Ben Thompson – Platforms, Ecosystems, and Aggregators

**Patrick O'Shaughnessy** (0:04)
Hello and welcome everyone. I'm Patrick O'Shaughnessy and this is Invest Like the Best. This show is an open-ended exploration of markets, ideas, methods, stories, and of strategies that will help you better invest both your time and your money. You can learn more and stay up to date at investorfieldguide.com.

**SPEAKER_1** (0:24)
Patrick O'Shaughnessy is the CEO of O'Shaughnessy Asset Management. All opinions expressed by Patrick and podcast guests are solely their own opinions and do not reflect the opinion of O'Shaughnessy Asset Management. This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions.
Clients of O'Shaughnessy Asset Management may maintain positions in the securities discussed in this podcast.

**Patrick O'Shaughnessy** (0:51)
Ben is the author of my favorite business strategy newsletter called Stratechery. He's also the host of the Exponent Podcast and now The Dithering, a new podcast he recently launched with John Gruber.
I think Ben is among the most interesting business analysts in the world, and I've learned from and directly applied many of his ideas.
We cover many of the major concepts he's introduced over the years, including his well-known aggregation theory. I think that to understand how the internet has changed the business world for good, you must read Ben and follow his thinking. I'm excited to finally have him as a guest on the show. Please enjoy our conversation. I thought a fun place to start would be with a recent post that you called the end of the beginning. We're going to back way up after we talk about this concept to talk about aggregators and platforms and ecosystems and all these cool things you've written about, but I'd love to start at the end there. Tell us a little bit about what you were thinking through in that post and why it might be important for these big incumbent technology companies.

**Ben Thompson** (1:48)
Well, first off, thanks for having me on, even though I'm not your typical investor.
Good to be here. I've been a big fan of the podcast.
So that post, it's interesting because there's an aspect to the post where it's kind of obvious, but also it's sort of very heretical in some corners of Silicon Valley in particular. So the idea there is that maybe tech isn't so special after all, meaning that tech likes to think about itself, oh, we're sort of constantly disrupting ourselves. And it's like back in the day, IBM was powerful and then Microsoft came along. And then Microsoft was powerful and then Google came along.
And then Google was powerful and then Facebook came along, et cetera, et cetera. And Apple came on, et cetera, et cetera. And the idea being that there's always a sort of new power around the corner and the position of the largest companies is very fragile, even though they look totally dominant today. In the future, they're gonna be disrupted. Disruption certainly fits very much into this sort of framework. But the question that I have is it sort of looks at technology as the sort of discrete sort of series of events where you went from the main frame to the desktop, for example. And I'm obviously compressing significantly. There is many computers and a whole host of things sort of in the middle there. But then you went from desktop to mobile, and you went from the desktop to the internet. And all these are sort of presented as discrete events. It's like we're in one era and then that era goes on. And then suddenly the era is disrupted by sort of a new era.
You can actually look back and all these eras from another point of view are actually all on one continuum where you sort of have two dynamics going on.
And so on one side you have the shift of how you interact with computing, going from being a sort of batch process with that sort of destination oriented, where you literally had to go into the compute room and you went into the compute room with your stack of punch cards, wherever it might be, and you went in and you ran your job. And then you came out and then you had your job finished and you went back and you checked it. And then you made a new job and you went in and did it. And then you shifted to sort of being on your desktop. It was like, wow, the personal computer, because you have your own computer. You have to go to the company batch center or whatever it might be.
And you could sit there and you could do job mobile while your phone's with you. And people have talked about it. The phone is actually the personal computer. Like we wasted a perfectly good name for the phone on the desktop computer. But you think about it, we said personal computer because it was my computer, but it was still a destination device. You had to go to your desk to use it.