Qualcomm

Qualcomm exemplifies success as an ecosystem participant rather than keystone controller. As an ARM licensee, the company designs chips using ARM's instruction set architecture, operating within the broader ecosystem enabled by ARM's keystone technology platform. Qualcomm's Snapdragon processors power smartphones for Samsung, Xiaomi, and dozens of manufacturers - providing the processing cores that enable mobile computing.

But Qualcomm's ubiquity also reveals modularity's dark side: commoditization. When competitors like Samsung use similar modular components (Qualcomm processors, Android OS, standard displays), products become harder to distinguish, intensifying price competition. This forced Samsung to develop its own Exynos processors as alternatives, pursuing differentiation through vertical integration where modularity created vulnerability. Qualcomm's strategic challenge is that being the default component supplier makes you both essential and replaceable.

The lesson: succeeding as a keystone participant requires continuous innovation to avoid commoditization. Qualcomm dominates mobile processors not by controlling the architecture (ARM does that) but by out-engineering rivals on power efficiency, modem integration, and AI acceleration. When your customers can switch suppliers easily, your moat is execution, not position.