Photograph by Boonchai Wedmakawand The formerly sleepy world of regulation has just become the hot new thing. Rules are being drawn up now that will fundamentally reshape the prospects of individual firms, sprawling ecosystems, and even entire nations. In this brave new world, the risks and opportunities of regulation […]
The formerly sleepy world of regulation has just become the hot new thing. Rules are being drawn up now that will fundamentally reshape the prospects of individual firms, sprawling ecosystems, and even entire nations. In this brave new world, the risks and opportunities of regulation have become a key driver of pretty much any business strategy. From e-commerce and energy production to selling experiences, financial services, and crypto payments, much hangs on what regulators will mandate, allow, or encourage in big tech. And if investors and businesses aspire to identify the future winners and losers, their first concern should be understanding, and potentially helping shape, the rules of the game.
Admittedly, regulation has always been an important strategic driver for telecommunications, public-sector contractors, and (especially after the global financial crisis) banking. But for most other businesses, regulation was just red tape—a drag on profitability that had to be overcome. This is changing radically: as traditional boundaries vanish and digitization shifts consumption from products to experience-based bundles, platforms and the ecosystems they support rule the day, and with them comes a new type of power. As orchestrators of sector-spanning ecosystems drive the economy, regulators are revisiting their playbook, and more change is afoot. The rising regulatory backlash against big tech should be of concern to all companies.
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