As a year, the two most prominent themes in 2018 were (1) the dark side of platforms and regulation of big tech and (2) the increasing importance of platform strategy in geopolitics. We also saw the growth in importance of B2B platforms as more industrial sectors started to get transformed in the platform economy.
This final roundup collection of the year consists of two sections:
Platforms are changing the economics of the creative industries. We’ve seen three distinct ways in which platforms have upended the creative industries:
The third point, in particular, is hugely compelling. Movies and music are high risk, high investment sectors and both Netflix and Spotify have been learning from consumer data while letting studios and labels take the risk of funding content. Now that they’ve learnt enough, they can themselves enter the studio and label game while taking more informed risks.
I was commissioned to work on this research by the UN’s World Intellectual Property Organization (WIPO) and presented this in a keynote at the WIPO’s annual global conference. The video below summaries these ideas and lays out a larger narrative for the impact of platforms on the creative sector.
As more work gets intermediated by platforms, it will be important to understand which platforms empower workers and which ones exploit workers. This has been a big theme with the UN’s International Labor Organization (ILO) this year and I was commissioned to work on an exhaustive research on this topic. The full report is long but juicy with detail. Worth reading, in particular, are Section 7 (how platforms like Uber exploit workers) and Section 8.3 (how to regulate platforms).
And if you’d like a quick overview, my speech at the Danish Parliament in March captures many of these ideas.
Country-level platforms will determine winners in future trade wars and create a new model for public-private partnership.
By far, the most far-reaching idea this year was the idea of country-as-a-platform. I first proposed this in February, taking Singapore as an example, but have since extended it to explain India’s strategy with the India stack and China’s strategy with the Belt and Road initiative as well (Video awaited from the European Platform Economy Summit).
Here’s the original article on Singapore’s platform strategy.
This will become an increasingly important theme in the coming year from two perspectives. First, more countries will begin to apply the country-as-a-platform strategy. I already see this beginning to take hold in the EU. Asian giants – China and India – as well as smaller countries like Singapore will continue to lead the charge. Second, beyond geopolitics, this will become the new framework for public-private cooperation. In country-as-a-platform strategies, the private sector plugs into the country platform but continues to maintain its unique control points.
One of the most interesting themes to follow at the moment, China is pursuing a multi-dimensional strategy to increase its influence globally but platform strategy is one of the key pillars involved. Companies like Alibaba are very strategically putting together the pieces for a global platform for trade and payments, by focusing on markets that lack a traditional financial stack. Worth reading: Chinese fintech planning a global coup
But this is much larger than this. Over the last year, most of the discussion in the EU has shifted from “How do we think about GAFA?” to “How do we think about Alibaba and WeChat?”
China’s experiments with social credit systems will also be worth watching. While I’m not a fan of data-driven reputation systems that punish users or inhibit their access, I do believe there’s a lot of value to be created by increasing access for reputable users without punishing the others.
Advertising – and making users click – continues to be the dominant model of funding the bigtech firms. And 2018 was the year when a lot of the unintended consequences of optimizing ad revenue came to the fore. We’ve already seen how Facebook and YouTube increasingly polarise users through their efforts to increase clicks. Worth reading: YouTube’s dark side As investigations increase, we’ll see more of this coming up.
If you’re really keen on the larger impact of BigTech, two reports I’d highly recommend for your Holiday reading:
Australia’s Digital Platforms Inquiry
Finally, we’ll see even more of B2B platforms in logistics, manufacturing, heavy engineering etc. Over the years, I’ve been asked by executives whether platforms are a consumer phenomenon only. Those questions have markedly decreased over the last few months with many execs in traditional industries realising the value of platforms to organise their industry ecosystems. Many companies will move beyond basic digitization and sensor-network installations to platform business models. Blockchain and DLT based initiatives will be an important starting point to creating interoperability in traditional industries and over the coming years, we will see new platforms coming up around these initiatives.
Country-level platforms will determine winners in future trade wars and create a new model for public-private partnership. Share this
Netflix and Spotify demonstrate how tech firms can migrate up the value chain with relatively lower risk capital. Share this
Work is moving to platforms and we need to identify which ones empower workers and which ones exploit them. Share this
Gaining power in concentrated markets What do Spotify, the connected vehicle data market, open banking…
The unbundling and rebundling of organizations We frequently make the mistake of thinking of AI…
On rebundling jobs and skill premiums The AI augmentation fallacy goes something like this: “AI…
On the risks of over-emphasizing platform thinking In an age of platform hype, everyone scrambles…
The untold story of the most under-used real estate on the phone screen Which players…
How stand-up comedy helps Amazon win at e-commerce On Attention Conglomerates and Internal Attention Markets…