We
often compare tech companies such as Google, Apple, Microsoft and
Samsung without realizing they represent two significantly different
types of businesses. Apple and Microsoft are the "purest" of the group;
they both have a relatively small number of related products; they began
in the PC era and evolved to embrace the current mobile craze. Their fortunes are in some ways easy to predict based on how the "PC sector" develops . Samsung and Google (now officially called Alphabet) represent
entirely different models.
As
a business, Google is primarily an advertising company - most of its
revenue comes from selling ads that show up on searches and YouTube
videos. The company uses a lot of technology but does not sell much of it. In addition it has a vast array of experimental projects
including self-driving cars and balloons to deliver Internet service
around the world. It's possible some of these will eventually go into
production and make money but many - likely most - will be cancelled.
Their free Android operating system for mobile devices is intended to
get Android based phones in as many hands as possible so - surprise, surprise - ads they sell
will pop up billions of times per day. Google cannot control much that
happens on Microsoft or Apple devices but Android is another story. The image above shows the complexity of the Google structure.
Samsung
most closely resembles a "conglomerate" a collection of unrelated
companies - hospitals, construction companies, smartphone maker and chip
making foundries to name a few. It diverges from what most people
consider a traditional corporate structure and operates more like a
hereditary monarchy. When the founder died his son took over; that
elderly son has been incapacitated for two years and his son is planning
to take the reins when he dies. It's not as simple as it seems because
the intrigue as the shift occurs resembles the power struggle in the
Saudi monarchy more than a mere passing of the baton.
It
is important to understand these changes since many people are
wondering who will be the next Microsoft. As large as some of these
companies are some will gradually diminish in power as others become
dominant.
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