Apple has gotten so big it's almost overtaken France's entire stock market | Hacker News Reader

Apple has gotten so big it's almost overtaken France's entire stock market

fortune.com

28 pointsthunderbong56 comments

Stuff like this really highlights how far European countries have lagged in commercializing innovation.

Apple is just one of dozens (if not hundreds) of major tech companies in the US that have been on a rally. Having been in Europe a bunch for both work and extended family, it's crazy to see how horribly mismanaged the commercialization of innovation sectors like Software, Hardware, and Pharmaceuticals are compared to their equivalents in the US, Asia, and Israel. The European business community just doesn't respect technology, and acts like a bad parody of the Asset Baron archetype.

Fundamental research is strong in Europe, but commercialization sucks.

Maybe it's a balance thing? Hyper-focus on commercialization and maximizing shareholder value might make other aspects of society worse, and some countries rather not make those tradeoffs while the US at large is willing to make those tradeoffs.

Even if "innovation commercialization" sucks in Europe, the EU is still the second largest consumer market in the world, so some of the things they're doing works, even if you're only focused on increasing capitalistic metrics.

Commercialization isn't just maximizing shareholder value alone. It's also the creation of startups based on IP.

If I have discovered an interesting pharmacological compound, or revolutionary ML workflow, or an optimized chipset - I'm less likely to get the funding and mentorship needed to scale out that startup in Europe compared to US, Asia, and Israel.

The EU is a large consumer market, but in my experience in Deeptech and B2B driven companies, the EMEA market is almost always a rounding error compared to the American market. It tends to be larger than APJ, but that's largely due to the fact that large APJ countries will create a domestic competitor that undercuts the American startup.

By falling behind in innovation commercialization, European countries will themselves face existential economic issues. For example, look at the Central European automotive industry and Electric Vehicles. Most of Central Europe (Germany, Austria, Hungary, Slovenia, Czechia, Slovakia, Poland) is heavily dependent on German ICE vehicle manufacturers like Volkswagen and BMW, but as Chinese and American EV competitors start eating market share globally, the value prop of the CEE Automotive Industry goes down, and has a downstream impact across other suppliers and industries (eg. Infineon, SAP, etc).

>Hyper-focus on commercialization and maximizing shareholder value might make other aspects of society worse

What does this translate to in apple's case?

>> Hyper-focus on commercialization and maximizing shareholder value might make other aspects of society worse > What does this translate to in apple's case?

If we're only talking about products, it's rather obvious that they are fairly hostile to their users, and I've been one for more than two decades. As for "society" as a whole, I don't envy any of the low paid workers involved in the supply chain of an iPhone. And, of course, there is "some" environmental concerns to have...

Not saying that a French "Apple" would do better though, they'd be equally bad. I'm only replying to your comment.

>commercializing innovation.

That's your take?

I see a different take. Europe has done more work than in the US in fighting the robbing of the middle and lower classes by the wealthy. Sure it still is a problem but wealth inequality is a huge deal.

Apple exists because of rampant cut throat capitalism that comes at a cost to everyone.

The Median Household Income in the US is still much higher than in most Western European countries. Inequality exists in the US, but quality of life still not all that different from Europe in most social indicators. Even stuff like health insurance or college isn't all that different when factoring household income, and the fact that it is largely subsidized by employers and the government in the US. The UX absolutely sucks in the US though compared to equivalent systems in Europe though - an employer PPO plan in the US can give you easier access to GPs than a number of Single Payer plans in Europe, but the Single Payer plans in some European countries is just conceptually easier to use.

That said, scale of things the US isn't some unequal hellhole third world country any more than Europe is some hedonistic post modern continent. The average European and American have largely comparable qualities of life, which makes the lack of innovative commercialization even more jarring.

The median isn't a good indicator for inequality. The Gini index is higher in the US than in most European countries (although the difference is admittedly not huge).

I think Europe in general just manages to take care of the most vulnerable better. You can't bankrupt yourself because you have cancer - the plot of Breaking Bad doesn't make sense in Europe.

I'd largely agree - the bottom 10% in Europe will have a better life than the bottom 10% in the US.

That said, even factoring post-tax Gini, American QoL isn't all that different from the UK or Japan. The only large (>50mil pop) European countries with a better HDI than the US is Germany and the UK (though the UK is barely higher than the US).

In 2023, France, Spain, and Italy all have developmental indicators the US reached in the early 2000s.

So why is Europe so behind the US that much less developed countries like China and India, and formerly developing countries like Israel, Taiwan, South Korea, and Japan can outcompete European countries in various sectors of innovation?

I don't think there's a single reason why European countries in general aren't always as competitive and/or developed as they could be.

In the case of Italy, there's an absolutely massive north-south divide, the total breakdown of the political system in the 90s followed by a succession of mostly awful (and short-lived) governments, a general skepticism towards the common good and, in the South, the Mafia. In the case of Spain, it used to be a dictatorship until the 70s and there's still tension between the various language communities. I don't know enough about France, but it probably has its fair share of issues as well.

Common to the EU as a whole is a lack of a common language (an app in English or Chinese can just naturally target a much wider audience), the Euro crisis (and austerity politics), the current energy crisis, the migration crisis, etc. Also, almost all European countries and especially their democracies are really young compared to the US.

And yes, I do think that there's also a fair share of Europeans that are just complacent and think that the good days will last forever, but I'm not sure that's the biggest factor.

> the plot of Breaking Bad doesn't make sense in Europe.

It’s not that Walter was going to be bankrupted by the cost of cancer treatment; it’s that the health insurance he has as a public schoolteacher does not pay for the level of cancer treatment he would like to get. Public health care does not always pay for top-of-the-line cancer treatment even in European countries and wealthy Europeans will sometimes travel to the United States and pay out of pocket for medical treatment. During roughly the same period of time Breaking Bad originally aired, the manager of FC Barcelona, Tito Vilanova, took multiple trips to New York for his own cancer treatment. So at least in this respect, the plot of Breaking Bad would have made just as much sense in Spain as it did in New Mexico.

Doesn't he just do chemo? Is chemo considered a fancy treatment?

The show‘s plot does not make sense after the Affordable Care Act was passed in 2010 which eliminated benefit maximums and implemented out of pocket maximums.

After 2010, Walter’s treatment would have been fully paid for.

If anything you are understating it. The average American is much more well off than the average European, much more likely to live in a climate controlled home that is heated or cooled to a comfortable temperature year round, pays significantly less to fuel his vehicles (and is likely to own more of them), has a bigger home, and so forth.

>Sure it still is a problem but wealth inequality is a huge deal.

Wealth inequality is really a problem. But Europe not being as competitive as the US means that their most qualified professionals move there. They tend to call this "brain drain"

Now, let's also take a look at the fertility rate in Europe. That's not a good combo

In this comparison of public market capitalizations, I don’t think that is as relevant as the difference in global utility offered by the companies on the exchange. For example, the business with France’s highest market cap, LVMH, could vanish tomorrow and make almost no difference in utility to anyone except LVMH’s employees and vendors.

Probably controversial on HN but I'm thinking the same about Apple, I could certainly imagine a phone landscape without them. Utility is subjective at the end of the day.

What operating system did you type this post on? Apple is more than phones.

I'm currently using Linux with pop-os, both for work and personal stuff.

I do have a macbook stored under my desk but it's only used for specific Apple-only stuff and it's really slow, not sure what's wrong with it.

I can give a couple examples of utility, showing the difference between a business like Apple and LVMH. That is not to say Apple is completely and forever irreplaceable. Replace Apple with Google or Samsung.

I had a completely uneducated, non English speaking great grandma living halfway around the world from all her grandkids. Due to the consistency, performance, and ease of use of FaceTime, we could easily video call to her regularly.

I have a business where IT/tech support costs are way down due to implementing iPads for all the front line employees. Troubleshooting is as easy as turning it off and on, or replacing the device. Training is cheaper too.

On the other hand, you have LVMH. I don’t see how anything they sell benefits 90% of the world’s population, and while people might buy expensive purses and whatnot, they will buy a smartphone first.

Edit: another one I just thought of. I just helped someone calculate a return on investment using a shared spreadsheet in google drive. Clearly provided greater utility to me and my relative than me buying expensive clothing.

Apple subsidize OLED manufacturing by buying up Samsung touchscreens, which directly feeds into the photovoltaic manufacturing chain (solar panel and OLED manufacturing is largely the same).

Apple subsidizes Telecom chipset manufacturing by buying up Qualcomm and Broadcom chips, which directly feeds into Military and Industrial IoT applications.

Apple subsidizes SoC research and manufacturing, which directly feeds into Military and Industrial IoT applications.

Apple subsidizes Battery research and manufacturing, which directly feeds into EV. BYD was originally a battery supplier for Apple before they entered the EV space.

Apple subsidizes CPU and chip manufacturing, which directly feeds into smaller and more efficient chipset generations.

Apple creating the first App Store in the World subsidized mobile app development, which directly fed into scaling out Digital Infrastructure like eBanking, BNPL, Microlending, etc

China's entire dual use supply chain can be attributed to the scale of Apple (and Samsung's) supply chain there, and both companies are having a similar impact in Vietnam and India now for the exact same reason (eg. all Samsung OLEDs are manufactured in a suburb of New Delhi now, 50% of all Samsung phones are assembled in Vietnam, 25% of all iPhones will be assembled in India by 2025, Airpods and other small consumable electronics by Apple will be assembled in Vietnam, etc)

I'm not saying they didn't have an impact, I'm saying I can clearly imagine a world without them. The consumer needs are very strong here anyways.

> I can clearly imagine a world without them

A world without cheap solar panels, cheap batteries, cheap electric vehicles, 3G/4G/5G internet, e-commerce and digital banking, and an industrialized China, Vietnam, and India.

That is the second order impact Apple has had due to their massive economy of scale

I don't agree with that analysis, any of that is happening, with or without them. We live in a consumer-first society and consumer needs are what are driving changes. Companies helping towards this direction are getting benefits and others are left behind.

> any of that is happening, with or without them

Not really. None of the scale existed for any of those industries without Apple (and Samsung).

BYD would be a fraction of the size it is today without becoming an Apple vendor.

Samsung would be a fraction of the size it is today without becoming an Apple vendor.

Qualcomm and Broadcom would be a fraction of the size it is today without becoming an Apple vendor.

The iPhone (and the Samsung Galaxy) are a marvel of engineering and logistics - representing the ultimate synthesis in Battery, OLED, Semiconductor, Telecom, and SoC manufacturing as scale.

Some other company would have needed the exact same components anyways, it's not like you can build a smartphone without those. The biggest difference is that Apple realised it earlier than others. And yes I agree that being a global company is a requisite but it's not like there's only a single company in that position.

> the business with France’s highest market cap, LVMH, could vanish tomorrow and make almost no difference in utility to anyone except LVMH’s employees and vendors

I disagree. I get plenty of utility drinking Glemorangie Scotch. My SO gets plenty of utility wearing a Louis Vuitton bag. Plenty of women get utility shopping at Sephora and plenty of men at TAG Heurer.

Luxury goods provide utility by providing psychological and social validation. You might think it's bullshit but for most people it's important.

Also, I'm fine paying a premium for LVMH's scotches over the crappy generic Total Liquor sells at almost the exact same price.

The point is that LVMH is easily replaceable. They do no real innovation, and if they disappeared tomorrow then consumers could obtain the same quality of luxury products from numerous direct competitors.

Much of LVMH revenue growth in recent years has come from Chinese nouveau riche. That will not be sustainable as China now faces severe demographic and economic challenges.

It's a good thing. They have far nicer communities and societies because it's not all just capitalism for the rich. Sure, our Apples and Googles and Metas may be huge, but what does that do for the average American? It makes their housing unaffordable and their cities shitty to live in.

At work the parking lot of the building contains Teslas and Rivians. The surrounding streets are back-to-back illegally parked RVs. The contrast is overwhelming.

Unaffordable housing and (literally) shitty cities are a consequence of a completely different set of policy choices on the West Coast.

Doubt it, they were getting that way through all the dot com bubbles. I lived through them there

There are plenty of shitty communities in France (and the rest of Europe) as well. Look outside the tourist areas.

It's better than shitty communities through most of the United States, isn't it? The US is the most gilded society I've ever visited, aside from apartheid South Africa...

It isn't.

https://www.bbc.com/news/world-europe-66071455.amp

Or beyond France, check out living conditions in the Roma ghettos.

Have you been to both? I've lived in one of these french ghettos, I know without a doubt what I'd choose in-between starting with empty pockets on Mission street or in Seine Saint Denis.

>, it's crazy to see how horribly mismanaged the commercialization of innovation sectors like... Pharmaceuticals are compared to their equivalents in the US, Asia, and Israel.

My every-two monthly prescriptions (four different drugs) cost me €8 a time - I would put that under 'great management' (after all, why can't it be done in the States?) I have seen the 'well-managed' US equivalents - it's not that 'we' actually hate the rich, quite the opposite: just please not at the expense of our 'mis-managed(!)' societies.

Are you implying that US is capital rich because of innovation? I think it is a source of innovation, but I could think of more convincing narratives for why it's rich.

> Are you implying that US is capital rich because of innovation

Yes I am.

"Clusters of productivity-boosting patents correlated closely with three major waves of U.S. technological progress: the late 19th century’s so-called Second Industrial Revolution (which saw new railroad technology and the birth of electricity), the 1930s (new applications of electricity and the development of chemicals, including Bakelite, the first fully synthetic plastic), and the 1990s (revolutions in computers, communication, and genetics).

The link between innovation and productivity held across sectors of the economy. For example, during periods when a given sector saw 30 percent more innovation than average, that sector tended to see up to 11 percent higher productivity." [0]

[0] - https://insight.kellogg.northwestern.edu/article/measuring-i...

I agree with you but the US has many other economic advantages as well: a well-educated workforce, plentiful natural resources, tons of energy, and a fairly liberalized free market system. The innovation is the most important factor though.

Two huge oceans on both sides, friendly bordering nations, effectively no competition in the whole western hemisphere, and being primarily English speaking are other ones.

At this point, speaking English is an advantage for other economies because it’s the language that Americans speak.

> The innovation is the most important factor though.

Yet all the eminent figures of AI, just to name that field, are from abroad.

From abroad, but where do they do their research? Recruiting ringers from around the world is also an American advantage :)

The article could be more precise. It says France's stock market reaches new records. So I'm pretty sure they mean the CAC40, which is only part of France's entire stock market.

Might be that France has quite some long tail of smaller companies that also create value. There might be even more companies that aren't listed on any stock market.

Still for France and Europe, this is a very worrying sign. Market capitalization is an indicator of economic power. Basically, large swaths of the European economy could just be bought by these large companies.

Good reminder that Apple and other technology companies, take up a large percentage of our supposedly "diversified" ETFs or retirement portfolios. For better or worse. Look at VTI for example. All tech companies at the top. Apple 6.35%, MSFT 6.34%, AMZN 3.05%, NVDA 2.47%, GOOGL 1.77%, META 1.64% https://investor.vanguard.com/investment-products/etfs/profi...

Inspiring. Maybe one day they won't need the 20 billion dollars they get from google anymore, and they'll be able to build their own search engine.

You don’t get huge by saying no to risk free money

And it would probably turn out as badly as Google selling its own phone.

From the best estimates I can find Google sold around 10 million phones a year. That’s about how many phones that Apple sells in 15 days.

To a first approximation, everyone would still switch to Google if Apple made a search engine.

Wanna count all Android phones sold (including non-Google ones) from which Google makes a cut, instead of just Google Pixel?

I feel like that would be a slightly more fair comparison, given that Google would be making money from Android phones even if Google’s own Pixel line didn’t exist.

Note: Apple almost definitely would still come out on top in terms of money made from phones, and by a significant margin, but the comparison would be more analogous if we counted not just Pixels imo.

No because selling hardware and selling software are different competencies

And we know from the Oracle Java trial back in the day how relatively little Google makes from Android compared to Apple from selling phones.

And all indications are that Apple probably makes more in mobile from Google than Google makes from Android

https://www.bloomberg.com/news/articles/2016-01-21/google-s-...

> And all indications are that Apple probably makes more in mobile from Google than Google makes from Android

Oh, absolutely. That’s pretty much the reason why devs often prioritize iOS releases over Android versions, due to them being able to make way more money from iOS users (and, by extension, Apple being able to make way more money from an equivalent app on iOS app store, compared to its Google Play Store versions, since the app store revenue they make is a cut from the revenue the app devs make).

My point wasn’t that taking all Android phones (not just Pixel ones) into the account would make the comparison a bit more representative of reality, even if it still keeps the gap in money made from sales of phones extremely wide.

Let me be clearer - my previous statement was kind of word salad.

Google probably makes less than the $20B on Android than the same $20B that they pay Apple.

I really appreciate the clarification.

That distilled claim is the one I can honestly believe to be true, though I don’t have the actual numbers to back it up.

This site: "Lord Thiel has commanded me to build monopolies."

Also this site: "Apple is an evil monopolist."

This site has more than one user, and those users have different opinions. Who knew?

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