We live in the age of hyper-consumerism^. Companies are desperate to convert as much raw material as possible into anything that can be purchased. The machine has been perfected to the point where even leftover byproducts from any production cycle can be fed back into another production line to manufacture something somebody would buy. Sometimes this includes using unhealthy materials, both for us and for the environment. But it doesn’t matter as long as it turns a profit. The machine has to keep producing something, anything, just please, buy it. This is wrecking our ecosystem and is woefully unsustainable.
Awareness regarding the bleak future we might be creating for ourselves after drowning our planet in toxic trash is increasing. However, most people still buy products built to last a very short time because there are no alternatives. And even when certain products could last longer, companies have gotten very good at fooling their followers^ that fashion doesn’t apply only to clothes, but to everything else as well. Now-a-days, many people willingly throw away perfectly operational devices just to jump on the latest model.
But a new economic model is becoming increasingly popular – the monthly payment for a certain service, sometimes metered based on how much a person has used the service. At the moment, this is particularly successful in the digital space (media streaming, software, data and bandwidth, games). Let’s see what a generalized version of this system could mean to our economy and ecosystem in the coming decades. I call it “anything as a service”. The term is already used for software, but in this case, it is truly anything.
The purpose of any post in the Futurology^ category is to launch a wild, boundless speculation regarding what the future holds regarding a certain concept. To get things going, here are some of the things I imagine can be happen in the near future (coming decades) with the widespread use of “anything as a service”. Feel free to submit your own ideas in the comments below. With your approval I may integrate these in the article, giving proper credit.
- Since I mentioned fashion earlier, let’s start with a lovely example of how a company is disrupting the way people use clothes. Enter Rent the Runway^: for a monthly fee of $159, the service allows you to rent four pieces of clothing or accessories at a time and make exchanges as often as you like. The fee includes shipping both ways, dry cleaning, and insurance. Granted, that’s a hefty fee, but given that the company offers products from top designers (including clothes that retail for $1500), it is understandable. There are other clothing companies that have excellent return polices, even though there are some challenges^ that will need to be overcome.
- What if instead of having to replace a smartphone every couple of years, or a TV once every five years, there would simply be a smartphone subscription, or a TV subscription? Pay $300 yearly and you are guaranteed the best smartphone in a given class, with a bi-yearly upgrade included (without the hassle of chaining yourself to a mobile carrier or the risk of spending hours bickering only to end up fooled by a sly salesman). Pay $200 yearly and you are guaranteed that your TV is always upgraded to the latest display standards. There will still be plenty of brands to choose from, all with their own different prices and features. Some retailers might even group several brands into the same pricing segment (not everybody cares about what brand their TV is, and if they’re not satisfied they can simply ask for another brand, with all transportation costs covered). Simplicity without harming diversity. Pricing and production philosophy will change drastically and for the better of everybody involved.
- The main and definitive difference with this strategy is that instead of buying a particular model, you would buy into an entire line. For example, you want a smartphone with a screen of a certain size, featuring a good camera, not necessarily from a certain company. Or you want a TV that is good for gaming. Or a road-warrior notebook that is very light, has a secondary backup battery and has a mobile data subscription included. A buyer would simply add features on top of a base cost, each feature costing an additional $X per year. This will greatly simplify a customer’s decision process and it will make companies more responsible for what they manufacture, since they would lose yearly subscribers if their products aren’t good enough.
- This will lead companies to improve their designs so that devices can have their parts easily replaced and upgraded. They will have to reuse as much as possible before throwing anything away. Eventually, the reusability standards will spread around companies and lines of products, as a way to reduce costs. If we look at the Rent the Runway example above: it encourages manufacturers to produce quality textiles, as they wouldn’t want these to be destroyed after a couple of washes, which is what happens very often to most clothes today. I have a sweater that I’m wearing since the 90s and it still looks better than some of the clothes I purchased a couple of years ago.
- What happens when an entire generation of devices or appliances is replaced? This system would make it very simple for these devices to make it to lower price tiers, or be repurposed. For example, previous generation TVs could be used inside airports or restaurants.
- While most of this will evolve naturally out of the need to keep a product alive for as many years as possible, some governmental regulation is also required, particularly when it comes to batteries and cables. This has become the main tool to force people to replace their electronics. Cables and adapters have always been a gold mine that companies abused in order to obtain additional profit (although it’s becoming quite ridiculous as of late). Design and water-proofing is another lie that companies use when justifying irreplaceable battery designs. Watertight watches have existed for decades and this didn’t prevent their manufacturers from allowing easy access to the device’s innards. Governments should enforce better practices in this area.
- Another area that is in need of regulation is software. As Apple has proven, it’s not so difficult to regulate software. Did you notice the efficiency ratings on various home appliances? How about having the same ratings, but for software. If I download a text editor, I don’t expect it to take more than a second to start up, no matter how many features it has. Features can be loaded on demand, and based on their complexity, they shouldn’t be consuming ridiculous amount of resources. Anything else is simply bad coding. Poorly designed applications will be rated low on the efficiency scale (E or F). With the advent of machine learning, the process of rating software might become quite easy in the future, driven mostly by automated inspection programs.
- How would “anything as a service” affect competition? Let’s start with an extreme but very useful example. If we look at Spotify, a music streaming service, it is quite obvious that less popular artists are having a very tough time competing with known artists, because income is based on the number of times a song is played. In turn, playtime is based on the taste in music of the majority, or even worse, on how some producers have become good at forming and exploiting what the general public likes. This situation will probably not be as bad in the case of appliances, electronics and software (unlike art, they have very specific functionalities). Even so, I believe a fix is possible for both situations.
Again, I’ll be using Spotify as an example. The company’s Discover^ functionality is a recommendation system used to promote all and any music hosted by the service. I have already found hundreds of new artists using this feature. All “pay as you go” markets would have such a system. I believe the functionality can be improved, so that artists and products that are risking bankruptcy can be given an extra lifeline consisting of additional promotion. A human factor could also be introduced in the form of community voting and accredited judges that can save overlooked or underrated creators. Such a system will work well even for the top performers, because increased competition is often a source of great ideas.
Another factor that can hurt competition is when a company takes advantage of its product catalog in order to force others out of business. Read about the concept of closed ecosystems (also known as walled gardens)^. This also happens within the current retail model, but it might become even more damaging for competition when a company can offer lower subscription prices to customers who purchase more of its subscriptions. This is a challenge that possibly requires regulation by an authority of some kind.
- There is also one major positive competitive disruption that will occur when “anything as a service” takes hold. Companies that will stick to ways that are destructive towards the environment and disrespectful towards customers will pay a steep price, perhaps even face bankruptcy. If we consider companies to be similar to lifeforms^, what the “anything as a service” model will cause is nothing short of an extinction event of the old business model. And I sincerely can’t wait for that.
The Futurology Disclaimer: I do not claim that my ideas are original. I’m sure these suggestions are just scratching the surface of what can be achieved, but hopefully they’ve scratched enough to get somebody inspired to come up with more. I’m also sure many of these ideas are already being worked on by several organizations. If any of the ideas listed by anybody on this page are original and will benefit any organization, I expect credit to be given where it’s due.
2018-02-11 – 1.0 – Written.