We are living in extraordinary times – there is no Old and New Economy. It is all new and everything is being transformed. We are moving to a whole new chapter in the book of mankind and it will be disruptive.
the api economy
We know that in time of fundamental disruptions, the incumbents will fade and new players will rise. Five US companies, Apple, Alphabet, Amazon, Facebook, Microsoft, are among the top ten US companies by market capitalisation and are less than 40 years old and competing for the trophy of the 1st trillion dollar company ($1,000 billion). Three Chinese companies, Baidu, Alibaba and Tencent (BAT) are catching up with lightning speed in the same league.
Are these global players, leveraging their platforms in search, social media and eCommerce, going to take over one-by-one all significant sectors of our economy and social life? Maybe, maybe not. It will depend on whether we let that happen or whether strong political and regulatory intervention will keep our world open for innovation and competition.
Open data and customers’ sovereignty over their data, open Application Programming Interfaces (API) and sharing digital identity (KYC) sound like another set of buzz words and ideas, but they are the remedies that our countries need to open up markets so that the best ideas can win and our economies can grow; so that new entrants can challenge the established players; and so that citizens and consumers have choice.
Dominant private global platforms versus competitive open API economies affect all areas of a modern economy such as mobility, health, energy, banking. Innovative banking is one of the key drivers for prosperity yet with the market currently being dominated by big banks, there is little room for competitive tension to encourage innovators to enter the banking sector and for new entrants to scale up to a size that makes a difference unless they are big global data aggregators taking over banking.
As long as we believe in the ultimate right of citizens and the primacy of politics, there is an alternative in the form of the API economy, a framework for the digital century where Government, regulators and antitrust authorities maintain access and a level playing field that enables and protects innovation and competition.
To flourish, the API economy needs an aggressive entrepreneurial culture, rewarding risk and embracing competition. Failure should not be mocked as a weakness, but accepted as a possible stepping-stone on the way to success.
The way forward is to develop an ecosystem of progressive start-ups and then scale-ups, working collaboratively to provide consumers and businesses with a “better deal”.
Entrepreneurship encouraged and enabled in an open API economy will empower customers to choose best-of-breed solutions and to constantly refresh their technology stack, unhampered by switching barriers, integration frictions and lock-ins.
We need to change our mindset dramatically. Those countries that will not create the open API economy will be colonialised by the new digital data giants. Those organisations unwilling to open up to collaboration and competition and unwilling to provide the efficiency and convenience customers now expect will become the dinosaurs of tomorrow.
While we are seeing more and more of the younger generations taking destiny into their own hands and trying to give their ideas a go, we also observe the degrading social realities and political dysfunctions in our ageing liberal societies. The benefits of globalisation and automations have gone to the few. Many have been left with angst for what the future may hold. We see the upheavals spreading, the unthinkable becoming reality. It is scary.
At the turn of the millennium we had this feeling of liberation spreading. Our slogan was, "Everyone is an entrepreneur, if he lets himself." The Personal Computer and the Internet freed people from the constraint of the central world of computers and gave them the world of knowledge at a fingertip. But much more important: the entrepreneurial culture allowed people to shape their work environment independently, to provide the service to the customer and to unfold their talents. We felt like departing into a more human world.
But with hindsight, we have made so little progress out of the liberation area. A lot of new things have emerged, but overall, our generation failed. Our misunderstanding was that we thought the few winners could take everything, go with impunity without taking the other fellow citizens with them. The result is that our knowledge-based and liberal society is existentially threatened. Our present misunderstanding is not to see and to look for fault with us, but with the "disgraceful" populists.
I continue to believe in the unlimited human possibilities of using the gift of exploding knowledge to overcome the scourges of mankind like hunger, disease, illiteracy, lack of freedom. But we will only have our peace when our best and brightest will now begin to rethink and experiment with our values, welfare systems and social communication. We need an awakening. We need experimentation with new social ideas and social break-throughs that will deliver that more ‘human’ world.