> Is it just me or does anyone else feel over the decades they've been divesting some of the best (long term) building blocks?
IBM is old enough to understand the pitfalls of that approach.
In year zero it sounds great. Integration! Efficiency! And that works for a bit.
Then internal politics causes you to pass on opportunities that competitors take because taking them yourself would cannibalize sales in one of your other lines of business.
Then somebody else comes up with a better microprocessor than you, or better software, or lower cost manufacturing, and it's going to take your internal team five years to catch up. In the meantime all your systems are integrated with your in-house solution, so you can't switch, but the deficient in-house alternative makes you less competitive, so you lose all the customers who can switch easily.
Then you have to cut R&D because of the lost revenue and fall even further behind the competition, which leaves you in a death spiral where the most profitable strategy is to lock-in your existing customers and milk them as hard as possible as you circle the drain.
Or you can concentrate on doing one thing and doing it well, so that you don't risk sinking your entire operation as soon as you fail to execute flawlessly in any one of the six different major fields you've created an internal dependency on.
Yeah, successfully vertically integrated companies like Apple choose very carefully which things they integrate vertically and which things they don't. Apple silicon for example isn't truly apple silicon. They still cooperate with a company for the manufacturing. Apple still buys gorilla glass from Corning, etc.
And in the areas where they do compete, they pour in top dollar to make actually competitive products.
It's way too early to tell how Apple is going to end. They've only been where they are for a small number of years. What happens if Zen3 turns out to be significantly faster than Apple Silicon, or next year Intel gets 7nm right? Do they abandon it or do they fall behind? What do they do if Google gets worried about their market share and decides to start selling a top of the line phone for cost and marketing it on google.com?
And the opposite failure mode is just as bad -- you actually succeed in monopolizing the market and then get smashed by antitrust.
>And in the areas where they do compete, they pour in top dollar to make actually competitive products.
Apple TV+, Apple Music, Apple Arcade, Apple News+. Every single one of them were done to mask the profits of their Services Revenue. ( You could argue they provide decent value if you think they are competitive. )
I think that is where it all start to feel like Apple wasn't actually going in because they want to do better. They are doing it for numbers and finance.
And it irritates the heck out of me those money aren't being put or spend on better product and services ( on the actual product ).
IBM is old enough to understand the pitfalls of that approach.
In year zero it sounds great. Integration! Efficiency! And that works for a bit.
Then internal politics causes you to pass on opportunities that competitors take because taking them yourself would cannibalize sales in one of your other lines of business.
Then somebody else comes up with a better microprocessor than you, or better software, or lower cost manufacturing, and it's going to take your internal team five years to catch up. In the meantime all your systems are integrated with your in-house solution, so you can't switch, but the deficient in-house alternative makes you less competitive, so you lose all the customers who can switch easily.
Then you have to cut R&D because of the lost revenue and fall even further behind the competition, which leaves you in a death spiral where the most profitable strategy is to lock-in your existing customers and milk them as hard as possible as you circle the drain.
Or you can concentrate on doing one thing and doing it well, so that you don't risk sinking your entire operation as soon as you fail to execute flawlessly in any one of the six different major fields you've created an internal dependency on.