19 November 2019

The advantages of integration, the downsides of a monopoly

Ben Thompson, writing on Stratechery, about Apple and the notion of monopoly versus the notion of integration:

What makes Apple so brilliant from a business perspective is that it has managed to, via hardware and software integration, earn monopoly profits in a way that would not normally be classified as a monopoly. Still, it seems to me that while integration” results in good outcomes, monopoly” doesn’t.

The full analysis from Ben Thomson is brilliant as usual, highly recommended.

The main example he picked to illustrate the problems caused by this monopoly” position — the one where we can argue that Apple has a monopoly on Mac hardware for MacOS for instance — is obviously the butterfly mechanism” MacBook keyboards. Users of MacOS were stuck with unreliable keyboards for their newly-bought laptops, and they still are if you look a the current lineup: only the brand new 16-inch has the new fixed” scissor-mechanism keyboard.

Why did this faulty hardware stick for so long? Short answer is: nobody else is building MacOS hardware.

These keyboards are probably the biggest hardware disaster of the Tim Cook era, and one of the biggest let down from Apple in recent years.


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