This whole idea of, like, every time you want something, having to spend money, I mean, that’s kind of like an old-school idea. As a futurist, I’m of the mindset that you won’t really buy anything, and people won’t own anything and that’s just how the world will work.
Buying stuff? It’s so last century. The internet has made distribution so cheap and convenient, and made it accessible for so many more customers, that it has opened the way for models that sell access rather than products. Aaron Perzanowski, a professor at a University in Ohio and author of The End of Ownership, said: “There’s no doubt the notion of ownership is in decline, and we’re likely to see this trend continue.”
These forces have been at work for years. What has changed is that the psychological barriers that have long held them back — the fixation with ownership — have begun to crumble. This is partly due to companies simply getting better at offering compelling services. It is also about demographics. The biggest section of our Z Tyre subscription programme are customers are aged between 25 and 45 — Generation X and Millennials.
Meanwhile, economic needs have become more acute as the proliferation of smartphones has accelerated the death of old models. Why buy a morning paper if you can scroll through the news before you get out of bed? The question is, how widely those dynamics can be applied and how quickly they will take hold. Well let’s look at the entertainment industry which was transformed by the file-sharing phenomenon Napster. Spotify this summer announced that more than 60m people pay a monthly fee for access to its library of 30m songs. That surge has coincided with the revival of the industry. This year is set to be the first since 1999 — when Napster burst on to the scene — that the industry will actually record consecutive years of revenue growth. Netflix launched its film streaming subscription operation 10 years ago, and this summer it surpassed 100m subscribers.
Technology’s ability to bend the concept of ownership is seeping into other, unexpected corners of life — such as cars. The typical automobile sits idle 95% of the time, yet most people would rather it stayed parked in the garage than hand the keys to a stranger. Turo was founded to change that. The San Francisco company connects people looking for cars to rent with owners willing to lend. Nearly 180,000 people have put their cars up for hire on the site, up from the fewer than 5,000 it had lured in 2012, the first year of nationwide operation. Chief executive Andre Haddad said shared ownership helped to alleviate the cost of buying and maintaining a car. “We can make the car an asset for the first time,” he said. Last month, Daimler led a $90m financing round in the company — its bet on the future of car sharing. You have also many major car manufacturers, like Porsche and Hyundai offering subscription services for cars. And now not just cars but even tyres can be subscribed for with Z-Tyre’s world first tyre subscription service.
As technology becomes more deeply ingrained into products, the very notion of what a product is, and where its value lies, gets muddied. When Hurricane Irma was bearing down on Florida last month, Tesla made a striking move. It remotely lifted the battery-charging constraints on some of its cheaper models to help people who were desperately trying to get out of town before the hurricane hit. The cars all had the same physical batteries. What that showed is what’s important isn’t the product, it’s the code, and it also demonstrated that Tesla can do the exact opposite. If you haven’t paid your bill, maybe they cut back your battery capacity. Even with these things in our possession, we don’t have control in the way we might expect.
So if buying stuff is over then one has to wonder what Amazon, the biggest seller of stuff on the planet is doing about this. The answer – PRIME!! I see Amazon bundling more and more into Prime. The opportunity for Amazon is to get hundreds of millions of people, or even a billion people, paying $10 a month for a bundle of services and effectively controlling more and more touch points. And you know if Amazon is getting into it then it really is the future!