Two Prerequisites for a Platform: An Exceptional Core and Genuine Neutrality

Robin: “Every company wants to grow bigger and stronger and become a platform. Like Amazon, they want to make their core functions available externally. But there are two prerequisites. First, your core function must be exceptional and globally unmatched. Second, your platform must be sufficiently neutral. You cannot compete with customers; indeed, you must earn the trust of both customers and competitors. TSMC, for example, is globally unmatched in wafer foundry services and does not compete with customers. Even if Samsung one day catches up with and overtakes TSMC, its customers will still have doubts because it has never given up its own IC design business. TSMC, by contrast, puts customers at ease and earns their trust. Even competitors such as Intel will therefore gradually shift orders to TSMC.” Robin: “Amazon is powerful and growing more powerful, but a concern remains. Every company ultimately faces limits to continued growth. Pursuing that growth may put it into competition with customers and cost it the neutrality of its platform. Once it loses customers’ trust, customers will begin to leave.”