Horizons Newsletter – week 34 // 2019
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 digitalization 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.
Can e-scooters redefine our cities?
Micro-mobility companies like Lime and Bird offer last-mile transportation in the form of e-scooters, steps, or bicycles. Helping to cut CO2-emmissions in cities and proving popular with commuters, these companies are expanding rapidly in the U.S. and Europe. McKinsey estimates the micro-mobility market in the U.S., China and Europe could be worth $300 to $500 billion by 2030. However, the rapid growth of micro-mobility services has spurred authorities into action to prevent unused, broken or illegally parked scooters from filling up the streets. To survive, e-scooter services have to comply with stricter regulations and seek close cooperation with local authorities. For instance, by providing the city with (anonymized) data through standardized specifications, like in Los Angeles. Leveraging data collected by these services creates opportunities for new revenue streams and helps municipalities define the cities of the future. Already, cities are partnering with companies that use data to evaluate urban planning and infrastructure changes, provide holistic views of mobility in a city by combining data from all transportation services, or offer advice on the pricing of curbside parking.
Putting open source to the test
Open source software (OSS) development has grown increasingly popular over the last two decades, underpinning most of our digital infrastructure from operating systems (Android, Linux) and database technology (Redis, MongoDB) to web browsers (Firefox). In fact, CB Insights forecasts that the open-source services industry will grow from ~$17B in 2019 to nearly $33B by 2022. The integration of OSS into cloud offerings of Google, AWS and others, further boosts OSS adoption by giving more credibility to OSS projects through scalability, interoperability and easy availability. The downside, however, is that OSS development companies, such as MongoDB, Redis, and Elastic, are left empty-handed. Instead of making money by selling advanced features and customer support services on top of the free OSS that they helped creating, they see their free code being bundled into services sold by the cloud providers. To turn the tide and safeguard open-source development practices, open source needs new models. For instance through revenue sharing agreements or by changing the OSS licensing terms. Both options are being put to the test; the outcome, however, is still unsure.
In December 2018, we posted a longer text on our website on the implications of the Open Source developments described in this Horizon.
A climate license to operate
So far in his presidency, President Trump has rolled back or weakened 83 environmental regulations in favor of businesses in, among others, the energy and chemical industry. Moreover, he has appointed a climate-sceptic leadership for the Environment Protection Agency, which has greatly reduced enforcement efforts at the federal level. In 2018, the EPA issued the lowest number of penalties of the past 20 years. However, this does not withhold new champions to arise at state-level. Climate action is often led by individual states. For instance, both California and New York have recently set some of the world’s most ambitious climate targets. These progressive states are pushing and inspiring other states to adopt climate measures and pressure the federal government to act. Moreover, in response to Trump’s climate inaction, the Democrats are now positioning themselves as ‘pro-climate’, vying to implement more sustainable policies if they win the 2020 elections. On a more speculative note, if the Democrats win the next presidency, the U.S. might undergo a wave of environmental regulations, creating problems for some industries but opportunities for others.
