The EU is free to pass laws preventing gatekeepers and insisting on interoperability requirements and Apple is free to refuse to do that and not offer their non-competitive gatekeeping products in the EU.
There's zero reason to think that this will mean the EU won't have a tech market. It just won't have one that includes Apple products which refuse to follow the law. Seems like a massive win for the EU, and because Apple is the one deciding to pull their products rather than follow the law they can't really complain either, so win/win I guess.
Anything that gets close gets bought or killed by non-european giants.
Tencent buys basically all game companies, microsoft buys basically all communication companies (skype, nokia come to mind), google buys basically everything. Even ARM is owned by Softbank after starting out in the UK.
The Automotive industry and ASML are just about the only things resistant to this because they're so large already; Automotive acts a lot like big tech. (a clear similarity I saw after being in BMW R&D and Googles Zurich and SF campuses)
There is an issue with that perspective though. The Europeans sell out. Ok. Maybe they are bad at valuation and don't realise that their companies are worth more than they are being paid for. Or maybe an EU company can't capture as much value as a US/Chinese company. And those are really the only two options - either the decision is rational or irrational. If it is an irrational decision then there isn't much to talk about. But it is probably the second case - selling out to someone on a different continent generates value. And there is a good chance that is because it helps avoid EU regulators.
For example, you mentioned Nokia. Nokia was blown out of the market by superior Chinese manufacturing and US design [0]. It wasn't a close battle, the EU contender was crushed. Apple's motivation for entering the market was that among other things that companies like Nokia were so bad at making phones that Apple reckoned it could break in to a new vertical. That is a very EU-led-industry problem to have. The reason they sold out was because the EU turned out to be incapable of incubating a modern, successful phone manufacturer in the 21st century even with an incredible lead and Nokia was being outmanoeuvred everywhere.
[0] Both looked like regulatory issues to me, we've seen how the EU responds to things like micromanaging the iPhone charging port.
> Nokia was blown out of the market by superior Chinese manufacturing and US design [0].
No, Nokia was blown out of the market via the exclusive deal with Microsoft, which in turn made the dumbest management decisions ever. Nokia bled under the horrible management of Steve Ballmer and their own ignorance with regards to Android. They also proved later on that you don't need any expertise to produce decent Android phones, as HMD global used their name as a brand and has been thriving.
To add to this: It's not that hard to develop a mobile operating system that's on par or better than Android, despite what Google might want you to think.
Pretty telling though. When dijit was talking about Tencent, Microsoft or Google a few comments ago they were being presented as these huge incumbent behemoths that scoop up everything in their path. And, fair enough, they are.
But when Nokia starts with an overwhelming incumbents advantage, their board doesn't even have confidence that Nokia's internal talent pool can lead them to make a mobile phone! They couldn't defend themselves from multiple companies in completely different industries with no prior competence in the mobile phone world. That was an A-Team EU hardware company's performance.
The issue here isn't company size, it is something specific to the EU. I'm not sure what, but since it is a geographic thing I'd start with regulation and branch out from there.
> their board doesn't even have confidence that Nokia's internal talent pool can lead them to make a mobile phone!
I'm sorry but it's honestly pointless discussing this as no one in this thread wants to spend even an ounce of time into researching this. Reading your comment in it's entirety tells me you weren't there when stuff was happening.
> That was an A-Team EU hardware company's performance.
For the record, the Lumia phones had A-Tier hardware in them. They boasted the best low light cameras on phones for a while around ~2012.
Nokia made the Lumia phones, MS provided the operating system. Previously, Nokia had their own Linux based OS, called Maemo, which was originally supposed to run on what became Lumia. It later formed into Sailfish OS, which had it's own device family.
The issue wasn't the hardware platform itself, it was the fact that Nokia decided to go with the MS ecosystem, instead of Android. And honestly, I don't even think that was a bad move. I am at a loss trying to figure out how device manufacturers actually make profits based on what has turned into extremely restrictive licensing deals with Google in order to get GAPPS on their phones.
I used to have a Lumia phone as a teenager and it was very nice. I loved how curved and rounded it was, made it look very sleek and sci-fi, and it felt really good in the hand. Even the panel-style home screen was considered to be pretty cool. I remember at the time that, as you say, the main criticism was that it was isolated from the main android/iOS app store ecosystem and there were hardly any apps for it.
> There is an issue with that perspective though. The Europeans sell out. Ok. Maybe they are bad at valuation and don't realise that their companies are worth more than they are being paid for. Or maybe an EU company can't capture as much value as a US/Chinese company. And those are really the only two options - either the decision is rational or irrational. If it is an irrational decision then there isn't much to talk about. But it is probably the second case - selling out to someone on a different continent generates value. And there is a good chance that is because it helps avoid EU regulators.
I think it comes down to two things:
1) The US is a large, uniform (regulation, language, media, etc.) making it easier to grow quickly. This puts the US competitor in a better place to buy the EU competitor than vice-versa.
2) More significantly, the US capital market is bigger & better. That starts with VC funding but is also the case with IPOs and publicly traded companies. That‘s how the EU tech standouts such as Spotify end up IPOing in the US.
#2 is certainly something the EU can work on improving but it has very little to do with tech regulation.
Vivendi and Tencent attempting to buy Ubisoft via shares might be one thing in living memory that disagrees.
If you are publicly traded there is little you can do to prevent people buying shares - though you are right that people sell privately held companies a little too often.
Ubisoft in particular created many poison pills to prevent companies getting too dug in, however that didn’t prevent anything except a total buyout. Their board is stacked with Microsoft and Tencent which causes weird, extremely harmful, decision making in the org.
> If you are publicly traded there is little you can do to prevent people buying shares
Nobody can force you to sell your shares. Nobody can force you to make your company public. It's all voluntary. You can't have your cake and eat it. Want to get that juicy foreign investor money then cry that the foreigners are taking over?
I have a low tolerance for absurdly stupid comments.
Once you sell a share you don't get to control who it is sold to afterwards, you could give shares to people as stock-options, and they are (rightly) going to sell their shares regardless who the buyer is, only based on the price.
So. Seriously, shut the fuck up, you're suggesting that the only answer is isolationism.
Identification of an issue (people buying up European talent before it gets large enough to be competitive) is not an invitation for absurd and deficiently reasoned victim blaming.
Your anger comes from your frustration, your frustration comes from realizing that you're wrong.
If you want to keep control of a company - or anything - within certain hands, then you can't sell that thing to others. As evident by millions of companies never having their shares publicly listed or sold on any market. If you sell, you have to accept that you don't have any control of who owns in the future. You can't have your cake and eat it. Not even Europeans can do that.
"People buying up European talent" - they can only buy if Europeans are willing to sell. Such victims...
This reminds me of people complaining about foreign investors buying up real estate. But of course, no blame is to be put on the greedy sellers who slurped up that juicy foreign money.
Yes, people sell things voluntarily. (In particular, small companies being bought and killed by monopolies is usually very benefitial to the small companies' owners, even if it's bad for the economy as a whole.) That does not contradict the parent comments.
The parents comments are about foreign companies owning your company.
If you do not want that, do not voluntarily sell your company.
I like my cat. I don't want others owning my cat. I probably shouldn't sell my cat then right? I can't take the money now and complain later the neighbor owns my cat.
EU didn't go into an uncontrolled spree investing every company that had .com in its name and ruined thousands of lives and wasted billions of dollars.
EU usually doesn't let companies to grow uncontrollable sizes that the government is completely controlled by them not the citizens.
The existence of Big Tech means that the government did a very poor job in protecting the consumers and the free and fair market
> EU didn't go into an uncontrolled spree investing every company that had .com in its name and ruined thousands of lives and wasted billions of dollars.
This is the thing that so many Americans in tech don't seem to understand. VC Twitter is full of smugposting about how the US has "$5 trillion market-cap of startups" and the EU doesn't.
And what they miss is that the EU doesn't want Silicon Valley. It doesn't want the "trillions in startups". Because essentially none of them turn any profit. Why on earth would anyone want $5 trillion dollars in companies that do not make financial sense yet have awful externalities.
I understand you were rebutting OPs point that not every tech company is a capital furnace, but when framed in this manner, this sounds like something to be solved, not something to be proud of. That’s the difference between the EU and the US, and there is a strong case to be made that life is better in the EU when observing majorities.
Who is benefiting from Apple’s profits being the size of a small country’s GDP? Not most people, therefore, why would this be optimized for?
Assuming that they know better than everyone else how they should be spending their money, and that reality is the one wrong because the numbers are too big when they are selling to the world? That sort of hubris is exactly why they don't have a world tech industry.
> That sort of hubris is exactly why they don't have a world tech industry.
You make this sound like a bad thing. There are diamonds to be found generating genuine value, but quite a bit of activity is simply low value under the guise of innovation.
I would caution against mistaking clarity and understanding for hubris. Europe doesn’t have line go up, but their citizens live better lives by most objective measures. From an optimization and first principles perspective, we should always be mindful of what we are optimizing for, so when I see people come out swinging with “Such profits! Much Tech! Innnnnnnovaaaaaation!” I approach it from a “simmer down now, lets decompose the system and observe” approach. What are the desired outcomes and what is value perspective we can compromise on as “good,” and then work backwards.
Apple makes a lot of profit because their products provide a lot of value.
Do you think that if you compare the profit that Apple makes to the value that that users get that Apple has the larger share of it? To a disturbing degree?
Certainly, if a company’s profits are the size of a small country’s GDP, I find that disturbing regardless of the value they’re delivering. Value is the experience and consumer excess, profits are fiat. Could that same value be delivered with compressed profits leading to greater consumer excess? I believe so. Not all profits are earned, some are inherent once an org achieves a certain maturity or industry position. Visa and Mastercard skimming a non insignificant amount off of US GDP, for example. Is that value?
I thought my comment was clear, I will attempt to be more explicit: I am of the opinion that Apple’s profits are excessive, regardless of the consumer value delivered. I respect that others may have opposing views that profits should have no limits as long as value is delivered.
Well if EU politicians think Apple's profits are excessive what about introducing laws to foster some competition? You can complain about other countries running circles around you all you want but at the end of the day if you can't make a phone, piece of software or a CPU you will be at the mercy of those who can. The way to reduce "excessive profits" is to make it easier to start businesses which could provide the "overpriced" goods and services cheaper.
Easier to reduce their size with regulation versus believing a free market that isn’t truly free will suddenly whisk competition into the space. This is why China gives their domestic companies “unfair” advantages, because the free market is an illusion. It’s only unfair if you believe there is a “free market” or the market is fair, which it is not.
It is easy to forget that the economic system of fiat and capital is a shared delusion, agreed upon rules that can change when needed. The intent is to encourage outcomes, not to be the primary function.
Whatever your views on free market if you want goods cheaper someone needs to make them cheaper. Splitting up Apple won't result in that. You still need someone else to make phones.
> Who is benefiting from Apple’s profits being the size of a small country’s GDP? Not most people, therefore, why would this be optimized for?
Off the top of my head, probably the millions of people who have a pension through one of Apple’s institutional investors like CalPERS. The effects of Apple’s profitability goes far and wide.
> Off the top of my head, probably the millions of people who have a pension through one of Apple’s institutional investors like CalPERS. The effects of Apple’s profitability goes far and wide.
That's like a member of the working poor who owns one share of stock, "benefiting" from company lobbying to keep the minimum wage down.
He's got two-hundredths of a cent more in dividends, and has lost many hundreds of dollars in potential wages.
These numbers are always trotted out like these people have a material majority investment in the equities market (“won’t someone think of the teacher pension”), when per the Federal Reserve, the top 10% of Americans by wealth hold 93% of US equities.
This doesn’t entirely discount that CalPERS holds almost 40M shares (~$8.7B) of Apple (its top holding), just that them doing so is not reason enough to be more judicious about governing corporate profits. Still profits, but less. Those profits have to come from somewhere.
(CalPERS has $502.9B AUM ending June 2024, making APPL ~1.72% of their total assets)
That seems all quite orthogonal. You asked who benefits and I’ve given you an example. Some benefit directly and some indirectly. But millions in the economy benefit and not just through institutions such as CalPERS.
American culture in a nutshell is to be in awe of large numbers without thinking very hard about whether you’re measuring the right things in the first place.
Not on Apple's scale, but with apple pulling products from the market, this opens the door for someone else to step up and fill that highly profitable gap in the market apple abandoned. I really hope that they do. The more players there are in the game from other countries the better off we'll all be.
This is the first product miss. And I don't know where Apple goes from here. Others will also leapfrog them is my instinct. Basically they are too big now and startups have a chance of beating both Google and Apple.
Apple has had other misses. They themselves cancelled the iPhone mini. There was the newton, quite similarly a product that the technology level was not quite ready for but they had great success with later. They constantly screw up with the Mac pro, introducing one version and then letting it whither away for many years.
Nah, the first iPhone was too expensive, slow, and limited in capabilities (no App Store). They quickly iterated to improve on all of that. The first watch also kind of sucked. The initial iPod wasn’t a blockbuster, either - didn’t work well on Windows, required FireWire. I’m sure there are other initial misses. I think there’s something there with Vision Pro, they just need to iterate and get the cost down.
It was a good product, but it took a lot of iteration to make it the juggernaut it is today. Add bad battery life to the list of flaws, along with slow web browsing, slow processor, etc. With all of those, and the high price, it was relatively niche. The 3G lowered the price substantially, and iirc that plus the faster modem gave it a big popularity boost. And the 4 was substantially more popular than that.
My point is, don’t write off this whole product category because people balked at the price of the first iteration, it happened with the first iPhone, too. Apple grinds its way to excellent products.
I dunno if you were alive at the time but that's not really what happened. The first iPhone was really expensive but people bought it anyway because it was sooo far ahead of the competition. Until the iPhone most people didn't even bother with smart phones because they were so bad (Blackberry was a partial exception).
The web browsing wasn't slow - part of what made it so compelling was that you could browse the real web without going insane. No WAP nonsense.
Yes, it was rough compared to the later versions, but even the first one was insanely better than anything else. It was pretty clear what the issues were (battery life and lack of 3G as you said).
I don't think the Vision Pro is like that at all. It's big issues aren't missing features or lack of polish. It fundamentally makes no sense as a product even if they improve the resolution, speed, battery life, etc.
>I dunno if you were alive at the time but that's not really what happened.
I was pretty alive at the time, I was an intern on the iPhone team at Apple when it launched and the run-up, so I was using the first gen phone/touch all day every day, and I was paying pretty close attention to its launch (but just watching what was said in the press/by the people I knew, nothing privileged on the sales side). Looking around at sales figures, it looks like the first gen sold low single digit million units total, 1.4M in 2007. The 3G sold 1M on the first weekend (the press release tagline was "Twice as Fast at Half the Price", and that lower price is a big part of what brought it mainstream). Now they’re up to a couple hundred million phones per year.
I wouldn't say it was a "miss", it was very good compared to the status quo trash on the market, but it also wasn't the company defining success it turned into until the following gens, it made much less revenue than Macs at the time, and the Mac was pretty niche. My point was that it took a bit to really dial it in, and Apples first gen products don’t usually reflect their eventual success very well.
I don’t think Vision Pro is at 1M sold yet, and Apple products definitely have more sales reach now, but again, I wouldn’t count it out. I was pretty impressed when I tried it, they really nailed a lot of the hard technical problems, especially around text rendering, and if it was 1/3 the cost, I’d definitely have one now, maybe at 1/2. Which means that unless they really dilute the capabilities or drop the cost less than I expect, I’ll probably have one within the next couple of iterations (I'm also assuming they'll sub out the metal for cheaper/lighter materials to improve long-term comfort). But yeah, maybe it’ll end up being a modern day Newton, we’ll see.
I don't think so. You are confusing the absolute and the relative. The iPhone when it launched had die hard fans. The sheer excitement was palpable. The Vision Pro has nothing like it.
In my opinion, nothing is lost here. They will either put out new improved and cheaper versions until they get the interest they want, or wait for someone else to innovate and then copy it better, the apple way (TM). I don’t see a way where this is apples downfall until they continue to f it up again and again.
The only other OS option being Android (on mobile) and Windows (on desktop) I don't think Apple is going anywhere anytime soon. A lot of Apple's moat is in its OS (however degrading in has been in last decade). It's the perfect duopoly in both segments. Do you see that changing? If not then all other OEMs will keep fighting among themselves for loose change.
Did they? It really felt to me like they weren't trying for a moonshot with it: their sales projection of ca. 1M units falls under the single-digit percentage range of their annual revenue.
Yeah, they've actually sold less than that, but in context, it's still very much a "let's throw it at the wall and see what sticks" kind of thing. It also nonetheless fits how Apple communicates their product vision in new areas.
Yes. Everyone has set targets and expectations, which imply a certain product strategy, that are all completely at odds with everything Apple has indicated. Then, they call AVP a failure for. It meeting those set expectations. It’s not all that impressive to win an argument when you get that much freedom over framing things without much regard for the realities.
What's the product strategy? How's it at odds with what Apple has indicated?
The accusatory use of the second person implies that you're in my head enough to know that I'm trying to win an argument. It's patently untrue; I want to be loudly wrong so that I have more than merely a snowball's chance in hell of garnering understanding here.
If you have corrections to offer, I'm receptive to them.
How important is technological industry? Pretty damn important I'd say if you're interested in economic growth and hence supporting your social safety net.
The technological industry is indeed very important, the mistake is thinking VR goggles and chatbots are somehow the only or even particularly relevant form of technology. Europe is of course full of high technology firms, (the awkwardly named https://en.wikipedia.org/wiki/Blue_Banana) contains a non trivial amount of high value added industry in the world.
What we need more of these days is 155 mm shells, chip fabs, nuclear power plants, solar cells and rail, not Facebook and Apple equivalents complaining about regulations.
Big tech is not inherent in the concept of a tech industry. Big tech is like 6 companies that want to swallow the world. Not being able to separate these two concepts is grade school level literacy and critical thinking. It’s not acceptable to conflate them. It’s completely ridiculous.
Accenture, Siemens, Nokia, Ericsson, Capgemini, Atos, Dassault Systems, Bosch, Ahold Delhaize, Dassault Systèmes? maybe little known outside the EU, but the EU has something like 20% of the world's software developers.
GP will have to explain to me, at a grade school level, how they want to differentiate big tech and BIG tech.
1. Accenture, Capgemini and Atos are consulting companies that don't produce anything, they just rent out their code monkeys to the customers. And you know what those code monkeys are trained in? Software stacks that were created mostly in the US.
2. The rest of the companies you mention do not employ that many software developers.
3. They also do not deliver terribly popular, or important products. I mean, Bosch produces commodities like dishwashers, vaccuum cleaners and power tools, hard to call it "tech company".
If so, Apple and Nvidia won‘t qualify. They‘re more of a hardware company.
BTW Bosch‘s main business is automotive supplies. They‘re doing everything down to having their own fabs for automotive chips. It‘s just completely invisible to us as consumers that‘s why you consider it a dishwashers, vacuum cleaners, and power tools company.
Nvidia’s moat is almost entirely software though, not just cuda but all the other bits of drivers required to bitbang a gpu into showing stuff on a screen (see: intel arc for how important this is)
Are they separable? Teens in particular appear to be bad for each other's mental health. Connectivity increases that effect, anonymity makes it worse, likes and other status features makes it worse still. Not sure where you draw a line between not quite bad enough and too bad.
It doesn’t help there are algorithms designed to keep them looking at things that aren’t great for them to be looking at though does it. Can you provide an example in the past wheee this has existed before outside of big tech ?
I wasn’t arguing that this was just as bad before. It’s clearly all made worse and accelerated by social media calling engagement and ad dollars above all.
Historically the victims of contagion have been oldsters in a moral panic. This time I think it is actually true - there’s a mind virus loose.
> The EU is free to pass laws preventing gatekeepers
I'm intentionally taking this out of context to point out that laws can act as gatekeepers and help preserve incumbent's positions.
Stuff like "minimum service requirement" which require new entrants to front a massive initial investment, preventing them from getting a foothold (see: France telecom landscape in the 90s-'10s). GDPR was crafted by the likes of Google & Meta that were strong enough to weather the transition, but kill off smaller competition.
There are always tradeoffs, but those aren't talked about as much.
It's absolutely true that regulations can be written by corporations to keep out competitors. Regulations are just tools. They can be used to protect and benefit the majority or to further enrich a small number of wealthy and powerful individuals. I haven't seen anything to convince me that the Digital Markets Act was written to hurt competition at the expense of the public.
> Apple is free to refuse to do that and not offer their non-competitive gatekeeping products in the EU.
Currently Apple has been complying with the letter of EU law (opening their devices to alternative app stores, etc) but not the spirit of the law (leaving the EU market).
> The EU is free to pass laws preventing gatekeepers and insisting on interoperability requirements and Apple is free to refuse to do that and not offer their non-competitive gatekeeping products in the EU.
Apple is also free to lobby the US government and people to take action against the EU. Especially if Trump gets elected, Apple complaining about Europe taking advantage of American companies would resonate with a lot of the officials likely to staff such an administration.
Given Russia, it is likely that the US has far more leverage on the EU than the EU has on the US.
Why should the US government care if Apple chooses not to sell some of their products in the EU because they don't want to abide by the EU's laws? The EU isn't taking advantage of US companies, or looking to pressure the US. The EU has every right to set their own laws and businesses can decide for themselves if they want to sell their products there. The fact that Russia exists doesn't change that.
Because even without public ownership of Apple stock China style or even any lobbing from Apple, the US government are effectively "invested" in their gains via taxation. Apple's interests are the US's interests to some small extent (technically so is that small coffee shop down the block). Geopolitical interest implies they'd care enough to at least nudge the EU a little.
Eu has lots of leverage too against US. Lobbying for actions against eu may have absolutely bad consequences and it's totally bonkers to think/prise that an us company has this much power proving once again that maybe it's a good think eu doesn't have such big corpos
Both us and eu are heavily relying on China. Even Nvidia sells lots of gpus with small limitations to china that in the end will not change things that much. Or ASML sells non covered by sanctions chip production utilities. All this trade war is just scratching the surface, in reality heavy money are made by all parts
This clever geopolitical analysis notably ignores China, and the fact that Trump pushing the EU to China would be the greatest geopolitical victory for China in history.
There's zero reason to think that this will mean the EU won't have a tech market. It just won't have one that includes Apple products which refuse to follow the law. Seems like a massive win for the EU, and because Apple is the one deciding to pull their products rather than follow the law they can't really complain either, so win/win I guess.