, these constraints are something of a novelty. Its bosses had better get used to them.
One limit is geography, often forgotten in a world of seamless global supply chains and largely borderless cyberspace. In so far as the tech giants peddle physical bits and bobs rather than digital bytes, they are sharing in the pain of supply disruptions. In April, Apple warned that its revenues would be $4bn-8bn lower than expected in the second quarter, chiefly because of supply-chain snags in China, where factories are locked down with unnerving severity every time a case of covid turns up.
Another limit has to do with talent. Tech firms are not used to scrabbling around for the best programmers. However, having dislodged banks and consultancies as graduates’ dream employers, big tech is finding it hard to recruit. One reason is the sheer size of’s collective workforce, which has grown nearly seven-fold in the past ten years, to 2.2m. The bigger the payroll the harder it is to replenish, let alone expand.
Be it online ads or shopping, the cloud or smartphones, tech markets are more mature—and mature markets grow more slowly, especially when regulators are no longer ignoring them. In many areas incumbents’ fat margins are being competed down. Amazon, for example, is investing heavily in its advertising business, Alphabet’s forte; Alphabet, meanwhile, is spending billions to get a foothold in the cloud, which is Amazon’s.The giants of tech may yet rediscover their reality-distorting magic.
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