4 ms·
Network effects are a symptom of the internet. They yield incredibly strong market control. Very few economic actors run extreme profit margins at giant scale [
by markvdb 6y ago
Network effects are a symptom of the internet. They yield incredibly strong market control. Very few economic actors run extreme profit margins at giant scale [0][1]. They extract a disproportional profit share from the market economy. Apple is just one of them.
Is this sustainable? Will these players stay happy just extracting profits and eating small innovative players for breakfast? Is the market economy strong enough not to succumb to their lobbying power?
To me, it's clear that as the general public, we don't benefit from this situation. In the best case scenario, we're overpaying for all things information. I think something should be done about this, but what? Suggestions welcome, because I don't have answers yet. In the meantime, I try to stay clear of the molochs.
[0] As a symptom, Apple, Microsoft, Alphabet, Facebook and Amazon's combined market cap equals 75% of the entire EU stock market. Read their annual reports to understand where thet extract their profits.
[1] https://www.businessinsider.in/stock-market/news/the-us-tech-sector-is-now-worth-more-than-the-entire-european-stock-market-bank-of-america-says/articleshow/77811931.cms https://www.businessinsider.in/stock-market/news/the-us-tech... .