Hacker News Reader

Comment by hn_throwaway_99 | Hacker News Reader

> The American Edge Project is dedicated to the bipartisan proposition that American innovators are an essential part of U.S. economic health, national security and individual freedoms

This will be interesting. On one hand, I definitely agree with that quote in the article. On the other hand, you often see highly tech-invested commenters on this website argue that it no longer makes sense to work for a startup because the FAANGs have amassed so much wealth and power that they can always be a better deal, even when the startup succeeds. So at the very least in seems the tech giants are stifling innovation in some way. It's also important to note that all of the tech giants amassed their power through acquisitions, not just organic growth (e.g. Facebook and Instagram/WhatsApp, Google and Android/YouTube).

View on HN

You're only thinking about the top 1 or 2% of software engineers. There's nowhere near enough FANG jobs to employ most SEs. What the heck is everyone else supposed to do? sit around unemployed forever? There's plenty of SEs for startups. Although working at a FAANG is great compensation for someone in their 20s, it's a whole nother story if you have a family. At that point, the cost of living/housing is so excessive that you're not better working at a FAANG in the bay area. If you're renting, a house in palo alto will cost at least 90K per year, after taxes. That's a pretax cost of 150K. Which means, you need at least 500K minimum just to be doing ok (factoring in the much higher taxes at those salaries, and all the other cost of living).

If anything FAANGs are stifling innovation due to their walled gardens.

What about Amazon? Wholefoods is the main notable purchase and they were were essentially a peripheral expansion/afterthought. NetFlix I can't even think of a single merger.

Amazon: Audible, IMDB, Goodreads, Comixology, the Book Depository, Woot, Ring, Eero.

They've been gobbling up other online media stores for decades. It's to the point you just assume a new store is an Amazon subsidiary or will be soon.

Don't forget Twitch as well. That was a massive acquisition. And Alexa, Box Office Mojo, Zappos, LoveFilm (an early Netflix competitor), and Curse. If I recall correctly, they also own a stake in Wikia/Fandom too. And that doesn't even go into the dozens of book stores and book data companies they've acquired over the last 20+ years.

Amazon has gobbled up tons of smaller companies in order to make themselves stronger and more diverse. I'm not sure why Nasrudith singled them out as someone who hasn't really.

In that case because I couldn't think of any that were a major component. Which I suppose is a side effect of their scale my mental modeling.

Facebook getting other social networks is cognitively equivalent to roughly an additional third each without checking the numbers - both are big known names. Google and getting YouTube is an influential chunk of their empire even if low margin from the expense - say an additional third of their "main product" along search and Android.

That is probably why I couldn't remember others.

M&A often involve conservative brand strategies, at least in part to promote a veneer of competition and diversity, while the insidious effects of consolidation are left unsaid and off the public radar after the M&A event. Imagine if all those purchases renamed to include Amazon in their name.

Zappos was a huge infusion of business DNA into Amazon, and from what I understand had a big influence on Amazon's customer service practices (Zappos was/is known for being maniacally customer focused.)

Another acquisition from around the same time was 'diapers.com'. That site is now defunct, and was never huge, but I believe they pioneered the concept of 'subscribing' to consumables like baby formula and, of course, diapers. After that acquisition, Amazon started doing the same with baby products, then their own brands, and now you can subscribe to just about any recurring purchase on the site.

In these cases, I think the acquisitions provided much more than the economic value of the business. They infused Amazon with new strategies and ideas to make them, as you said, stronger _and more diverse._

Also PillPack, their entry into the healthcare industry.

I’m mixed on this thought that they are stifling innovation. On one hand, yes, they have a habit of commoditizing their complements by acquisition or fast following. On the other hand, they most often have built the platforms that have made such complements possible in the first place.

It seems more like an innovation trade off relative to other innovators, but a net gain relative to other areas of society that are either innovation neutral (most of non-tech non-science society) or innovation destructive (politicians except when they are listening to advice from the EFF).

Yeah acquisition itself can have a positive role in innovation from specialization of capabilities. The VC model often is based upon "growth then monetize" and the monetization and creation skillsets don't always overlap.

Imagine a hypothetical world where anyone buying start ups was forbidden. Someone capable of building something new but not monetizing it would be less incentivized than if they could be bought out. Others would be encouraged to roll their own for redundancy of labor as there are downsides to building dependencies upon things you don't have full control over.

The current system is not a perfect system by any means but it does have merits.

Reply on news.ycombinator.com