Why the laws of competition don’t apply to tech giants

Monopolies, duopolies, and the role of regulators

The network effect, which states that the value of components in a network increase as the members increase, makes tech giants such as Facebook, Google and Apple almost impossible to slow down once they gain critical mass. The more users of a platform (iOS, for example), the more apps are developed for the ecosystem, making the ecosystem more valuable. Competing with that platform becomes extraordinarily difficult as exponentially rising network value creates insurmountable barriers to entry. Microsoft’s failed mobile OS is an example (see next article). The Verge

dis-rup-shun: As The Verge states, competition is good for the consumer and good for the economy. If the forces of competition are not able to scale the barriers to entry into network-based businesses, then it is the job of government regulators to level the playing field, or at least monitor the powers of those that control the network and access to its markets.

Microsoft’s biggest error ever

Speaking to Village Global venture group, Bill Gates said the biggest mistake in Microsoft’s past was missing the opportunity to be the alternative (to Apple) mobile OS provider – an opportunity lost to Android, which Google purchased in 2005 for the purposes of defeating Microsoft’s mobile strategy. The Verge

dis-rup-shun: For those that tried Microsoft mobile phones, you recall that the company really blew the customer experience opportunity. At the time, there were Blackberry, Motorola, Nokia and upstart iPhone. Microsoft’s error was to think it could squeeze the bloated WinCE operating system into a phone form factor. Rather than looking at the opportunity as a fresh, new ecosystem, Microsoft (Steve Ballmer) saw mobile phones as tiny Windows devices. The error launched Google’s fortunes in the Android business, both in licensing software and building handsets, while missing, likely forever, a future in mobile for both Microsoft and close partner, Intel.

Smart products suffering from lack of intelligence

TechCrunch reports on Samsung SmartThings’ release of a new camera, smart plug and smart bulb. The products work as expected but are described as not very exciting.

dis-rup-shun: Unfortunately much of the smart home industry is still competing on devices — expecting the white box or switch with the most features or protocols to prevail. Machine learning, however, is the competitive differentiation that will make smart homes intelligent homes. By using data profiles of users and ‘understanding’ habits, as well as deviations from those habits, connected products will operate for users, not by users, and will become ubiquitous in new homes and buildings. Connected products that do not use data and data analytics for their operation will remain lackluster to the markets.

Hackers have infiltrated over 10 mobile carriers

According to cyber security firm Cybereason, hackers have infiltrated over ten global wireless carriers and, prior to detection, could have shut the networks down at any time. The firm says none of the carriers are in the U.S., but spread around the globe. CNet 

dis-rup-shun: Global infrastructure, including energy grids, wireless networks, and banking networks are dangerous prizes for hackers. With escalating tensions with Iran and ally, Russia, the West can expect a sharp increase in cyber attacks, and the future of defense will increasingly involve hardening networks and scanning for breaches.

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