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As usual, I like Matt Levine's take. [1]

Page and Brin ran Alphabet as a highly funded system of moonshot programs with near-infinite runway to make profits, which is unusual or unique. Basically it only worked that way because Page and Brin were idealistic visionary gazillionaires who were bored of thinking about the somewhat dirty business of selling targetted ads. With a more standard corporate governance under a common CEO with the google ad business, the expectation is a more standard corporate focus on making profits from its ventures in some defined timeline.

But read Levine's version; it has detail and humor and insight I can't convey in a summary!

[1] https://www.bloomberg.com/opinion/articles/2019-12-04/alphab...




That seems way more idealistic somehow. More likely, with a more standard corporate governance Google will begin to rot from within. Apple certainly made more profits under Cook than Jobs, but innovation has slowed to a crawl and he has failed to diversify Apple away from having one product (instead he just added a bunch of accessory products and services). The last thing Google needs is to double down on ads, it takes 2 minutes to block them.


> innovation has slowed to a crawl

This is so typical of Apple criticism. They did do well with the iPhone and Mac that now any new innovations seem boring in comparison. It’s wrong.

The Apple Watch came out under Cook. That is more than an “accessory.” It’s a new platform, new OS variant, etc. It’s dominating smart watches.

The AirPods are pretty innovative in terms of the fine grained details that have made them super successful.

Latest OS builds included evidence of stereoscopic glasses in the pipeline.

Remember Apple isn’t always the first with stuff, even smartphones. Their innovations are more around key details and hardware/software integration that makes the whole system work like magic.


> The Apple Watch came out under Cook. That is more than an “accessory.” It’s a new platform, new OS variant, etc. It’s dominating smart watches.

The Apple Watch is literally designed to be an accessory to the iPhone - you can't use most of its features without an iPhone. I wanted one for my Android phone but tough shit for me.

If you like it as a product that's fine, but it is absolutely an accessory to an iPhone because you can barely use it without one.


You can’t set it up without an iPhone. But, once you set it up - especially the cellular one, you can leave your phone at home. You can do anything on your watch that you can on your phone that would make sense on a screen that small. You can make phone calls, text, receive notifications, get directions, stream music and podcasts, etc.

As of the latest OS you can download apps directly to it.


Right now it requires an iphone. They've been slowly reducing the need to have one until pretty soon, maybe v5, won't require one


It’s at S5 already, which is actually v6 since there’s an S0. So maybe v7.


Sorta, since the S1 released alongside the S2 as a revised low end model.

Versioning wise it feels more like following up the v1 with v2 and a 1.1 revision.


iPhones were originally an accessory to iTunes. What you complain about is all software. Software is changeable.


The iPad even required iTunes to set up for the first year and half.


Not on these devices, it isn’t. Without Apple’s signing keys, they run whatever Apple gives you, until they are EOL’d and then they run nothing else, ever.


Yes but that’s irrelevant to the point.


I thought the point was that “the issues you are complaining about are just software, and software can be changed/updated”.

If Apple doesn’t make sufficient changes and upgrades, nobody else can - and the device is back to being an appliance that has the functionality that it has right now and nothing further, and it’s not “just a software upgrade away”.

There’s still no way to get the time display off of the face of my Apple Watch. You can customize everything except turning off the clock.


This is a predictable response that is trivially wrong. Originally the iPhone required iTunes to set it up. Is it an “accessory”?


iTunes was released for Windows in 2003, so it was available for free on all major platforms. The iPhone was released in 2007. If iTunes had only been available on Macs, it would have been perfectly reasonable to consider the iPhone a "Mac accessory", but it wasn't, so it isn't.


Nah, that’s a different sense of the word “accessory”. Trapped in the ecosystem is one thing. But the question here is whether it’s a substantial, standalone product.


Correct. People think that stuff like iPhone can just be created, if there is enough will and innovation. The iPhone is the most successful consumer electronics product of all time, and might also be the most profitable product on an yearly average basis. Failure to recreate that is not bad. Expecting any company to keep churning out things like the iPhone would be too harsh.


It's more nuanced than that — things like smart phones require the serendipity of any number of both technological and even cultural events before they are born.

The Newton is an interesting foil.

Why wasn't the Newton the first smart phone? Early internet, barely a high-speed cellular infrastructure, silicon not quite small and efficient enough, no lithium batteries, cost....

Saying the Newton was "ahead of its time" is really a way of saying all the right bits and pieces weren't there yet.

We'll know what the next "big thing" is after it happens. You can't force it though regardless of the dollars you have for R&D.

Just MHO.


Apple is Apple because every ten years or so they take an existing product category and make it worlds better than anyone has ever before. They’ve done this with workstations (iMac), laptops (iBook then PowerBook then unibody/retina), they’ve done this with phones, and they’ve done this with in-ear headphones.

They almost did it with wireless speakers (the HomePod is an absolute engineering marvel, entirely unparalleled as a speaker), but they left out bluetooth in a platform play for AirPlay on their own phones/tablets, and it basically flopped. It would have been an airpods-level success if it were a record player that could play everybody’s records.

People keep talking about how they might do it with cars, or televisions, or glasses, or whatever. But so far, as yet, that has failed to materialize.

Edit: I left out the watch, despite it being the best selling watch. It isn’t as better than a normal watch as an iPhone was better than a blackberry; it is merely sufficient: great, but certainly not insanely so. If it could support Google Assistant instead of Siri, and had better bluetooth device support, and didn’t require an iphone, it might be. But the watch presently really just falls short of the Apple level expectation for a product. To be fair, that level is literally “insane”.


HomePod flopped because few people want to spend hundreds of dollars on Siri when they could spend tens of dollars on Google home which is a better voice assistant. Having good audio quality doesn't explain the price tag when you can pair Google home with a dumb speaker if you find the audio quality is insufficient.


An equivalent quality speaker + amp system, etc will cost you about the same or more, take up more space and create a wire mess.


I dunno, but it seems like the iPhone was a product of many technological advances coming together at once, and Apple's key addition was to execute it in a way that made it appealing to the masses. So, I don't expect Apple to make a teleporter, or home fusion energy, or something that doesn't exist. I expect them to take something that is possible, like VR/AR, like videoconferencing, like IPTV.. even just computers and cellphones, and to execute them in a way that makes them the best designed product in the industry. Lately, it seems like they've been failing to do that. At this point, it seems like they're just a fashion brand whose products lack a compelling advantage over their competitors' products. Apple needs a guy like Steve Jobs to raise the standards and drive the company to meet them. Under Cook, it seems like they're sliding into mediocrity.


> I expect them to take something that is possible... and to execute them in a way that makes them the best designed product in the industry.

I mean they just did that with smart watches and earbuds, under Cook. They are totally dominating those categories with uncontroversially the best designed products. Not good enough for you?


Curiously, what other products launched by any other company have had a similar effect as the iPhone.


How are you measuring success? I would say the digital quartz watch was far more disruptive and certainly moved more units. It's definitely consumer electronics.


I won’t speak to “innovation” because of how subjective that is. However, the quality has taken a serious downturn. MBP keyboard issues, MBP speaker crackling issues since 2016, iOS 13 bugginess (random FaceID locks, lock screen refusing to turn on, phone shut offs in the middle of the night, alarms randomly not going off, bottom “gesture pill” disappearing on the lock screen making you unable to swipe up to unlock your phone requiring a reset, apps killed in the background after just a few minutes, etc etc etc), macOS bugginess with Catalina, SwiftUI mess, iCloud corrupting files, and much more.

I’m at a point where I’m surprisingly preferring Windows and Linux for my desktop work. I just wish there was a better alternative in the mobile space than Android, which I feel is in an even worse state than iOS.


From a long-term user's perspective, that Apple magic is fading quickly to reveal the banality underneath. Same with Google. The elves have left Middle Earth.


The Apple Watch is much more impressive technically than the iPad. The iPad was easy once you had the iPhone and once it was introduced, was easily copied hardware wise. The amount of technology in the Apple Watch still hasn’t been duplicated in the same small form factor.


I'm sure that's true, that they are continuing to innovate.

I'm not familiar with the Apple Watch (nor the iPhone much to be honest). I'm kind of an old-timer that fondly remembers the Apple II and the early Macintosh.

Should have added an emphasis that, _for me_, I feel that their magic is fading. Same with Google, in their early years I was amazed - now, not so much. I guess miracles don't happen so often, and I should respect their continued growth and renewal. (And there are still elves working there.)


That’s nothing to do with Apple. That’s just because you are now used to the technology and not so awed by it.

But that feeling is irrelevant to whether or not they are innovating or not.


I bought a mac because I wanted a Unix workstation. That's increasingly unsupported and poorly working.


// Their innovations are more around key details and hardware/software integration that makes the whole system work like magic.

That philosophy was Steve Jobs' key insight back than. Today many companies excel at magical ux design.

And sure, their control over iOS and their rich clients allow them to do stuff others cannot. And definetly, it's incremental innovation.

But that's very little innovation, considering their size or compared to their competitors - Google AI and moonshots, Amazon(where do i even begin), or Microsoft(Cloud and their research efforts).


How much have Google’s “innovations” led to profit?

People seem to forget that one of the first things Jobs did was get rid of Apple’s Advanced Technology Group and focused research on profitable products.

Google’s lack of focus explains why it has had five failed messaging apps.


Google is doing well. Some of their older investments (like AI maybe) are already making them money.

And they have a few bets that with time and some luck could make them a lot of money.

It's very likely they would be able to cover their investments, at the very least.

And they have ackuired many new capabilities as a result.

It makes for a better financial future, a stronger company long term, and also, contributing so much value to the world is simply a good thing.


How much “longer term”? Compare Apple’s, Microsoft’s, or even Amazon’s revenue mix since 2001. They have all diversified. Google still makes 90%+ of its profits selling ads.


Selling ads does speak nothing of diversification.

In 2001 Google probably only sold search ads.

Today they sell ads on so many digital places, some of those they own.

As for the question of "long term" - Google X was founded only 9 years ago.

That probably a reasonable time for a drug startup to show sucsess.

And they recently started testing self-driving cars with no safety driver , with real passengers. So they're close to some deployment.

That seems quite good.


In the last 9 years, Apple has introduced two products that are probably larger generators of revenue than the iPod.

Microsoft has released Azure.

Saying that a Google sells ads in more places is about as “diversified” as saying Apple sells iPhones on more carriers.


In 2001 Google didn't own YouTube. Today it does.

YouTube profits from selling ads, that's true.

Yes YouTube makes all of their money from selling ads. But it's fate is highly independent from Google search. That's diversification.

Same idea goes for Other Google businesses.

As for Apple - it's less diversified than it seems: the fate of the watch, for example, is highly dependent on the fate of the iPhone.


And all indications is that Youtube is barely profitable....


How's Google cloud doing? Does that count?



They've been slacking in development, both software and hardware. Look at the MacBook keyboard problem, or all of the security exploits like pressing Enter numerously to escalate to root privileges.

You don't get these kinds of problems when you aren't trying to mass produce cyclical consumption.


They are better on security than anyone else, so if this is ‘slacking’ it has to be contrasted with abject failure elsewhere.


You forgot Apple Pay. That's a whole new market for Apple — and seems to be doing well?


But Pay is so common. You've got Google Pay, Apple Pay, AliPay, and WeChat Pay. It's a good addition because it adds something that was really missing from the ecosystem but it's just really something that is expected.


It's also not really any better than tapping your card against the reader, which is what most people in UK do.


And just wait for AR.


Apple is definitely working on AR glasses for 2022 to 2023 release dates. Facebook and Microsoft also have AR projects (Microsoft have actually shipped of course).

Innovation at Apple scale takes time. Let’s see what happens with AR.


some of the stuff they do really is stupid. I literally can't buy an apple computer with a mainstream desktop processor. they sell laptops and two different desktop computers that use laptop parts. or I can pay $6k for the pro tower with xeon parts. why do they have to make it so hard for me to get a machine that compiles code targeting their own desktop OS?


All these products were previously imaginedand started by SJ. Cook is a marketer not a visionary or inventor of any sort.


That's not an accurate depiction of Tim Cook - a man who is a very capable supply chain guy and general businessman. My personal opinion? Steve Jobs was the marketer -- his skill was getting other people with hard skills to buy into his general vision. (Recall the "reality distortion field" he possessed.)


No. The Apple Watch was started under Cook.


Since Tim has taken charge, they’ve become much more diversified. The watch and the AirPod business is larger and will probably be longer lasting than the iPod business, the iPad is much more than a big iPhone, and they are in services.

Compare this chart to Google’s

https://sixcolors.com/images/content/2019/financials-2019-7-...

The iPhone was a once in a lifetime thing. Even in 2007 there were 1 billion phones a year being sold (Apple said they wanted to capture 1% of the market by selling 10 million in its first year).

By definition, what electronic market can be much larger than one that has a 80%+ penetration?


I made another chart back in 2016 to show how over a decade the iPhone became such a truly once-in-a-lifetime product: https://jasonlefkowitz.net/wp-content/uploads/2016/10/apple-...

(As an illustration for this post: https://jasonlefkowitz.net/2016/10/why-apple-doesnt-care-abo...)

By 2009 Apple's iPhone business was larger than its personal computer business. By 2011 it was larger than all of Apple's other businesses put together. By 2015 it was several times larger than all of Apple's other businesses put together.

Which is why, even though I'm not the world's biggest Apple fan, it always amuses me to hear people complain that Tim Cook hasn't pulled another iPhone out of his hat. The iPhone was the kind of hit that only comes along every two or three decades. I'm struggling to think of anyone who's produced two hits on that scale.


Also look at Apple’s product and revenue mix since 2007. They have consistently been able to change it as technology changed.

If you look at Google’s revenue and profit mix, it looks the same as it did in 2007 - advertising.

Microsoft and Apple have been able to pivot. Even while the Mac is only 10% of Apple’s revenue, even it has grown slowly throughout the years.

Another note from your article - Apple sold $23 Billion dollars worth of Macs in 2016.

Between 2010 - 2016. Google has only made $31 billion in revenue on Android (https://www.theverge.com/2016/1/21/10810834/android-generate...).


How many Android users buy Apple watches and airpods? They are primarily accessories to the iPhone, not standalone products.

What limits Apple to the electronics market? It's been clear for a long time that they need to grow outside of electronics. Apple's value is in its design and brand. They could be so much more than an electronics company, under different leadership.


And how has that worked in the past?

AOL/TimeWarner

General Electric/Universal/Synchrony Bank

AT&T/DirecTV

Google/Motorola

....


Those are mergers and acquisitions. I said Apple needs to find new product categories outside of consumer electronics. They were going to make a car at one point but the project imploded.

It's really not healthy for a company to build a whole constellation of products and services around one product only. It creates unnecessary risk because if that product ever sours, everything will fall apart.


As of last quarter, only 48% of Apple’s revenue comes from iPhones. For Apple, the Mac and iPad markets are both tiny - at around 10% of their revenue - that revenue by itself would put it in the top 100 companies in the F500.

None of the tech giants are well diversified - with Google being the least diversified. Facebook just buys up competitors.

Amazon has retail and AWS. Microsoft has software and Cloud.


It takes us two minutes to block ads. Everyone on this site is a tiny minority who finds this sort of thing easy.

https://www.nngroup.com/articles/computer-skill-levels/


It's shockingly high. Most western countries see an average of 26% - 40% ad block rates (by pageview) across the web. Some sites skewing to an older, less tech savvy audience, see between 8% and 15%, while tech heavy sites can go as high as 92% of pageviews being ad blocked. It's actually crazy that adblock rates in developing countries like India and Indonesia can actually be much higher on average because of UC Browser adoption and high mobile web consumption. They don't care about ads and privacy though -- just saving money on their data plans from not downloading ads.

Source: I was briefly a product lead for a large tech company's anti-adblocking efforts and worked with publishers and others globally to measure these rates.


I'd love to hear more about your experiences in this field... we don't hear much fron the inside (as it were!)


Officially: https://www.blog.google/topics/ads/helping-publishers-recove...

Beyond that, even though I've been out of the game for a few years, I have to be careful what I say. But I've been planning on writing something soon.


What are you doing these days


We are starting to put tools like Pi Hole in our homes.

Someday soon we will put AdGuard in as the DNS provider for our parents and other relatives.

The same way Firefox and Google Chrome got adopted.

Advertising has gone from an annoyance to a potential serious threat to our well being from an increasingly surveillance oriented ecosystem.

Pi Hole blocks anywhere from 35 - 50% of all requests in my home. That's an astounding number of requests for an apartment with two residents.


> Google will begin to rot from within

Continue, not begin.


I disagree on the criticism of Apple, since they do try to innovate, but I think you are spot on on Google embracing a conservative business culture centered on selling attention.

Directly to advertisers and indirectly through content creators, so they have multiple channels at least.

Not an Apple fan at all, but if I could pick an employer, Apple actually is on a track to become more favorable. Still, their locked down environments aren't really interesting if you don't care about monetizing software directly.


>but innovation has slowed to a crawl and he has failed to diversify Apple away from having one product (instead he just added a bunch of accessory products and services).

Apple has definitely slowed down quite a bit under Cook. But that is comparing from Apple's best to Current Apple. iOS 13 and macOS quality has definitely slipped. Along with the extremely long denial and no reaction pattern of Mac, Mac Pro and MacBook Pro Keyboard problems. But they are still Innovating like hell on iPhone, iPad, Apple Watch, and AirPod. Getting a decent iPhone out every year, which also happens to be the best selling Smartphone around the world is no small task. Services is also growing, although I am still not too fond of the idea of Apple TV, Arcade and News.

Those so call "bunch of accessory and services" would have been a Fortune 2000 company on its own, and likely to be Fortune 500 soon if not already.


> he has failed to diversify Apple away from having one produc

isn't Apple+ the largest diversification Apple has had in a long time?


"There is a bit of a walking-away-from-Omelas element to this—you get to think about driverless cars and human immortality because in some dingy basement ad metrics are being tortured—and it was a lot easier to forget the, uh, all the internet stuff in 2015 than it is in 2019."

One of the best and most tragic short fiction stories ever written. It is scary how accurate the metaphor is.


Are you referring to walking away from omelas?

I don't see why people think that story is in anyway interesting or tragic. It's non-sensical, when reality isn't so. It's only deep if you have never read an account of a war or read history or basically know anything about how anything works outside of your suburb.


It would be more helpful to focus your comment on seeking to understand why the OP connects with the story than to put them down and imply that they've never read an account of war, history, or how things work outside of their own suburb.


Non-AMP page:[1]

Alphabet's problem is simply that they mostly failed. Robots - fail. ISPs (Fiber, Loon) - fail. Self-driving cars - in test, but a long way from profits. Android predates Alphabet and is really part of the ad system.

[1] https://www.bloomberg.com/opinion/articles/2019-12-04/alphab...


>the expectation is a more standard corporate focus on making profits from its ventures in some defined timeline.

That's a reasonable prediction. It's the way Sundar started running Google anyway (demanding profits of the non-ads products or killing them).




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