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From "Laws of Tech: Commoditize Your Complement" (https://www.gwern.net/Complement https://www.gwern.net/Complement): > Joel Spolsky in 2002 identified a major
by Presquare 8y ago
From "Laws of Tech: Commoditize Your Complement" (https://www.gwern.net/Complement https://www.gwern.net/Complement):
> Joel Spolsky in 2002 identified a major pattern in technology business & economics: the pattern of "commoditizing your complement"
> This pattern explains many otherwise odd or apparently self-sabotaging ventures by large tech companies into apparently irrelevant fields ...
> ...they are pre-emptive attempts to commodify another company elsewhere in the stack, or defenses against it being done to them.
After having read this article, it's been interesting how a lot of these investments have started making more sense. They often aren't primarily about the product itself, rather they serve the function of minimizing any leverage other companies could have over them.
As Github offers an access to a valuable resource for tech companies, developers, Microsoft could use it to promote its products/services and to attract talent. This isn't good for Google, so they are hoping to reduce Microsoft's leverage.
In some sense this is obvious, but I hadn't consciously identified this as a pattern before.
- maxxxxx 8y agoI hope somebody will do this to Google's business so they have to do something else than selling ads.
- sureaboutthis 8y agoSo all other media companies, too? Television networks, newspapers, magazines, etc.?
- radiorental 8y agoThat's why there is alphabet, labs etc. The business is trying to diversify.
- pdimitar 8y agoApologies if what I say is naive -- I don't follow Google announcements at all -- but they don't seem to try and progress any field per se, except maybe deep learning and only where it serves them (like one of their first successes was to reduce their power usage on a ship full of servers I think?). They are merging YouTube Gaming to YT itself (cited branding problems), discontinuing Inbox next March... Add that to a long list of canceled services. I am not saying they have to run a charity but they do seem very heavy-handed in these situations. And so far we have not seen them innovate anywhere for a while -- correct me if I am wrong. To me, it seems they entrench themselves even further in the business of using personal data for profit -- one example could be the upcoming laptop OS Fuchsia. Imagine how much more they will know about people if that takes off on a massive scale.
- wodenokoto 8y agoNone of those services you mentions are alternatives to selling ads. They are just places to sell ads. As for alternative revenues, they are heavily pushing Google Cloud platforms to businesses.
- manigandham 8y agoThey do have lots of ancillary revenue streams, but when you're talking about 100s of billions from ads then they just get overshadowed completely. Very hard to build an equivalently sized business in any other sector. The major now seems to be on Google Cloud, but they have struggled there with bad marketing, lack of sales and support talent, and strange priorities. Seems to be growing now with the AI functionalities but there's a long road ahead.
- quanticle 8y agoGoogle Compute Engine, and their infrastructure offerings more generally, are in a nice spot relative to Amazon and Microsoft. AWS and Azure get all the attention, but I wouldn't be surprised if GCE is decently profitable as well. Like sibling commentors have pointed out, it's easy for even relatively successful ventures to be completely overshadowed by the golden goose that is ads and search.
- themacguffinman 8y agoThe very example you cite at the end is an example of them genuinely innovating and advancing the field. Have you read the Fuchsia docs (https://fuchsia.googlesource.com/docs/+/HEAD/README.md https://fuchsia.googlesource.com/docs/+/HEAD/README.md)? It's spearheading several innovative OS concepts and I'm excited to see it develop (to name three: microkernel architecture, top to bottom least-privilege access sandboxing, and Flutter for the UI which advances UI development in other ways).
- zhengwang 8y agoDo any of its subsidiaries even generate revenue?
- closetCS 8y agoAs much as a Google replacement would be great for competition, it would be extremely difficult. Google was able to scale with the web gradually through anti spam and proprietary software, but a new competitor would struggle to reach such a needed scale so quickly Tl;dr: High cost of entry for newcomers
- imron 8y agoPeople said the same thing about AltaVista.
- matt_the_bass 8y agoAgreed but I don’t think this is quite the same case. Back then Alta Vista pretty much only offered search as a value to its users. Google certainly started there but offers a lot more than just search to its users. Only one service had to be overthrown to overcome AV. Lots of services would need to be overcome to overthrow google. (Note I said “users” not “customers”)
- maxxxxx 8y agoYou just need to overthrow the ad business and Google will have a huge problem.
- manigandham 8y agoWhy? Advertising isn't going anywhere so there will always be providers of it, so why would Google not remain one of those providers?