If they just stopped throwing money at research and development of new tech like Alexa they would probably be more profitable.
Could they? If they stopped pouring money into research and development, that would mean that any competitor with superior technology could eventually upend them.
When betting on technology companies in the long term, you're betting on two things: continued growth and the absence of a competitor that disrupts their business model or industry. To avoid the latter, you need research and development to stay competitive.
Re:The Shareholder Value Myth (2013)
by skookumchuck on Sunday July 15, 2018 @03:49AM
(#17534255)
> Could they? That is speculative.
Not really. They could simply stop re-investing in the company, and then that money would become profit.
Re:The Shareholder Value Myth (2013)
by johannes1234321 on Sunday July 15, 2018 @09:20AM
(#17535123)
Short term yes, but long-term they stop growing while competitors come closer
Re:The Shareholder Value Myth (2013)
by skookumchuck on Sunday July 15, 2018 @04:26PM
(#17536883)
Which is exactly why Amazon is not sacrificing the long term for short term profits.
Could they? That is speculative. Nobody knows what would happen if these companies started increasing their profit margins. It definitely would affect consumer behaviour in a negative way; we just don't know how significant the impact would be.
Also, I don't think that the strategy of trying to monopolize the entire world economy under a few central authorities is going to work in the end so in that sense maybe Amazon and Netflix actually do think short term.