On the top 30 list among this year's Fortune Global 500, no high-tech companies show up except for Samsung, Apple and Hon Hai. It illustrates how the mobile business is determing the winners and the losers among the world's largest corporations.
Widen the search among top 40, HP shows up at No. 43, but this is a company with the negative revenue of $14.3 million.
In contrast, top five automotive companies are all there within the top 30 list.
I don't think that high tech is very profitable. That's why high tech is so accessible to everyone. The profit margins are in general thin.
Apple, naturally, has been pushing the fashion statement angle of high tech, so it straddles the line between, you know, high tech and Gucci. If Samsung shows up high in the rankings, it would also be for its hand-held gadgets and not its other high tech offerings.
True @Bert22306. But if you take a long look at the top 100 list for example, you realize that Fortune 500 truly represents "the world's big businesses" -- mostly consisting of oil companies, banks, insurance companies, electricity suppliers and auto manufacturers -- reminescent of big iron days.
No digital companies (Google, Microsoft), no fashion companies, none from film industries made the top 100.
Siemens ($109 billion)got int the 53rd place, and so did Boeing ($81.7 billion) at the 95th place .
Three Japanese electronics companies snuck in, including Hitachi (No. 54), Panasonic (No. 83;but with a negative $9.1 million profit) and Sony (#95).
It isn't a surprise that auto companies are high on the list, since this is based on revenue. Cars cost tens of thousands of dollars each, phones cost only hundreds of dollars each. More people may buy a new phone every year than a new car, but probably not 100x more that would be required to equalize revenue between the auto industry and cell phone industry.
If I had a killer idea for something that everyone in the world would buy one of every year, somehow it was impossible to clone, and it provided me 90% profit margin with a $10 retail price, my company wouldn't climb very high on the list because of the low revenue. But it would probably become the most valuable company in the world based on the amount of profit it was generating.
There are multiple ways to rank companies - revenue, profit, market cap, brand value, etc. and you'll come out with different industries in the lead depending on which method you use. Revenue just isn't a good one for things with low prices unless you can sell many units to many people (i.e. oil/gasoline)
If you flip the metric around to how broad the base is then the automotive companies look positively anemic. There are a few attempts to start up new car companies these days, but 99.9% of that industry is concentrated in a very few companies. That is a sign of a very mature industry. It has also put in place serious barriers to entry to make sure that new competetitors have a very hard time.
Contrast that to the grab-bag of industries that we label 'tech'. Half the engineers that I know are working their own projects on the side. We do have the problem of a patent industry that is heavily weighted towards the incumbents, but we also have the option of skirting around it as long as we are too small to be worth being chased. The open source community that is providing a lot of the grist for these efforts is still incredibly prolific, boding well for the future of this dynamic ecosystem.
I don't see what difference how "broad the base is" makes. There are actually a lot more auto companies than you probably think, but most are botique firms that create a few hundred supercars are a year, like Fisker, Koenigsegg, Pagani, etc. Trying to start a new car company that sells into a broader market is an insanely expensive proposition due to the startup costs to obtain and tool a new factory, and is therefore very risky. Someone who is already very rich and willing to lose a billion dollars if he fails like Elon Musk is required, because you are going to have a hard time finding investors until you've already spent a ton of money proving you have a chance.
Look at it this way. There are a lot of "tech" companies, especially if you include all the one person companies selling apps or whatever. But certain sectors of tech are far less dynamic than the auto makers. Look at silicon foundries. No one has started up a new one in a long time, and barring some huge change in how we make chips, no one ever will. Instead the market narrows as costs of a new fab go up and up, and many believe we'll be down to as few as 4 or 5 left standing to compete in leading edge processes by 2020.
You can argue I'm making my point using only a small sector of the entire tech industry, but automakers like GM and Toyota are only a small sector of the entire auto industry, which would also include parts makers, auto dealers, repair shops, and speciality stores like AutoZone. When you measure by revenue, none of those have a chance to make the list simply because that part of the auto industry is so diverse. If a handful of companies owned all the dealers in the country, they'd be way up on this list (selling at retail gives you even more revenue than the auto makers who sell at wholesale) If one company had a near monopoly on auto parts and repairs in the way Intel does for PC CPUs, it would be way up on the list. Instead we have countless thousands of small businesses fixing cars and selling parts. Intel wouldn't make the list if it was a slightly bigger fish in a pond teeming with fish in the way say Midas is in the auto repair field.
I agree Doug...ranking by revenue is not that useful and fairly predictable, we all could had guessed who would be among to top 30...so there is little information in the data provided...I would personally prefer to see revenue growth, profits, or some other metric
What are the engineering and design challenges in creating successful IoT devices? These devices are usually small, resource-constrained electronics designed to sense, collect, send, and/or interpret data. Some of the devices need to be smart enough to act upon data in real time, 24/7. Specifically the guests will discuss sensors, security, and lessons from IoT deployments.