How results and perspectives of IT service platforms change. The analysis by Franco Becchis, scientific director of the Foundation for the Environment and of the Turin School of Local Regulation. for Lavoce.info
The quarantine imposed by Covid-19 and the subsequent reopening phases have already significantly affected the trend and prospects of the economy of the platforms, even if in different directions, intensities and methods. Among other things, it is not yet clear what effects will persist in the medium-long term: for example, the home delivery sector, which had a significant initial increase, could re-establish itself at lower levels with the return to normal.
One of the biggest challenges, from the regulation point of view, is the growth of market power that some platforms are acquiring. Three fronts concern: the brake on innovation, consumer protection, data accumulation.
The lockdown has had negative effects especially in sectors that involve a physical shift of the consumer towards goods or services, such as mobility and tourism / hospitality: the difficulties of Uber and Lyft (platforms that bring together offers and car travel demand), with a 50 percent drop in journeys and Lyft leaving the scooter-sharing market. The two platforms laid off 14 and 17 percent of the workforce respectively. Problems also for Booking and Airbnb (which fired 600 people).
On the other hand, precisely the need to bring goods and services to the home of the consumer in "quarantine" has strengthened the platforms that have the IT and logistics infrastructures for home delivery, an activity that in the case of goods combines a digital segment (the aggregation of demand) and a physical segment (delivery): Amazon, Alibaba and Deliveroo have growing results both in market value, which could indicate investors' expectations, and in earnings.
The advertising sector is falling, with negative repercussions on the giants that find a significant share of revenue here: Facebook has lost $ 3 billion in advertising revenue and revenue per user has dropped from 7.38 to $ 6.03. The modest increases in the capitalization of Facebook and Alphabet are probably the balanced result of the advertising crisis and of factors of rise (growth of the user base and extraction of personal data).
Twitter, which is heavily dependent on advertising, also suffered a 100 percent drop in earnings in the first few months of 2020 compared to the same period last year. On the contrary, the streaming platforms of streaming audiovisual content benefited from the lockdown: Spotify, for example, increased users by 31 percent in the first quarter of 2020, but could be subject to pressure on its commissions from the authors, whose earnings were brought down by the collapse of live shows.
AND ZOOM MADE BOOM
The videoconferencing sector deserves careful consideration, in which the Zoom case (+178 percent in one year in market value) stands out for its exceptional nature. On the one hand, the lockdown forced consumers to use the platforms, producing an immediate push; on the other, it can be assumed that even in the medium to long term, virtual meetings are destined to gain market share with respect to meetings and physical meetings, with effects on the future of the offices. However, different ways of measuring the market lead to confusion in published data: depending on whether you count virtual participants or meetings, the numbers change. Zoom, with 300 million daily participants, is a leader, but Facebook declares 700 million daily users who call with Whatsapp and Messenger. But there are other players: Networks GlobalProtect and Cisco AnyConnect declare 94 and 86 percent unique user growth between February and March 2020. Tik Tok (short video sharing) was downloaded by 2 billion people, 113 million in February alone . Byte Dance, which owns Tik Tok, has reached an unlikely quotation of $ 75 billion, but is under investigation for the misuse of personal data. Even Zoom, after Motherboard's revelations that the platform passed its users' data to Facebook, had to declare that it had removed the communication code with Mark Zuckerberg's social network.
In any case, it is not foreseeable how this market penetration will translate into revenue and profits in the medium to long term.
A NEW ADJUSTMENT?
In the face of such radical changes in the context in which digital platforms operate, the need for good public regulation on three crucial issues is accentuated: market power, consumer protection and the management of personal data. Antitrust and regulation, two sisters who have traditionally alternated collaboration and conflict over methods and their respective fields of intervention, will have to be much more cooperative in the future to meet new challenges.
Article published on lovoce.info
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/innovazione/covid-19-e-piattaforme-online-chi-guadagna-e-chi-perde/?utm_source=rss&utm_medium=rss&utm_campaign=covid-19-e-piattaforme-online-chi-guadagna-e-chi-perde on Sun, 07 Jun 2020 05:53:42 +0000.