Money rules the world, the saying goes, and today that seems truer than ever. Right now we’re seeing a concentration of financial resources like never before. Oil companies pale in comparison to tech giants as data became more valued than gold, black or not.
Nowhere is the hegemony more obvious than it is on the smartphone market. Two companies, Google and Apple, have a tight grip on the software that’s controlling the devices that are always by our side. It’s no wonder then, that those are the most valuable companies from the Big 5 (Apple, Google, Amazon, Microsoft and Facebook).
This is why people tend to have the highest expectations from them, after all, with pockets as deep as theirs, how can anything be less than perfect. Yet, things don’t always go the best way possible neither for Google nor for Apple. But why is that?
The limitation of human resources
The term “human resources” sounds a bit sterile, as if humans are just another ingredient to put into the machine that’s making your product. And for some companies, that’s not far from the truth. If the work doesn’t require high-skilled workers, companies keep wages low and the high turnover rate doesn’t concern them, because they can replace each worker at a moment’s notice.
In the world of Silicon Valley, the reality is very different. The distribution of software is cheap and relatively effortless, no grunt work needed, so all the weight falls down on those that are creating it. And, well, that’s not exactly an easy task when the experience of billions of users is at stake.
The likes of Apple and Google need only the best of the best in every department, from coding to marketing to management. And as any bell curve will tell you, there is only a small amount of people at the top end of any field. This severely limits the pool of suitable candidates.
Of course, this is where money comes handy! However, no matter how high the salaries you offer are, you can’t just conjure the specialists you need out of thin air. In games, if you have the cheat code for infinite money, you can do anything, but in real life, money itself doesn’t do anything. It all boils down to the people and their ability to convert cold hard cash into something that will ultimately bring even more of it.
Which is why companies often “steal” each other’s employees by offering them not only higher salaries but better benefits or higher positions.
This has a double effect, the “poacher” not only boosts his own production, but its competitor takes a hit as well. It’s not uncommon for valuable employees to be “protected” by a non-compete agreement, which usually comes with a hefty compensation if broken. That compensation can, of course, be paid by the other company, if it deems the “catch” valuable enough.
To counter the talent problem, companies often create their own academies to train people for the positions they need. Obviously, this takes a lot more time than hiring someone who’s ready for the job and putting him/her immediately to work. This is why human resources are often the bottleneck for software product development.
Furthermore, developing a software product is like raising a child. If you’ve been with it since the beginning, you know all its quirks, strengths and weaknesses and what it means when something goes wrong. In some extreme cases, the code can be so deeply tied to a specific person that losing them can render it unusable. You can’t afford to juggle developers unless you want the end result to be a hot mess, which is something we’ve seen plenty of times.
Even if you have all the people you need, however, that doesn’t mean you’re set for success.
The curse of having too much choice
Having a lot of money can be a blessing and a curse, and we don’t refer to the increased death rate of lottery winners. In the world of IT too much disposable income can also lead to bad decisions.
Google’s vast financial resources, for example, are a double-edged sword. The company can afford to pour money and dedicate developers into pretty much any idea that seems good, even if it's aware that not all of them will become actual products. Google is often throwing ideas in the wild to see which will catch on. The company is notorious for releasing half-baked products, then barely supporting them and eventually dumping them onto the ever-increasing pile of abandoned projects. This is true not only for software products but hardware ones as well. There’s so many of them that there’s a website dedicated to keeping track of them: KilledByGoogle
To be fair, projects are often merged, renamed or broken down into pieces that become parts of other products (which might get the same treatment later), so it’s not like Google is just throwing people’s hard work away.
The temptation to give everything a try seems to be irresistible for Google’s executives. This practice has shaken confidence in Google’s releases to a point that even very serious endeavors like the game-streaming platform Stadia are seen by people as the next potential entree to Google’s graveyard.
Despite having even more cash laying around, Apple appears to have a much narrower focus on what it wants to make and has mostly been able to avoid product cancellations. The infamous AirPower wireless charging mat that was axed recently was one of the few cancellations we’ve seen from Apple. And when it comes to failed products, we should give a shout-out to the Pippin gaming console of the olden days when Apple was far from being the corporation it is today.
However, there’s a big difference between canceling a product during development and doing it after people have gotten accustomed to it and have been using it for a while (I’m looking at you, Google Inbox). Apple hasn’t been free from criticism, though, users and reviewers alike have been vocal about some of its nonsensical money-saving practices like putting slow chargers in the boxes of its iPhones. And while that’s a conscious decision that can easily be changed, there’s another aspect that we must consider…
Having money doesn’t mean you can spend it however you want
While tech giants seem almighty to us, they too have someone they fear and bow to: shareholders. The billions and trillions we mention when talking about how much a company is worth are often just stock market evaluations. And one of the biggest factors on the market is how profitable a company is.
So while Apple can absolutely afford not only to put fast chargers in iPhone boxes but wireless chargers as well, at the end of the quarter/year it will have to explain to its investors why they made less money. And that’s a conversation no CEO wants to have, as Tim Cook can probably confirm after having to justify Apple's unexpected results a few months ago. This constant oversight often prevents companies from investing in unproven product concepts or take on some “wild” new endeavor.
Of course, companies still need to innovate if they want to keep an edge over the competition. This is where they sometimes face another obstacle that can’t be overcome by throwing money at it.
Sometimes the technology just isn’t there yet
In nature, everything follows a predetermined progression, plants grow from seeds, birds are hatched from eggs and so on. The same goes for technology. You can’t have a wireless phone before a wired one, or a quad-core processor before a dual-core one. There’s no skipping steps.
If Apple goes to its chip manufacturer with a 100 billion dollars in cash and demands a 3nm CPU for its next iPhone, it will be sent back to California with a reminder to come back in a few years. Sure, the amount of money invested in certain technology does influence how fast it will develop, but as the saying goes, one person can dig a well in a 100 days, but a 100 people can’t dig a well in a day. You can give a plant soil with more nutrients and the best conditions, but you can’t force it to grow faster. Similarly, in tech, there’s only so much you can do to expedite things and we’re pretty much at the limit already.
And while for us as consumers it might be frustrating that technology isn’t moving faster, it’s the hard work that’s left behind the scenes that has made us so used to the amazing advancements we saw in a relatively short span of time. It’s easy to forget how far we’ve come in the last couple of decades and start getting technology for granted.
These are just a few of the reasons why big tech companies can’t just churn out one awesome product after another despite having billions in the bank. There’s always room for improvement, of course, but we should remember that while the scale is different, companies like Google and Apple also face limitations that are beyond their control. Having a little more patience and understanding is something we all can benefit from.