[dragonwriter]

> Why couldn’t they just agree to let each other use the other’s tools for free / massive discount for some limited period, or even in perpetuity?

A big point of splitting up is so that (in both directions, to the extent that it applies) cross-unit costs aren't baked into operations. Subsidies like you suggest directly undermine that.

[vl]

Interesting, Google spun off many companies under Alphabet umbrella, but essentially continues to provide base tooling/compute/IT support to them.

[marc__1]

Even if they 'spun off' businesses, they still have transfer pricing schemes among each and every subsidiary of Alphabet. This is just BAU for small and large organizations

[1] https://www.pwc.com/m1/en/blog/intangibles-tax-risks-opportu...

[2] https://prospect.org/economy/decisive-tax-defeat-for-the-mul...

[dragonwriter]

> Interesting, Google spun off many companies under Alphabet umbrella, but essentially continues to provide base tooling/compute/IT support to them.

Those aren't actually spinoffs in the sense of what IBM is doing; "Google" was effectively just renamed "Alphabet", with its core business in a new subunit called "Google". They are all still within the same corporate ownership structure. Its an internal organizational change, not a separation into separately-owned organizations.

[alexdean]

It's not that simple, for example Waymo has external investors alongside Alphabet, https://blog.waymo.com/2020/03/waymo-raises-first-external-i...

[dragonwriter]

Sure, it's a bit more complicated, but the point here is that Waymo remains an Alphabet subsidiary, external investors are investing under that understanding and with full knowledge of Alphabet’s control of Waymo (which is why the blog entry you link to links to the Alphabet 10-Q reporting the external investments and the resulting “noncontrolling interests” in the subsidiary.

A “spin-off” within a common corporate umbrella is a different thing done for different reasons than a corporate divorce kind of spin-off like IBM is doing.

[megablast]

You really need to look up the definition of words.

[AnimalMuppet]

That would be a more useful comment if you pointed out the flaws in the definitions that vl is using.

[vosper]

Sure, but you could do something to ease initial shock?

Like: We'll give you an 80% discount in the first quarter, and the discount goes down by 20% per quarter, eventually you'll either be negotiating your contracts with us like any other potential customer, or you'll have moved off to some other platform.