses struggle. But when you have a rich | parents, they you come up with some start up idea, hire a | team of people to make it - then yes cashing out is a win. | But those people don't look at it as business, as a real | thing that adds value for other people, but pure selfishly as | showing themselves they can pull this off. These people also | often steal ideas from people who care and love what they do. | Often those people become wage slaves in those rich daddy | companies. | manigandham wrote: | Then don't cash out. But that's usually a fantasy. Nobody | is really "passionate about enterprise saas" or whatever | the marketing says. | | Founders are interested in control and eventual (financial) | freedom, and tend to like building an organization in | general. An acquisition provides that freedom while | allowing them to build something else in the future with | even better circumstances. | throwitaway1235 wrote: | At some point in his life Larry Ellison was passionate | about something as mundane as a database. | burntoutfire wrote: | Database engines are cooler (and harder) than 95-99% of | the stuff that people on HN build. | manigandham wrote: | Was he? Or was it the opportunity to create a business | around new tech and the eventual riches it brought? It | seems his real passion is buying islands and racing | boats. | lotsofpulp wrote: | Because you might love security for your family's future | more than your work. A bird in the hand is worth two in the | bush. You can always start another company. | dalbasal wrote: | At any given time, there are founders in the "sprint-to-buyout" | camp and those in a "build to own" camp. In any given year, | there are many founders who hold to their principle and those | who change their minds. | | People make choices. Nothing is deterministic. That said, the | number of companies founded, run or exited with a buyout win | condition mentality is governed by price economics. FB, Google, | etc offered a very high price for Android, Instagram, etc. | because those M&As were worth a lot to them. Given this, a lot | of M&As are going to happen. | | The interesting question, to me, is "why is the price so high?" | It's silly to get all huffy about M&As and ignore the | consequences of M&As. | whimsicalism wrote: | Your comment assumes that the people buying the business and | the people running the business are the same. In the 21st | century, this is less & less the case, as people with capital | are uninterested in hands-on management. | formercoder wrote: | That's what happens when there's a flood of venture capital | money whose intention with its investment is to see a specific | return on capital on a specific investment horizon. | schnevets wrote: | I am much further removed from the "startup frenzy" of the | early 2010s, but does it seem like this model has trended | downward since the start of lockdown? | | As optimism about the pandemic rises, it seems like the | innovation that you would expect from this kind of volatility | never panned out. I suppose capital was pumped into the | public market instead? | ryandrake wrote: | History repeats! 20 years ago, some business exit plans | basically boiled down to "...and then we'll get bought by | Microsoft!" Not too bad, at least for the founders. | | Especially if your goal is to land a nice FAANG job anyway. | It's gotten to the point where interviewing is so competitive, | exhausting, opaque, and ultimately random, that it might | _actually_ be easier to do a bootstrapped start-up for a year | and get bought by Facebook than it is to grind leetcode and | interview-prep for a year and roll the dice on the interview | circuit. I wish I were joking. | | EDIT: Wow, no disrespect to founders, I did not intend to | trivialize the work you do. Instead of "easier" I should have | said something like "more controllable" or "less random". | kurbin wrote: | This is not anywhere close to true. Have you built a | bootstrapped startup from scratch and negotiated an | acquisition? It's far, far harder than practicing a few | leetcode Facebook problems and getting a referral. | oblio wrote: | You don't even need the referral. Unless your CV only has | farming experience or something :-) | scarface74 wrote: | I concur. My sparse LinkedIn profile shows decades of | doing CRUD work for no name companies and I have had | recruiters from most of the major tech companies reach | out to me. No I couldn't pass any DS&A tech screen | without a lot of preparation. | | Even now that I work at one of the Big 5 tech companies, | I clearly state that my role is not officially | development, I still have recruiters reach out to me from | FB for development positions. | thayne wrote: | There is a big difference between getting recruited and | actually getting a job offer. | oblio wrote: | Yeah, but the discussion was about referrals. Referrals | are for getting your foot in the door. You don't | generally need them for FAANG. You just need a half | decent CV. | | The hard part is passing the interviews, but referrals | don't help with that, from what I know. | tolbish wrote: | An actual referral for an "industry rockstar" would | catapult them past the first few rounds of interviewing. | oblio wrote: | And referrals for top management do the same. Why are we | talking about something applicable to maybe 0.00001% of | candidates out there? | [deleted] | tolbish wrote: | Because far up the comment tree, referrals were confused | with "some recruiter said I should interview for a job". | fatnoah wrote: | Agree 100%. I've bootstrapped, I've been acquired, and I've | gone through the FB/G/etc. interview processes. Going | through those interviews took a few weeks of light prep, | whereas bootstrapping to acquisition was a multi-year slog. | Just the due diligence portion of the acquisition too many, | many, many times the effort of job interviewing. | N1H1L wrote: | Yep. Bootstrapping a startup is _hard_. | | FAANG interviews are not even close. | whymauri wrote: | Even just the diligence behind a potential acquisition | (stated 'win' condition) is orders of magnitude more | stressful than reviewing DFS, lol. | wskinner wrote: | If the acquisition is mainly about talent, and in many cases, | even if it's not, FAANG will expect you to interview like | everyone else. | | Source: founder of a company which was acquired by a non- | FAANG company, but talked to a few FAANGs as part of the | process. | Voloskaya wrote: | > that it might actually be easier to do a bootstrapped | start-up for a year and get bought by Facebook than it is to | grind leetcode and interview-prep for a year and roll the | dice on the interview circuit. I wish I were joking. | | If you are not joking you are delusinal, this is not even | remotly true. | 908B64B197 wrote: | > grind leetcode and interview-prep for a year and roll the | dice on the interview circuit. | | Or go to a serious CS/Engineering school and just take the | Algorithm class. | SilurianWenlock wrote: | What are peoples opinions on whether just taking the | algorithms class helps a lot? People can do it online | almost as easily | heymijo wrote: | OP is exaggerating, but Yahoo under Marissa Mayer wasn't | far off. Nicholas Carson's 2015 book about their M&A during | this era has lots of details. | jbn wrote: | what's the actual title of this book? I couldn't find it | (my google-fu probably isn't very good, but "Nicholas | Carson" is not a very unique patronym...) | hooande wrote: | You may not agree with OP, but I don't think this view is | delusional. Starting a company is a lot of day to day work | in terms of hours, but it's more rewarding than doing | interview prep. If you spend weeks or months studying for | interviews and don't land a job, you get nothing. If you | start a business you generally get paid or make profit the | whole time, you build relationships and end up with | something tangible to show for the experience. | | Personally, I would much rather be running a moderately | successful business than studying esoteric programming | questions full time. At the least, the relative "easiness" | of starting a business vs the normal FAANG interview | process is personally subjective. | vlovich123 wrote: | > If you start a business you generally get paid or make | profit the whole time | | What tech startup is this? Profitability is a long road & | for a good chunk of the time you're relying on funding to | get you through to profitability. You might get paid but | how much you withdraw impacts your runway. | Voloskaya wrote: | I agree with you that it's a way more interesting | journey, but it is by no mean "easier". Especially since | OP was talking about getting acquired at the end. Just | keeping your business alive is hard enough, let alone | being acquired by one of the FANGs. | veemjeem wrote: | It's not easy to get acquired by a FANG, but if you're | okay with acqui-hire terms of most companies, you'll | eventually get acquisition requests if the startup gets a | little bit of press or has some traction. I've personally | gone through this process several times already, turned | down a few acqui-hire requests, and eventually accepted | one. One of my startups only lived for 4 months before it | was acqui-hired, which was still more enjoyable than | doing 4 months of interview prep. | | In hindsight, if I accepted my first acqui-hire request, | I would've eventually got hired into Google because the | startup that wanted to hire us was eventually folded into | google, but honestly it's hard to tell from a distance | which companies are going to be acquired by a FAANG. | rhizome wrote: | I was part of an aquihire and got screwed every which | way. As the acquired's only person in my position and | required (almost! I'm not delusional) in order to | transition the company, I should have driven a harder | bargain when deciding to go along with it. In the future | I would not go along without a _significant_ retention | bonus, like, say, a percentage of the purchase price that | reflected my contribution. | capableweb wrote: | I guess it depends on your previous experience. If you're | familiar with actually building a software company, know | good people to employ and know a problem that needs | solving, it probably is easier to go that route than having | to learn the whole interviewing-scam thing that is | happening today, in order to just be employed. | | Helps that building a company gives you real experience as | well while prepping for interview just gives you that, | preparation for the interview, while the real job is | different than the interview. | joshuamorton wrote: | The companies that FAANG acquire are usually mid sized, | 50+ employees. Getting to that size, in a particular | industry that will be of acquisition interested is not | going to be easier than getting hired. | | Might get you hired at a higher level though, but yeah | delusional to think it would be easier. | tjs8rj wrote: | If leetcoding and going from 0 to acquired by Facebook in | a year were just as hard, we'd all be rich. | | Even if it was only an order of magnitude difference, the | expected value of starting that startup would be so much | higher. | | They aren't even in the same ballpark | Retric wrote: | I think it really depends on your background. For people | with a questionable job history, poor credentials, modest | intelligence, a speech impediment, and a criminal | background self funding to Raman increases in difficulty | less than working directly for Facebook. However, ridding | the VC train has a lot of the same dependencies as | working for Facebook, but is vastly more difficult. | | The same is true of networking and friends and family | financing. I might look at scraping together a ~200k seed | round as trivial, but that's not true for everyone. On | the other hand if 5 of your collage friends are working a | FANG companies that's also a huge leg up. | tjs8rj wrote: | We're not talking about bootstrapping for a year, op said | selling to Facebook in a year. To pull that off means | awesome traction or clubhouse level hype or deep serial | founder connections, or corruption at high levels. | | All of these are much more difficult to pull off, often | requiring years, than simply hitting the books for a few | months | manigandham wrote: | I get what you're saying but none of those words work. | | There are some people who are very well networked and can | repeatedly start and sell companies by leveraging those | connections as a business model in itself, but this is | extremely rare. | | Building a business to even be attractive enough for an | acquisition is magnitudes harder than any round of interviews | will ever be, but I do agree that those interview processes | are a joke now compared to the talent they're designed to | find. | at-fates-hands wrote: | > Especially if your goal is to land a nice FAANG job anyway. | | I wouldn't just say getting acquired by a FAANG company. I | work for one of the biggest health care companies in the | world. Last year they acquired over 200 companies with the | goal of exceeding that this year. | | They literally are buying companies whose technology they | would rather buy then build themselves. If you knew what my | company was looking for (machine learning, AI and automation) | you literally could start a company with less than ten | people, focus your work on one of the three areas and have a | better than decent shot of being acquired by the company I | work for in a span of less than 5 years. | | What would take longer? Building that company with a singular | focus on a singular product my company needs or achieving a | senior level knowledge of Javascript for a full stack | developer role? I would say at that point its a toss up. | jcadam wrote: | Eh, both have proven impenetrably difficult for me. I just | kind of float through life and stumble into jobs these days. | mattgreenrocks wrote: | AFAIK, you're still subject to some sort of vetting process | when getting acqui-hired, so you'd still be studying for that | anyway. | | So it is probably _more_ work than simply studying and | rolling the dice over and over. | anonymousab wrote: | > It's gotten to the point where interviewing is so | competitive, exhausting, opaque, and ultimately random, that | it might actually be easier to do a bootstrapped start-up for | a year and get bought by Facebook than it is to grind | leetcode and interview-prep for a year and roll the dice on | the interview circuit. | | Not sure about founders but sometimes you have to interview | with the Big Tech Co. as well to keep the job after | acquisition. | EGreg wrote: | This is the free laissez faire market at work. What's the | problem? There is no problem with capitalism BUT.... | coliveira wrote: | This a point that is missed by the people who still say the the | big tech companies got there "by merit and by the choice of | consumers". Most big tech had a single idea, and then used the | money to buy others who could pose a threat. So in effect the | consumer has little choice. For example, consumers didn't have a | choice in selecting Google to watch video, they had to accept the | fact that Google bought Youtube. | chillacy wrote: | Hmm, but by the time Google could afford to buy YouTube, they | were already very popular and had a well liked search product. | Ask Jeeves didn't buy YouTube. | conductr wrote: | This is along my initial-not-fully-formulated thought | process. Majority of business doing the acquiring are still | primarily in the business of what allowed them to do the | acquiring. There's only a few I can think of where the | acquisition is a meaningful/noteworthy part of their current | business. I don't necessarily feel like valid competition was | squashed in most cases. Following tech M&A headlines has led | me to feel mostly it's acquihiring and the underlying product | has no value to the acquirer. | dangus wrote: | This is the inevitability of capitalism. It has no built-in | control for a company that becomes too big to the point of being | a detriment to society. | | In my mind there are only three kinds or tech companies: | | 1. Growing fast enough to eventually become huge and | irreplaceable, losing money all along the way. When they are too | big to fail, they flip the switches and de-invest and cost-cut to | profit indefinitely (Uber and Lyft) | | 2. Attempting to just run a sustainable business, which | translates to languishing and eventually being replaced or | acquired by companies in category #3 or #1 (Tile, Pebble) | | 3. Giants that deserve antitrust attention but never seem to get | any because they buy out the government (Google, Apple, Facebook) | | That's why there's no room for companies that won't surrender to | venture capital. Just making a profitable product isn't enough, | they have to surrender their autonomy to people who have no | expertise or innovative tendencies besides having a bigger bank | account. | EarthIsHome wrote: | Yes, capital has a tendency to concentrate and centralize. | | A 19th century philosopher summed [0] this phenomenon of the | concentration and centralization of capital: | | Capital grows in one place to a huge mass in a single hand, | because it has in another place been lost by many.... The | battle of competition is fought by cheapening of commodities. | The cheapness of commodities demands, caeteris paribus, on the | productiveness of labour, and this again on the scale of | production. Therefore, the larger capitals beat the smaller. It | will further be remembered that, with the development of the | capitalist mode of production, there is an increase in the | minimum amount of individual capital necessary to carry on a | business under its normal conditions. The smaller capitals, | therefore, crowd into spheres of production which Modern | Industry has only sporadically or incompletely got hold of. | Here competition rages.... It always ends in the ruin of many | small capitalists, whose capitals partly pass into the hands of | their conquerors, partly vanish. | | [0]: | https://en.wikipedia.org/wiki/Capital_accumulation#Marxist_c... | bhupy wrote: | > It has no built-in control for a company that becomes too big | to the point of being a detriment to society. | | That's verifiably untrue. One of the key traits of capitalism | is that businesses are allowed to fail, and we see that they | _do_ fail. 30 years ago, the retail and supply chain behemoth | was Sears; today that 's Amazon; 30 years from now, it might be | someone else. | | Berkshire Hathaway recently remarked on the dynamism as seen in | the top 20 companies in the world in 1990 vs today. | | https://twitter.com/brettberson/status/1388555627698429953 | | It's almost entirely a different set of companies. | mLuby wrote: | > Berkshire Hathaway recently remarked on the dynamism as | seen in the top 20 companies in the world in 1990 vs today. | | 180-year-old 360,000-person company worth half a _trillion_ | dollars says what? | | (They might not be wrong, but they certainly aren't | impartial.) | drivebycomment wrote: | The linked twit simply shows top 20 largest companies by | market cap in 1990 vs today. That's a fact. If you want to | argue that the particular fact is somehow misleading or | misrepresenting, please put an argument with an evidence - | without that, this falls into the "attacking the motive" | fallacy. | yrgulation wrote: | To me it feels like this is the opposite of capitalism. The | free flow of capital is impeded by monopolies amassing huge | fortunes. Just like a clogged pipe, the free flow is then | blocked and regulated by such forces. Not ideal for the overall | market. | lotsofpulp wrote: | How is it being blocked? The share buybacks are record | breaking, but investors just plow the money right back into | them by buying more. | | The big tech companies are objectively delivering products | that people around the world derive a lot of utility from. | [deleted] | zxcb1 wrote: | "Software" is eating the world | zepto wrote: | The thing that's missed is that vertical Integratron is far more | efficient for core products than relying on third parties. | | Apple won out over Microsoft in consumer electronics because they | were able to make decisions up and down the stack as a unit | whereas Microsoft had to deal with layers of device makers and | consortia. | | All the talk of breakups and "big is bad" ignores the fact that | vertical _works better_. | | I don't think it has to be this way. I think it's entirely | possible that a network of companies can outperform a monolith | with the right kind of coordination. | | This would be a _new_ , evolutionary strategy, and would be good | for everyone. | | It won't however, emerge if we roll the clock back to the late | 90's by force. | amelius wrote: | I like Microsoft's approach more though. It makes the market | more modular, since other companies have access to the same | resources. | | You can say "Apple's machines are easier to work with because | better integration". But I'd say that's only a small | convenience which doesn't stack up against the huge downsides | of this non-modular approach as seen from the societal/economy | perspective. My mom and dad can work with a Windows laptop just | fine. | zepto wrote: | > I like Microsoft's approach more though. It makes the | market more modular, since other companies have access to the | same resources. | | Microsoft's approach failed against Apple's when it came to | product innovation. That's why Apple is now dominant. | | The downsides from a societal perspective are imaginary. | Things simply weren't better in any way when Microsoft was | dominant. | | Having said that, I agree with you - modular could make | things better. | | This is what I mean by a network of companies. | | We need a new model of modularity - not microsoft's variety. | colinmhayes wrote: | Apple isn't even close to dominant though. Mac market share | is less than 10%. Microsoft is around 90%. | zepto wrote: | Agreed overall but they are dominant over Microsoft in | terms of the high end. | username90 wrote: | But a locked in ecosystem is bad for innovation. Windows | model is way better in the long run. | zepto wrote: | That's obviously not supported by the evidence at the | current time, and if it's true then we can just wait for | Apple to fall behind. | | I do think a modular ecosystem might be better in the | long run but that's not windows. | lotsofpulp wrote: | > My mom and dad can work with a Windows laptop just fine. | | Mine can't. All I know is I spend many fewer hours, near | zero, doing tech support for my parents on macOS/iOS than | when they used Windows. | adambatkin wrote: | Mine too. But it has nothing to do with the hardware or | software (I'd argue that for many things the Apple | ecosystem makes things harder due to its inflexibility) and | everything to do with the fact that whenever they have a | problem they can walk to an Apple Store (or call Apple | Care) and they are able to help without having to work | around my time constraints (job, family, etc...) I suppose | that's a type of integration too (the fact that Apple has | retail stores and a Genius Bar that for "normal" people | works well to solve "normal" problems) but it has nothing | to do with pure technological innovation. | zepto wrote: | > (I'd argue that for many things the Apple ecosystem | makes things harder due to its inflexibility) | | Yes - many things are harder, but on balance the Apple | ecosystem delivers better end user results. | | But your point is important - there is _huge_ opportunity | for something better. | | Apple isn't standing in the way of that. | | The belief that Microsoft or Linux as they stand are | somehow better _is_. (I think Linux is fundamental to | what comes next, but only if we people stop pretending it | is currently better for end users and stop trying to make | it more like an Apple product) | lotsofpulp wrote: | Yes, I don't know why, but Microsoft doesn't want spend | the money to compete in the face to face customer service | space. No big company except Apple does. And I like | rewarding that. | | I can't believe Microsoft even opened a whole bunch of | stores. They just keep quitting after a couple years. If | they were willing to plow some money into it for a decade | and keep supporting windows phone and clean Windows | laptops, maybe we'd have some competition. | zepto wrote: | Windows is much harder to support. That's the problem. | | A modular system could be better, but Microsoft's is not | it. | mrkurt wrote: | Vertical doesn't unequivocally work better, there's a high | external cost. | | None of Apple's "stack" is available to other companies because | they have no incentive to sell components. The reverse happens, | they buy up independent companies (like the touch id folks) and | prevent anyone else from using a given piece of tech. | | Same problem with Amazon and shipping. Regular schmoes are | limited to USPS/Fedex/UPS for shipping in the US. Amazon opting | out of the "market" for shipping limits the quality of the | shipping services I have access to. | | We need to role back to something closer to the 1970s, really. | The 90s were ok in tech company terms (at least when the DoJ | slowed Microsoft's monopoly) but that was already a full decade | into the big-ification of companies. | | There's no real alternative but force. You can't evolve from | big monopolies into smaller companies, the smaller companies | can't even exist in most cases. | spideymans wrote: | >None of Apple's "stack" is available to other companies | because they have no incentive to sell components. The | reverse happens, they buy up independent companies (like the | touch id folks) and prevent anyone else from using a given | piece of tech. | | As Apple's sales success allows them to invest even more in | R&D, their tech stack become an even bigger moat. Competitors | are going to find it increasingly difficult to create | products that can compete with Apple's tech stack on a | technological basis. | mschuster91 wrote: | > Competitors are going to find it increasingly difficult | to create products that can compete with Apple's tech stack | on a technological basis. | | No one is stopping anyone (outside of US economic | sanctions) from getting an ARM architectural license and | designing their own CPUs to compete with Apple. There are | _countless_ vendors to choose from if you don 't have the | experience to do yourself, there are IP cores for | everything from battery management over memory to AI | available on the market. | | The problem is that, rather than go the expensive Apple | route, most seem to be content to pay top dollar to | Qualcomm (or for lower classes, Mediatek) and get buggy | hardware and BSPs in return, instead of pushing Qualcomm to | deliver better quality. | | And for what it's worth, there _are_ serious competitors to | every Apple product. There have been Windows laptops with | 32 and 64 GB of RAM _years_ before Apple finally updated | their line. Samsung puts up a diverse lineup of phones and | tablets that definitely compete with iDevices. Sony has | AirPod clones (admittedly they 're bulkier, but have more | selection in earbuds). There are a _number_ of Apple TV | competitors - Roku, Amazon 's TV stick, Chromecast to name | the most popular ones. | mrkurt wrote: | You literally just said "no one is stopping someone else | from building a vertical monopoly". | | The problem with vertical consolidation is _not_ that | they prevent other large companies from competing. | There's always a scale where you can replicate work and | release a competitive product. | | ARM is inaccessible to most companies, including | companies that don't compete with Apple. In a world where | we prevent vertical monopolization, those very nice ARM | CPUs Apple and Amazon have on lockdown become commodities | and spur all kinds of innovation in other areas. | | Who do you think pushes Qualcomm to deliver better | quality when the two primary consumers of those CPUs | aren't buying from third parties? | mschuster91 wrote: | > ARM is inaccessible to most companies, including | companies that don't compete with Apple. | | What are you talking about? ARM is literally the dominant | CPU architecture for years now, with a _lot_ of CPU /SoC | vendors for everyone's choosing. An architecture license | is expensive, yes, but you only need it if you want to | roll your own cores (and there is at least a dozen AL | holders). Everyone who's fine with stock cores can use | ARM Flexible Access where you only have to pay per- | product fees at tapeout. | | That's the reason why all other competitors (Hitachi's | SuperH and MIPS being the biggest ones) have all but | vanished. | | >In a world where we prevent vertical monopolization, | those very nice ARM CPUs Apple and Amazon have on | lockdown become commodities and spur all kinds of | innovation in other areas. | | I agree it would be better if everyone were able to buy | Apple's CPUs, yes, but the real secret behind Apple's | performance is that they own the OS stack and can | ruthlessly optimize it for performance. _Technically_ , | everyone can take the Android AOSP code and do the same | for a given hardware stack, it's just a lot of work that | is not much in demand. | | > Who do you think pushes Qualcomm to deliver better | quality when the two primary consumers of those CPUs | aren't buying from third parties? | | Uh, Samsung also buys from Mediatek, not just Qualcomm's | Snapdragon and their own Exynos line... anyway there are | _lots_ of smartphone vendors who could go ahead and | differentiate their products by focusing on quality, if | they wanted and the consumers would want it. Samsung and | Apple together only have 39% of market share (per | https://www.counterpointresearch.com/global-smartphone- | share...), there's a lot of room for competition. | zepto wrote: | The framing here is off. It's fair to say that catching | up with Apple is next to impossible. This has absolutely | nothing to do with monopolies, and everything to do with | their velocity. | | The idea that we have to somehow overthrow Apple in order | to build better things is the problem. | | Ironically Apple itself had this problem when Steve jobs | returned. Microsoft was seen as the 'problem' to be | overcome and thinking that way prevented Apple from | seeing what else was possible. | | Jobs explicitly rejected this kind of thinking "We have | to stop thinking that in order for Apple to win, | Microsoft has to lose." | | The same holds true now - we need to stop thinking that | in order for others to win, Apple has to lose. | | Apple's solutions are not the only possible solutions. We | don't have to mimic them. | mrkurt wrote: | I don't understand why you keep talking about Apple's | direct competition? Vertical consolidation is a very | different, potentially more harmful problem than "a | mobile phone monopoly". | | More competitive phone market is pretty boring. Good ARM | CPUs are not boring, there are all kinds of places those | would be amazing that Apple isn't going to bother using | them. | | Apple doesn't have to lose, in a healthy market they'll | be able to buy good ARM CPUs just like I will. | | The problem is that Apple's solutions are the only | solutions that get to use certain technologies because | they don't want other people to compete with them. | zepto wrote: | > The problem is that Apple's solutions are the only | solutions that get to use certain technologies because | they don't want other people to compete with them. | | This just misunderstands what vertical integration is | about. | | Apple's solutions aren't _general solutions_. They are | narrow solutions that work in Apple's ecosystem. | | Apple hasn't developed general solutions that other | people could use. This is the whole point. It's why they | can move faster than a modular ecosystem can. | | This has nothing to do with not letting other people use | their technologies. They don't actually _have_ | technologies that anyone other than Apple _can_ use. | mrkurt wrote: | I'm less worried about moats (although we should be wary of | anticompetitive moats) and more worried about an ecosystem | where the already successful companies monopolize access to | innovations. | | Forget competitors, you can't buy the touch ID tech to | create things like door locks. Big companies locking up | access to markets means big companies are the sole arbiters | of what even gets sold. | zepto wrote: | > Forget competitors, you can't buy the touch ID tech to | create things like door locks. | | Doesn't that mean there is a business opportunity for | someone to make touch technology for door locks? Apple | isn't the only company that uses touch sensors. | mrkurt wrote: | Maybe. The two biggest consumers (apple and google) of | touch id like components won't buy from someone else. So | the opportunity is quite small. And it's too expensive | for a small company that might just want to build a | consumer door lock. | | Apple also acquired patents when they bought AuthenTec. | So it might be tough even with unlimited money. | | Consolidation problems are never an outright ban like a | law would be. But raising the cost of entry is just as | effective. | zepto wrote: | > So the opportunity is quite small. And it's too | expensive for a small company that might just want to | build a consumer door lock. | | That just indicates that the value of a modular component | isn't high enough to make it worth building for now. | | Touch ID is not a modular component. It's part of a | system and it's not designed to be used in door locks. It | took a huge amount of R&D overall which was worth it to | build into hundreds of millions of dollars worth of | phones. Touch ID isn't just a sensor. | | It isn't a technology that can be used in a door lock. | | At some point it will be cost effective for a door lock | component to be built, but there is little connection | between this and touch id. | mrkurt wrote: | > That just indicates that the value of a modular | component isn't high enough to make it worth building for | now. | | This is the dilemma. The value is low _now_ because Apple | bought the vendor, rather than purchasing from a vendor. | In a healthy marketplace, Apple's scale would fund | development of technology that other people could buy and | run with. Instead, the market "developed" touch ID and | Apple got to keep everyone else from using it for the | low, low price of $365mm. | zepto wrote: | That's completely wrong. Touch ID is not a sensor. Touch | ID is an integrated system that was developed by Apple | for phones. | | Touch ID doesn't do anything for door locks. It's the | fact that it's a tailored for their phones that makes it | work better. | | The market didn't develop Touch ID. Apple did. | | Fingerprint sensors are widely available in the | marketplace and they are better than what was available | when Apple bought a sensor company. | | In a healthy market, someone else would look at what | Apple did, and work out how to apply any relevant | concepts to use outside of phones. | | This is work that hasn't been done yet, and is open for | someone to do. It's normal for a general solution to | follow a specific one. The idea that Apple should have | developed a door lock solution makes no sense. | kasey_junk wrote: | Presumably he's talking about the acquisition of | authentec. | zepto wrote: | Sure - but that doesn't negate anything I said. | jayd16 wrote: | I don't follow you. Microsoft only dabbles in specific | hardware. Where they do, they're fully integrated like the | surface or the xbox. | | If you're talking about things where Microsoft just makes the | software, aren't they still winning over the Mac? | neogodless wrote: | Since I agree with you and don't have a new point to make, I | just want to expand on yours. | | Consoles - Apple doesn't compete here. Microsoft is | competitive. | | Smartphones / tables - Microsoft lost here, Apple competes | against Google and various hardware makers instead. They | probably win in US market share and net profits, but not | global share. | | Computers / operating systems - Microsoft still dominates in | market share over Apple. Opinions vary (strongly) between | which is best, but more people buy computers with Windows | than computers made by Apple. | | Watches, air tags, etc. - Microsoft doesn't compete here. | | Accessories - no clue about market share, but I do think | Microsoft makes some pretty good keyboards and mice. | zepto wrote: | You are looking at today - this is about the history. | | In 2002, Microsoft was the dominant force in consumer | electronics because everyone assumed they needed 'PC | compatibility' or even to integrate Windows CE. | | If you worked in the industry then, Microsoft was discussed | in every meeting and was a major player in standards bodies. | | That started to change with the introduction of the iPod. | jayd16 wrote: | But those accessories aren't fully integrated Apple | products so I don't really understand the point at all. | zepto wrote: | I'm not talking about accessories. | | Also - Apple does in fact make most of the important | accessories for their own products, and they leverage | vertical integration when doing so. | | AirPods for example. Bluetooth - the consortium solution | wasn't good enough, not were Bluetooth chipsets. Apple | didn't need to wait for standards changes or persuade a | vendor to make anything for them. | bcrosby95 wrote: | Yet Apple doesn't make the boards themselves. Would them doing | that be more efficient vs what they do now? How do you draw the | line? Where does your theoretical "stack" start and stop? | | I think this is all just a big bag of hindsight bias. If the | "winner" does something different then people attribute winning | to that thing. Reality tends to be more complex. | scarface74 wrote: | Hypothetically, say Microsoft and Apple both announced that | they planned to move from x86 to ARM on the same day, knowing | nothing else, who would you have bet would be more | successful? | zepto wrote: | > Would them doing that be more efficient vs what they do | now? | | In the end, probably yes. | | They did do this for a while but this wasn't competitive with | having the work done in China. | | Apple exerts a lot of control over how that work is done. | | They don't just send out a design and get boards back - they | embed engineers and management in places like Foxconn and in | fact control the process. | | > How do you draw the line? Where does your theoretical | "stack" start and stop? | | See above. Basically whenever something is not literally a | commodity, Apple steadily builds expertise and control. | | Look at how they have done this with screen technology for | example. Their partner companies build parts dedicated to | Apple. | | Even if there is another corporate partner involved for | geopolitical reasons, there is still vertical integration. | hctaw wrote: | Environmental pollution also "works better" for companies and | yet we regulate it. I don't think this is a false dichotomy, | the role of government in business regulation is to modify | business practices that are contrary to the best outcomes for | society. Not what is more efficient for businesses. | zepto wrote: | It is a false dichtotomy. | | Inefficient decision making _creates_ environmental | pollution. | | Regulating to make companies less good at decision making | under the belief that this will increase opportunity is | literally making society stupider. It is the path to | idiocracy. | | I'm not against government intervention. | | Let's invest in alternatives, and let's invest in making | people's lives less precarious. | toomuchredbull wrote: | It's interesting because there was a post yesterday about how | companies hollow themselves out by outsourcing all the pieces, | (the example he used was a toaster) until the entire toaster is | built by outsiders and the toaster company is just a sales and | marketing unit, unable to innovate, whereas apple is the | opposite it is basically the only company that is a real | outlier to this trend. | FridayoLeary wrote: | vertical always works better. until it doesn't. dictatorships, | autocracies and none other then the failed Soviet Republics are | testament to this. the job of our lawmakers is to judge when | top- down decision making stops being beneficial to society in | general and our economy in particular. | zepto wrote: | Apple is nothing whatsoever like a dictatorship, autocracy, | or failed soviet republic. | | It's a silly comparison. | stadium wrote: | > the fact that vertical works better | | It works better until it doesn't. A company with high market | share and positive cash flow can invest in vertical | integration. They gain economies of scale. It gets harder to | adapt to the market and stay efficient and innovative at larger | companies. Or they slowly kill off the competition and no | longer find the need to innovate, and settle into money | printing mode and monopolistic behaviors. | zepto wrote: | If larger companies are not innovative they will fail. The | giants of today haven't been giant for very long. | | There is plenty of money around to invest in alternatives. | arrosenberg wrote: | > All the talk of breakups and "big is bad" ignores the fact | that vertical works better. | | That's not even close to being universally true, and good/bad | are in the eye of the beholder. Is it better or more efficient | for the people who assemble the phones? Is it better or more | efficient for the retail employees making minimum wage? Is it | better or more efficient for app developers who lose 30% of | their revenue to private taxation, or the businesses that never | reached their potential because a BigTechCo launched a | competing product at a loss? | | > It won't however, emerge if we roll the clock back to the | late 90's by force. | | It might, but I can absolutely, guarantee, beyond a shadow of a | doubt that we don't get a more democratic solution if we leave | the current stakeholders in their current positions of immense | power. | anonuser123456 wrote: | > Is it better or more efficient for the people who assemble | the phones? | | yes. Factory work is better than subsistence farming. And big | tech has done 100x more than anyone else in the consumer | electronics supply chain to push for better working | conditions in those factories. | | >Is it better or more efficient for the retail employees | making minimum wage? | | Yes. Improved margins are what allow wages to rise. | Inefficient businesses don't have the money to pay employees | more. Apple retail stores pay on average 18$/hr vs the 10.50 | a mom and pop might be able to afford to pay someone. | | >Is it better or more efficient for app developers who lose | 30% of their revenue to private taxation, or the businesses | that never reached their potential because a BigTechCo | launched a competing product at a loss? | | Yes. Software distributors used to pay 50% to retailers. | arrosenberg wrote: | > Factory work is better than subsistence farming. | | Working in a 1900's Chicago meatpacking plant may have been | better than subsistence farming too, but the alternative to | working in bad conditions isn't going back to farming, it's | improving the working conditions. Big tech has _NOT_ done | 100x more than anyone to push for better working | conditions. If they really wanted to provide good, first- | world working conditions in their factory, they could do | so. Yes, their costs would go up, that 's what happens when | you stop subsidizing consumer products with labor abuse. | | > Yes. Improved margins are what allow wages to rise. | Inefficient businesses don't have the money to pay | employees more. Apple retail stores pay on average 18$/hr | vs the 10.50 a mom and pop might be able to afford to pay | someone. | | Is the Apple store representative of all retail? And | further, with Apple's massive stack of cash in the bank, | shouldn't they be paying their workers even better? Are | they not a big part of getting that premium margin for | apple? | | Further, that doesn't seem like a better or more efficient | deal for entrepreneurs. Should we be happy that most | independent electronics stores have been replaced by | branded stores and Best Buy? | | > Yes. Software distributors used to pay 50% to retailers. | | More bad faith arguments huh? I guess you mean before the | internet, when they actually had to ship physical medium | and deal with retailers? Keystone pricing is pretty | standard in that setup, and at least you had a broad choice | of distributors to pick from. There is no justification for | the high fees or the lack of distribution options in 2021. | It's almost pure profit for the landlords. | zepto wrote: | > That's not even close to being universally true, and | good/bad are in the eye of the beholder. Is it better or more | efficient for the people who assemble the phones? Is it | better or more efficient for the retail employees making | minimum wage? Is it better or more efficient for app | developers who lose 30% of their revenue to private taxation, | or the businesses that never reached their potential because | a BigTechCo launched a competing product at a loss? | | Yes. It works better for _making technology_. | | Nothing you have said contradicts that. | | Every single one of the indicators you mentioned is better | now than it was in the 90s. | | What you are calling for is more opportunity for all these | people to build wealth. | | Making existing industries work less well is not going to | achieve that. | | Things that might: universal health care, student loan | easing, increased investment in impoverished communities. | | Blaming things that work well and breaking them is silly. | | Making new things that work better is not. | arrosenberg wrote: | > Yes. It works better for making technology. | | You haven't proven that at all. You took one instance of | Apple disrupting Microsoft's PC dominance and seem to have | extended it to an entire worldview (which clearly ignores | the entire MS antitrust saga that took place a couple years | before Jobs reinvented the company). | | > Making existing industries work less well is not going to | achieve that. | | You haven't proven that. When AT&T was broken up, it | unlocked a host of new technologies (answering machines, | modems) that Ma Bell was blocking to protect their existing | revenue model. | zepto wrote: | > You took one instance of Apple disrupting Microsoft's | PC dominance and seem to have extended it to an entire | worldview | | That's not a reflection of my views. | | AT&T is not like Apple. They had a literal monopoly due | to access rights. | | Apple can't be compared to AT&T usefully. There is | nothing they do that doesn't have vigorous competition | and there is nothing that Apple has that others cannot | buy. | arrosenberg wrote: | Power is power, they have more in common than in | difference. I'll stipulate that they arrived at power and | maintain it slightly differently. | | > There is nothing that Apple has that others cannot buy. | | How can you state this as a fact? Even a relatively high- | level Apple executive wouldn't know that with any level | of certainty. | | I don't really take issue with Apple compared to some of | the others, but their vertically integrated position | means that they don't have vigorous competition. There | are only a handful of empire-scale companies that can | compete with them at all. Smaller businesses are not | vigorous competition, since Apple (or similar) could | crush them at any time they want with their scale, as | they recently did with Tile. | [deleted] | zepto wrote: | > Power is power, they have more in common than in | difference. | | Oddly, later in this same comment you become interested | in facts and evidence. | | >> There is nothing that Apple has that others cannot | buy. | | > How can you state this as a fact? Even a relatively | high-level Apple executive wouldn't know that with any | level of certainty. | | If you had evidence to the contrary, you'd have presented | it. | [deleted] | boxed wrote: | > Apple won out over Microsoft in consumer electronics because | they were able to make decisions up and down the stack as a | unit whereas Microsoft had to deal with layers of device makers | and consortia. | | That sounds nice but can't be true. Remember when Apple almost | went out of business? It was the exact same situation then. | | I'll offer an alternative hypothesis: Apple won out because | they executed well year over year over year. They made that | vertical integration work for them by slowly making things | better faster than the competition. | | Apple also never paid a strategy tax. They cannibalized their | existing business ruthlessly. This is also unrelated to | vertical integration. | zepto wrote: | > I'll offer an alternative hypothesis: Apple won out because | they executed well year over year over year. They made that | vertical integration work for them by slowly making things | better faster than the competition. | | You say this is an alternative hypothesis, but it is in | complete agreement with me. | | Without vertical integration they would have been held back | by the rest of the industry. _Vertical integration_ is _how_ | they were able to move faster. | noptd wrote: | >Without vertical integration they would have been held | back by the rest of the industry. Vertical integration is | how they were able to move faster. | | Without supporting evidence, this is nothing more than a | post hoc fallacy. | zepto wrote: | > Without supporting evidence, this is nothing more than | a post hoc fallacy. | | Not really - it could also mean you don't have industry | experience to know what I mean. I'm guessing you weren't | around at the time. | | The evidence is widely available for you to check out. | | Just read accounts of how industry committees work and | look at how industry alternatives have failed to keep | pace with Apple's proprietary alternatives. | dredmorbius wrote: | Microsoft's key strategy was always market domination by | monopoly, paid through the vig of per-CPU licence fees | (whether DOS/Windows was installed or not, still largely the | case), and extending through "productivity software" (MS | Office) and later organisational glue (MS Active Directory / | Exchange) and the Web (MSIE). | | The DoJ case had Microsoft back off that lever a bit, just as | Apple executed beautifully (and with some Microsoft | concessions in part devolving from the DoJ suit ... yes, a | simplification, my 4th-fav pedants), and then hit it out of | the park with the iPod and iPhone (subscriptions, apps, | hardware sales, fashion accessories, ...). | | Google cracked Microsoft's revenue model with advertising | (though that may be starting to give a bit), as has | Faceboook. Amazon got where both Microsoft and Google wanted | to be: between the buyer and the lion's share of online | retail. | | Work, comms, adverts, shopping, fashion, and entertainment. | There's hot competition for transport (automobiles, whether | smart, electric, for-hire, or self-driving). There's not a | whole lot of consumer spend left to grab that I can see. | (Housing. Utilities. Insurance. Finance.) | zepto wrote: | Do you love Apple products? Not a trick question. I think | they are the best, but I don't feel great about them. | zepto wrote: | > That sounds nice but can't be true. Remember when Apple | almost went out of business? It was the exact same situation | then. | | At that time the company was being run by an executive whose | backround was as a flavored soda salesman _who tried to adopt | Microsoft's strategy of licensing the OS_. That's why they | nearly went out of business. | | When they returned to the integrated model and stopped trying | to compete head to head, their success returned. | ocdtrekkie wrote: | It's efficient, sure, but Windows still effective counts as an | open platform compared to Mac, because so many different | vendors are welcome and involved. Closed vertical integration | is worse for consumers. | | And that consumer standard is also often based on price: | Windows platforms are almost always cheaper than the Apple | equivalent. So that efficiency doesn't benefit consumers. | mikepurvis wrote: | I don't think either of those is necessarily a slam dunk. A | lot of consumers really appreciate the non-openness of | platforms like iOS when it comes to security, privacy, | parental controls, and so on. I know your argument is | specifically about the Mac, but on the "openness" spectrum, | MacOS sits somewhere between Windows and iOS, so iOS is a | helpful reference point for where the Mac could end up. | | And as for cost-- I don't think that's necessarily strictly | worse either. I have a Dell XPS now, and it's.... fine. But | relative to my old MBP, the screen is worse, the build | quality is worse, the trackpad is worse, the keyboard is | worse, the power management is way, way worse. So although | there might be slightly more compute here in terms of the raw | numbers, a lot of corners had to be cut to make this machine | work out, and all things considered, I'm not sure that the | market is in a better place when even "premium" non-Apple | computers don't have the profit headroom to invest in the | little stuff. | ocdtrekkie wrote: | I'm an iOS convert, so you don't have to sell me on the | benefits of a closed platform. But I was referring to more | than just software. When servicing an Apple laptop with a | broken keyboard last month, I had to find an Apple-brand | USB keyboard in order to get it into the recovery menu, | because I needed an Apple command key. (Linux works fine | with the Windows key for similar types of shortcuts.) | | The idea that I needed an Apple keyboard to do something | trivial on an Apple machine was... hilarious to me. | zepto wrote: | There is nothing closed or proprietary about Apple usb | keyboards. | | There are 3rd party options with a command key - you just | don't happen to own one. | ocdtrekkie wrote: | Sure, there are Apple-certified accessories out there, | but you literally have to buy stuff explicitly catered to | their hardware for their software to work right. Whereas | anyone else can use "literally any keyboard out there", | you need an Apple keyboard to work with an Apple device. | zepto wrote: | That just isn't true. | | You don't need an Apple certified keyboard. You just need | one with the command key mapped correctly. | | As for 'explicitly catered' - the command key was on | Apple keyboards _before_ Microsoft added the Windows key, | and before Linux even existed. | | It seems a bit weird to complain about monopolies while | at the same time saying every product should work the | same way. | raspasov wrote: | Such "analyses" simply appeal to our ape brain centers that | trigger envy and seek easy explanation for complex phenomena. | "How did they get big?" Oh, it's just acquisitions and the law! | Nothing that a savior in the House/Senate can't fix. | | I am sure acquisitions played a part. But failing to admit that | those companies and their leadership did many things the right | way is a very one sided view of what has actually happened. | throwawaysea wrote: | I don't think they got big through acquisitions. They simply got | big due to first mover advantages, favorable sentiment among | investors (which gives them lots of capital), network effects | that prevent competition, massive patent portfolios (which let | them copy smaller company's innovations without consequence), | running around regulations (like avoiding sales taxes in US for a | long time, or avoiding taxes in Europe), and so on. | | Yes, there are some acquisitions that added a lot to these | companies and took away competition (YouTube, Instagram, | Doubleclick, etc.). But the majority of the market share in these | companies is not driven by just those pieces. The reality is that | we do not have sufficiently modern anti-trust laws to capture the | ways in which these companies hurt customers. It doesn't take a | 90% market share in some segment or explicit abuse of market | position to create harm. Their mere existence is enough, soaking | up talent from the market, creating massive centralization of | power and influence, and so on. I'm not sure what the best way to | address this is, but rather than wasting time proving consumer | harm, I think it's better to just treat giant companies | differently to limit their size and growth - perhaps graduated | corporate income taxes, or automatic splitting up above a certain | market cap, or whatever else. | yrgulation wrote: | > They simply got big due to first mover advantages, | | Neither facebook nor google were first movers. They actually | joined the game at a tome when there were established | competitors. | | But they beat them with a much better execution (and other key | ingredients such as those you mentioned) which markets | rewarded. Then they started buying off possible threats, | effectively blocking late starters as they themselves were, to | the point where they became monopolies and, frankly, a nuisance | to customers and society. | peder wrote: | Big-time survivorship bias in this article and thread. Just | yesterday we learned that Verizon is dumping Yahoo and the | related media brands. Those acquisitions were a major failure. | | The reason that Big Tech got so big is that they're really really | good at growing their high-margin core business and have a ton of | free cash flow. That's really all it is. | georgeecollins wrote: | You are right to point out the issue of survivorship bias, but | that doesn't tell the whole story either. | | Google without Doubleclick and YouTube would be a different | animal. Facebook without WhatsApp and Instagram as well. | | You can't deny the impact of those acquisitions. | baby wrote: | This goes both way: founders create start ups with the idea that | being acquired is a valid exit strategy. It's hard to quantify | but perhaps not that many start ups would have been founded if | they didn't see as many valid options to exit, and a founder | wouldn't have created the next big thing if his previous company | didn't get acquired. | dragontamer wrote: | > and a founder wouldn't have created the next big thing if his | previous company didn't get acquired. | | Hershey (of Hershey's Chocolate) failed multiple times and went | bankrupt each time before finally making his Chocolate company. | Repeated failures are absolutely an option. | asdff wrote: | Anecdotal stories of the survivors from 100 years ago when | you could work a bottom of the barrel job for 1 week and | cover a months living don't apply today. In order to insulate | yourself from failure, you need wealth today to draw upon and | cover your cost of living. Many americans don't have a spare | $400 (1), they can't quit their job to tinker with a | perennially failing side business without ending up risking | living on the street. Many americans are trapped. | | 1. https://www.cnbc.com/2019/05/23/millions-of-americans-are- | on... | dragontamer wrote: | Hershey was pretty well connected. I'm pretty sure his | family bankrolled a lot of his early ventures. This wasn't | a "by his own bootstraps" story. But its absolutely a "try | try again" story. | | Today, there are more "by their own bootstraps" stories. | Steve Jobs was the adopted. His original father was a | Syrian immigrant, for example. If we go back to the 1800s, | the "Gilded Age", the oppression of the "robber barons" was | obvious: they destroyed small companies before the | invention of antitrust laws. | | Maybe we'd like more "by their own bootstrap" stories | today, and I'd support implementing policies that make it | more possible. (including a new antitrust review of today's | companies, to see if they're bad for the economy, like the | 1800s robber barons were). But lets not pretend that the | 1800s were easier than they actually were. | [deleted] | andyxor wrote: | WaPo?? not gonna give this garbage source a click | robbyt wrote: | Why do you think the Washington Post is garbage? | andyxor wrote: | it's a political propaganda machine spewing misinformation | for years. | SeanLuke wrote: | The WP is one of the most highly respected newspapers in | the world. Extraordinary claims require extraordinary | evidence. Please provide your extraordinary evidence. | [deleted] | andyxor wrote: | the last 5 years of non-stop propaganda is quite | extraordinary | SeanLuke wrote: | So... no evidence at all then? | [deleted] | solutron wrote: | Gov't is going to try and break the big ones up, and stop M&A's | as anti-trust sentiment warms up. Startups will become much, much | harder to benefit from. The cost of capital is going to go up and | make it harder to fund-raise, and people will get much more | judicious about what they invest in. If your company isn't tied | to some other industry or sector of the economy and is a tech | company, just consider if your business can survive on its own | for the next 3 - 5 years. ___________________________________________________________________ (page generated 2021-05-04 23:00 UTC)