innerscorecard

I think the big threat to Google is the declining importance of web search generally. There will be new methods of discovery that don't necessarily go through Google. The big issue of course is mobile and apps. But even on the desktop, look at what Apple is doing with search in Yosemite.

I think other examples of strong moats in the technology space are those enjoyed by Baidu, Alibaba and Tencent. The government keeps out competition for foreign enterprises, although it somewhat encourages competition between these three and the other, sub-scale players domestically. It doesn't matter if their services are inferior to Google's, Amazon's, or Facebook's (sometimes the services are better and sometimes they are worse). The competition is simply locked out by the Great Firewall and other regulatory barriers. These companies are also free to be fast-followers of foreign innovation without having to actually compete against that innovation. It's quite a good position to be in.

I think it goes beyond the brand into the organization of Apple itself. We've seen in real-time how hard it is to build the whole stack of hardware, software and services that work together. Look at Microsoft's, Facebook's, Amazon's, and Google's failed entry into hardware. And look at Samsung's failed entry into software and services. I don't think it's a coincidence that, as Tim Cook says, only Apple can do this. It's Apple's unique organization and culture that was the best and most important thing that Steve Jobs created, as Tim Cook said in a recent interview. It's a systematic structure for innovation (innovation is hard to do, whereas mere novelty is quite easy to do). That's Apple's moat. (Whether the above is actually true or not, I believe that's close to Apple's internal narrative as to what its moat is.) With the recent round of hires we'll see how well this structure can take in new kinds of inputs (culture leaders, creative personalities, etc.) and convert them into product innovation.