Once a company becomes an industry leader, its employees, from top to bottom, start thinking defensively. Suddenly, people feel they have more to lose from challenging the status quo than upending it. As a result, one-time revolutionaries turn into reactionaries. Proof of this about-face comes when senior executives troop off to Washington or Brussels to lobby against changes that would make life easier for the new up and comers.

Years of continuous improvement produce an ultra-efficient business system—one that’s highly optimized, and also highly inflexible. Successful businesses are usually good at doing one thing, and one thing only. Over-specialization kills adaptability—but this is a tough to trap to avoid, since the defenders of the status quo will always argue that eking out another increment of efficiency is a safer bet than striking out in a new direction.

Long-tenured executives develop a deep base of industry experience and find it hard to question cherished beliefs. In successful companies, managers usually have a fine-grained view of “how the industry works,” and tend to discount data that would challenge their assumptions. Over time, mental models become hard-wired—a fact that makes industry stalwarts vulnerable to new rules. This risk is magnified when senior executives dominate internal conversations about future strategy and direction.

With success comes bulk—more employees, more cash and more market power. Trouble is, a resource advantage tends to make executives intellectually lazy—they start believing that success comes from outspending one’s rivals rather than from outthinking them. In practice, superior resources seldom defeat a superior strategy. So when resources start substituting for creativity, it’s time to short the shares.

One quick suggestion: Treat every belief you have about your business as nothing more than a hypothesis, forever open to disconfirmation. Being paranoid is good, becoming skeptical about your own beliefs is better.

in their efforts to provide better products than their competitors and earn higher prices and margins, suppliers often “overshoot” their market: They give customers more than they need or ultimately are willing to pay for. And more importantly, it means that disruptive technologies that may underperform today, relative to what users in the market demand, may be fully performance-competitive in that same market tomorrow. This was the basis for insisting that the iPhone must have a low-price model: surely Apple would soon run out of new technology to justify the prices it charged for high-end iPhones, and consumers would start buying much cheaper Android phones instead! In fact, as I discussed in after January’s earnings results, the company has gone in the other direction: more devices per customer, higher prices per device, and an increased focus on ongoing revenue from those same customers.

Apple seems to have mostly saturated the high end, slowly adding switchers even as existing iPhone users hold on to their phones longer; what is not happening, though, is what disruption predicts: Apple isn’t losing customers to low-cost competitors for having “overshot” and overpriced its phones. It seems my thesis was right: a superior experience can never be too good — or perhaps I didn’t go far enough.

Jeff Bezos has been writing an annual letter to shareholders since 1997, and he attaches that original letter to one he pens every year. It included this section entitled Obsess Over Customers: From the beginning, our focus has been on offering our customers compelling value. We realized that the Web was, and still is, the World Wide Wait. Therefore, we set out to offer customers something they simply could not get any other way, and began serving them with books. We brought them much more selection than was possible in a physical store (our store would now occupy 6 football fields), and presented it in a useful, easy-to-search, and easy-to-browse format in a store open 365 days a year, 24 hours a day. We maintained a dogged focus on improving the shopping experience, and in 1997 substantially enhanced our store. We now offer customers gift certificates, 1-Click shopping, and vastly more reviews, content, browsing options, and recommendation features. We dramatically lowered prices, further increasing customer value. Word of mouth remains the most powerful customer acquisition tool we have, and we are grateful for the trust our customers have placed in us. Repeat purchases and word of mouth have combined to make Amazon.com the market leader in online bookselling.

This year, after highlighting just how much customers love Amazon (answer: a lot), Bezos wrote: One thing I love about customers is that they are divinely discontent. Their expectations are never static — they go up. It’s human nature. We didn’t ascend from our hunter-gatherer days by being satisfied. People have a voracious appetite for a better way, and yesterday’s ‘wow’ quickly becomes today’s ‘ordinary’. I see that cycle of improvement happening at a faster rate than ever before. It may be because customers have such easy access to more information than ever before — in only a few seconds and with a couple taps on their phones, customers can read reviews, compare prices from multiple retailers, see whether something’s in stock, find out how fast it will ship or be available for pick-up, and more. These examples are from retail, but I sense that the same customer empowerment phenomenon is happening broadly across everything we do at Amazon and most other industries as well. You cannot rest on your laurels in this world. Customers won’t have it.

when it comes to Internet-based services, this customer focus does not come at the expense of a focus on infrastructure or distribution or suppliers: while those were the means to customers in the analog world, in the online world controlling the customer relationship gives a company power over its suppliers, the capital to build out infrastructure, and control over distribution. Bezos is not so much choosing to prioritize customers insomuch as he has unlocked the key to controlling value chains in an era of aggregation.

consumer expectations are not static: they are, as Bezos’ memorably states, “divinely discontent”. What is amazing today is table stakes tomorrow, and, perhaps surprisingly, that makes for a tremendous business opportunity: if your company is predicated on delivering the best possible experience for consumers, then your company will never achieve its goal.

In the case of Amazon, that this unattainable and ever-changing objective is embedded in the company’s culture is, in conjunction with the company’s demonstrated ability to spin up new businesses on the profits of established ones, a sort of perpetual motion machine

Owning the customer relationship by means of delivering a superior experience is how these companies became dominant, and, when they fall, it will be because consumers deserted them, either because the companies lost control of the user experience (a danger for Facebook and Google), or because a paradigm shift made new experiences matter more (a danger for Google and Apple).

Quality software from independent makers is like quality food from the farmer’s market. A jar of handmade organic jam is not the same as mass-produced corn syrup-laden jam from the supermarket. Industrial fruit jam is filled with cheap ingredients and shelf stabilizers. Industrial software is filled with privacy-invasive trackers and proprietary formats. Google, Apple, and Microsoft make industrial software. Like industrial jam, industrial software has its benefits — it’s cheap, fairly reliable, widely available, and often gets the job done.

Big tech companies have the ability to make their software cheap by subsidizing costs in a variety of ways:

Google sells highly profitable advertising and makes its apps free, but you are subjected to ads and privacy-invasive tracking. Apple sells highly profitable devices and makes its apps free, but locks you into a proprietary ecosystem. Microsoft sells highly profitable enterprise contracts using a bundling strategy, and makes its apps cheap, also locking you into a proprietary ecosystem.

I’m not saying these companies are evil. But their subsidies create the illusion that all software should be cheap or free.

Independent makers of quality software go out of their way to make apps that are better for you. They take a principled approach to making tools that don’t compromise your privacy, and don’t lock you in. Independent software makers are people you can talk to. Like quality jam from the farmer’s market, you might become friends with the person who made it — they’ll listen to your suggestions and your complaints.

Big tech companies earn hundreds of billions of dollars and employ hundreds of thousands of people. When they make a new app, they can market it to their billions of customers easily. They have unbeatable leverage over the cost of developing and maintaining their apps.

But more than anything, they were able to merge with major competitors and buy out small ones. Google made one good product, search, a quarter of a century ago. That opened conduit to the capital markets that gave Google an effectively limitless budget to buy competitors.So it didn’t matter that everything Google made in-house failed — videos, social media, wifi balloons, smart cities, they couldn’t even keep an RSS Reader alive!Because they were able to buy other peoples’ companies — mobile, ad tech, videos, maps, documents, satellites, server management. Google isn’t Willy Wonka’s magic idea factory, they’re Rich Uncle Pennybags, spending other peoples’ money to buy the products they themselves are too ossified and lumbering to create.

They were able to sell goods below cost, which let the deepest-pocketed companies bankrupt their competitors, and prevent new companies from entering the market. Think of Amazon, which tried to buy diapers.com, got rejected, and then lit $100m on fire selling diapers below cost, until diapers.com went bankrupt.

When Apple reversed Office and built iWork, Microsoft just had to suck it up. In the ensuing decades, Apple — and Microsoft, Facebook, Google and other tech giants — have secured changes to law, regulation and their interpretations that make doing unto them as they did unto others radioactivelyillegal.

Tech companies can twiddle the knobs whenever they want, without explanation or transparency, and we can’t get a law passed to make them stop compulsively touching their knobs, because in the world of five giants websites each filled with screenshots of the other four, they can easily agree that these rules are bad, and they can mobilize their monopoly casino winnings to make sure they never pass.

Step one: consolidated industries eliminate competition through predatory pricing and acquisitions. Step two: tech companies play a high-speed shell-game on the back end, and use their consolidation to bigfoot any attempt to constrain their twiddling (like privacy, labor, or fair trading laws). Now we come to step thre: where tech companies embrace tech laws, laws that make it illegal to twiddle back at them, the IP laws that create felony contempt of business-model, criminalizing the adversarial interoperability, that once acted as garbage collection for enshittified, bloated, top-heavy companies, letting nimble, innovative players drain off their users, eat their lunch and dance on their graves.Put these three factors together — consolidation, unrestricted twiddling for them, a total ban on twiddling for us — and enshittification becomes inevitable.

We don’t want to wait that long for a new good internet, and we don’t have to. Because tech is different: it is universal. It is interoperable, and that means we have options we’ve never had before.Interoperability options: options that devolve control over technology from giant companies to small companies, co-ops, nonprofits, and communities of users themselves.Interop is how we seize the means of computation.

First things first: we need to limit twiddling.Pass comprehensive federal privacy laws with private right of action, meaning that you can sue if your privacy is violated, even if the local public prosecutor doesn’t think you deserve justice.End worker misclassification through the so-called gig economy, meaning that every worker is entitled to minimum wages, a safe workplace, and fair scheduling.Apply normal consumer protection standards to ecommerce platforms and search engines, banning deceptive advertising, fake reviews, and misleading search results that put fake businesses and products ahead of the best matches.

Then we need to open the walled gardens. Laws like the EU’s Digital Markets Act will force tech platforms to stand up APIs that allow new platforms to connect to them. This interop will make switching costs low. So you can leave Facebook or Twitter and go to Mastodon, Diaspora — or Bluesky or some new platform — and still exchange messages with the people you left behind, and participate in the communities that matter to you, and connect with the customers you rely on.

To make mandatory APIs work, we need to make robust interoperability preferable to behind-the-scenes fuckery, we need to align tech giants’ incentives so they encourage competition, rather than sabotaging it.

in addition to the mandatory interop that’s already coming down the pike, we need to restore the right to mod, tinker, reverse and hack these services.

If we have the right to mod existing service to restore busted API functionality, then any company that’s tempted to nerf its API has to consider the possibility that you are going to come along and scrape its site or reverse its apps to make the API work again.That means that the choice for tech giants isn’t “Keep the API and lose my discontented users or nerf the API and screw my competitors.” It’s: “Keep the API and lose my discontented users or, nerf the API and get embroiled in unquantifiable guerilla warfare against engineers who have the attackers’ advantage, meaning I have to be perfect, and they only have to find and exploit a single error I make.”

Governments should require that every tech company that sells them a product or service has to promise not to interfere with interop.That’s just prudent public administration. Lincoln insisted that every rifle-supplier for the Union army used interoperable tooling and ammo. Of course he did! “Sorry boys, war’s cancelled, our sole supplier decided not to make any more bullets.”

Every digital system procured by every level of government should come with a binding covenant not to impede interop — from the cars in government motor-pools to Google Classroom in public schools to iPhones in public agencies.

Your shareholders’ priorities are your problem. Public agencies are charged with doing the people’s business.

It’s frankly surreal that the way we keep Facebook’s partners from abusing your info is by asking Facebook to decide what is and isn’t acceptable.Remember: Cambridge Analytica was a Facebook partner. So whether you’re using an API or you’re fielding an interoperable app that relies on scraping and reversing, you will be bound by those same laws, passed by democratically accountable lawmakers in public proceedings, not by shareholder accountable corporate executives in closed-door meetings.

They’re just able to buy their way to dominance, merging with competitors, until they have the money and the unity of purpose to capture our laws, to give them the freedom to abuse us without limit, and to criminalize anything we do to defend ourselves.To stop them we need to block new merger, and unwind existing ones, limit their ability to twiddle the back end to keep their users and business customers in a constant state of confusion, and restore our ability to twiddle back, to give ourselves an internet operated by and for the people who use it: the new, good internet that is the worthy successor to the old, good internet.

Remember when tech workers dreamed of working for a big company for a few years, before striking out on their own to start their own company that would knock that tech giant over?Then that dream shrank to: work for a giant for a few years, quit, do a fake startup, get acqui-hired by your old employer, as a complicated way of getting a bonus and a promotion.Then the dream shrank further: work for a tech giant for your whole life, get free kombucha and massages on Wednesdays.And now, the dream is over. All that’s left is: work for a tech giant until they fire your ass, like those 12,000 Googlers who got fired six months after a stock buyback that would have paid their salaries for the next 27 years.

“Some day, there will be a crisis, and when crisis comes, ideas that are lying around can move from the fringe to the center in an instant.”

For Google Search to increase its profits, it must shift value from web publishers, advertisers and/or users to itself. The only way for Google Search to grow is to make itself worse.

Google’s product managers are each charged with finding ways to increase the profitability of their little corner of the googleverse. That increased profitability can only come from enshittification. Every product manager on Google Search spends their workdays figuring out how to remove a Jenga block. What’s worse, these princelings compete with one another. Their individual progression through the upper echelons of Google’s aristocracy depends as much on others failing as it does on their success. The org chart only has so many VP, SVP and EVP boxes on it, and each layer is much smaller than the previous one. If you’re a VP, every one of your colleagues who makes it to SVP takes a spot that you can no longer get. Those spots are wildly lucrative. Each tier of the hierarchy is worth an order of magnitude more than the tier beneath it. The stakes are so high that they are barely comprehensible. That means that every one of these Jenga-block-pulling execs is playing blind: they don’t — and can’t — coordinate on the ways they’re planning to lower quality in order to improve profits. The exec who decided to save money by reducing the stringency of phone number checking for business accounts didn’t announce this in a company-wide memo. When you’re eating your seed-corn, it’s imperative that you do so behind closed doors, and tell no one what you’ve done. Like any sleight-of-hand artist, you want the audience to see the outcome of the trick (the cost savings), not how it’s done (exposing every searcher in the world to fraud risk to save a buck).

Google/Apple’s mobile duopoly is more cozy than competitive. Google pays Apple $15–20 billion, every single year, to be the default search in Safari and iOS. If Google and Apple were competing over mobile, you’d expect that one of them would drop the sky-high 30 percent rake they charge on in-app payments, but that would mess up their mutual good thing. Instead, these “competitors” charge exactly the same price for a service with minimal operating costs.

your bank, your insurer, your beer company, the companies that make your eyeglasses and your athletic shoes — they’ve all run out of lands to conquer, but instead of weeping, they’re taking it out on you, with worse products that cost more.

There is little precedent for a civilian’s becoming the arbiter of a war between nations in such a granular way, or for the degree of dependency that the U.S. now has on Musk in a variety of fields, from the future of energy and transportation to the exploration of space. SpaceX is currently the sole means by which NASA transports crew from U.S. soil into space, a situation that will persist for at least another year. The government’s plan to move the auto industry toward electric cars requires increasing access to charging stations along America’s highways. But this rests on the actions of another Musk enterprise, Tesla. The automaker has seeded so much of the country with its proprietary charging stations that the Biden Administration relaxed an early push for a universal charging standard disliked by Musk. His stations are eligible for billions of dollars in subsidies, so long as Tesla makes them compatible with the other charging standard.

In the past twenty years, against a backdrop of crumbling infrastructure and declining trust in institutions, Musk has sought out business opportunities in crucial areas where, after decades of privatization, the state has receded. The government is now reliant on him, but struggles to respond to his risk-taking, brinkmanship, and caprice

Current and former officials from NASA, the Department of Defense, the Department of Transportation, the Federal Aviation Administration, and the Occupational Safety and Health Administration told me that Musk’s influence had become inescapable in their work, and several of them said that they now treat him like a sort of unelected official

Sam Altman, the C.E.O. of OpenAI, with whom Musk has both worked and sparred, told me, “Elon desperately wants the world to be saved. But only if he can be the one to save it.

later. “He had grown up in the male-dominated culture of South Africa,” Justine wrote. “The will to compete and dominate that made him so successful in business did not magically shut off when he came home.”

There are competitors in the field, including Jeff Bezos’s Blue Origin and Richard Branson’s Virgin Galactic, but none yet rival SpaceX. The new space race has the potential to shape the global balance of power. Satellites enable the navigation of drones and missiles and generate imagery used for intelligence, and they are mostly under the control of private companies.

A number of officials suggested to me that, despite the tensions related to the company, it has made government bureaucracies nimbler. “When SpaceX and NASA work together, we work closer to optimal speed,” Kenneth Bowersox, NASA’s associate administrator for space operations, told me. Still, some figures in the aerospace world, even ones who think that Musk’s rockets are basically safe, fear that concentrating so much power in private companies, with so few restraints, invites tragedy.

Tesla for a time included in its vehicles the ability to replace the humming noises that electric cars must emit—since their engines make little sound—with goat bleats, farting, or a sound of the owner’s choice. “We’re, like, ‘No, that’s not compliant with the regulations, don’t be stupid,’ ” Cliff told me. Tesla argued with regulators for more than a year, according to an N.H.T.S.A. safety report

Musk’s personal wealth dwarfs the entire budget of OSHA, which is tasked with monitoring the conditions in his workplaces. “You add on the fact that he considers himself to be a master of the universe and these rules just don’t apply to people like him,” Jordan Barab, a former Deputy Assistant Secretary of Labor at OSHA, told me. “There’s a lot of underreporting in industry in general. And Elon Musk kind of seems to raise that to an art form.”

Some people who know Musk well still struggle to make sense of his political shift. “There was nothing political about him ever,” a close associate told me. “I’ve been around him for a long time, and had lots of deep conversations with the man, at all hours of the day—never heard a fucking word about this.”

the cuts that Musk had instituted quickly took a toll on the company. Employees had been informed of their termination via brusque, impersonal e-mails—Musk is now being sued for hundreds of millions of dollars by employees who say that they are owed additional severance pay—and the remaining staffers were abruptly ordered to return to work in person. Twitter’s business model was also in question, since Musk had alienated advertisers and invited a flood of fake accounts by reinventing the platform’s verification process

Musk’s trolling has increasingly taken on the vernacular of hard-right social media, in which grooming, pedophilia, and human trafficking are associated with liberalism

It is difficult to say whether Musk’s interest in A.I. is driven by scientific wonder and altruism or by a desire to dominate a new and potentially powerful industry.

Netflix could buy 10 top quality screenplays per year with the cash they’ll spend on that one job.  They must have big plans for AI.There are also a half dozen AI job openings at Disney. And the tech-based streamers (Apple, Amazon) already have made big investments in AI. Sony launched an AI business unit in April 2020—in order to “enhance human imagination and creativity, particularly in the realm of entertainment.”

When Spotify launched on the stock exchange in 2018, it was losing around $30 million per month. Now it’s much larger, and is losing money at the pace of more than $100 million per month.

But the real problem at Spotify isn’t just convincing people to pay more. It runs much deeper. Spotify finds itself in the awkward position of asking people to pay more for a lousy interface that degrades the entire user experience.

Boredom is built into the platform, because they lose money if you get too excited about music—you’re like the person at the all-you-can-eat buffet who goes back for a third helping. They make the most money from indifferent, lukewarm fans, and they created their interface with them in mind. In other words, Spotify’s highest aspiration is to be the Applebee’s of music.

They need to prepare for a possible royalty war against record labels and musicians—yes, that could actually happen—and they do that by creating a zombie world of brain dead listeners who don’t even know what artist they’re hearing. I know that sounds extreme, but spend some time on the platform and draw your own conclusions.