Or will AI steer us towards fragmented, more efficient markets?
VC and PE investors as well as stock market analysts are placing and betting in many different ways on companies that use AI for their business model. But will we truly see many new AI stars in the investment sky?
AI is being hailed as a technology that will change our world. It enables completely new user interactions via natural language or chat. AI is creating the space for a revolutionary form of robotics because machines will be able to work more closely with humans as cobots in the future. This will massively simplify the previous small-step programming of actions for machines and robots and create completely new areas of application.
Yes – AI will lead to massive upheavals in many industries and influence our lives as humans in many areas. But will this also lead to completely new AI companies that dominate the digital world in a similar way to today’s digital companies à la Meta, Google, Microsoft or Apple? Will we see new players in this field, perhaps from other countries? What opportunities and possibilities do China or Europe have in the field of AI companies? To provide a possible answer to these questions, we first need to take a closer look at the current situation.
The new global AI players are already here
The new AI giants don’t have AI written all over them. They are just familiar business models that utilize AI in a new form and are successful with it. They are called TikTok or TEMU, for example, and are able to measure every user with just a few ‘Like’ interactions and classify their characteristics. After just a few days, they know us, and our preferences, better than we know ourselves. They use their AI models to sell us goods that we don’t need but feel we’ve always wanted.
These new players can become big through new, consumer-orientated business models. But they can only become big if we let them. It is therefore up to us as a society to establish rules that restrict the direct use of AI against our interests.
Content business models will be the first to change
In the first wave, we will primarily see major changes in content-driven business models.
It’s not just about posts on social media platforms. It’s about educational content, tutorials, films, books, newspapers, magazines, and photos – everything that can be generated from human output using machine learning.
And it is also clear that a well-designed learning course for a technical task will not be worse in the future, but probably even better than a course that was previously created by humans.
The question for the coming years will be: How do we as humans want to retain our self-determination and, ultimately, our dignity – and ensure that we do not lose more and more control over the fact that ever more parts of our attention (and thus of our consciousness) are controlled and thus realistically manipulated by machines?
Whether new and large AI-driven content business models with a monopoly character emerge from this will therefore depend, above all, on whether we want to and will allow this to happen. Developments in the USA show that there is also resistance to the monopolies that have emerged in the digital era.
Perhaps new areas with paid services will develop for services that are currently free, such as search services and social media.
The transformation of digital monopolies into AI aggregators
Apple, Microsoft, Google and Meta – all the big tech giants are ‘all in’ when it comes to AI. They want to save their digital monopolies in the AI age. And they have the best chance of not being disrupted by new providers because they are already sitting on huge amounts of data, which are the prerequisites for the AI models of the future.
The most clearly recognizable strategy is that of Apple, who want to slowly but surely introduce us as users to the new possibilities of personalized AI with IOS18. AI should remain invisible, increase the value of the devices and draw us even deeper into the Apple ecosystem. Preferably without a big outcry, but also preferably without a warning.
Microsoft wants to and will earn from everything we or our companies do with data to utilize AI models via their software stacks and Azure consumption. They will make money and have a hand in every new industry that is first digitized and then AI-ized.
There is a certain likelihood that the AI model providers will end up like the data centers and telecommunications providers of the early 2000s. Overhyped – and seen as fallen angels.
The digital companies that are already big today will take their market power with them into the AI age. Perhaps a new provider such as Snowflake or a tech provider for data integration will also make the leap into the new AI era.
And the other industries?
The existing industries will have to incorporate the new AI possibilities into their services and products. A huge transformation attempt in which a lot of providers could fall by the wayside.
We will all utilize the tech stacks of the big US providers and make these companies bigger and stronger. The space for digital sovereignty will shrink.
What can we deduce from this for B2B models?
Thesis 1: The big US tech giants will not only be able to defend their market power in the age of AI, but also expand it.
Thesis 2: Our previously non-digital physical business models such as mobility, housing, industry and mechanical engineering will be digitalized by AI and we will have to cede more of our margins to the big US tech companies.
Thesis 3: Our plant construction and mechanical engineering will be robotized. We definitely have opportunities to build larger companies here. But as soon as it comes to software and digital services, US companies will cut out parts of our models.
What can we deduce from this for consumer markets?
Thesis 4: The free consumer aggregator models from Google and Meta will have to be used primarily by people without money. For people who can afford it, new trust models will be established that classify and evaluate content.
Thesis 5: Markets with physical interaction with our bodies will remain and become more important. This includes mobility and everything related to real interaction between people such as travelling, concerts, and eating.
Thesis 6: All these physical markets are under attack from AR, VR, and other digital technologies and models. (One example of this is the current virtual concerts that are and will continue to take place in parallel to real concerts).
Thesis 7: What is luxury, hip or ‘in’ will be defined in ever smaller communities and subject to fashion cycles. This will make the world more fragmented and increasingly difficult to explain according to clear rules. Ambiguity will increase significantly and increase uncertainty for every individual.
Thesis 8: The price for us consumers will become community specific. How we measure and determine value, and therefore the price of physical and digital goods and services, will be determined by our social environment. Here too, the concert example can be used to illustrate this: People who cannot afford to attend a real concert have the opportunity to do so anyway through virtual concerts.
Of course, these are wild hypotheses – and things will probably turn out very differently. But to understand the influence of AI on our future, one aspect is crucial: the role of humanity itself.
Our future with AI
AI will find its way into the B2B environment as a new technology and thus become a further building block in the digitalization of the world.
In consumer markets, it is more complicated and more fundamental. The main fork in the road we face as humanity is the question of whether we let the market decide how exactly AI is used or whether we impose rules on ourselves as a society and in what form.
We as humanity determine these rules and our self-image ourselves.
I’m certainly not a fan of the global frenzy of regulation and bureaucracy. And we see what conceptually absurd results politicians achieve when they intervene in complex systems and markets with dogmas such as consumer protection or environmental protection.
Without intelligent, self-determined, and ethically stable people, we will collapse as a society because of AI. This cannot be changed with new and more rules or laws with which we try to avert the potential dangers. This will drag us deeper into the swamp of overregulation.
The dawn of the AI age will lead to a systems war between the capitalist West (USA, Canada, Great Britain), the European socialist world view and the communist camp in China and Russia.
Over the past few years, we in Europe have weaned people off self-responsibility through over-regulation. For this reason, I see a dark future for us Europeans in this area. Because in an AI world, we need a liberal and self-responsible mindset in order to use our attention and decisions in a meaningful way for our own lives and our society.
So what will become of our extremely successful platform business models?
The eternal bundling and unbundling cycle for aggregators and brands will continue in the AI world. If we get it right, the world will become more fragmented and it will be harder for the ‘winner takes it all’ markets.
If this happens, it will mean that we have (finally) found sensible regulations to tame AI-supported platforms in the human sense.
It is more likely that there will be AI brain hacking platforms such as TikTok or Temu that ultimately manipulate us, regardless of the current ban debate.
As humanity, we therefore have it in our own hands how our future develops. In the coming age of AI, our future will be characterized less by individual people with names like Elon or Jeff and more by the resilience of entire communities. Thanks to the possibilities of VR, some of these communities will still have a reference to a place such as a city or a nation state. Others will be orientated around professions, hobbies or beliefs.
In the meantime, the big US tech giants will continue to benefit from the incorporation of AI models into many new industries and business models.
