In the past, much of our economy has operated on the principles of ownership. Companies sell things, and consumers buy them and own them. The idea of ownership is simple—if it’s mine, it’s mine. I can alter, destroy, sell, or save my stuff, and I can use it for as long as I’d like.
The latest technological advancement especially artificial intelligence is transforming static products into digital and connected products. The concept of the Internet of Things (IoT) is getting popular and becoming essential for all sizes of industries that design material products. When products are becoming smart and connected, then the inner nature of the product behaves more like a software than hardware. Software demands continuous improvement and upgrade, which is the essential nature of any services. So, products becoming services, service prefers to access over ownership. There are several other technological trends that are emerging that prefer access over ownership.
Most recently we observed, “Uber, the world’s largest taxi company, owns no vehicles. Facebook, the world’s most popular media owner, creates no content. Alibaba, the most valuable retailer, has no inventory. Airbnb, the world’s largest accommodation provider, owns no real estate. Something interesting is happening.” Indeed, digital media exhibits a similar absence. Netflix, the world’s largest video hub, allows us to watch a movie without owning it. Spotify, the largest music streaming company, lets us listen to whatever music we want without owning any of it. Amazon’s Kindle Unlimited enables us to read any book in its more than million volume library without owning books. Every year we own less of what we use. Possession is not as important as it once was. Accessing is more important than ever.
There are 4 basic technological trends that giving us the preference to accessing over owning
Digitization and Connected
Digital technology accelerates innovations and continues upgrades by hastening the migration from products to services. The new nature of products means they don’t have to be bound to materials, but smart connected with internet. The race in IoT (Internet of Things) industries in building smart and connected products will transform the concept of owning a product to agreeing for service. Smart intelligence hardware will behave more like software. In Silicon Valley, they say this: “Software eats everything.”
Today, selling software as service (SaS) model will be used for all smart products. In the last few years, we’ve seen tools as service (TechShop), clothes as service (Stitch Fix, Bombfell), and toys as service (Nerd Block, Sparkbox). So, the trend of digitization and connected will lead us to access a product as a service, instead of owning a product.
When Amazon founder Jeff Bezos first introduced the Kindle e-book reader in 2007, he claimed it was not a product. He said it was a service selling access to reading material.
An automobile today is really a computer on wheels. This rolling computer is about to be connected to the internet and become a smart car. As cars become more digital, they will tend to be swapped and shared and used in the same social way we swap digital media. The more we embed intelligence and smarts into the objects in our households and offices, the more we’ll treat these objects as control and own by the producer. We’ll prefer to have “access the objects” over “owning the objects”. The switch from “ownership that we purchase” to “access that we subscribe to” will overturn many conventions.
Continuous Improvement
When products get digitized, they are also getting cognified, and continues upgrade and improvement is an endless process. Every product is becoming outdated quickly, ownership is becoming casual, if something better comes along, get it. A subscription, on the other hand, will flow with a never-ending stream of updates, issues, and versions that force a constant interaction between the producer and the consumer. There is not a one-time event with a product; it’s an ongoing relationship between producer and user. So, the future clearly shows the preference, access over ownership.
Real-Time
Access is also a way to deliver new things in close to real time. Unless something runs in real time, it does not count. Our cycle of expectation for time jumped from batch mode to daily mode to real time. If we message someone, we expect them to reply instantly. If we spend money, we expect the balance in our account to adjust in real time. Why should medical diagnostics take days to return results instead of immediately? For news, we demand to know what is happening this very moment, not an hour ago.
In the industrial age, companies did their utmost to save themselves time by increasing their efficiency and productivity. That is not enough today. Now organizations need to save their customers and citizens time. They need to do their utmost to interact in real time. Real-time is human time. We are getting real-time snobs. When we demand everything in real time, we can’t wait. We will prefer quick access.
On Demand
In the coming future, more items will be invented and manufactured for advanced and efficient use in our daily life. While the total number of hours in a day to enjoy or use them remains fixed—we will spend less and less time per item. In other words, the long-term trend in our modern lives is that most goods and services will be for short-term use. Therefore most goods and services are candidates for rental and sharing.
On-demand services like Netflix, Amazon Kindle are in the digital space, and uber, and other car-sharing in physical space. In the future we will have uber for laundry, uber for lawn mowing, an uber for tech support (Geekatoo), an uber for doctor house calls, plus many more are emerging every day. The promise of these services to us is that we don’t need a lawnmower or washing machine or to pick up flowers because someone else will do that for us—on our demand, at our convenience, in real-time—at a price, we can’t refuse. So, on-demand prefers access over ownership.