Convergence is not a process that will happen immediately, nor be a simple and linear progression. Trends will combine at different speeds based on technical limitations, political and social barriers, as well as commercial considerations. The market dynamics will vary with industrial manufacturers and telecommunications providers leading the charge in the Internet of Things, while consumer Internet companies like Google and Facebook innovate in artificial intelligence. It is important to grasp the nuances of each market, but in doing so, it’s easy to miss broader macro-trends. The development of blockchains is a good example, as exceptionally talented developers push the boundaries of cryptography with zero-knowledge proofs and smart contracts but fail to see the implications on broader governance structures and political philosophies. These are the kind of things we have been trying to figure out since the dawn of civilization. It is just as important in technological progress to study Plato and Hume as it is to study Von Neumann and Shannon.
As the rate of change increases, it is critical to understand these technology trends as part of a wider collective rather than as separate developments. Blockchain-enabled convergence is our attempt to capture this wide collective. The first part of the white paper explores blockchains, artificial intelligence, the Internet of Things, autonomous robotics, 3D printing, and virtual & augmented reality to understand the drivers and barriers to adoption. Part two investigates how blockchain-enabled convergence changes the trade value chain from manufacturing and design through logistics and distribution to retail and commerce, and even more profoundly changing the very governance structure of the organisation.
5 Key Themes
The white paper explores an extremely broad range of technologies and markets, yet despite this breadth, we found five key themes that kept coming up time and time again. These themes are not technological in nature but rather trends that will reshape markets, society and excitingly, the relationship between humans and machines.
1. Web 3.0 — The Global Trust Network
Web 3.0 underpinned by blockchains and decentralised technologies provide global trust. The core design of The Internet was to enable the sharing of information. The core design of Bitcoin, and other open permissionless blockchains is a network of trust for exchanging value and asset ownership. Web 3.0 provides trust and chain-of-ownership; the missing link with the existing Internet infrastructure.
2. The ‘Real’ Sharing Economy
New digital intermediaries have sprung up so individuals can ‘share’ unproductive assets; spare rooms on Airbnb, spare seats on Uber and spare time on TaskRabbit. These ‘sharing economy’ companies are nothing more than a new middleman sitting between a buyer and seller capturing outsized value. Blockchain-enabled convergence allows the seamless peer-to-peer exchange of assets and value reducing the need for trust brokers in the middle of a market extracting economic rent.
3. The Killer Business Model: The Decentralized Data Marketplace
A blockchain-based data marketplace helps solve two major problems in artificial intelligence today, the access to data for those that need it, and monetizing unused data for those that have it. A decentralised data marketplace creates an economic mechanism for individuals and organisations to buy and sell data, reducing the incentive to hoard valuable unused data and remunerating the creators of data, not just the processors.
4. The Commoditization of Logistics & Production
Blockchain-enabled convergence transforms the trade value chain. Autonomous robotics, AI, IoT and blockchains will digitise logistics and distribution reducing its importance and therefore the ability for companies at this point in the value chain to capture profit. Producers can capture more of the value they create and consumers can pay less. In the long-term, technical deflation will hit the knee of the exponential curve as much of production gets commoditized by 3D printing, and virtual and augmented reality make it cheap to design and print products at home.
5. The Rise of the Decentralised Organisation
The global multinational corporation that developed to coordinate global trade is under threat as the dominant form of governance structure. New decentralised processes for business financing with Initial Coin Offerings (ICOs), incorporation, voting, payments and talent and project coordination are enabling start-ups to choose processes that are suitable for smaller, more agile start-ups rather than using an expensive corporate structure designed for large companies.