Second Place in Tech Is Usually the Profit Winner (opens in new tab)

Market dominance looks great on a PowerPoint slide. It tends to look worse on an income statement. The conventional story about tech winners — that the company with the most market share captures all the value — gets the economics exactly backwards in many of the most important markets. The runner-up position, the one that looks like a consolation prize, is frequently where the real money lives. This is not an accident. It is a structural feature of how competitive tech markets work, and unde...