Comment by jacquesm
8 years ago
> One example is using Android to prevent a monopoly on the smartphone side. If Apple had a monopoly or near monopoly, it would be able to extract larger economic profits from the other links on the value chain, including Google
In the case of Apple vs Android I'd say Apple is doing pretty good and are arguably doing substantially better than Google in spite of not having followed this strategy themselves.
Apple absolutely does follow this strategy: it's not presently very profitable to be a supplier of small electronic components, or a contract manufacturer, or an app developer, or an Apple retail store employee. At least in the case of app development, Apple puts significant effort into making their dev tools powerful and their development experience easy, with the goal of bringing in as many devs as possible and keeping the market commoditized.
The difference is that most of Apple's complements are B2B suppliers and so are rather invisible to the general public, while many of Google's complements were formerly consumer-visible markets. So it's much more obvious when Google turns the web browser or ISP market into a commodity than when Apple turns the electronic supplier marketplace into a commodity.
Calling their suppliers compliments lacks understanding of what Joel meant. You don't use apple's contract manufacturer with your iPhone - its not a compliment product. iPhone apps however are compliment products, and apple has successfully dropped the price of most to $0.99 or free.
The strategies are orthogonal. Google's interest is not in making money from smartphones, it's in preventing Apple from having a monopoly wherein they can charge Google unlimited amounts for access to mobile users.
But Google still pays Apple $3 billion a year....
https://www.cnbc.com/2017/08/14/google-paying-apple-3-billio...
Exactly. Can you imagine how much it would be if Apple had a monopoly on smartphones?
16 replies →
> In the case of Apple vs Android I'd say Apple is doing pretty good and are arguably doing substantially better than Google in spite of not having followed this strategy themselves.
They follow a different strategy: vertically-integrated walled garden.
"Other links" means things other than smartphones. You read the comment incorrectly, I think. They're saying Apple would have more power over other actors (including google) if they had a smartphone monopoly.
Apple is not making money from links.