November 19, 2013
How much stuff do you own? The answer for most people ranges from a few changes of clothing to a large house full of possessions – your material self. It turns out that most of us also have a digital self – the information and items we create or that others collect about us. It is your footprint, your impact on the digital world. Without a digital self, you don’t exist in the world of computers and the Internet.
The era of Internet has spawned riotous new forms of business disruption as cheap tools and services combined with Internet reach and social media have empowered anyone on the planet to compete with the largest, most established businesses. James McQuivey’s reports and book on digital disruption highlight the fast rise of new hardware devices such as Microsoft’s Kinect and Apple’s iPad, and the fast mainstreaming of new Internet services such as Dropbox, Twitter, and Facebook. Companies in the business of retail, books, movies, and music have been toppled or transformed, with more to come.
As you and I create and manage our growing digital self, we’re laying the groundwork for more than just the convenience of accessing our digital stuff from any gadget. Once info about us is stashed in online services, it can be analyzed and compared to make our experiences better. (I can hear many of you raising concerns about privacy and security, appropriate concerns. The industry will eventually address these concerns to the satisfaction of most, but not all.) The assistance and convenience that can be created from having more information about us will prove powerful for many people
So what will be the digital disruption driven by services for the digital self? Just as Google used search to disrupt the print advertising business, disruptors will use services for the digital self to reshape existing markets and create new ones. Amazon reports that it makes little profit on its tablets and plans to profit from content and services sold to customers of those tablets. Xiaomi, a Chinese smartphone manufacturer that has zoomed to 5th place in the China market in just over 3 years, is building their entire company around that model and plans to add smart TVs to the mix soon.
Meanwhile in the US, Zumbox, Doxo, Manilla, and Volly plan to carve off big chunks of the $78 billion spending on first class mail for bills and statements and turn it into a personalized customer services and marketing platforms. Google and Apple are now giving away office productivity software and web apps so that you’ll work with documents in their services, rather than spend money on Microsoft’s Office 365– which is switching from a purchased license model to a $100/year subscription service. For a lot of people that $100 looks steep compared to free …. So far the free combination of Office Web Apps and SkyDrive are not in the public eye the way Apple and Google’s offerings are.
The myCARFAX service and Automatic Labs gadget are disrupting and reshaping the auto repair and the automotive telematics business by engaging customers with an ongoing information service about the repair records and performance of their autos, at little or no cost. Both services have the potential to reshape the relationships between the auto owner and dealerships or independent repair shops.
What other examples can you think of where an online service has the potential to reshape commercial relationships and revenue streams?