Top 7 Trends that will affect the digital space in 2019
It seems every day there is a news story about how a large digital company continues to violate societal norms, as it pertains to our data privacy & security. Today, as I get ready for work and turn on my news feed, Facebook is once again in the news — if not at the front of the line in corporate misdeeds.
In the last year, we have also learnt about the full extent of data breaches affecting, not only the US 2016 election but scratching the surface of societal impact — be it the war in Myanmar or social media as a propaganda platform, with global ramifications. Further, there is a growing cynicism of technology, even with Millenials and other generations. In a recent study with Millenials present, we were struck by millennials acuity when asked to divulge any personal data. Everyone seems alert to any request for personal information online.
As we near the end of 2018 and think about how to move forward with technology as an integral part of our existence — here are my thoughts on some 2019 trends that will impact the digital space.
1. Regulations, Lawsuits, Dissolvements & Bans
This first trend is less of a trend and more the inevitable end. For years now, many digital companies have operated in the “wild west” of technology, with little to no regulations governing how they conduct themselves, especially around the usage of human data. As this year tapers off and a new year ensues, there is much in the air to suggest that the regulatory wheels are already in motion.
On December 19th, 2018 Washington, DC sued Facebook over its Cambridge Analytica data breach. For those with short memories, given the news cycle these days, Cambridge Analytica was central to the 2016 Election scandal and was deemed to have been a recipient of over 86 million users’ data from Facebooks. Even more distressing, just in early December 2018, Facebook also divulged that Netflix and Spotify were also given access to Facebook’s user messages — yes! Direct access to its users’ messages.
Upon divulgence of this news, Facebook’s market value dropped by an estimated $22 billion from its stunning market capitalization to $319 billion. According to US Attorney General Karl Racine in the accompanying press release:
“Facebook failed to protect the privacy of its users and deceived them about who had access to their data and how it was used.”
Given this — there is all indication to suggest regulations for Facebook, Google, as well as other offenders of the technological age, is around the corner. Of note, on a political side, there is also some level of bipartisanship, which seems to be fundamental to the increased probability of regulatory predictions.
It would seem fair to say that the breadth of influence of many of these companies is not unlike an oligopoly — few large companies driving the market space and acting with impunity. And not unlike many media giants that were forced to slice and dice their bits into smaller operating units, the same fate awaits these virtual giants that that for many have become too powerful.
It was only in 2017 that US President Donald Trump issued an executive order to ban Facebook in the country. While many may see this as the utterances of an unpredictable president flexing his muscles, there is nothing to say that constant threat may not be the reality of our existence soon.
Just in 2016, several countries have banned access to Facebook, including Bangladesh, China (not including Hong Kong or Macau), Iran, and North Korea. As of May 2016, the only countries to ban full-day access to the social networking site are China, Iran, and North Korea.
While this post uses Facebook as the example here, it may extend to other similar networks whose platforms are deemed, digital violators.
2. The Power of the People — Pushback on Technology?
In a recent Pew survey conducted between May and June of 2018, there is glaring evidence that many millennials are moving away from Facebook. In the late Spring of 2018, Pew reported that an estimated 44 percent of users between 18 and 29 deleted Facebook’s app versus the 20 percent of people aged 50–64 who did so. For users over 65, that number dropped to 12 percent. At a minimum, over half of the respondents said they’d adjusted their privacy settings over the previous year. I predict that as we learn more and more that the fall out will continue to grow, leaving the once touted “darling of the tech industry” following in the steps of My Space and other vanished social networks.
The once aspirational social media platform may have overstayed its welcome in the app world — now seen more as a social media pariah, that many users, once followers are proud to loudly announced that they are not on Facebook.
In another post, I wrote about my own Facebook experience and the fundamental flaws in the platform. Back in 2015, I sensed increased anxiety about the app as well as slow spreading toxicity on the platform and decided it was time to disconnect. Something had changed, and Facebook would never be the same again.
As an early adopter of Facebook, the app served its purpose to connect me to my countless cousins, sharing family pictures and stories from across the globe. And then one day, I said goodbye to my 413 friends and family and spent the next day’s deleting all my content.
Did I feel sad?
Yes!
Do I regret it?
No!
Three years later, the movement away from Facebook continues and is only expected to go downstream and potentially dwarfed in the social media space. The hope is the ills of Facebook can be used to mitigate potential fallout, with the companies acquisition of Instagram — now seen as the new darling of the social media world.
While I use Facebook as an example here, they are not alone, but rather the most prominent of the digital companies amid this societal problem. Finally, the fallout of Facebook trust erosion will affect every online experience moving forward.
3. The Rise of User Experiences in Brick & Mortar
Now let’s pivot to the offline experiences, briefly. Over the summer, I spoke to a close friend of mine who owns a thriving shoe and kids accessory store in Vancouver, Canada. He was concerned that many of the stores in the mall had a “schtick” as he called it. Not only do they sell something, but there is also an experience underlying the customer experience. His online business was doing great, but offline was becoming a concern.
Until you are a parent, you don’t realize that there is an underserved group of consumers — tweener kids — too big for the typical kid department but not big enough for the adult section. And, if Walmart is not your ideal place to shop, there are very few options. My friend decided to fill this niche in the online plus brick and mortar space. BUT he needed a branded experience.
He wanted to brainstorm how to add more visceral experiences in both his online shop but mostly his brick and mortar store — make the experience sticky -make customers want to bring their kids and mostly make the kids want to come back.
Much like my thriving local bookstore, with an adjoining Starbucks and toy shop, where an additive trainset is a focus for young families, my friend wanted to add something to be more memorable.
In a Forbes article, How the Brick & Mortar Experience Has Changed Interior Display & DesignUNSPLASH, Rayonne Vossough writes:
A compelling atmosphere and the overall story that a business tells is important. Shopping is becoming more of an experiential experience and now, with trending exhibits attracting consumers, (Candytopia, Dream Machine, ColorFactory) retail business owners should be focused on enhancing their overall physical environment. All touch points including sight, smell and sound along with clean, easy to shop environments with interesting décor and displays are what attracts customers and encouraging them to stay, and ultimately spend more money.
It is clear that the companies that thrive will be those whose value-add is an integrated user experience as they make decisions about how best to attract customers harder earned money. Competing with online experiences will be a challenge but all things considered, there is an opportunity to build on real-life experiences that may shortly create high levels of viability for those turning away from online, where data compromise seems to be an everyday thing.
4. Silicon Valley loses more of its gloss
In March 2018, the New York Times reported that Silicon Valley investors and other elite groups of business people have declared Silicon Valley to be “dead.”
Silicon Valley! — The Northern California area, known colloquially as Silicon Valley, for its beginnings in the semiconductor space, is home to all the big tech giants of our age, including Google, Facebook, Twitter and Yahoo. A part of this prognosis comes from the fact that Silicon Valley has become very expensive, making it hard for new start-ups to thrive. I take this a bit further and predict that the compounding of the high cost, earned with the reputational loss of many of these giant companies, will inform lacklustre appeal that seems to be taking root in the valley.
In the past years, investing in tech was seen as a winning strategy. 2018 has been a different story. And 2019 will be interesting.
In February 2018, the stock market saw a brutal sell-off, and tech stocks were not exempt. The tech sector suffered along with the broader market, seeing a loss of 8.6% — almost the same as the benchmark S&P 500. It later recovered and surged higher to a record high after President Donald Trump’s tax-cut plan, which provided a brief reprise. Then the Nasdaq tanked as much as 24% during the final four months of the year, tumbling into what investors call a “bear market” — a market with prices falling which encouraging selling.
Of note, there was widespread loss among the tech group, the “FAANG basket” — i.e. Facebook, Apple, Amazon, Netflix, and Google parent Alphabet. Apple (-12%) and Google (-5%) are down for the year, and Facebook (-27%). Saved were Amazon (+18%) and Netflix (+21%) though these were not their all-time best. It must also be noted that Facebook’s strategy is to grow outside of the US as its domestic growth has plateaued.
Recode reports:
After months of bad news, Facebook unveiled its second quarter earnings back in July and reported less revenue than Wall Street analysts expected — and more importantly, fewer new users. In fact, Facebook didn’t grow at all in its most valuable markets, the U.S., Canada and Europe. It actually shrunk.
Further, internal upheavals and employee dissatisfaction at other social media giants seem in the news regularly. Some of the issues range from data policies, to pay equity and sexism and other forms of discrimination in the workplace.
A recent Google employee walkout foretells of worse to come, more is understood about the inner workings of Google operations. While this is not limited to Silicon Valley alone, the tell-tale signs of a growing lacklustreness about Silicon Valley are evident.
CNN reported:
The demonstrations, dubbed “Google Walkout,” follow an outcry over a New York Times investigation that detailed years of sexual harassment allegations, multimillion-dollar severance packages for accused executives, and a lack of transparency over the cases.
In another New York Times article, California congressman, Rohit Khanna, representing Silicon Valley may have best captured the growing sentiment towards Silicon Valley. In an address during a tour through the Midwest, he says:
Some of the engineers in the Valley have the biggest egos known to humankind. If they don’t have their coffee and breakfast and dry cleaning, they want to go somewhere else. Whereas here, people are hungry.”
Granted nothing good lasts forever — and much like the great American gold rush, this too will pass.
5. Institutionalization of Side Hustles
So if you have never heard of the expression Side hustle, then you must be living under a rock, as the saying goes. Last year, I posted an article on the topic of side hustle economy, also referred to as the “gig economy.” Here is a recap from that post:
Side gigs refers to ways in which people augment their income outside of your 9 –5, allowing for more financial flexibility and enabling the pursuit of things they would rather be doing instead of a 9–5.
For many people, the word “side hustle” is also seen as just another millennial trend that will fade away as the millennial generation mature. From all reports, the trend is taking root among other generations. There are many factors at play, including the rapid automation of many jobs, making some traditional types of industrial and corporate roles, all but eliminated.
And so yes it is still here. A recent Forbes article outlines five reasons why the Gig economy is here to stay. Of significance is the ripeness of technology accommodation primarily in the Millenial and Gen Z group that both enables and catalyzes the gig economy. This trend is even more tangible to me as I see this with my Millenial stepdaughters, who have turned their side gig passions in food styling and luxury flower arrangement into full fledge businesses in high demand.
Entrepreneurship is now taking on a wholly different additional meaning. A growing number of millennials and Gen Z’ers are becoming “solopreneurs,” that is taking their skills and selling them on the market to a variety of “buyers,” and simply working independently, or collaborating with one or two others to offer a variety of skill sets to established enterprises.
This trend is only at the beginning as more and more people also seek services borne out of passion.
6. AI needs a course correction
Yes, I said that! So we have trained that monkey called AI. Now what?
Recently I read an unfortunate article about a woman who had used social media to divulge the fact that she was expecting a baby. As things turned out this woman had lost her baby. However, it seems that the AI underpinning her social media platform had not yet received that memo. In her heartfelt letter addressed to Tech Companies she writes:
Please, Tech Companies, I implore you: If you’re smart enough to realise that I’m pregnant, that I’ve given birth, then surely you’re smart enough to realise that my baby died, and can advertise to me accordingly, or maybe just maybe, not at all.
So you may think, so what?
I love technology with a sense of cautious optimism. As we live our online lives, we must be acutely aware that the content we see is not accidental. Machines are continually learning about us — be it your phone listening to the inflections of your voice to improve voice technology or your search history or your social media posts. It paints a picture of you — informing AI doppelganger, whose sole goal is to spark engagement, translating into income for these platforms.
Just last night alone I was stumped and upset when, after dinner, I turned on my phone only to see an advertisement for a deep fryer.
What!!! — wrong; just wrong.
We had just made French-style homemade fries and had engaged in a table chatting over french fries. A device had been listening and decided to chime in as an ad. I spent the next 30 minutes reviewing all devices in the room for privacy and security settings.
The course correction will come encased in mandatory transparency into how our data is collected, for what purpose and how it elicits responses from us. We need to understand the degree to which our human agency is manipulated and in many cases, violated.
As human users of technology, we need to remember that AI aims to be “human-like” anticipators of us. Tech companies will, in the future, need to give users full access into those elements that affect our agency in cyberspace. Opt-out options to be followed, Opt-out options for recommendations and so forth need to be part of the societal conversations. The fight for our agency is critical and will be a conversation in the air in 2019 and the years to come.
7. Monetization opt-in benefits for Personal Data usage
How much is your data worth?
In June of 2013, later updated in 2017, the Financial Times built and revealed a unique calculator that allows users to check how much their data is worth. This calculator, if anything, provides an insight into the billion dollars “data brokerage industry,” about the personal and social details of individuals. The calculator allows some insight into the money that can be made by a social media giant like Google and Facebook from selling such data records of their users. But when and will users ever see any of this money generated from their collective data?
Will users be able to opt in or opt out of having their data used for financial gain? And if users opt-in, will there be a future compensation model to profit share with these social media giants?
IF YOU’RE EDUCATED OR WEALTHY, PEOPLE WILL PAY MORE FOR YOU
A few years ago I opened a Medium account and a few months later received 103$ for one of my posts that had received some claps. Frankly, I never expected any such compensation and would still write if I never received another dime; I write because it’s cathartic. But the thought re-crossed my mind then that as content creators in any sphere, there should be the expectation of compensation, as the content is itself the lifeblood of all social media platforms.
Just imagine if all content creators disappeared — what would be left then?
In a recent New Yorker post by Kevin Roose, the author writes:
Chief among influencers’ complaints: Even though Facebook has made it easy for them to reach enormous audiences, it has been slow to deliver tools that would let them share in the advertising revenue their posts generate. Facebook has also cracked down on certain types of link-sharing deals that many influencers have used to earn money on the side.
Roose also earlier quotes a social media promoter who laments:
“Facebook has got to start treating influencers with more respect,” said Roozy Lee, a social media promoter who manages a network of celebrity and influencer Facebook pages with more than 200 million combined followers. “These people need to make a living.”
As these conversations about data ownership, usage and monetization, expect a change.
Taken together these 7 trends are spaces to watch.
Happy New Year!
