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So you’re saying everything except “operating systems, development tools, databases and other infrastructure stuff” is “niche software”? I’m not following, e.g., that would make Google and Facebook niche software?

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They are extremely niche in a sense. There are very few other search engines (all much smaller), and there's no another Facebook.

The market just naturally gravitates to the biggest player.

What's the definition of niche being used here? I'd define it as software that's only relevant to a small percentage of the population (i.e., that obviously wouldn't include Facebook and Google).

It does include Facebook and Google, because Facebook and Google do not make up a large proportion of the population.

"extremely focused?"

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