We talk about how stack monopolization creates all sorts of problems. But we wouldn’t be honest if we didn’t point to an occasion when it worked.
Apple previously used Intel to supply its computing chips. That changed in 2020 when Apple started launching its computers with its own processing chips. The results? Pretty damn good.
This is clearly the exception to the rule. When we look across retail broadly, we struggle to find a situation where a non-core acquisition resulted in a better product experience. In fairness Toast does have some compelling tools around the data they’re curating in house – especially relative to POS competitors that don’t have a bottomless R&D budget – but those tools are still nowhere near as good as third party analogues.
We could look no further than the POS acquisitions made by payments companies. Across the board, not one reseller we’ve spoken with has said that their POS systems have improved since being acquired. We applaud Shift4’s efforts and investments into a great concept of their API Marketplace, but we continually hear it’s not working as intended. And this is somewhat understandable: the legacy POS systems Shift4 acquired are a hodgepodge of crap code.
But at least they did something. Meanwhile, Global Payments has, in essence, abandoned the POS assets they acquired in favor of MobileBytes (reskinned to Heartland Restaurant POS). Too bad, so sad for the merchants on Heartland’s older systems.
Friction might be removed in the sales process, making investors happy, but often the customer does NOT get a better experience
It’s very hard to do everything, and remember that Apple has had many, many failures when building products. Here’s a quick list – see if you can spot a trend:
- Macintosh TV
- Pippin (all-in-one video came console, internet appliance)
- Ping (social network)
- Newton and eMate (PDA)
- HomePod (Amazon Alexa competitor)
- Hi-Fi (home stereo)
- AirPower (wireless charging)
- QuickTake (digital camera)
- FireWire (proprietary USB)
- eWorld (AOL walled garden competitor)
See the trend? They’re all non-core products. Undoubtedly some of the learnings helped Apple shape successful products in the iPhone, iPod, and iPad, but it’s really hard to do a lot of stuff well. You use Google for social media? Facebook for search? It’s hard to rule them all.
The point is not that you shouldn’t experiment and fail, but that if companies the size of Apple can’t build all these non-core products what makes you think a much smaller single provider (like your POS) can do everything well?
They can’t. There are clearly exceptions, as is the case in Apple’s in-house chip development, but they are very much not the rule.
Add comment