[streetcat1]

However, the network effect in tech can be leapfrogged due to the zero marginal cost (as shown in this post). I.e. what network effect do you get from doing ML inference in the cloud?

The case for big tech today is still the economy of scale and not network effects (maybe facebook have those, but it exists only if the interface to facebook does not change).

The big tech players have economy of scale, due to their ability to use automation and offload the risk of managing complexity (I.e. one AWS engineer can manager 1000's of machines with AWS software).

No wonder, that the software that manages the public cloud is still closed source.

However, with Kubernetes operators, there is a way to move those capabilities into any Kubernetes cluser.

[mooted1]

Did you actually read the post?

> The case for big tech today is still the economy of scale and not network effects (maybe facebook have those, but it exists only if the interface to facebook does not change).

This is only true if you believe that the greatest cost of developing software is running hardware. The greatest cost of developing software is developing software. Not only are economies of scale in compute management negligible except at massive scale, the cost of compute has declined dramatically as the companies you've described have made their datacenters available for rent through the cloud. Yet the tech giants persist.

Facebook, Google, Netflix, Amazon all have considerable network effects that you're not considering. For each of these companies, having so many customers provides benefits that accrue without diminishing returns, giving them a firm hold on market share. See https://stratechery.com/2015/aggregation-theory/

Ben is saying that the only way to topple the giants is by working around them and leveraging new computing technologies better than them. He makes the (admittedly speculative) case that this is no longer possible because we can't bring compute any closer to the user than the mobile devices.

> However, with Kubernetes operators, there is a way to move those capabilities into any Kubernetes cluser.

Kubernetes, at the scale of technologies we're discussing, is a minor optimization. Introducing k8s costs more than it helps far until far into a company's infra maturity. Even if most companies deployed k8s in a manner that significantly reduced costs, it's not enough to overcome the massive advantages existing tech companies have accrued. Not to mention all of the big tech companies have internal cluster managers of their own.

[streetcat1]

I don't think that the amount of current customers is any indication of network effects or any other kind of moat.

See: Walmart -> Amazon, Nokia->Apple, MSFT -> Andriod.

I mean, what more of network effect did MSFT had in the 90's. It was dominating both the OS layer AND the app layer (office). And yet, it does not have ANY share in mobile.

Kubernetes is not minor optimization if you think about what it is. Yes, if you see it as mere container orchestration. But it is the first time that a widely deployed, permissionless, open API platform exists.

[mr__y]

>this is no longer possible because we can't bring compute any closer to the user than the mobile devices.

this is based on a very dubious assumption that bringing compute closer is the only path for innovation.

and even that is not true, you could imagine compute being even closer with a direct brain interface (actually you could consider google glasses to be an attempt at bringing compute closer)

[yodon]

Your comment would work equally well without the initial inflammatory "Did you actually read the post?" opening line.