Platforms Forge New Paths
Experts at the MIT Platform Strategy Summit described new challenges as well as opportunities
By Peter Krass
Today’s global platform ecosystem is ubiquitous, but it also faces some tough challenges — including value creation, labor issues; antitrust, misinformation, and government regulation.
Nevertheless, platform businesses are well-positioned to integrate the explosive growth of AI capabilities into their future operations and services. Platforms are also at the heart of innovative business models, the creator economy, and end-to-end visibility for supply chains, supporting new opportunities, marketplaces, and growth.
To explore these changes and trends, the 2023 MIT Platform Strategy Summit was held on July 13, both live in Cambridge, Mass., and online with more than 300 attendees.
One of the first speakers, University of Surrey professor Annabelle Gawer, noted that “When we as a community started to work on platforms…the mood was extremely optimistic, some might even say utopian.” But now, she added, “we need to take a harder and more lucid look into what platforms have achieved — not just in terms of good, but also in terms of bad.”
The spread of fake news and misinformation on social media were never anticipated, nor were legal and ethical concerns over generative AI, and the unevenly distributed benefits derived from platform content.
“Power is shifting increasingly to the platforms,”
said Marshall Van Alstyne, one of the summit’s three co-chairs, a professor of information systems at Boston University, and a Digital Fellow at the MIT Initiative on the Digital Economy (IDE). “We’ll have to pull some of that back,” he said.
As a result, government regulation of platforms is not only on the horizon, but in Europe it’s a reality. During a panel discussion on “The New Platform Regulators,” Europe’s actions were laid out by Rita Wezenbeek, director of platforms policy and enforcement for the European Commission. As she explained, Europe’s Digital Services Act requires platforms to submit to annual audit and risk assessment. What’s more, the audit committee can actually require a platform to take down content it deems unlawful, dangerous to democracy, or in violation of human rights. That’s a big contrast with the restriction-free “platforms-aren’t-publishers” attitude of the U.S. courts and Congress.
[Note: The summit was held prior to the July 21 announcement that seven AI firms are voluntarily setting safety standards on their developments.]
AI Unfolds
Generative AI tools such as ChatGPT were the focus of a panel entitled “AI and U.” The question dividing panelists was whether generative AI is just another technology tool or the first in an entirely new category of tech. Among those who see generative AI as “a paradigm shift” was panelist Kaifu Zhang, head of the AI initiative at Alibaba. “Generative AI is different,” he said. “Language is truly unique, and in the past six to eight months, AI has become really good at language.” That will lead AI to develop skills like planning and task decomposition, he said
“The universality of language is what makes [Generative AI] truly different from all previous generations.”
Another panelist, James Wilson, global managing director of IT and business research at Accenture, on the other hand, took a more sanguine view. “Going back more than 10 years, there are a number of ways that businesses can benefit from human-and-machine collaboration,” he said. “I don’t see this [trend] going away as the new era of generative AI comes into the workplace.”
Yoshua Bengio, a pioneer in deep learning and professor of computer science at the Université de Montréal, believes AI could soon become so smart, it could essentially evolve into an entirely new species — one that could escape the control of humans. Even worse, he added, “we aren’t ready as a society.” (Read more about Bengio’s presentation.)
New Platform Possibilities
Many speakers focused on the opportunities ahead. For example, a panel on end-to-end visibility for logistics and manufacturing platforms was quite upbeat. Although the manufacturing sector isn’t always leading edge when it comes to new concepts, Jon Sobel, co-founder and CEO of Sight Machine, explained how his company takes huge quantities of plant data and transforms it into concise information that manufacturers can use to dramatically improve their operations.
Another panel member, Inna Kuznetsova, CEO of ToolsGroup, detailed how her company offers industry-specific solutions based on advanced predictive analytics that help companies and supply chains forecast demand and replenishment needs, sometimes with an uncanny level of accuracy.
More positivity came from a fireside chat with Scott Sandell, chairman, CEO and chief investment officer at venture-capital firm NEA, in conversation with Geoffrey Parker, one of the summit’s co-chairs. Parker is also a professor at Dartmouth College, visiting scholar at MIT IDE.
Among Sandell’s key takeaways: Platform startups should initially give away their products and services for free. Then, once they’ve achieved substantial market share, they can develop more specialized offerings for subsets of their customer base, and sell these offerings to them. To be sure, this isn’t the easiest way to attract venture capital, Sandell admitted. Most VCs want to see revenue before they invest. But, he added, you’re not going to get a large market share quickly “by charging money, building out sales, and all that old-fashioned stuff.”
The circular economy was also top-of-mind at the event. These innovative supply chains emphasize re-use, repair, redesign and recycling, all in the name of helping to ease the climate crisis. The need is certainly great. It’s estimated that less than 9% of materials get re-used, meaning over 90% of man-made products end up being burnt, tossed into landfill, or dumped in the ocean.
Panelist Maryam Al Mansoori is fighting this good fight. As general manager of the Rebound Plastic Exchange, a global B2B digital marketplace for recycled plastics, she aims to match those with plastic they’d like to unload with those who seek plastic for recycling and reuse. Al Mansoori and her colleagues have found the going tough, however. “Recyclers are very old-fashioned,” she said, with some of them preferring paper and pencil to online tools. Also, recycled plastic is currently more expensive than virgin plastic “and a lot of CEOs and CFOs just look at the dollar sign,” she said.
Influencers Gain Clout
One of the summit’s more surprising discussions came during a session entitled “Navigating the Creator Economy.” The session explored the role of influencers, individuals who first build audiences on social media, then land serious marketing contracts with major brands.
Influence marketing has come a long way.
According to Ansley Williams of Ogilvy, influencer marketing today is a $21.1 billion business, a big jump from $1.7 billion in 2016.
“There are some 50 million creators out there, of whom about 2 million consider influence marketing a full-time job from which they earn a living. It’s crazy to think about,” Williams said.
Some brands even hire external content creators to work on specific marketing campaigns, explained fellow panelist Lindsey Gamble, associate director of influencer innovation at platform company Mavrck. “You can really integrate creators on every type of platform,” he said. “You now think, ‘Where can I insert creators into different touchpoints with consumers and others I’m trying to reach?’”
Video replays of the full 2023 MIT Platform Strategy Summit are available now on the MIT YouTube channel.
Peter Krass is a contributing editor and writer to MIT IDE.
