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Something unsettling about the feeling (founded or not) that a handful of tech juggernauts have the ability to buy up seemingly whatever they want. This along

Something unsettling about the feeling (founded or not) that a handful of tech juggernauts have the ability to buy up seemingly whatever they want. This along with the anti-headhunting collusion, sprawling campuses puts me in mind of a Gibsonian future ruled by a handful corporate arcologies [0]. Has business always operated this way and I'm only now noticing because it's happening closer to home? 0: http://en.wikipedia.org/wiki/Arcology http://en.wikipedia.org/wiki/Arcology

loceng 13y ago
A future open technology sounds nice doesn't it? The only issue here then is making sure resources are distributed, managed and organized in a kind way.
capkutay 13y ago
Well, it's possible that they recognize that market capitalizations of tech companies are a little saturated right now given their sources of revenue and growth plans. So while your stock is overvalued, one of the best ways you can take advantage of it is making stock-heavy acquisitions (even if the deal is 50/50 cash-stock, it helps when your stock is valued at $550 a share). How else could they take advantage of high stock valuations in the short term?
- seizethecheese 13y ago
  Good point. It kills me,however, when people quote a stock price when they really should talk about market cap. Stock prices are basically arbitrary unless you consider shares outstanding.
mcphilip 13y ago
Once you're a front runner in a given market sector, it's often more efficient to buy up smaller companies to gain valuable intellectual property and future revenue streams than it is to rely solely on inhouse R&D. These types of acquisition sprees are extremely common, especially with companies like Google that are flush with cash.
- mehrdada 13y ago
  > to gain valuable intellectual property and future revenue streams ...and neutralize the risk of potential competitors by effectively killing them
samstave 13y ago
You might agree with this post I made a couple years ago on the idea of acquisitions by the tech giants: https://news.ycombinator.com/item?id=4325445 https://news.ycombinator.com/item?id=4325445
icegreentea 13y ago
Businesses have pretty much always worked this way. If you accept that efficiencies of scale are a thing, that network effects are real, and that capital breeds capital, then you pretty much arrive at the conclusion that capitalist systems will tend to grow towards consolidation and concentration of power. Disruption is always a thing - corporations are still run by humans and still subject to some weaknesses of human judgement, but concentration of capital and power will tend to feedback on itself. For example, take a look at the list of brands owned by P&G and Johnson&Johnson.
- orblivion 13y ago
  Calculation problems are a thing too, though. A huge corporation is still central planning, which isn't very efficient. That's why disruption happens, at a large scale there's a lot more room for error. That is, if they really are subject to market forces, which is always a good thing to question.

loceng 13y ago

A future open technology sounds nice doesn't it? The only issue here then is making sure resources are distributed, managed and organized in a kind way.

capkutay 13y ago

Well, it's possible that they recognize that market capitalizations of tech companies are a little saturated right now given their sources of revenue and growth plans. So while your stock is overvalued, one of the best ways you can take advantage of it is making stock-heavy acquisitions (even if the deal is 50/50 cash-stock, it helps when your stock is valued at $550 a share). How else could they take advantage of high stock valuations in the short term?

seizethecheese 13y ago
Good point. It kills me,however, when people quote a stock price when they really should talk about market cap. Stock prices are basically arbitrary unless you consider shares outstanding.

mcphilip 13y ago

Once you're a front runner in a given market sector, it's often more efficient to buy up smaller companies to gain valuable intellectual property and future revenue streams than it is to rely solely on inhouse R&D. These types of acquisition sprees are extremely common, especially with companies like Google that are flush with cash.

mehrdada 13y ago
> to gain valuable intellectual property and future revenue streams ...and neutralize the risk of potential competitors by effectively killing them

samstave 13y ago

You might agree with this post I made a couple years ago on the idea of acquisitions by the tech giants: https://news.ycombinator.com/item?id=4325445 https://news.ycombinator.com/item?id=4325445

icegreentea 13y ago

Businesses have pretty much always worked this way. If you accept that efficiencies of scale are a thing, that network effects are real, and that capital breeds capital, then you pretty much arrive at the conclusion that capitalist systems will tend to grow towards consolidation and concentration of power. Disruption is always a thing - corporations are still run by humans and still subject to some weaknesses of human judgement, but concentration of capital and power will tend to feedback on itself. For example, take a look at the list of brands owned by P&G and Johnson&Johnson.

orblivion 13y ago
Calculation problems are a thing too, though. A huge corporation is still central planning, which isn't very efficient. That's why disruption happens, at a large scale there's a lot more room for error. That is, if they really are subject to market forces, which is always a good thing to question.