[trysomething]

This conduct is obviously despicable, though certainly not out-of-character for Steve Jobs (all due respect for his talents). However, I generally believe this will resolve (and has been resolving) itself via market mechanisms. The mistaken assumption is that the only competition here is between Apple, Google etc and that it is focused primarily on income.

The market is a lot more subtle than that:

  1. Hackers are not simply mercenaries, esp. the best. 
  2. A decent % of the best are involved in startups, either as  founders or early hires. 
  3. "Acquihires" are a mechanism for the best engineers to get paid more "outside" the system. 
  4. Aside from industry, there is competition from academia etc.

[sounds]

Your points are well thought out, but I'd like to play devil's advocate to get you to expand on them, if I may...

1. Isn't this why large companies target the inexperienced, the recent college grad who is scrambling to make rent, or exploit people who can only live and work in the US if they get that job?

2. Some would say once you're a successful startup founder, you're "one of them" and the incentives become reversed. Do you think hackers who become founders still retain the hacker ethos? Why?

3. Because acquihires aren't fully disclosed, wouldn't the market function more efficiently if the compensation came through more normal means (salary and stock grants)?

4. Do you really feel like an academic path has competitive compensation to industry?

[trysomething]

1. Absolutely, they do target these people, particularly through internships which are essentially recruiting tools. The BigCo advantage is that any decent salary will seem like a lot to people who've never had one before.

However, they are not the only players in the game, particularly recently. Y-Combinator itself started as a recognition of this paradox: while recent grads may be "struggling" to make rent (and in need of income), they are good at struggling (scrappy, risk-tolerant etc) and therefore ideally suited to starting a startup.

That said, I believe this particular lawsuit is more relevant to "proven" talent than students.

2. I think "hackers" will generally retain the "hacker" ethos, which I don't think is particularly tied to how they behave as founders or executives. I don't see "hackers" as any more or less benevolent or idealistic than the general population in the long run. In the short run, however, they are more likely to feel empathy since they were in the same shoes as their early employees more recently. From a more pragmatic standpoint, they realize more acutely that it will take a lot to get the best people to stay and contribute to someone else's dream.

Finally until they are formidable enough to engage in strategic discourse with the likes of Google and Apple, they don't have the ability to attempt such collusion.

3. Perhaps, but not necessarily. Acquihires might be a particularly good tool for talent discovery. There's also the potential threat that acquihires represent (if you treat us (engineers) too badly we'll just leave and you will have to buy us back 10x).

Your argument here is a good one, acquihires may reduce information available to all parties. However, this information asymmetry may work against the acquirer more than the acquired (or vice versa). I don't think there is enough data to confirm either possibility.

4. It depends on what you mean by compensation. In many cases (not all), the work may be more interesting and more importantly you (may) have more freedom in choosing what to work on. I qualify these statements because to get all the way to this utopia you need to get tenure, which is hard.

Regardless, you get to work with the best and most interesting people, which is a form of compensation. Also, plenty of startups come out of academia simply because it's like an extension of student life* (particularly grad students, post-docs and other non-tenured people).

* discussed in #1

[nerfhammer]

> "Acquihires" are a mechanism for the best engineers to get paid more "outside" the system.

Acquihires mainly benefit the managers/founders of the acquihired firm, not per se the "best" engineers