I'm less worried about moats (although we should be wary of anticompetitive moats) and more worried about an ecosystem where the already successful companies monopolize access to innovations.
Forget competitors, you can't buy the touch ID tech to create things like door locks. Big companies locking up access to markets means big companies are the sole arbiters of what even gets sold.
> Forget competitors, you can't buy the touch ID tech to create things like door locks.
Doesn’t that mean there is a business opportunity for someone to make touch technology for door locks? Apple isn’t the only company that uses touch sensors.
Maybe. The two biggest consumers (apple and google) of touch id like components won't buy from someone else. So the opportunity is quite small. And it's too expensive for a small company that might just want to build a consumer door lock.
Apple also acquired patents when they bought AuthenTec. So it might be tough even with unlimited money.
Consolidation problems are never an outright ban like a law would be. But raising the cost of entry is just as effective.
> So the opportunity is quite small. And it's too expensive for a small company that might just want to build a consumer door lock.
That just indicates that the value of a modular component isn’t high enough to make it worth building for now.
Touch ID is not a modular component. It’s part of a system and it’s not designed to be used in door locks. It took a huge amount of R&D overall which was worth it to build into hundreds of millions of dollars worth of phones. Touch ID isn’t just a sensor.
It isn’t a technology that can be used in a door lock.
At some point it will be cost effective for a door lock component to be built, but there is little connection between this and touch id.
> That just indicates that the value of a modular component isn’t high enough to make it worth building for now.
This is the dilemma. The value is low _now_ because Apple bought the vendor, rather than purchasing from a vendor. In a healthy marketplace, Apple's scale would fund development of technology that other people could buy and run with. Instead, the market "developed" touch ID and Apple got to keep everyone else from using it for the low, low price of $365mm.
That’s completely wrong. Touch ID is not a sensor. Touch ID is an integrated system that was developed by Apple for phones.
Touch ID doesn’t do anything for door locks. It’s the fact that it’s a tailored for their phones that makes it work better.
The market didn’t develop Touch ID. Apple did.
Fingerprint sensors are widely available in the marketplace and they are better than what was available when Apple bought a sensor company.
In a healthy market, someone else would look at what Apple did, and work out how to apply any relevant concepts to use outside of phones.
This is work that hasn’t been done yet, and is open for someone to do. It’s normal for a general solution to follow a specific one. The idea that Apple should have developed a door lock solution makes no sense.
Authentec didn’t make Touch ID, and wouldn’t have been able to make it as a standalone company and Touch ID isn’t a general solution that others can use.
That means there is still room for someone else to do what Authentec was doing.
Forget competitors, you can't buy the touch ID tech to create things like door locks. Big companies locking up access to markets means big companies are the sole arbiters of what even gets sold.