The U.S. Can't Manufacture the Kindle
blogs.harvardbusiness.org
The U.S. Can't Manufacture the Kindle
1–10 of 18 posts
Re: The U.S. Can't Manufacture the Kindle
#2The article is actually fairly careful to note the difference between manufacturing (high value) and assembly (low value). This distinction is usually missed when discussing trade.
Re: The U.S. Can't Manufacture the Kindle
#3[deleted]
Re: The U.S. Can't Manufacture the Kindle
#4Ever since before Adam Smith, this model of countries not being able to produce everything that they require, but instead, focusing on a few things, and trading for the rest, has been accepted as a more efficient system, where everybody benefits from the savings these efficiencies allow.
I think this model works extremely well ... until it doesn't. Until some event keeps trade from occurring, whether that event is a currency collapse, a drought, or, more often, a war.
I don't know what the right answer is. We seem to be muddling along fine, however, with the system as it is, but there's always a specter of catastrophe hanging over our heads.
Re: The U.S. Can't Manufacture the Kindle
#5Ever since before Adam Smith, this model of countries not being able to produce everything that they require, but instead, focusing on a few things, and trading for the rest, has been accepted as a more efficient system, where everybody benefits from the savings these efficiencies allow. I think this model works extremely well ... until it doesn't. Until some event keeps trade from occurring, whether that event is a…
Yes, "comparative advantage" this is called. Everyone should try to do the highest-margin thing they can, even if they are capable of doing lower-margin things more efficiently than their competitors. The article is worrying about downstream effects, i.e. that by giving up a low-margin business in the present, you cut yourself off from future high-margin businesses.
Re: The U.S. Can't Manufacture the Kindle
#6This author leaves out that the Kindle could be a loss leader for Seattle based Amazon to sell a shit load more book downloads that cost them just a sliver of bandwidth.
Plus, Amazon is getting a foot hold in a new industry they have created from thin air.
Further, do you think the foreign E-ink disdlay maker is the only game in town? A lot can change in a few years.
Re: The U.S. Can't Manufacture the Kindle
#7This author leaves out that the Kindle could be a loss leader for Seattle based Amazon to sell a shit load more book downloads that cost them just a sliver of bandwidth. Plus, Amazon is getting a foot hold in a new industry they have created from thin air. Further, do you think the foreign E-ink disdlay maker is the only game in town? A lot can change in a few years.
Actually, he didn't leave that out.
> Of the total cost of $185, perhaps $40 to $50 is captured in the U.S. Is that a problem? After all, Amazon seems well-positioned to capture most of the value of the Kindle (the difference between the product's wholesale cost and retail price) and a healthy portion of the profits generated by sales of e-books to Kindle owners. In addition, the Kindle's wireless data service, which uses Sprint's data network, resides in the U.S.
> So why does it matter if the Kindle can't be manufactured in the U.S.?
And then he goes on to answer that question.
Re: The U.S. Can't Manufacture the Kindle
#8Ever since before Adam Smith, this model of countries not being able to produce everything that they require, but instead, focusing on a few things, and trading for the rest, has been accepted as a more efficient system, where everybody benefits from the savings these efficiencies allow. I think this model works extremely well ... until it doesn't. Until some event keeps trade from occurring, whether that event is a…
I accidently hit the down arrow when I meant to upvote you and now it's vanished - sorry. Absolutely right about the efficiency of specialization.
Re: The U.S. Can't Manufacture the Kindle
#9Ever since before Adam Smith, this model of countries not being able to produce everything that they require, but instead, focusing on a few things, and trading for the rest, has been accepted as a more efficient system, where everybody benefits from the savings these efficiencies allow. I think this model works extremely well ... until it doesn't. Until some event keeps trade from occurring, whether that event is a…
Yes, "comparative advantage" this is called. Everyone should try to do the highest-margin thing they can, even if they are capable of doing lower-margin things more efficiently than their competitors. The article is worrying about downstream effects, i.e. that by giving up a low-margin business in the present, you cut yourself off from future high-margin businesses.
Errr, I'll give you 50% credit for pulling out the catch phrase "comparative advantage" which indeed is used to weakly describe the concepts Mr. Smith was outlining.
As for the article itself, as it is from harvard business school, the author may indeed be concerned about margins. I'm more interested in the inherent dangers of a system that makes you extremely vulnerable in bad times, and how to balance that against the obvious advantages, in good times, of that system.
Re: The U.S. Can't Manufacture the Kindle
#10[deleted]
For the former question (percentage of revenue that comes from the US vs Internationall) you can usually find out from a companies financial filings. That said, that doesn't really say if the company is bringing foreign profits into the US. There is often significant financial disincentives in moving money into the US from , say, Dublin.
As to the open source helping/not maintaining, I would say that with a few exceptions, it doesn't matter. It helps bring revenue in for us based companies that best take advantage of the code, but at the same time, it helps level the playing field for other people/countries/companies entering the space, which might endanger entrenched interests.
This is a bigger question than HN is good for. I've thought of writing it up in a blog post, but I suspect most people would find it hugely boring. For instance, does the release of the ChromeOS source code enhance or detract from Google's (my employers) revenue.
If ChromeOS is successful it will help bind people closer to google, which is ostensibly good for us.
But...If we lose technological leadership in the project, does it matter? It will mean someone else has advanced the project and likely as not , brought more people onto the internet, where through our advertising skills we thrive.
Also, I don't think that you could call seach a commodity while there is qualitative differences between the different engines. But that's a much longer post...