"X makes money, therefore they are not a tech company" seems rather oversimplified in the same way "X is a tech company" is oversimplified. Actually, it seems oversimplified to the point of maybe not being so useful.
I think the way most people would define "tech company," if they were pressed to offer a definition, is that a tech company is one that derives the bulk of their revenue from selling technological goods and services, rather than using technology as the means to sell other goods and services. There's no way to keep that definition from being somewhat fuzzy, but if I say "Dell is a technology company and Cadbury is not," I don't think people will really object to that unless they're trying to be pedantically clever about it: Cadbury may use technology in all sorts of clever ways to manufacture chocolates and get them to retail shelves, but they're selling you chocolates.
There are obviously companies that complicate this by having multiple divisions with different kinds of revenue streams -- Amazon and Apple both come to mind immediately -- but Netflix really isn't one of them. What they do requires a lot of focus on their technology, and from the perspective of someone perusing their job listings it's very easy to think of them as "a tech company." But what they're ultimately selling is access to their content.
Probably because people don't even have a good definition of "tech". Everything we use is tech. Even books. Some of it is old, some of it is new. But people's definition of tech mostly centers around when they were born.
As a software developer, I mostly care if a company considers their software a competitive advantage. Because they're more likely to treat me well. This is also similar to how I tend to define tech companies: companies that view tech as a competitive advantage. So they aren't just buying stuff off the shelf - they're figuring things out in house, regardless of what they sell.
Other industries also exhibit this, like media.
And that is what differs an auto company from a Google. The next car sold still has significant capital investment.
I have never heard that. Car companies are mostly manufacturing, that is the major part of their organizations and what drives their decisions. They have big engineering teams, but they have way bigger teams working at factories. If you had a company just creating car designs and selling those to manufacturing companies it would be a tech company, but the current ones aren't.
When I visited our customer auto assembly plants the only actual manufacturing going on at was the frame and paint. The rest of the parts were shipped in from other manufacturing facilities.
The auto company did design the parts and send them to contract manufacturers, which is what I worked at. Again, I’m sure this depends on the vertical integration and supply chain relationship of each company, but I think there is less manufacturing than assembly going on.
Auto makers could turn into tech companies again but their risk tolerance has to be turned way up.
But we probably should just stick to industry standard jargon. Lockheed and Boeing are definitely technology companies, but not "tech" companies, although that is even further complicated in that they do sell computing hardware and software products, not just airplanes and missiles.
Netflix unambiguously only sells entertainment, though. They use an app and a website as a delivery mechanism, but the app isn't the product.
Also, as much as the emphasis on hacker news is think of employment by Netflix as being an engineer for Netflix, engineers are very far from the highest paid contracts. No engineer is getting the $500 million deals Netflix hands out to Shonda Rhimes and Benioff and Weiss. Netflix itself recognizes content is king here.
There are companies that effectively use technology to outcompete (or "disrupt") incumbent companies in a market. Amazon in retail, Netflix in media, Craigslist for classifieds, Uber for taxis, etc.
It seems as if many existing companies, like Cadbury's perhaps, aren't able to effectively re-work their business models with the new possibilities available via tech. Thus they're "non-tech" companies even if they do make some modest use of technology, but ultimately their business model predates tech.
"Tech" companies in this space are the ones creating or adopting brand new business models in an existing space enabled by technology. This is the "software eating the world" part of the tech market.
So Netflix is using a tech strategy, but it won't forever be a tech company.
As the particular technology a company deploys becomes widespread, then everyone will deploy it and it will no longer be a tech company.
To put it another way: Netflix was not a tech company when it launched and was mailing DVDs, it became a tech company when it started its streaming service, and as other companies also launch streaming services, it won't be a technology company in the future.
Across many industries, especially in the past several decades, companies have used (modern) technology to compete, and the successful ones grew and gained recognition for good application of technology.
Google, at the core, doesn't sell technology to consumers. They help people find and share information. (Yes, they sell consumer products that have evolved in the technology age, and we often call a phone or a modern speaker "technology.")
Apple is a consumer products company. Microsoft is (by revenue share) an enterprise solutions company. (This includes software, hosting, APIs, etc - all technology.)
As sibling comments have pointed out, from the beginning of their existence, automotive companies took the newest technology (initially motorized transport!) and used it to sell personal transport to consumers. Technology is in almost everything sold (except when it clearly isn't... food, most clothing, some services) or it's used behind the scenes.
Overall, what value do we get from trying to draw a line between technology company, and "not" a technology company? Netflix by itself doesn't really try to sell you technology, and yet they were instrumental in selling smart TVs and streaming boxes.
Do we want to know as prospective employees? Knowing if we are cost centers or profit centers?
I think this is less a flaw of the definition and more a sign that Amazon should be broken apart and AWS spun off as an independent company.
Except, many of these companies have a second, b2b service that they're cultivating as a goal unto itself: customer attribution, identification, aggregation, etc. Companies like goPuff (or Amazon, but Amazon has a hand in everything so is more complicated for this example) have a core "not really tech" service of online ordering of human-delivered goods, but they are actively working to turn all of those engagement/sales/preferences info into a packaged product they can sell to brands and marketing companies, which is at its core, data aggregation and analytics as a service...so "kinda tech"?
I personally consider "tech companies" to be companies with tech I find interesting to think about - Netflix definitely qualifies under that header, Apple does too owing to producing a huge operating system, Amazon not only has AWS services on offer but they also run a storefront of a staggering scale and were pioneers in how storefronts like that were discovered... Dell - Dell might get grandfathered in as a tech company based on how they were earlyish into the market of web-based computer sales (ala "Dude you're getting a Dell" days) but now a days I assume their tech stack is a pretty ornery customized CMS like thing with a relatively simple order processing system behind it.
Only half of that revenue is from “Dude you’re getting a Dell” - PC (and network / peripheral) sales. DellEMC (mostly enterprise storage or hyperconverged hardware and software) top line is $35 billion or so of that number. The rest is VMware and other software / services.
Simple order processing it is not, it’s like saying a Google is “just search and ads”. Somewhat true, but misses a lot.
Such as if you were to ask people, "which is the tech company, Apple or Ford?", most would choose Apple, choosing to call Ford, instead, a "car company".
How would you define pre-AWS Amazon? It doesn't seem to meet this definition, yet I think most would still consider them to have been a tech company
there is no real definition of a "tech company" or "tech industry", the word "tech" defines the operating model. This is the dirty little secret VCs don't like to tell you because it means they can call Tesla a tech company (its a car and battery manufacturer) to fetch tech-like valuations or Facebook a tech company (its a media company). Tech operating models typically net high gross margins (i.e. Facebook) which is one of its major defining characteristics.
I therefore posit there is no such thing as a "tech industry", but rather businesses that sit on a spectrum of operating models from:
- Back office IT supported
- Tech enabled
- Tech Led
As an example, pencils are an excellent technology for writing. (Petroski's "The Pencil" and "The Evolution of Useful Things" are great reads on how much innovation it takes to make something mundane.) But Faber-Castell is definitely not a tech company. Similarly, ~100 years ago, electricity was novel. Fortunes were made starting and investing in electricity and electrical-adjacent companies. Now it's mundane.
Dealing with novel technology requires different skills. Both for the specific technology involved and for wrangling things that are less well understood and keep changing. A good example is the IT department and what they are and aren't responsible for. The breakroom toaster? Nope. The breakroom wifi? Yup. The breakroom TV? Well, that depends.
For me the useful dividing line for "tech company" is where novel, volatile technology is at the heart of their business and vital to their success. That doesn't last. And indeed, the markets have been too generous about pretending certain things are tech companies. Most notably, WeWork, but I'm sure here folks here can name plenty more.
How many "non-tech companies" are non-tech companies simply because they're too disfunctional to use technology effectively? Think of your bank with its shitty password rules, only offering 2FA using SMS, and no useful APIs; that's a non-tech company. They either aren't aware of their lackluster technology, or are unable to organize themselves well enough to improve it.
I'm not saying banks are great at tech, because on any individual metric it would be really hard to find an example of where they lead, but they (and other highly regulated industries) have a lot more to solve for along the way.
Is the IT/Software Dev a profit center or a cost center, easy as that.
For a modern information-centric company, what does that mean? Get the technology right. Pay some smart people to get your internals ship-shape and reproducible, for example.
There is an incredible amount of advanced technology being created and used by more "traditional" industries like manufacturing, aerospace, or animation.
Why should Facebook be considered a technology company but not Pixar, Ratheon, General Dynamics, Corning or TSMC? It makes zero sense and relies on a very self-serving definition of "technology".
This hits the nail on the head. If you dig down into it, this almost always aligns with the companies people describe as 'tech companies'.
Maybe it's more to do with the strategy of the company.
It isn't that Tesla has no MBAs on staff or the GM has no engineers on staff. But a culture that leverages engineering culture can iterate and reinvent itself and include new technologies faster than one who is focused on management metrics.
I'm not saying that MBAs are bad, there are plenty of companies that went way to heavy on hiring engineers and went bankrupt before their business plan was viable.
What is Microsoft then? What is Apple?
Google I can accept as some kind of service provider and advertising company that uses a lot of tech. Amazon as well.
So Intel, TSMC, Nvidia are not tech companies?
For the vast majority of companies technology is tool, not the product, but whether you call them a "tech company" seems a silly game. I'd think pretty much all companies are "tech companies" and the better you are at using those tools can provide a competitive advantage.
This does not guarantee a strong competitive opportunity, nor strong execution - but it makes it possible for the benefits of IT to be realized.
Actually, there are several legitimate definitions of 'tech company', this is just a relevant one today that is significant long-term.
Aside from weird blockchain entities, this doesn't exist. Companies may use software, but they are made of people.
Making money is what the _company_ part of "tech company" is about ... right?
It sounds like you want to imagine a world where making tech for non-business purposes is more normalized. I also want to live in that world. But I think perhaps we're so far into a world where tech to be used by an open audience (as vs e.g. secret defense tech) is entirely the province of for-profit enterprises that people have ceased to consider that the players in tech need not be companies.
Needless to say, the difference on how the tech team is valued is night and day between this last one and all the others.