MANAGING OUR HUB ECONOMY

a winner-take-all world is emerging in which a small number of “hub firms”
1. expanding share of the value
2. shaping our collective economic future
  1. transforming it from product-driven to networkdriven
    1. the hub economy will spread across more industries, further concentrating data, value, and power in the hands of a small number of firms employing a tiny fraction of the workforce
      1. could exacerbate already dangerous levels of income inequality, undermine the economy, and even lead to social instability
3. create and control essential connections in the networks that pervade our economy
  1. they own access to billions of mobile consumers that other product and service providers want to reach
    1. increasing returns
    2. controlling crucial competititve bottlenecks
      1. They can extract dispropotionate value
      2. tip the global competitive balance
4. To remain competitive
  1. transform their core businesses
  2. develop new revenue opportunities
  3. develop new revenue opportunities
    1. manage collective risks
    2. sustain the networks and communities
  4. hub strategies that foster a more stable economy and united society will drive differentiation among the hub firms themselves
    1. Fake news affect traffic on the hubs
      1. hubs have to consider the long-term societal impact of their decisions prioritize their ethical responsibilities to the large economic ecosystems that increasingly revolve around them
Digital domino Effect
1. performance improvements will continue driving the augmentation and replacement of human activity with digital tools
2. network’s value increases with the number of nodes the dynamic we think of as network effects
  1. migration from payment tools to the broader financial services and insurance
3. many players competing in traditionally separate industries get winnowed down to just a few hub firms that capture a growing share of the overall economic value created
4. Hardware centricityto network structures centered on iOs and Android platforms
  1. he growing power of WeChat in messaging and communications; along with Facebook and others, it’s challenging traditional telecom service providers
Automotive sector
1. cars connected to digital networks as a new source of value
  1. manufacturers have to think on dashboards to connect
  2. apps are based on location but next step will be to get autonomus cars
    1. services at driving experience more important: insurence, maintenance, road construction, enforcement
INCREASING RETURNS TO SCALE ARE HARD TO BEAT
1. A firm gains no particular advantage as its user base continues to increase beyond already efficient levels, which enables multiple competitors to coexist
2. Some digital technologies, however, exhibit increasing returns to scale
  1. better as many ads has
    1. the more consumers increasess available apps
      1. costumer rises with apps
Pushing back
1. New technologieas are copetinf sucha as augmented reality, virtual reality, voice activated technology.
2. IoT (internet of things), getting as HUBs
  1. platforms that make industrial sector more competitive
  2. value changes as much as companies compete, innovate and respond to pressure
    1. companiesa need to make products and services available on multiple hubs
    2. difusing the capture of value trhugh competition
    3. collective action
      1. Open sources with legacy of common intellectual property, capabilities and methodologies
      2. Sustaining balance in the digital economy
      3. The public concerns are about privacy, online tracking, cybersecurity and data aggregation
Ethics
1. Hubs need to incorporate value sharing, value creation and value capture
2. Big companies provide and develop frameworks, software tools and oportunities to business models
  1. Preserving strenght and productivity of complementary communities shuld be fundamental
3. Hubs have to promote healt and sustaintability
  1. encourage competition, protect cosnumer wlfare, and foster economich stability

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MANAGING OUR HUB ECONOMY

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	Created by Cecilia\| Velazquez about 6 years ago