Profit is not co-extensive with value created. Profit is a function of value created but also your ability to control and monetize the delivery of value to customers. Software is a great example. Creating a shrink-wrapped software product creates a lot of value, but it&#x27;s almost impossible to monetize shrink-wrapped software these days. That&#x27;s why everything is moving to SaaS--it&#x27;s much easier to monetize.<p>The way the consumer electronics market is currently structured, what drives your ability to monetize created value is strong, vertically-integrated manufacturing capability. That&#x27;s what Apple&#x27;s and Samsung&#x27;s profits are built on. Creating technology delivers value, but you can only monetize it to the extent you can build and deliver Chinese-made products into the hands of consumers at high efficiency.<p>A great example of this is Apple buying P.A. Semi. A7-A9 have created tremendous value for consumers. But Apple purchased P.A. Semi for a pittance. The value-creation potential in P.A. Semi was not monetizable without access to Apple&#x27;s incredible manufacturing muscle.