3 ms·

> Whereas since the entry bar for creating competitive software is so much lower, many countries can afford to nurture genuinely homegrown products, and have a

> Whereas since the entry bar for creating competitive software is so much lower, many countries can afford to nurture genuinely homegrown products, and have a reasonable expectation that they will be competitive. I don't think it's that. It's that eg. Kakao has KakaoTalk, a chat app. And chat apps tend towards monopolies and oligopolies because of network effects. The value of the app is less in how good it is, and more in who else uses it. If you're just buying a music player or an office suite for a common file format, what you use doesn't really matter to anyone else, and their choices to you. Chat apps, collaboration platforms? Suddenly, who else uses them matters a lot, since it's about the people, not the physical function. And once you get big enough, the network effects turns from a hurdle into a gigantic moat.

MichaelZuo 4y ago
> If you're just buying a music player or an office suite for a common file format, what you use doesn't really matter to anyone else, and their choices to you. The question of how many people use any given physical product, such as music players, certainly matters to supply chain executives and factory managers at the very least. Because the same network effects applies to manufactured products, notably in economics of scale. More generally, it's true that KakaoTalk benefits from network effects, but Facebook Korea could have benefited from the same. It's just that a homegrown Korean chat app is viable against Facebook Korea because the entry bar is lower, whereas a homegrown Korean iPod would have been laughable against Apple, even in Korea. There's very few people that would have paid 5x more for an all Korean iPod, but most are fine with being slightly inconvenient by Kakao's smaller international userbase.

3 ms·

> Whereas since the entry bar for creating competitive software is so much lower, many countries can afford to nurture genuinely homegrown products, and have a

by soundnote 4y ago

MichaelZuo 4y ago
> If you're just buying a music player or an office suite for a common file format, what you use doesn't really matter to anyone else, and their choices to you. The question of how many people use any given physical product, such as music players, certainly matters to supply chain executives and factory managers at the very least. Because the same network effects applies to manufactured products, notably in economics of scale. More generally, it's true that KakaoTalk benefits from network effects, but Facebook Korea could have benefited from the same. It's just that a homegrown Korean chat app is viable against Facebook Korea because the entry bar is lower, whereas a homegrown Korean iPod would have been laughable against Apple, even in Korea. There's very few people that would have paid 5x more for an all Korean iPod, but most are fine with being slightly inconvenient by Kakao's smaller international userbase.