If you thought the first half of the internet revolution was disruptive, just wait for the second act
humans lived in cities than outside them for the first time. It was a transition 5,000 years in the making. The internet has been quicker to reach the halfway mark. Over 50% of the planet’s population is now online, a mere quarter of a century after the web first took off among tech-savvy types in the West. The second half of the internet revolution has begun. As our briefing describes, it is changing how society works—and also creating a new business puzzle.
Most new users are in the emerging world; some 726m people came online in the past three years alone. China is still growing fast. But much of the rise is coming from poorer places, notably India and Africa. Having seen what fake news and trolling has done to public discourse in rich countries, many observers worry about politics being debased, from the polarisation of India’s electorate to the persecution of Myanmar’s Rohingya minority.
Despite these firms’ punchy valuations, they are still looking for sustainable business models. Reliance Jio, an Indian firm, has sunk $37bn into building a high-speed mobile network and acquiring a big base of mostly poor users. Each Facebook user in Asia generates only $11 of advertising revenue a year, compared with $112 for a North American one. The combined revenue of all the internet firms in emerging markets is perhaps $100bn a year.
Nonetheless, the impact of these firms on business will get bigger in two ways. First, they will grow fast—although whether fast enough to justify their valuations remains to be seen. To maximise their chances, many are offering not just a single service , as Western firms tended to in their early years, but a bundle of services in one app instead, in the hope of making more money per user. This approach was pioneered in China by Alibaba and Tencent.
The second is that in the emerging world, established firms are likely to be disrupted more quickly than incumbents were in the rich world. They have less infrastructure, such as warehouses and retail sites, to act as a barrier to entry. Many people, especially outside the big cities, lack access to their services entirely. Beer, shampoo and other consumer-goods firms could find that as marketing goes digital, new insurgent brands gain traction faster.
United States Latest News, United States Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Climate change could pose ‘existential threat’ to humanity by 2050, advocates sayThe world as we know it could end in mere decades if drastic changes aren't done to mitigate climate change, according to an Australian think tank.
Read more »
Epileptic girl who had half of brain removed can read after organ rewired'What we're seeing is remarkable,' a scientists who studied the girl said.
Read more »
What it’s like to spend half a life in solitary confinementTony Medina has spent two decades in a concrete box in Texas, alone
Read more »
Mega Millions jackpot is now more than half a billion dollarsThe next drawing is Friday, June 7 at 11 p.m. ET. It's the first time the Mega Millions jackpot has exceeded $500 million since last October's record-breaking $1.5 billion mark.
Read more »
Pivotal Software loses almost half its value after 'train wreck' of an earnings reportShares of Pivotal Software were down as much as 45% Wednesday after the company's weak revenue forecast
Read more »
Lowest mortgage rates in a year and a half don't impress homebuyersMortgage rates are falling fast, but not enough to offset high home prices. Gains in mortgage applications last week were driven by refinances.
Read more »