Horizons newsletter – week 44 // 2018
Horizons is a bi-monthly Dasym Research initiative to show you how the Dasym themes have been in the news. We publish the Horizons on our website and as an email newsletter. If you wish to receive the email, please contact Investor Relations.
Do you have a question about the digitization of consumer’s daily lives? As a research-driven investment company, we want to be relevant to you, so please provide us with your questions and remarks. Your feedback will help us to drive our research agenda.
Dutch Design Week, designing the future?
Last week, the Dutch Design Week took place in Eindhoven. Northern Europe’s biggest design event presented work from 2,600 designers. This year’s theme was ‘If not us, then who?’, driving home the point that we are entering a period in which designers will increasingly take responsibility to shape the world and make it better. In this new geological era, known as the Anthropocene, human creation will realign processes of nature and will further blur the boundaries between the natural and the technological. For instance, in her design of a greenhouse (see below), solar designer Marjan van Aubel used solar-powered LED lights to grow plants. To deal with a future of rising sea levels and less fresh water, designer Mathilde Nakken created a concrete tile that solidifies dikes and at the same time offers ideal conditions for sea kale, a vegetable grown in salt water. However, as we enter the Anthropocene, we do not have a full oversight of the consequences of our actions, making speculative design an increasingly important tool to investigate possible futures.
America’s second Sputnik moment
After WWII, the U.S. became the unchallenged global hegemon. Consequently, the launch of the first Sputnik satellite by the Soviet Union in 1957, was viewed with awe and anguish in America. In response to this “Sputnik crisis”, the U.S. ramped up public investment in technology (federal R&D spending doubled in 1958) and established several public-private partnerships to catch up with the Soviet Union’s space technology. Now again, U.S. dominance is challenged; this time by China’s rise and the fear that China will leapfrog the U.S. in next-gen technology. As a result, there is renewed American interest in defining a grand industrial and technological strategy, for example for AI, quantum computing and 5G. Even Jeff Bezos – a long-time critic of President Donald Trump – urged Big Tech companies to collaborate with the U.S. federal government to spur new technological innovations. The threat of China’s industrial strategy (Made in China 2025) and progress in technological development is creating a second U.S. “Sputnik moment”, possibly leading to a new public-private cycle of technological innovations.
Sustaining video service appetite
This quarter Netflix added more subscribers than expected with most growth coming from overseas, indicating saturation in the U.S. market. Indeed, Ampere Analysis found that the U.S. market might have reached a limit in terms of new homes that are willing to pay for online video services. Nevertheless, TV networks, digital media companies and even retailers (Walmart, Costco) continue to launch new video streaming businesses. At the moment, the offer ranges from broad Netflix-like services to niche services aimed at (specific) sports, drama, horror, anime, art house movies, etc. However, in this increasingly fragmented market, players are facing growing content and subscriber acquisition costs, making it more difficult to operate and thrive. In such a market, the winner might not be the company with the best or most unique content, but the one that centralizes content for customer convenience, even if that means directing a user to a competitor’s video stream. Only a few services attempt this route – among them several pay-TV operators – but it might be the one that pays off the most.