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Consumers driving global dominance or new ecosystems?

Consumers driving global dominance or new ecosystems? 

A social network with many people means high potential for good advice; the same goes for instant messaging. A sharing economy with many participants means lots of offers and even more user reviews. When many participate, you stand to benefit from their experiences. A lot. Research for Ericsson ConsumerLab’s 10 Hot Consumer Trends for 2016 shows that 4 out of 5 now actively seek out the most used services in order to benefit from the intelligence of really big crowds, and we call this trend the Lifestyle Network Effect.

But is it only a good thing?

Our research in this case covered 24 countries and was representative of over a billion consumers. And that number is relevant – one billion is the new baseline. As crowd intelligence improves with more participants, consumers increasingly flock to the most popular services. A handful of brands have billions of users; others rather fewer.

Google already has seven products with a billion users, and Apple recently scrambled to show that one billion people use Apple devices.

WhatsApp also has a billion users. And parent company Facebook’s own billion is even more impressive, given that this billion logs in every day. No other social network has a billion user reach, not even Tencent’s QQ in China. In fact, the only other member of the overall billion users club is Microsoft (for both Windows and Microsoft Office). In that light, Mark Zuckerberg wanting to have five billion users by 2030 almost seems logical. Never mind that it is far more people than even have internet access today, or even more than the current world population aged 15-64.

But what will this dominance mean in a world where everything is becoming networked at an increasing pace, and lifestyle network effects blow like tornadoes through all industries? When cars get connected, passengers will want to benefit from collective experiences in order to have safer and more pleasant journeys. When using connected power grids, who wouldn’t want some extra intelligence to save both money and the environment? Wellness is crowd-optimizing your habits via smartphones, fitness trackers and other wearables; and although similar effects may be slower to spread to healthcare, it is probably just a matter of time.

One extreme view of the future could be of the billion users club members playing a global Monopoly board game. Winners, in effect, take over the users in any and all other industries as soon as these industries become sufficiently networked. We end up in a world where a small group of companies cut across all industries on all continents.

An opposing future view could be one where consumers’ need to control their personal information creates a new ecosystem with independent intermediaries between consumers and the big internet brands. In a 2015 Ericsson ConsumerLab report about internet and wellness, consumers implicitly saw a new ecosystem entailing cooperation between several parties. However, they also wanted to retain control over the flow of their personal information. Even though authorities were seen as the second largest wellness service provider, as many as 66 percent wanted full control over the dissemination of their information by authorities.

In this scenario, the idea of an internet access provider takes on a whole new meaning – not just providing access to connectivity but helping users manage access rights for all the services they are using. Such an access provider stores personal data, and when I, as a consumer, want to change social network service, for example, I just close the access rights I had given to the previous social network brand and open the corresponding access rights to the new brand. As a consumer, I can easily switch between service brands that all compete on equal terms, and I get to keep my personal data history intact while switching. The number of users of any specific brand will still be important when it comes to crowd intelligence, and probably also to advertisers. But entry barriers will be very much lower for companies who want to provide services.

A more realistic view on the future may lie between these two extreme points. What do you think? Will consumers drive global dominance, or new ecosystems?


Michael Bjorn-14Michael Björn is Head of Research at Ericsson ConsumerLab and has a PhD in data modeling from the University of Tsukuba in Japan. One of Michael’s keen research interests is the process of assimilation of ICT into everyday consumer life.

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