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But what's the advantage of a company with 50k employees? Why not have several smaller companies that collaborate?

Microsoft could easily be broken into several smaller companies.

I've often thought this was a good idea. The "interfaces" between the smaller companies would be far more strict and simple then interfaces between departments in a single large company. It's like the difference between buying a hamburger from a fast food chain which is extremely easy and asking a co-worker to sell you a burger which gets complicated very quickly.

Overhead in terms of office space etc would increase. However the simplicity of the necessary interactions between the smaller companies could turn the entire arrangement into a net gain for the parent company.

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