one that features cloud-pipe-device synergy . The new ICT is the combination of these foundational , enabling and digital transformation accelerators ─ Cloud , Big Data , Software-Defined Network ( SDN ,) 5G , and IoT .
Challenges
The challenges created by the fourth industrial revolution appear to be mostly on the supply side , in the world of work and production . As a result , the great beneficiaries are the providers of intellectual or physical capital , the innovators of intellectual or physical capital . These are the innovators , the investors and the shareholders , which explains the rising gap in wealth between those who depend on their labour and those who own capital . The concentration of benefits and value in just a small percentage of people is also exacerbated by the so-called platform effect , in which digitally driven organisations create networks that match buyers and sellers through a marketplace comprising a wide variety of products and services , and thereby enjoy increasing returns to scale . The consequence of the platform effect is a concentration of a few powerful platforms that dominate their markets .
Looking at financial services as an example of the impact of these platform companies , these new strategies adopted and deployed by the aforementioned platform companies are even more challenging for incumbent banks . By creating a unified customer-centric value proposition that extends beyond “ the walls ” of what users could previously obtain , digital pioneers are bridging and merging the value chains of various industries to create vastly more scaled ecosystems that reduce customers ’ costs , increase convenience , provide them with new experiences , and whet their appetites for more . This is compounded exponentially by the network effect . Not only do they have exceptional data that they exploit with remarkable effectiveness but also , and more worrisome for banks , they are often more central in the customer journeys that include big financial decisions , while at the same time through leveraging the assets of the 2 nd information age and the distributed , hyper-connected Internet .
Platform paradigm in action
Consider Rakuten Ichiba , Japan ’ s single largest online retail marketplace . It provides loyalty points and e-money usable at hundreds of thousands of stores , virtual and real . It issues credit cards to tens of millions of members . It offers financial products and services that range from mortgages to securities brokerages . And the company runs one of Japan ’ s largest online travel portals — plus an instant-messaging app , Viber , which has some 800 million users worldwide .
Likewise , Alibaba is not just an enormous e-commerce company ; it ’ s also a large asset manager , lender , payments company , B2B service , and ride-hailing provider .
Tencent is making similar advances from a chat-service base . And Amazon continues to confound rivals with moves into the cloud , logistics , media , consumer electronics domains , and even old-fashioned brick-and-mortar retailing — and lending and factoring for small and medium-size enterprises .
Such companies are blurring traditional industry boundaries . With their superior customer experience , they can sell an ever-wider range of products to their loyal customers . The manufacturing end of many businesses is fading from view , as the platform companies increasingly dominate the distribution end of multiple businesses , providing a wide range of products and services from a single platform .
Those companies that can break down the walls to become more relevant to their customers lives by enabling and providing endto-end and last-mile connectivity , combined with the platforms and integrated “ glue ” required to enable the convergence of the emerging technologies of the fourth industrial revolution , will be best positioned to scale and remain contextually relevant at the center of customers ’ attention . This , in turn will continue to contribute to their exponential growth .
These are the companies that are making our lives easier , every day resulting in economic gains for all , while also giving us enhanced and balanced livelihoods . It ’ s an exciting time to experience this transition to this new information age and the next step of progress in humanity .
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