Reply to post: Re: never forget though

Re: never forget though

> Sure, you can steal the market by selling a one-off...but then you starve yourself out of the market because once you sell it, you never hear from the customer again.

The tech companies have now reached the point where they are having difficulty selling "better" because "better" isn't needed (speed) so there's no useful upgrade cycle that they had in the past. Now they sell stylish and worse (*cough*mac pro*cough*), even brazenly being less functional.

As a lot of the tech companies are finding, they are large enough to saturate the market within a year or so - hence, the yearly new models and consumerism. Telstra contracts are structured so that buying your own phone isn't worthwhile - bring your own phone to a contract and you'll be subsidising those who don't.

Personally, I'd love to start a business that goes the other way. Sell really good quality stuff that will last forever, make my millions in one-off sales and leave the industry sector. The problem with that is that the large corps respond to competition. If I made good kit, they would do the same, tie up the suppliers, throw vexatious sueballs and loss lead until I went bust. Then they would go back to doing what they do now.

The problem is that the companies are too large and have to much cash in reserve (stifling potential competition I think is a large part of all that off-shore profit accumulation) for competition to flourish. Yes, Apple and Samsung compete and it improves the products, but the chance of a newcomer being profitable, let alone growing to a decent size is slim to none, so the kind of competition and the source of competition is severely limited.

Consolidation in the supply chain makes matters worse. To quote from Pretty Woman, "Whose business is more valuable? Call the bank." Outsourcing production gives you leverage over the rest of the industry - if you are big enough. Foxconn's economies of scale are unlikely to be of much benefit to someone making a Mozilla phone.

I like well-made stuff. My leather lounge suite is over 20 years old and still in good shape. I bought an oak dining / coffee table suite which is strong enough to dance on with friends and will last a lot longer than I will. I have an iphone 3 which has been dropped countless times without screen shatters, doesn't bend despite spending most of its life in front and rear trouser pockets. Sadly, Apple's software updates have done what years of abuse could not - render it almost useless - far worse than it was in its mid-life. My Dell 2711 will far outlast my wife's imac internals and using an "old-fashioned" desktop separates ensures that they can't invalidate my screen investment with software updates, as they did with the phone. Ditto, disks, RAM, graphics card.

Politicians see any economic activity as being good. It just isn't true. Strangely they increasing loans (debt) as a measure of success. They go to war and tell us it is for peace. As far as I can tell, they don't represent the wishes of the population neither to they act in the population's best interest. Has democracy failed? If my history lessons are anything to go by, it is almost certainly about to.