Exclusive to Infobe of The New York Times.
We know that in the fifteen years since the arrival of the iPhone, technology has spread to every corner of our lives. Technology has changed politics, industries, leisure time, culture and interpersonal relationships, for better and for worse.
The march of technology has also been accompanied by this depressing reality: almost none of the technology of the iPhone era has been a resounding success.
I would argue that only one consumer Internet company of the smartphone era has emerged as the undisputed winner in popularity and financial vitality: Meta, with its Facebook and Instagram apps.
(The company was founded in 2004, but I classify it as part of the iPhone era because Facebook was actually around the time smartphones were moving.)
Every other consumer Internet company since the days of the iPhone gets an incomplete rating because of a relatively small number of users, questionable finances, uncertain growth prospects, risk of dying, or all of the above. Even the meta is concerned about not being healthy, as my colleague Mike Isaacs of the New York Times wrote. In addition, meta has contributed to some serious problems in our world.
I know it sounds ridiculous. In the past fifteen years, technology has conquered everything. How is it possible that there are so few technology companies that we can be relatively confident that the Middle Ages will last?
I am going to dedicate the remainder of this paper to presenting my arguments.
First, I’m taking a big leap from my review to exclude Google’s search engine, e-commerce sites like Amazon and Alibaba, and Netflix’s streaming service. They may be the long-term technology winners, but they belong to the first generation of the Internet. I’m not even counting the technology that is used almost exclusively by most businesses. I only see consumer companies that were in their infancy or not yet born when smartphones came into our pockets and whose popularity was fueled by those tiny supercomputers.
In addition to meta, the most popular applications of the last fifteen years have a big caveat.
Billions of people use YouTube, but it’s no big deal relative to its size and influence. YouTube wouldn’t exist today if Google hadn’t bought the video site in 2006, a year before the arrival of the iPhone.
Twitter is impressive, but under-utilized and has been a bad business for a long time. Snapchat is a hotbed of creative ideas online and has been consistently copied by Meta and others. But it may not last and it has not proved to be a capable company. Uber and Spotify are two examples of good technology that is bad business. They don’t make consistent profits, and some astute tech watchers believe those business models simply won’t work.
E-commerce fades come and go. China’s ubiquitous apps like WeChat and Meituan are likely to never go global. As far as TikTok is concerned, we will see if its popularity continues, whether it is able to make money consistently, and if Chinese ownership concerns haunt the app forever.
Will these stars of the iPhone era still be around ten years from now, or will they go the way of Yahoo and MySpace? (For Gen Z readers, Yahoo and MySpace were popular websites long ago.)
This leaves us with the meta. Once again the company is in trouble, but so far it has adapted to the changing online habits of people many times. Also, the company has been very good at making money. So far.
You can’t be a winner without the ability to convert popularity into money and stick to one app as people’s tastes change. Very few companies have been able to do both in the past decade.
How is it possible that we have so much technology and so few winning technology companies?
The nature of innovation can leave many victims in its wake. In the pre-technical days, perhaps only one or a few companies were born. Microsoft and Apple were the big winners since the introduction of computers in the home. Google, Amazon and Netflix were the stars of the first generation of the web. There were many other technologies and technology companies that have been forgotten along the way.
And if we go beyond the technologies that people use, that companies use, there have been more winners in the last 15 years. Cloud computing (short for digital operations performed over the Internet rather than specialized computers owned by individuals or companies) has reshaped Internet services and corporate technology. Cloud computing has also made many technology prosperous companies, including Amazon, Microsoft and Salesforce.
Emerging inventions in artificial intelligence, self-driving cars and technology that further blur the lines between the virtual and real worlds are likely to produce many successful technology companies. But this has not happened in today’s technological reality.
The Internet and smartphones were revolutions that changed the world. And the medium has been more flexible and powerful than any part of it.