The Apple Home Application, a Safe Future Bet?

22

October

2016

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With the introduction of iOS 10 Apple added the new Home future to its mobile devices. The new application lets you control devices which are connected to the internet around your home. Over 50 brands already provide home accessories that are compatible with this Home application. Ever more new and classic home devices get internet access, such as your sound system, your thermostat and your lighting. The internet access on these devices lets you control them from a distance and lets you save your favourite personal settings for them. With this application Apple now offers one environment in which you can control all of them.

 

Benefits on multiple sides of the iOS platform are created by this new application. First of all, it creates a lock-in effect for Apple’s platform. Once customers get used to controlling their home accessories through Apple’s platform, it will be harder for them to switch to another platform. It also creates a lot of data collected from the application, which can be used to create a broader understanding about their own customers, but also to be sold to third parties. For customers it creates a greater ease of use in controlling their home environment. For the brands already producing products that are compatible with Home it offers a unique selling point for their products and creates an additional lock-in effect as well. Also deals could be made with leading furniture and home applications producers for an effective cooperation and integration with Apple, bringing all kinds of cross-side network effects to its platforms for businesses and consumers.

 

Apple bringing this innovation to their platform shows that they are one step ahead of the competition.  The internet of things is still an upcoming trend and Apple shows that they are prepared to take charge over the internet of things in and around people’s homes.

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Spotify, the positive and negative implications

12

October

2016

3.75/5 (4)

Spotify currently is one of the most famous platforms in its industry. Ever since its launch in September 2008 the service has grown expeditiously, currently entertaining over 100 million active users and over 40 million paying subscribers worldwide. Spotify provides free and paid music streaming services on digital devices and sells advertisement placements to third parties on its platform. Spotify is renowned for its innovative business model and their contribution to the modern music industry. They have diminished piracy in this industry and at the same time created a new revenue stream for artists and record labels. Despite their success, there is still no consensus whether Spotify has been a good or bad addition to the music industry.

Criticism has come from the supply side of the Spotify platform. Artists and record labels have shown contempt about the revenue stream coming from their portfolio available on Spotify. On average a song has to be streamed 137 times in order to generate the same amount of revenue of one track sale, which is between $0.006 and $0.0084 according to Spotify’s latest figures. The suppliers argue that Spotify captures too much of the value themselves. Furthermore, these royalties are not paid to the artists, but to the record labels, leaving even less income for the artists. This has resulted in some major artists abandoning the platform, such as Radiohead and Taylor Swift.

Spotify has also caused upheaval regarding the privacy of their users. The large growth of their platform has resulted in the company being responsible for a vast amount of personal and financial details. As a consequence successful and less successful attempts have been made to hack Spotify’s information systems. This has led to some customers being afraid of having their financial details exposed and therefore deleting their account.

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Technology of the Week – Innovative Business Models in the Dutch E-ticket Market

6

October

2016

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Markets have been subject to information technology lead change over the last decade, which has transformed them into today’s electronic markets. An interesting example of a market that has experienced rapid change is the ticket market. Where tickets used to be physical products, nowadays they are distributed digitally as e-tickets. The electronic ticket market is more flexible, convenient and less costly than its traditional form. We will discuss the innovative business models of two successful companies in the Dutch e-ticket market: I’M IN and Ticketswap.

I’M IN is an application which consumers can use to buy or win tickets, receive gifts, get discounts and find information about dance-events. Within half a year they became the biggest application in their segment, with over 300.000 active users and a 90% retention rate. I’M IN creates their revenue by charging event companies a fee to launch a promotional campaign on their platform. These companies can offer free tickets on I’M IN when their event has not sold out, still earning revenue with for example merchandise at the event itself. On the supply side I’M IN delivers value to companies by offering them a suitable promotional tool for their target group, while also supporting last-minute sales. On the demand side value is added through providing event related information and offering affordable or free tickets to price sensitive consumers.

Ticketswap is currently the largest second-hand ticket sales platform in The Netherlands with over 800.000 active users and over 1.000.000 sales. The application delivers value by providing a secure, fast and reliable platform with a focus on the coordination of ticket flows through matching supply and demand, and facilitating transactions between consumers. Ticketswap generates revenue by charging the seller and buyer a 5% fee and limits ticket sellers with a price ceiling of 120%. In contrary to the traditional market, ticket prices do not skyrocket through e.g. the intervention of intermediaries and excess demand for certain events.

Although these platforms are successful, they have their limitations. I’M IN offers their functionalities only through their application since they do not have a website, it has a limited target audience and the most popular events will not benefit from participating on their platform. Ticketswap does not offer the ability to trade physical tickets and is not entirely fraud proof yet, despite their partnership with Paylogic. The maximum price of Ticketswap could also offset suppliers, who can get a superior price for their tickets elsewhere.

Our future prediction of the ticket market would be the existence of few transparent, and connected online platforms making impressive personalized offers in terms of recommendations and willingness to pay. To achieve this, e-commerce is going to be an important factor. Lastly, people will have to possibility of modular ticket selling, allowing consumers to sell single tickets of their seasonal tickets more easily. This will all continue to happen through the use of smartphone applications, since they enable event organizers to attract their target group more efficiently.

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