Framework is selling Chromebooks and laptops pre-installed with Windows or BYO operating system. Windows and ChromeOS have a massive installed base.
System76 are still mostly selling rebadged generic laptops with their own custom linux distro (which I have no interest in). They do some good work but they are considerably more niche and don't really add much value to Framework which has the potential to grow much faster.
I have known of System76 and been interested in their products for almost 2 decades and I bought a generic laptop to match one of their models once because I didn't want to ship a rebadged machine from the other side of the planet and deal with the potential RMA/repair problems. I bought a Framework last year because they were happy to ship not just the product to me but any parts I needed to self repair. This ease of repair/ugrade could be just as appealing to a Windows/BSD user or anyone else. Months later Framework announce an AMD and battery upgrade option. This is something System76 can't do while they are slapping a badge on other companies designs.
The System76 collab with HP is a good example of what that company can do very well, bringing Linux customization experience to other manufacturers. Framework don't really need it and I would rather see them innovate on hardware than waste money on developing yet another Linux desktop environment.
I don't know that they're a good merge match. That said, it would be cool if Framework sold units with PopOS supported by System76, and/or System76 selling Framework unit with PopOS on their site. Since it would align with a relative miss.
Framework seems to have a better build quality than the System76 hardware, and they did a similar deal with a dev laptop from HP, that got discontinued. So it wouldn't be completely unheard of. Could also be a boost for development overhead for both considering firmward development.
That is a worry I have, but on the other hand, more pro RTR brands out there is more opportunities to win over customers.
I had a galago ultrapro 10 years ago. Loved it, loved system 76's support for it (they shipped everyone a replacement keyboard at no cost simply because they weren't happy with the one it launched with). The only part I didn't like was the plastic body which saw a lot of wear and tear. But the laptop is still working fine.
Now I have a framework. The first touchpad on mine had issues. Wasn't registering clicks unless I pressed really hard. They shipped me a replacement, I swapped it out myself and shipped them back the defective one at no cost to me.
I wish both companies the best, but yeah I do hope there is enough business out there for them both.
Anecdotal, but my couple-years-ago work laptop was a System76 and my recent work laptop is a Framework. Both are running the same flavor of Linux and being used for the same things, I just decided that I liked the Framework's hardware much better (and that Linux was supported adequately on the Framework).
System76 support was very good, but the build quality of the Framework is definitely better (to say nothing of all the very exciting upgradeable bits)