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Impressions of “The Four: The Hidden DNA of Amazon, Apple, Facebook, and Google,” by Scott Galloway

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Scott Galloway is a professor of marketing at the New York University Business School. In The Four: The Hidden DNA of Amazon, Apple, Facebook, and Google, he analyzes the success of four major technology firms. He provides a list of their strengths, and near the end a list of competitors. While Galloway is an engaging speaker, the length of this book is artificially expanded by dubious claims and heavy political signaling. He clearly wants to be a pundit and pop intellectual. Ultimately, you are better off listening to his talks than buying this book.

Galloway’s focus is on the importance of luxury brands. Luxury is a high margin business, and (along with finance) luxury businesses are the most valuable business in the world. Certainly, these two facts are related to each other! An important aspect of luxury is controlling the customer experience, through vertical integration of both delivery and story — marketing. The most insightful passages of The Four analyze two of these tech giants as luxury companies, and two as luxury-destroying companies.

Two of the four analyzed companies, Amazon and Apple, focus on controlling the user experience with their brand. Both Apple and Amazon have their own retails stores (Apple Stores and Whole Foods, respectively). This allows the control over inventory and store design, makes it easy to identify high margin products customers are interested in and take those business for themselves (such as Amazon Essentials or Apple dongles), and of course freeze out potential competitors. Interestingly, Galloway mentions in passing he was once on the board for the computer maker Gateway 2000, which had its own line of retail stores since 1996 — two years before Apple announced its own retail line. Of course Apple won and Gateway lost, but as Galloway was a board member of Gateway, some discussion of his personal failure at testing his own theory would have been interesting.

By contrast, Facebook and Google are brand-destroying companies. They have no physical interaction with the customer, and effectively place a barrier between brands and consumers. Even if you “like” a company on Facebook, for instance, you are unlikely to see that company’s posts unless they pay for an advertising campaign on the site. Likewise, while Google at least sells devices (Google Home, Pixel) and provides an operating system or two (Android, Chrome OS) these are not profit centers in themselves but serve to protect their advertising monopoly. Because Galloway sees corporate success through the lens of marketing, this makes him much more cautious about these firms than others.

Galloway provides an extended case study of the failure of the New York Times to adapt to the digital age. He gives the example of the Times as a potential luxury information brand whose value was being diluted first by Google and then by Facebook. Working for an investment firm, he suggested that the Times remove all of its content from all digital platforms except its own and an exclusive digital partner. His goal was either a buy-out of the Times at several times its existing market cap, or the creation of a media conglomerate that could monopolize a small but high-income mix of landing pages on the web. Galloway identifies the failure to do this, caused by the immense benefits Google and Facebook provide in the short term for abandoning the direct link to the customers, as a cause of the New York Times‘ long term decline.

This material would cover at most one-fourth of the books’ length. The rest is an aggravating collection of signaling to specific political factions, including what-in-retrospect seems like the assumption of an activist Democratic president in the White House. Extended and irrelevant asides to the importance of banning end-to-end cryptography, income redistribution, references to the “creative class,” and so on.

Galloway is well worth listening to, even if this book is not worth buying. He has an excellent hour-long interview on the Triangulation podcast that I highly recommend. The Four is not as detailed a corporate history as Console Wars, as good of a biography as King Larry, or as solid a personal advice book as many others. Skip the book — watch his interviews or speeches.

I listened to The Four: The Hidden DNA of Amazon, Apple, Facebook, and Google in the Audible edition.

Bookosphere, Faith

Impressions of “Biblical Games: Game Theory and the Hebrew Bible” by Steven J. Brams

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biblical games steven j brams

Biblical Games is a fun book. Brams has written a basic introduction to game theory, designed to be a text used in a 400/500 level college class on the subject. But it’s also a fun introduction to the literature of the Hebrew Bible, and could be used as such in a theology class at a similar level. Plenty is missing and left out of both, but where else can you get such an unusual double-introduction?

Game theory is a way of mathematically modeling human interactions based on preferences. Game theory breaks down human behavior into a small number of games, such as the Battle of the Sexes game (trigger warning: assumes basic familiarity with human sexes).

Because the Hebrew Bible concerns human struggling in an incomprehensible world, there are plenty examples of these “games.” For example, in discussions the Battle of the Sexes game, Brams describes Samson and Delilah, David and Abigail, and Esther and Ahasuerus. While much is left out (the romantic comedy innuendo of the “golden scepter,” and the sadomasochistic subtext of Samson and Delilah, for instance), Brams treats his subjects seriously, which is far more than is done in most sermons and even much pop biblical criticism. No “dumb semite” theory here.

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Biblical Games twice examines the Binding of Isaac, once presenting a preference schedule that might explains what happened in the Hebrew Bible (that Abraham did not believe his son would truly die), and another that explains an alternative set of actions (if Abraham had refused to bind Isaac).  But that each is equally convincing seems to be a problem.  If human interaction can be “formalized” — put into mathematical terms — so easily, in such contradictory ways, is not the “formalization” simply an obscurantic tautology?

Other biblical themes — such as the “fraught with background” nature of the Hebrew Bible (where much more is hinted at or assumed than is spoken) are hinted at, which makes Biblical Games a good teaser to the Old Testament. Likewise, Brams briefly describes how God almost seems to be a composite character, in some ways fully divine, in some ways a human being, in some ways proceeding from a different source…

My greatest disappointment in Biblical Games is that in discussing God, both the author’s mathematics and theology fail. In the final chapter, where Brams discusses the “theory of moves” (pdf description), he for the first time hints at the terrifying implications of “stopping power.” But otherwise God is presented as just another player, traveling in time at 60 minutes/hour with all the rest.

A time-bound God is problematic because a basic conception of God (explicitly rejected by Brams) is that He is hyper-dimensional, at least present at all possible points in time at once (which would at the very least make Him a four-dimensional being, as opposed to three-dimensional beings traveling along the axis of a fourth dimension). This would have been a neat way to introduce hyperspatial geometry, the idea that a higher-dimensional object can be “unfolded” or “shadowed” into lower-dimensional space. The shadow of the tesseract, or four-dimensional cube, can be drawn in this manner…

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While the shadow of an unfolded tessaract on two-dimensional space looks like

UnfoldedCube

One imagines a fuller description of God would have lead to an additional, interesting chapter, but such was more forthcoming. For “cursed is he who is hung on a tree” (Deuteronomy 21:23), as was the Son of David (2 Samuel 18:9). But such a chapter must be kept to our imagination.

Biblical Games is a fun book. It’s not the final or most convening word on either game theory or the Hebrew Bible, but its a very readable introduction to both.

Bookosphere, Doctrine, Europe, History

Review of “To Lose a Battle: France 1940,” by Alistair Horne

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To Lose a Battle, by Alistair Horne (the author of A Savage War of Peace: Algeria 1954-1962) is (1) a logistics-heavy description of the Battle of France, (2) a description of the general incompetence in both the France and German High Commands, (3) a tale of France, a country that was not then and never became a western democracy, and (4) a history of the end of France and Germany as distinct states.

1. The Logistics of War

“It was time that was the vital element which — more than weapons, even perhaps more than morale — France most lacked in 1940.”

Horne’s focus on logistics, timing, supplies, and materiel is refreshing, especially given so much strategy-focused writing by John Boyd and William Lind. I am not in a position to evaluate the completeness of Horne’s account, but his manner of writing certainly has fans:

Some two years later, I encountered at a London publishing party Israel’s leading military analyst and former Chief of Intelligence, Chaim Herzog (He was later to become Israel’s President.) We had met some years previously in Israel, and he had now just published his own account of the 1973 campaign, The War of Atonement. (Weidenfeld, 1975). When I commented on the similarities to the Manstein Plan of 1940, he smiled knowingly and said something to the effect that, only recently, General Sharon had referred to it, acknowledging a certain indebtedness to To Lose a Battle. Herzog kindly signed a copy of his book for me, adding the laconic but meaningful inscription, “In appreciation.”

I’ve never read a clearer account of battle that focused on the vital appointment of having the right materiel at the right location at the right time. Horne deserves major props for this part of the book, as he does for flowing between the political and military dimensions of struggle in his last book.

2. The Incompetence of the High Commands

Poor decisions went up to the part. “During the course of the Second World War,” Horne writes, “Hitler committed half a dozen key blunders that were to lose Germany the war.” Though in fairness, Hitler’s consistent habit was to bluff as much as he can while being prepared to rapidly ceed ground at the first resistance. Even as late as 1939 Horne believes that a French attack on Germany (during the Nazi invasion of Poland) would have reached the Rhine within two weeks.

The French and German general staffs, however, were fixated on the strategy of an orderly defense, and as such both were hesitant to move rapidly or seize the initiative. These “wrong lessons learned” for World War I, however, reach comic levels with the French, who even move troops away from Paris and towards the Maginot Line near the end of the fight.

3. France, an Unstable Democracy

The best insight I have from reading To Lose a Battle and A Savage War of Peace is that France was never a stable western democracy. Attempts to view its behavior as analogous to what the United States or Britain would do in a similar situation are unfounded, because France had a unique set of interests. Specific elements of French political life that made normal politics impossible were

  • A lack of separation between the political and the military
  • A militant left-wing (which was purposefully crippled by Stalin)
  • A revolutionary right-wing (which was sympathetic to military coups against elected governments)

The pattern of both To Lose a Battle and A Savage War of Peace is the old general, brought in from retirement, who oversees the death of the old Republic and faces resistance from an idealistic general

Philippe Petain v. the Third Republic and Charles DeGaulle
but then… DeGaulle v. the Fourth Republic and Roaul Salan

After reading both books, the solution is obvious: France is not a stable democracy.

Reading To Lose a Battle and A Savage War of Peace at first is strange, because the country appears to be a nightmarish version of the United States, but the U.S. is a democracy that has not had a new constitution since the the 18th century. France, by contrast, was never stable. Thus Petain, and DeGaulle, operated out the same frame: no stable government existed absent a strong leader, so a constitutional dictatorship was (for the time being) the only natural form of government for France.

The difference between Petain and DeGaulle was not between traitor and patriot (by our standards, they were surely both). Indeed, both recognized the unstable nature of French democracy, and sought to meld the French polity into Germany. Likewise, both (like Mao Zedong, Chiang Kaishek, and Wang Jingwei) differentiated between ‘diseases of the limbs’ and ‘diseases of the hearts’ — during their heights…

DeGaulle, unlike Petain, was an optimist as DeGaulle, unlike Petain, did not live with the guilt of overseeing a massacre. While other French commanders fled he attacked the Germans, achieving some pointless victories that did nothing to stop the German war machine. Thus, DeGaulle was willing to wait for a better time to commit his ethnic cleansing campaign and tie his country’s fate to Germany. Petain simply wanted to end the destruction of his country.

4. The End of France and Germany

The hosts of heaven allowed the sons of man to form two nations, France and Germany, in June 840. The mandate was revoked in June, 1940.

Before France and Germany western Europe was controlled by a transnational aristocracy. After June, 1940, such a world returned.

The end of the book has a “where are they now” section. There seemed to be no correlation between the side of a leader and how his future career unfolded. Both German and French generals suffered under Hitler. Both German and French generals were executed post-war. Both German and French generals would enjoy a sunny career in NATO. June 1940 appeared to be the last month where the fates of Germany and France were, truly, antagonistic.

For centuries it was impossible imagine a world without these two countries. Now, it is impossible to imagine one with them. Considering the inability of either France or Germany to establish stable national democracies, the accomplishments of the European Union are astounding.

To Lose a Battle is a brilliant history of one of the first fights of the Second World War. Highly recommended!

Bookosphere, Chet Richards, Doctrine

Review Center for Chet Richards’ "Neither Shall the Sword"

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My review of Chet Richards’ Neither Shall the Sword in three words? Buy this book.

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I expect a number of posts to come out of Neither Shall the Sword, and this page will serve as an guide to them. While I won’t give away the surprise ending on page 82, the most radical proposal in the book is for what Mark Safranski has called “free companies,” or in Dr. Richard’s words

An obvious solution for a grand strategy of rollback, and I believe the correct one, is to private the Sword/Leviathan function and put direct government resources into the more complex Sys Admin mission of construction, once Sword/Leviathan has done its job

Once again: buy this book.