From Plutocracy to Meritocracy: How Blockchain can Upend Digital Platforms and Empower Individuals
We live in the age of the digital platform. Many of the world’s largest companies create value by connecting us to one another, rather than by producing something directly. Airbnb is now worth more than most of the world’s hotel chains despite not owning any hotels. Ride sharing services like Uber are outcompeting taxi companies worldwide, despite not owning their own vehicles. Social media platforms such as Facebook and YouTube provide platforms for us to capture one another’s attention, and then sell some of this attention to advertisers. These platform companies have grown immensely, becoming increasingly dominant over time by owning and controlling the conduits of interactions, and collecting user data to continually improve their services. However, distributed trust technologies such as blockchain are now presenting an existential threat to this model. Public blockchains and smart contracts can enable the creation of decentralized platforms that do not rely on profit-seeking intermediaries, and can allow individuals to own and control their user data. Without the possibility to own and control platform architecture and user data, a firm’s strategy must change fundamentally if it is to survive in this new world. This research conceptualizes how blockchain technologies change firm strategy in platform ecosystems, and asks: under what circumstances should firms continue to exist at all?
Chris Rowell, DSc (Tech), is a Postdoctoral researcher and instructor at the UBC Sauder School of Business. His research is in strategy and innovation, especially with new technologies, and he is currently following the emergence of the blockchain field in British Columbia and more broadly. Chris is especially enthusiastic about how blockchain (and other distributed trust technologies) can change the way we organize and interact, and the implications for business, governance, and society.