Gorilla Criteria and Logic
DS, I understand that you are playing Devil's Advocate here to draw out our thinking.
O.K, I will play along.
To reduce confusion in playing the GG, you have to focus on the criteria. Mike has been doing that, and teaching us to do it. There is an acceptable consensus on the board that QCOM is a Gorilla. As the most respected opinion leader on Gorilla analysis, Mike gave his imprimatur to that last year.
If you re-read my post, you will notice (if you have not already noticed) that it is in the form of a deductive argument: If QCOM is a Gorilla, and it has transferred the essential Gorilla properties to SPINCO, then SPINCO is a Gorilla. In more abstract terms the form is: If Q implies G, and if S equals Q, then S is a G.
I believe not only is that argument a valid syllogism but also that QCOM is betting their business on it. IJ intends to transfer enough open proprietary architecture with high switching costs to SPINCO to enable its continuing Gorilla status. QCOM is becoming an intellectual property business. They believe that this can be done, and they cannot afford to make a mistake.
All the rest of this is just confetti. It is heat without light.
Turning to your counter example of Intel. First, I agree with sditto's post that Intel is a Gorilla, including his citing the historical necessity of licensing AMD and Intel's retained control of its architecture. I agree that it adds functions to its mother board that shakes its value chain as it vertically integrates, producing competitive advantage. I believe it continues to pursue a similar strategy in a stealthier fashion in the post-PC era, which I don't have time to describe in this post.
Cross licensing does not give away Know-How.
I hope that this helps. If not, I suggest a remedial logic course. (VBG).
Don |
