I don’t want to comment on if a breakup is a “good” thing for society, because I vaguely agree, but I’m not sure I agree with you on many points here.
> I think the valuation of a broken-up Google and Apple would exceed the monolithic conglomerates that they have become. So many of their business units and products don't even monetize because they're going for an intangible "platform value".
I think a lot of these products aren’t monetized because they’re actually bad businesses or failed ventures and companies have the free cash to support them. A lot more of Google’s (for example) random side projects seem to be getting subscriptions or collapses into existing ones. I also think that vertical integration creates unique value sometimes. I think spinning off these random side businesses could destroy the side businesses, but that this may still raise stock prices as the companies get better margins. I think a lot of these products are bad businesses because big tech salaries are high and that makes labor costs hard to account for.
I think the breakups obviously rectify consolidated power. 100%. But I don’t see more mobile phone operating systems coming from a breakup of Apple, for example. Gmail isn’t going to be replaced by a new email provider. Nor would we see a new YouTube, or other dominant businesses. Disrupting these massive aggregators won’t come from direct competition, but rather new product and service experiences. TikTok has shown that tech is already not impenetrable.
Finally, I totally agree that this would be a feeding frenzy for VCs, but VCs learned in the last decade how to rip off ICs even more through delaying IPOs and more aggressive dilution. So I wouldn’t be holding my breath as an IC that breaking up Google (or others) will make jobs better.
> I think a lot of these products aren’t monetized because they’re actually bad businesses or failed venture
Gmail, for example, would be a fabulous standalone business with a normal (subscription) business model like other premium email services. I would love to run that spinoff.
YouTube: fabulous standalone company. Would love to be working there when they IPO. I’m sure there are more.
The business units that can’t survive except for “platform charity” should shutdown, go open source, sell their assets, etc. and the developers should move on to found new startups.
These big mega-platforms have sucked most of the oxygen out of the tech industry and it’s in the best interest of everyone except their major shareholders to break them up.
The examples you’ve provided aren’t “platform-charities”. They’re already massive businesses with healthy revenue streams that are aggressively monetized.
Look at Google Assistant or Alexa and their speakers. Losing Billions a year.
Look at smaller products like Google Fi or Fiber. Google Podcasts. Google Translate. Google Voice. WhatsApp. Quest/Oculus. Amazon Go stores. Apple HomeKit.
It’s the long-tail of small-use products that would be hurt. No one doubts that an ad-supported product with multiple billions of users would be a great standalone business.
99% of Gmail users would not pay for the service, and would just move to other provider. I don’t know how you can think they can operate as a subscription service and act like nothing changes.
Not OP, but Gmail is and could continue to be ad supported. Gmail also is a subscription service offered to enterprises, and it is a very lucrative service for Google.
> I think the breakups obviously rectify consolidated power. 100%. But I don’t see more mobile phone operating systems coming from a breakup of Apple, for example. Gmail isn’t going to be replaced by a new email provider. Nor would we see a new YouTube, or other dominant businesses. Disrupting these massive aggregators won’t come from direct competition, but rather new product and service experiences.
Perhaps you're right. Perhaps breaking these products up would not create more competition.
But it would mean that these products must determine how to make money on their own merits. That might mean a better product overall. Or it might mean that the product really doesn't deserve to exist as a consumer product.
> Or it might mean that the product really doesn't deserve to exist as a consumer product.
Why?
If a product or experience is used by people, and enjoyed, and could not be monetized directly, why should it not exist?
I think of Alexa/Google Assistant/Siri as representative examples. Some set of execs decided to fund these voice assistants - now used by millions - and they obviously don’t make money. Would customers be better off if they were jettisoned to drown on their own?
I just don’t see why it’s wrong that businesses have these silly side projects. We seem to have competition even amongst the subsidized vanity projects.
Again, I think a breakup wouldn’t be bad overall, but I don’t think this is the thing missing in the industry.
This is, of course, the entire point of this entire thread.
Its not a particularly "narrow" view, FWIW, because most businesses have a P&L sheet that will list expenses and revenues, and entire business units have big "costs" and not so big "revenue". Which is what "don't make money" means.
Apple would never have invested in Mx chips that are only 14% of Apple’s revenue - Macs + iPads. If it weren’t for the R&D from iPhone Ax chips and the volume.
So exactly who want Chrome? How would they monetize it and you can already get Chromium for free. Could Android not come with a browser? Chromebooks?
> I think the valuation of a broken-up Google and Apple would exceed the monolithic conglomerates that they have become. So many of their business units and products don't even monetize because they're going for an intangible "platform value".
I think a lot of these products aren’t monetized because they’re actually bad businesses or failed ventures and companies have the free cash to support them. A lot more of Google’s (for example) random side projects seem to be getting subscriptions or collapses into existing ones. I also think that vertical integration creates unique value sometimes. I think spinning off these random side businesses could destroy the side businesses, but that this may still raise stock prices as the companies get better margins. I think a lot of these products are bad businesses because big tech salaries are high and that makes labor costs hard to account for.
I think the breakups obviously rectify consolidated power. 100%. But I don’t see more mobile phone operating systems coming from a breakup of Apple, for example. Gmail isn’t going to be replaced by a new email provider. Nor would we see a new YouTube, or other dominant businesses. Disrupting these massive aggregators won’t come from direct competition, but rather new product and service experiences. TikTok has shown that tech is already not impenetrable.
Finally, I totally agree that this would be a feeding frenzy for VCs, but VCs learned in the last decade how to rip off ICs even more through delaying IPOs and more aggressive dilution. So I wouldn’t be holding my breath as an IC that breaking up Google (or others) will make jobs better.