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Why Big Companies Keep Failing: The Stack Fallacy (2016)

101 points by bobbiechen 9mo ago

dang 9mo ago
Related: The Stack Fallacy (2016) - https://news.ycombinator.com/item?id=26177629 https://news.ycombinator.com/item?id=26177629 - Feb 2021 (28 comments) Why Big Companies Keep Failing: The Stack Fallacy - https://news.ycombinator.com/item?id=10927600 https://news.ycombinator.com/item?id=10927600 - Jan 2016 (169 comments)
grsmvg 9mo ago
So many examples mentioned can be explained by network effect, first mover advantage, or an already saturated market, instead of underestimating the making of a good product.
taeric 9mo ago
I have grown to not agree with this idea. Sorta, at least. It isn't so much that I think the criticism is wrong. Many people do think they could more effectively do something in a different area. But this isn't a stack thing. People are largely ignorant of a ton of work happening everywhere. You see that ignorance quite commonly in stuff like climate activism. Young activists are convinced that nobody is working on the problem. And to be clear, it would be nice if maybe more people were working on some problems. But please don't ignore the progress made by a lot of hard work, in the meantime. But back to "why companies keep failing." I could as easily assert that big companies fail when they stop pouring money into growing. Wouldn't be hard to build an argument that the more "funny money" is at play in a large company, the more they are stifling innovative ideas in their walls. Of course, if you pour money through leveraged debt, some day that comes due, as well.
- r14c 9mo ago
  > You see that ignorance quite commonly in stuff like climate activism. Young activists are convinced that nobody is working on the problem. IMO the complaints here are well-founded, but maybe some wires have gotten crossed in communication. There are many climate related companies out there (with varying levels of actual utility). People are obviously working on the problem, but the policy side is largely captured by big oil and other monied interests who would lose a lot of money if any meaningful shift away from fossil fuels were to happen. Addressing the climate crisis using minimally subsidized market forces is way too slow to be effective at reaching even the bare minimum Paris Accords numbers. Even those policies at this point are being dismantled and called a "climate hoax". The market side work is laudable, but the climate crisis cannot be averted without a supportive policy framework. I do a lot of activism work and the critique is typically centered on "nobody in the government is making progress on climate policy", not "nobody is doing anything at all". Though maybe we're talking to different groups of people lol
  - philipallstar 9mo ago
    > the policy side is largely captured by big oil and other monied interests Then the activists would do well to demand a better government that isn't bribeable so easily.
    - immibis 9mo ago
      There's no such thing.
      - philipallstar 9mo ago
        Then we've still identified the problem.
        immibis 9mo ago
        ok? Now how to fix it?
  - taeric 9mo ago
    I'm talking about people that literally think absolutely nobody is working on things. There was a viral video not too long ago of a young activist saying she got into this because she realized that "literally nobody was working to make things better." I could chalk that up to online viral nonsense, but I've talked to people fresh out of college that legit think this sort of stuff. This sort of thing is usually made worse by people that are not willing to acknowledge that not all progress is definitionally good. (As an easy example, the report a few years ago that raised the idea that measurable increases in ocean temperature were from cleaner shipping got annoyingly ignored.) Again, though, in my theme of "this isn't really stack related." This is also not activist related. People have a tendency to think the problem they are working on is more important than every other problem. Dentists tend to think oral health is the key to understanding all health. Nutritionists, the same. Managers tend to think things just need good management. It is a very common pattern. And it is enticing because it speaks to kernels of truth. It just doesn't survive the "no panacea" test.
wrs 9mo ago
I call it the “sandwich fallacy”. A lot of good bakeries decide to start making sandwiches. It’s an obvious value-add and adds margin. But sandwich customers are different from bakery customers, a sandwich shop has a different layout from a bakery, and making a great sandwich is a very different skill set from making great bread. So it’s not easy to stay a successful bakery and add on a successful sandwich business. On the other hand, a great sandwich shop can pretty easily hire a baker and set up an oven to make exactly the bread that it needs to elevate its sandwiches.
- themafia 9mo ago
  The sandwich shop should just open next to the baker. It's okay to own and operate two businesses.
  - pooper 9mo ago
    This 'sandwich fallacy' perfectly illustrates why I think sports should be removed from the university system. Universities are great 'bakeries' (centers of learning), but they’ve become bogged down trying to run massive 'sandwich shops' (commercial sports). It’s okay for these to exist, but they should be independent entities so the school can focus on being a school.
    - Terr_ 9mo ago
      Just musing on the flows between the Sports and Academics sides: * Sports gives Academics some funds * Sports gives Academics brand marketing/prestige * Academics gives Sports a moral cover for exploiting young athletes * Academics gives Sports a pre-made core fanbase of students
    - bluGill 9mo ago
      Spectator sports should be run by the marketing department at the university and judged by their ability to bring in future students and donations - both important things that sports do for marketing. Justify your existence based on those two or get rid of those sports. Since this is a marketing department thing other departments should stay out. There is a different class of sports though. Schools should have sports as exercise for students, and classes on how to get better at sports.
austin-cheney 9mo ago
This became the most toxic part of web development... the tech stack. Its why I went to go do something else. Holy fuck, all you need is a server application, a database, HTML, JavaScript, and CSS to make a CRUD app. Seriously, that is really all you need. The problem though is that nobody trains developers any more and so you get a little bit of helpers to help the developers along, which turns out to be a mountain of bullshit that developers use to line their resumes like notes on toilet paper. As a counter point I wrote a large single page app and then adapted it into removable modules that can be turned off from a JSON file. So, its modular, which then solves for the design goal of most modern JavaScript browser frameworks. But, it's just vanilla TypeScript. It is stupid simple to scale, extensions from one of two TypeScript interfaces without tech debt. The best part is that its fast... like completing all initial execution, rendering, and garbage collection in less than 130ms. https://github.com/prettydiff/aphorio/blob/screenshots/papers/performance_browser_2.md https://github.com/prettydiff/aphorio/blob/screenshots/paper... So, in practice it seems you could easily replace 10 React/Angular developers with a single TypeScript developer and a series of small TypeScript interfaces. The bonus is that you get faster releases, 100% accessibility (because its mostly raw HTML instead of compiled templates), and a substantially faster product.
- codyb 9mo ago
  Nobody builds anything modularly. It's very weird. I've come into codebases at my current big co where 15 tables that all looked and acted exactly as terribly as one another (no sorting, no discernible sort, no filtering, limited page sizes, no search beyond CMD/CTRL-F) And they were all built out one by one, every time. What a mess, why! I consolidated everything down and am now bringing up both an App URL Param library other folks can use, a generic resource engine other folks can use, and a table engine which combines the two to give you most table functionality with a simple config and passing in the resources (We're internal tooling for small record sets so a lot can be handled on the front end since resource baseline can be assumed and customer count is low). Even when you build things modularly people will give you grief. It's over engineered. Well, you say that, except it's testable at the unit level, easy to slide in to other use cases (which the test cases help ensure resiliancy for old and new), small, not nested, discoverable, flat, easy to read, and easy to maintain. So sure, took a couple of extra hours of legwork up front compared to just dropping everything into a single React function as is the standard round these parts, but the benefits are clear.
roncesvalles 9mo ago
Some of it could also be a plain Darwinian numbers game. Facebook was neither the first nor the only social media of its kind. There were hundreds of failed attempts at similar social media, counting those that died in obscurity. When Google attempted their Facebook clone, it was just one of the many who took a spin at the wheel. It was always more likely to have failed than succeeded. Building a B2C with hysteric adoption is difficult because it's very mysterious what elements of the product will actually lead to success, because it's a psychological thing. E.g., if Facebook chose green instead of blue as their theme color (all else equal), it might've died in obscurity.
- irishcoffee 9mo ago
  Pretty sure Facebook took off because they required you to have a .edu address, and even then, when it first launched it wasn’t just any .edu, the rolllout was slow. I remember people enrolling in 2-year schools when the regex matched on *.edu just so they could get an account. Facebook hit the seam of internet 2.0: after the .com crash with a bunch of kids who grew up on AIM/ICQ/whatever and all these kids wanted to keep up with their friends at various colleges. They indeed just got lucky.
  - bjt 9mo ago
    The .edu constraint also played perfectly to the most important requirement of a new social network: Your parents must not have accounts there.
seanhunter 9mo ago
This is a great example of persuasive, but superficial, analysis. 1) It may well be a dumb thing they do, but is this really "why big companies keep failing?" There's no real examination of this causal assertion which seems central. 2) Is it really the "stack"? That is to say, do people really assume that just the layer above them is trivial? I see engineers all the time assume that basically everything they don't understand is trivial. For example Elon Musk's famous assertion that the hyperloop is "Basically just like an air hockey table. It's not that hard". Well in turns out air hockey pucks don't need to transport people, g-forces aren't important for air hockey versus not murdering your passengers is quite important for a public transport system. Air hockey pucks don't need to breathe versus people do which makes the vacuum part quite critical and challenging especially since you have to figure out how to get people in and out without rupture. To think of it as like air hockey you are assuming that all interesting/challenging parts of the problem are trivial. To be clear: I think that this hubris is basically essential for innovation. I really don't think people would ever innovate if they worried too much about every small detail of things, but this is why a large proportion of experiments by everyone (big and small companies alike) fail. I don't think the layer above you in the stack is the important part here and the article doesn't examine whether that characteristic is important.
- bee_rider 9mo ago
  Your point 2 is interesting, but Musk isn’t any type of engineer really, just a money guy that uses engineer words. It seems more likely that he assumes a Hyperloop would be trivial not because it is a simple application of some lower framework that he’s got a deep understanding of, but because he hasn’t been given an itemized bill for one.
  - prewett 9mo ago
    Musk used to be seen as an engineer. He co-founded a payments company that merged with PayPal (not sure if he did engineering, though). I believe he is widely seen as being a knowledgeable rocketry engineer. I also think that he contributed to engineering of early Teslas. Now he is completely over-committed, and seems to me like he is burnt-out but does not realize it, and is doing all sorts of crazy things which act to sort of paper that over. Twenty years ago he was seen as a high-level engineer (I've heard that Marvel's Tony Stark was based on Musk [I mean, obviously it was based on the comic book character, but hopefully you know what I mean]).
dosinga 9mo ago
This doesn’t sound very convincing, mostly because the examples don’t really line up with the claim. Apple supposedly struggles “up the stack,” yet many of the best and most-used iPhone apps are built by Apple itself. Google is held up as failing at social, but YouTube is arguably the largest social network in the world. Oracle is described as struggling in apps, yet it’s clearly doing just fine as a massive, profitable enterprise software company. And the IBM example is backwards: IBM didn’t accidentally hand Microsoft the OS layer, it already had its own operating systems. In fact, Microsoft is the clearest counterexample here, it got big by owning the OS and then very successfully moved up the stack to dominate applications with Office.
- bee_rider 9mo ago
  FWIW the article is from 2016 (although, if the article was discovering some real underlying force it shouldn’t be invalidated by the passage of time). Apple Maps was quite bad when it was released, I forget when that was exactly, but maybe it was recent enough in 2016 to be top-of-mind?
  - hansvm 9mo ago
    IIRC it was released somewhere in the iPhone 4/5 transition (2011ish?). It was so abysmal for a road trip I took that I went to Android and haven't looked back (they also removed Google Maps for a bit, and the web version wasn't suitable). It wouldn't have been top of mind for me in 2016, but I wouldn't have been surprised at somebody telling me Apple maps sucked.
  - anshublog 9mo ago
    exactly. it took longer for Apple to fix its Maps app - and to this day their email app is nowhere as good as most third party apps. Even iMessage is lacking features that WhatsApp and Signal built 5 years ago. (And iMessage is clearly their best app.)
- trickypr 9mo ago
  I think a lot of your examples are flawed. Google didn’t build the initial version of YouTube, they bought it. A lot of Apple’s apps predate the App Store. The apps that came later had limited use until Apple spent a lot of time refining them. Think Apple Maps. Microsoft released Word for Mac a year before they released Windows 1.0, so Windows was “down the stack” for them.
cliffaust 9mo ago
It's always better to just listen to your audience first before building. Big companies have so many layers involved to actually make sure that every engineer understands what the product they are building is really about
nonameiguess 9mo ago
It's pretty funny to see the 2016 date here. That's a few years after I finished grad school having doubled up in computer science and finance. It was nearly axiomatic at that point that small cap value funds were the best way to go for long-term investing, having outperformed all other broad options consistently for the past century over any time horizon longer than a decade. Except today. Even since this was written, large cap growth funds or "blue chip" stocks have tremendously outperformed everything else, more than doubling the return of small cap value. Big companies are absolutely not failing. They're doing better than they ever have at any other time in history, granting this is the admittedly short span of human history in which we had public equity markets.
- anshublog 9mo ago
  NVIDIA was a small cap in 2016. Netflix was a small cap in 2016. Intel was the leader. Comcast was the leader. Yes Google and Apple have done great but its because they have made some good strategic decisions. And some (not all) of their failures of last 10 years fall sqaurely in stack fallacy.
jackfranklyn 9mo ago
[flagged]
toss1 9mo ago
>>The bottleneck for success often is not knowledge of the tools, but lack of understanding of the customer needs. THIS!! A Thousand Times This! I have had many successful projects putting the coders in direct contact with the end users. In contrast, every time a manager is inserted between the real user requirements and the code, the project descends a lower ring of endless-feature-creep hell, doubles in length, and doubles it's likelihood of failure. Yes, managers are needed to provide some insulation from very noisy and chaotic feature requests from users, but insisting on at least some frequent time with some actual coders in contact with actual users pays massive dividends.
- anshublog 9mo ago
  thanks. :) [og author here]
jkingsbery 9mo ago
This isn't really just a big company problem, lots of start-ups fail too. It plays out a bit differently at big companies, as those failures tend to be more public but also done in a way that lets the company shuffle people around to the next project. There were lots of start-up companies that tried to build social networks or ERP systems or map applications that most people don't hear about.
- adamc 9mo ago
  Sure, in all cases, acquiring knowledge of what the (potential) customers want is difficult. The point of the article is that vendors of layer N tend to think they know what it takes to succeed at layer N+1, but they don't, because that customer base (N+2) is different. The other (more important, maybe) thing the article points out is that building layer N-1 turns out to be easier, because layer N is the customer and understands those needs already.
roenxi 9mo ago
Big companies also fail to keep their own markets with some regularity, the tech companies are built over the ruins of industries that solved the same problem in the days of yesteryear with different tools. The view of the article seems to be that companies solve problems. The way they solve problems is actually baked in to the structure of the management rather than any individual (sometimes there is an individual like a CEO with enough vision to reshape the management structure to solve new problems, although that is rare). It is also why acquisitions fail so easily - if you take an existing company and graft it under an existing management structure geared to solve some other problem then there is a lot of risk.
laughing_man 9mo ago
>History is full of such examples. IBM thought nothing much of the software layer that ran their PC hardware layer and happily allowed Microsoft to own the OS market. IBM didn't "happily" do anything of the sort. The company was undergoing multiple anti-trust investigations at the time and was trying to avoid incurring a large fine or even a structural remedy for creating a vertical monopoly. The reason Microsoft went to the mat so hard when the government was trying to separate IE from Windows was Gates' fear that the company would end up being similarly crippled by the specter of anti-trust action from the government.
- bonesss 9mo ago
  However many years later: the broad sentiment that MS needed to be broken up into separate Office, Windows, and Dev/Tools organizations was pretty on the money. Document exchange, formats, and user editing experience have suffered due to their mixed goals and market control, this has real social cost. And with the current ‘copilot everywhere’ push we’re seeing pretty disruptive tech being hammered down a lot of throats. Mature Visual Studio features are being deprecated for subscription based off-site code gen… (which at a distance sounds like MS is struggling and needs extra development help to maintain its flagship development software, if only they had some kind of AI that could help them keep up…) I dare say we’d be oodles better off with similar crippling fears in the board rooms of some media, energy, and tech conglomerates. The judge was right, and we missed a key chance to set a guiding example.
dzonga 9mo ago
this is very relevant in this era - where you people making noise without results about they can build with a.i and our technolords telling us plebs will be technoserfs to be replaced by a.i or that everything will be built by a.i
danielmarkbruce 9mo ago
This article misses the mark. It's not about knowledge, it's about competition. One direction creates a monopoly, the other creates a competitor in a competitive market.
throwaway81523 9mo ago
This sounds like the Blub paradox in reverse ;).
anshublog 9mo ago
Oh wow - interesting to see this up again. I am the author of The Stack Fallacy. #AMA I am now founder of Skyflow, we are runtime AI data security platform. This is my third startup, and previously I ran strategy for Salesforce.
bitwize 9mo ago
From The Tao of Programming, chapter 3.3: There was once a programmer who was attached to the court of the warlord of Wu. The warlord asked the programmer: "Which is easier to design: an accounting package or an operating system?" "An operating system," replied the programmer. The warlord uttered an exclamation of disbelief. "Surely an accounting package is trivial next to the complexity of an operating system," he said. "Not so," said the programmer, "When designing an accounting package, the programmer operates as a mediator between people having different ideas: how it must operate, how its reports must appear, and how it must conform to the tax laws. By contrast, an operating system is not limited by outside appearances. When designing an operating system, the programmer seeks the simplest harmony between machine and ideas. This is why an operating system is easier to design." The warlord of Wu nodded and smiled. "That is all good and well, but which is easier to debug?" The programmer made no reply. https://www.mit.edu/~xela/tao.html https://www.mit.edu/~xela/tao.html

101 points by bobbiechen 9mo ago

dang 9mo ago

Related: The Stack Fallacy (2016) - https://news.ycombinator.com/item?id=26177629 https://news.ycombinator.com/item?id=26177629 - Feb 2021 (28 comments) Why Big Companies Keep Failing: The Stack Fallacy - https://news.ycombinator.com/item?id=10927600 https://news.ycombinator.com/item?id=10927600 - Jan 2016 (169 comments)

grsmvg 9mo ago

So many examples mentioned can be explained by network effect, first mover advantage, or an already saturated market, instead of underestimating the making of a good product.

taeric 9mo ago

I have grown to not agree with this idea. Sorta, at least. It isn't so much that I think the criticism is wrong. Many people do think they could more effectively do something in a different area. But this isn't a stack thing. People are largely ignorant of a ton of work happening everywhere. You see that ignorance quite commonly in stuff like climate activism. Young activists are convinced that nobody is working on the problem. And to be clear, it would be nice if maybe more people were working on some problems. But please don't ignore the progress made by a lot of hard work, in the meantime. But back to "why companies keep failing." I could as easily assert that big companies fail when they stop pouring money into growing. Wouldn't be hard to build an argument that the more "funny money" is at play in a large company, the more they are stifling innovative ideas in their walls. Of course, if you pour money through leveraged debt, some day that comes due, as well.

r14c 9mo ago
> You see that ignorance quite commonly in stuff like climate activism. Young activists are convinced that nobody is working on the problem. IMO the complaints here are well-founded, but maybe some wires have gotten crossed in communication. There are many climate related companies out there (with varying levels of actual utility). People are obviously working on the problem, but the policy side is largely captured by big oil and other monied interests who would lose a lot of money if any meaningful shift away from fossil fuels were to happen. Addressing the climate crisis using minimally subsidized market forces is way too slow to be effective at reaching even the bare minimum Paris Accords numbers. Even those policies at this point are being dismantled and called a "climate hoax". The market side work is laudable, but the climate crisis cannot be averted without a supportive policy framework. I do a lot of activism work and the critique is typically centered on "nobody in the government is making progress on climate policy", not "nobody is doing anything at all". Though maybe we're talking to different groups of people lol
- philipallstar 9mo ago
  > the policy side is largely captured by big oil and other monied interests Then the activists would do well to demand a better government that isn't bribeable so easily.
  - immibis 9mo ago
    There's no such thing.
    - philipallstar 9mo ago
      Then we've still identified the problem.
      - immibis 9mo ago
        ok? Now how to fix it?
- taeric 9mo ago
  I'm talking about people that literally think absolutely nobody is working on things. There was a viral video not too long ago of a young activist saying she got into this because she realized that "literally nobody was working to make things better." I could chalk that up to online viral nonsense, but I've talked to people fresh out of college that legit think this sort of stuff. This sort of thing is usually made worse by people that are not willing to acknowledge that not all progress is definitionally good. (As an easy example, the report a few years ago that raised the idea that measurable increases in ocean temperature were from cleaner shipping got annoyingly ignored.) Again, though, in my theme of "this isn't really stack related." This is also not activist related. People have a tendency to think the problem they are working on is more important than every other problem. Dentists tend to think oral health is the key to understanding all health. Nutritionists, the same. Managers tend to think things just need good management. It is a very common pattern. And it is enticing because it speaks to kernels of truth. It just doesn't survive the "no panacea" test.

wrs 9mo ago

I call it the “sandwich fallacy”. A lot of good bakeries decide to start making sandwiches. It’s an obvious value-add and adds margin. But sandwich customers are different from bakery customers, a sandwich shop has a different layout from a bakery, and making a great sandwich is a very different skill set from making great bread. So it’s not easy to stay a successful bakery and add on a successful sandwich business. On the other hand, a great sandwich shop can pretty easily hire a baker and set up an oven to make exactly the bread that it needs to elevate its sandwiches.

themafia 9mo ago
The sandwich shop should just open next to the baker. It's okay to own and operate two businesses.
- pooper 9mo ago
  This 'sandwich fallacy' perfectly illustrates why I think sports should be removed from the university system. Universities are great 'bakeries' (centers of learning), but they’ve become bogged down trying to run massive 'sandwich shops' (commercial sports). It’s okay for these to exist, but they should be independent entities so the school can focus on being a school.
  - Terr_ 9mo ago
    Just musing on the flows between the Sports and Academics sides: * Sports gives Academics some funds * Sports gives Academics brand marketing/prestige * Academics gives Sports a moral cover for exploiting young athletes * Academics gives Sports a pre-made core fanbase of students
  - bluGill 9mo ago
    Spectator sports should be run by the marketing department at the university and judged by their ability to bring in future students and donations - both important things that sports do for marketing. Justify your existence based on those two or get rid of those sports. Since this is a marketing department thing other departments should stay out. There is a different class of sports though. Schools should have sports as exercise for students, and classes on how to get better at sports.

austin-cheney 9mo ago

This became the most toxic part of web development... the tech stack. Its why I went to go do something else. Holy fuck, all you need is a server application, a database, HTML, JavaScript, and CSS to make a CRUD app. Seriously, that is really all you need. The problem though is that nobody trains developers any more and so you get a little bit of helpers to help the developers along, which turns out to be a mountain of bullshit that developers use to line their resumes like notes on toilet paper. As a counter point I wrote a large single page app and then adapted it into removable modules that can be turned off from a JSON file. So, its modular, which then solves for the design goal of most modern JavaScript browser frameworks. But, it's just vanilla TypeScript. It is stupid simple to scale, extensions from one of two TypeScript interfaces without tech debt. The best part is that its fast... like completing all initial execution, rendering, and garbage collection in less than 130ms. https://github.com/prettydiff/aphorio/blob/screenshots/papers/performance_browser_2.md https://github.com/prettydiff/aphorio/blob/screenshots/paper... So, in practice it seems you could easily replace 10 React/Angular developers with a single TypeScript developer and a series of small TypeScript interfaces. The bonus is that you get faster releases, 100% accessibility (because its mostly raw HTML instead of compiled templates), and a substantially faster product.

codyb 9mo ago
Nobody builds anything modularly. It's very weird. I've come into codebases at my current big co where 15 tables that all looked and acted exactly as terribly as one another (no sorting, no discernible sort, no filtering, limited page sizes, no search beyond CMD/CTRL-F) And they were all built out one by one, every time. What a mess, why! I consolidated everything down and am now bringing up both an App URL Param library other folks can use, a generic resource engine other folks can use, and a table engine which combines the two to give you most table functionality with a simple config and passing in the resources (We're internal tooling for small record sets so a lot can be handled on the front end since resource baseline can be assumed and customer count is low). Even when you build things modularly people will give you grief. It's over engineered. Well, you say that, except it's testable at the unit level, easy to slide in to other use cases (which the test cases help ensure resiliancy for old and new), small, not nested, discoverable, flat, easy to read, and easy to maintain. So sure, took a couple of extra hours of legwork up front compared to just dropping everything into a single React function as is the standard round these parts, but the benefits are clear.

roncesvalles 9mo ago

Some of it could also be a plain Darwinian numbers game. Facebook was neither the first nor the only social media of its kind. There were hundreds of failed attempts at similar social media, counting those that died in obscurity. When Google attempted their Facebook clone, it was just one of the many who took a spin at the wheel. It was always more likely to have failed than succeeded. Building a B2C with hysteric adoption is difficult because it's very mysterious what elements of the product will actually lead to success, because it's a psychological thing. E.g., if Facebook chose green instead of blue as their theme color (all else equal), it might've died in obscurity.

irishcoffee 9mo ago
Pretty sure Facebook took off because they required you to have a .edu address, and even then, when it first launched it wasn’t just any .edu, the rolllout was slow. I remember people enrolling in 2-year schools when the regex matched on *.edu just so they could get an account. Facebook hit the seam of internet 2.0: after the .com crash with a bunch of kids who grew up on AIM/ICQ/whatever and all these kids wanted to keep up with their friends at various colleges. They indeed just got lucky.
- bjt 9mo ago
  The .edu constraint also played perfectly to the most important requirement of a new social network: Your parents must not have accounts there.

seanhunter 9mo ago

This is a great example of persuasive, but superficial, analysis. 1) It may well be a dumb thing they do, but is this really "why big companies keep failing?" There's no real examination of this causal assertion which seems central. 2) Is it really the "stack"? That is to say, do people really assume that just the layer above them is trivial? I see engineers all the time assume that basically everything they don't understand is trivial. For example Elon Musk's famous assertion that the hyperloop is "Basically just like an air hockey table. It's not that hard". Well in turns out air hockey pucks don't need to transport people, g-forces aren't important for air hockey versus not murdering your passengers is quite important for a public transport system. Air hockey pucks don't need to breathe versus people do which makes the vacuum part quite critical and challenging especially since you have to figure out how to get people in and out without rupture. To think of it as like air hockey you are assuming that all interesting/challenging parts of the problem are trivial. To be clear: I think that this hubris is basically essential for innovation. I really don't think people would ever innovate if they worried too much about every small detail of things, but this is why a large proportion of experiments by everyone (big and small companies alike) fail. I don't think the layer above you in the stack is the important part here and the article doesn't examine whether that characteristic is important.

bee_rider 9mo ago
Your point 2 is interesting, but Musk isn’t any type of engineer really, just a money guy that uses engineer words. It seems more likely that he assumes a Hyperloop would be trivial not because it is a simple application of some lower framework that he’s got a deep understanding of, but because he hasn’t been given an itemized bill for one.
- prewett 9mo ago
  Musk used to be seen as an engineer. He co-founded a payments company that merged with PayPal (not sure if he did engineering, though). I believe he is widely seen as being a knowledgeable rocketry engineer. I also think that he contributed to engineering of early Teslas. Now he is completely over-committed, and seems to me like he is burnt-out but does not realize it, and is doing all sorts of crazy things which act to sort of paper that over. Twenty years ago he was seen as a high-level engineer (I've heard that Marvel's Tony Stark was based on Musk [I mean, obviously it was based on the comic book character, but hopefully you know what I mean]).

dosinga 9mo ago

This doesn’t sound very convincing, mostly because the examples don’t really line up with the claim. Apple supposedly struggles “up the stack,” yet many of the best and most-used iPhone apps are built by Apple itself. Google is held up as failing at social, but YouTube is arguably the largest social network in the world. Oracle is described as struggling in apps, yet it’s clearly doing just fine as a massive, profitable enterprise software company. And the IBM example is backwards: IBM didn’t accidentally hand Microsoft the OS layer, it already had its own operating systems. In fact, Microsoft is the clearest counterexample here, it got big by owning the OS and then very successfully moved up the stack to dominate applications with Office.

bee_rider 9mo ago
FWIW the article is from 2016 (although, if the article was discovering some real underlying force it shouldn’t be invalidated by the passage of time). Apple Maps was quite bad when it was released, I forget when that was exactly, but maybe it was recent enough in 2016 to be top-of-mind?
- hansvm 9mo ago
  IIRC it was released somewhere in the iPhone 4/5 transition (2011ish?). It was so abysmal for a road trip I took that I went to Android and haven't looked back (they also removed Google Maps for a bit, and the web version wasn't suitable). It wouldn't have been top of mind for me in 2016, but I wouldn't have been surprised at somebody telling me Apple maps sucked.
- anshublog 9mo ago
  exactly. it took longer for Apple to fix its Maps app - and to this day their email app is nowhere as good as most third party apps. Even iMessage is lacking features that WhatsApp and Signal built 5 years ago. (And iMessage is clearly their best app.)
trickypr 9mo ago
I think a lot of your examples are flawed. Google didn’t build the initial version of YouTube, they bought it. A lot of Apple’s apps predate the App Store. The apps that came later had limited use until Apple spent a lot of time refining them. Think Apple Maps. Microsoft released Word for Mac a year before they released Windows 1.0, so Windows was “down the stack” for them.

cliffaust 9mo ago

It's always better to just listen to your audience first before building. Big companies have so many layers involved to actually make sure that every engineer understands what the product they are building is really about

nonameiguess 9mo ago

It's pretty funny to see the 2016 date here. That's a few years after I finished grad school having doubled up in computer science and finance. It was nearly axiomatic at that point that small cap value funds were the best way to go for long-term investing, having outperformed all other broad options consistently for the past century over any time horizon longer than a decade. Except today. Even since this was written, large cap growth funds or "blue chip" stocks have tremendously outperformed everything else, more than doubling the return of small cap value. Big companies are absolutely not failing. They're doing better than they ever have at any other time in history, granting this is the admittedly short span of human history in which we had public equity markets.

anshublog 9mo ago
NVIDIA was a small cap in 2016. Netflix was a small cap in 2016. Intel was the leader. Comcast was the leader. Yes Google and Apple have done great but its because they have made some good strategic decisions. And some (not all) of their failures of last 10 years fall sqaurely in stack fallacy.

jackfranklyn 9mo ago

[flagged]

toss1 9mo ago

>>The bottleneck for success often is not knowledge of the tools, but lack of understanding of the customer needs. THIS!! A Thousand Times This! I have had many successful projects putting the coders in direct contact with the end users. In contrast, every time a manager is inserted between the real user requirements and the code, the project descends a lower ring of endless-feature-creep hell, doubles in length, and doubles it's likelihood of failure. Yes, managers are needed to provide some insulation from very noisy and chaotic feature requests from users, but insisting on at least some frequent time with some actual coders in contact with actual users pays massive dividends.

anshublog 9mo ago
thanks. :) [og author here]

jkingsbery 9mo ago

This isn't really just a big company problem, lots of start-ups fail too. It plays out a bit differently at big companies, as those failures tend to be more public but also done in a way that lets the company shuffle people around to the next project. There were lots of start-up companies that tried to build social networks or ERP systems or map applications that most people don't hear about.

adamc 9mo ago
Sure, in all cases, acquiring knowledge of what the (potential) customers want is difficult. The point of the article is that vendors of layer N tend to think they know what it takes to succeed at layer N+1, but they don't, because that customer base (N+2) is different. The other (more important, maybe) thing the article points out is that building layer N-1 turns out to be easier, because layer N is the customer and understands those needs already.

roenxi 9mo ago

Big companies also fail to keep their own markets with some regularity, the tech companies are built over the ruins of industries that solved the same problem in the days of yesteryear with different tools. The view of the article seems to be that companies solve problems. The way they solve problems is actually baked in to the structure of the management rather than any individual (sometimes there is an individual like a CEO with enough vision to reshape the management structure to solve new problems, although that is rare). It is also why acquisitions fail so easily - if you take an existing company and graft it under an existing management structure geared to solve some other problem then there is a lot of risk.

laughing_man 9mo ago

>History is full of such examples. IBM thought nothing much of the software layer that ran their PC hardware layer and happily allowed Microsoft to own the OS market. IBM didn't "happily" do anything of the sort. The company was undergoing multiple anti-trust investigations at the time and was trying to avoid incurring a large fine or even a structural remedy for creating a vertical monopoly. The reason Microsoft went to the mat so hard when the government was trying to separate IE from Windows was Gates' fear that the company would end up being similarly crippled by the specter of anti-trust action from the government.

bonesss 9mo ago
However many years later: the broad sentiment that MS needed to be broken up into separate Office, Windows, and Dev/Tools organizations was pretty on the money. Document exchange, formats, and user editing experience have suffered due to their mixed goals and market control, this has real social cost. And with the current ‘copilot everywhere’ push we’re seeing pretty disruptive tech being hammered down a lot of throats. Mature Visual Studio features are being deprecated for subscription based off-site code gen… (which at a distance sounds like MS is struggling and needs extra development help to maintain its flagship development software, if only they had some kind of AI that could help them keep up…) I dare say we’d be oodles better off with similar crippling fears in the board rooms of some media, energy, and tech conglomerates. The judge was right, and we missed a key chance to set a guiding example.

dzonga 9mo ago

this is very relevant in this era - where you people making noise without results about they can build with a.i and our technolords telling us plebs will be technoserfs to be replaced by a.i or that everything will be built by a.i

danielmarkbruce 9mo ago

This article misses the mark. It's not about knowledge, it's about competition. One direction creates a monopoly, the other creates a competitor in a competitive market.

throwaway81523 9mo ago

This sounds like the Blub paradox in reverse ;).

anshublog 9mo ago

Oh wow - interesting to see this up again. I am the author of The Stack Fallacy. #AMA I am now founder of Skyflow, we are runtime AI data security platform. This is my third startup, and previously I ran strategy for Salesforce.

bitwize 9mo ago

From The Tao of Programming, chapter 3.3: There was once a programmer who was attached to the court of the warlord of Wu. The warlord asked the programmer: "Which is easier to design: an accounting package or an operating system?" "An operating system," replied the programmer. The warlord uttered an exclamation of disbelief. "Surely an accounting package is trivial next to the complexity of an operating system," he said. "Not so," said the programmer, "When designing an accounting package, the programmer operates as a mediator between people having different ideas: how it must operate, how its reports must appear, and how it must conform to the tax laws. By contrast, an operating system is not limited by outside appearances. When designing an operating system, the programmer seeks the simplest harmony between machine and ideas. This is why an operating system is easier to design." The warlord of Wu nodded and smiled. "That is all good and well, but which is easier to debug?" The programmer made no reply. https://www.mit.edu/~xela/tao.html https://www.mit.edu/~xela/tao.html