[ItsMonkk]

Everyone knows in a perfectly efficient market profits naturally go to 0. Recently I worked out that platforms - for example iOS and Android apps - where developers and users form a two-way market where the network effect dominates, naturally causes for the few platform owners to form a cartel with no need to compete. New platform owners can't enter into the market as they need both developers and users to take a chance, so the duopoly is stable. So you can't get to a perfectly efficient market in such an environment.

I hadn't realized until this thread that this is actually everywhere. Our supply chains are nothing more than nested Matryoshka dolls of tightly bound interfaces. The cartel formed by these platforms are the most profitable way to be in business. Everyone is seeking to become a platform that others expend energy building on top of.

Now that these interfaces are tightly bound, Metcalfe's law and it's associated n^2 communication costs mean that one participant can't make a change unless someone down the line changes. And they can't change unless someone else changes. It's the exact same problem as refactoring a big ball of mud.