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Comment by confidantlake | Hacker News Reader

I would argue it is less healthy for the economy. Large companies are very good at extracting value, not necessarily producing it.

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> I would argue it is less healthy for the economy. Large companies are very good at extracting value, not necessarily producing it.

I agree, but from a different point of view. Companies put out products and services aligned with their strategies. In large companies, you build up strategies that spread across multiple domains. This means that product managers need to enforce constraints that will go well beyond the concerns of the use base of their specific product. That is a net loss for the customer as the product/service they once loved is now a way to force-feed them things they do not want or care about.

There's an optimum point. Too small is bad[1], too big is bad (too big to fail, regulatory capture, and sales driving out product[2]).

[1] https://asteriskmag.com/issues/07/want-growth-kill-small-bus...

[2] Steve Jobs quote: "It turns out the same thing can happen in technology companies that get monopolies, like IBM or Xerox. If you were a product person at IBM or Xerox, so you make a better copier or computer. So what? When you have monopoly market share, the company's not any more successful.

So the people that can make the company more successful are sales and marketing people, and they end up running the companies. And the product people get driven out of the decision making forums, and the companies forget what it means to make great products. [...]"

Unless large companies can intercept cash before it's paid to you and take some of it, they are only getting value from providing value.

I am sure you yourself can think of some specific examples, where companies earn money without providing value.

Or are you suggesting, that every single cent that every single company earns, comes from something that actually provides value to someone (excluding shareholders)?

I'm not saying every cent; who knows? But companies can't take your money on pain of throwing you in jail. They're not tax systems. They get money when people buy their stuff, and, pretty much universally, people buy stuff they think is worth the price.

> Large companies are very good at extracting value, not necessarily producing it

Citation seriously needed. There is no argument here, merely a demonstrably false statement. A large company is literally the only kind of entity that is capable of creating entire categories of value which make up a huge percentage of the global economy. Furthermore, a lot of what many, many small businesses are doing, especially very profitable ones, is directly enabled by and entirely dependent on the existence of large businesses.

Did you use an iPhone to type this?

Everything apart from the look of the iPhone is value created by publicly funded organisations, with the exception of the transistor which was developed by at&t. And at&t were effectively a government sponsored monopoly at the time. So apple extracted value, I would argue.

Publically funded means "paid for out of taxes skimmed off value created by private citizens and private corporations". The value was extracted from people by taxes. It was reused into something useful for people by Apple.

Wild.

I can't think of any companies that were more product-focused than Steve Jobs' Apple. They created so much value across so many industries. They created so many transformational products.

Their machines in the 1980s revolutionized personal computing (eg they brought GUIs and the mouse to the world). The iPod let us carry thousands of songs, audiobooks, or podcasts in our pocket. iTunes changed the music industry, giving us an easy way to get the music we wanted without piracy. The iPhone put the Internet in every pocket. Honorable tangential mention: Pixar transformed kids movies and dethroned Disney.

Apple made a ton of money making products that were delightful to use that users happily pay a massive premium for. They made things that were so much more than the sum of their parts.

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