Thank you for raising this topic, very interesting. In my view, there is no reason for the world to not be completely cashless – it is a waste of resources – paper and metal. Everything should be digital, so anyone that is betting on cash existing in the 10+ year horizon in the developed world will lose out.
A NY Times article from earlier this months shows the % of people that have made or received a cashless payment, and the numbers are staggering (92% in U.S., 97% in Canada, 97% in Britain, 99% in Sweden, etc.). The countries where the numbers are not so high will eventually get there but NCR may not be playing in those countries (e.g., India with 22%). So in the short-term, NCR should start diversifying their business model, take out their investments in the U.S., and invest in the developing world .
In the end, we will all be trading money digitally. Not only am I worried about ATMs, I am also worried about currencies – is the dollar also at threat with the rise of digital currencies? That one I have less of a view on, but definitely think about!
I think the market for companies such as StickFix is limited and the competition is fierce. I agree that currently their competitive advantage has been their technology and their consumer data. That being said, if Amazon decides to enter this space aggressively (they are trying to get their overall apparel game in-line), then they can easily out compete anyone on both those dimensions of technology and data. They have so much consumer data, beyond someone’s fashion style that they can do a much better job of recommending. In addition, they have a much wider product assortment and can really customize their recommendations for each customer. Currently Amazon’s problem is they have too much going on so its hard for consumers to find clothes. Once they do a better job at managing their assortment, they will easily win this game.
On top of their data and technology, they have awareness and convenience. They don’t have to burn money to acquires customers on their platform because they already have so many prime members.
As an investor, I would not bet on StichFix in the long-run. I think they will be fine in the short run.
This article made me think of what Roneal mentioned in the Watson case – where data can be used to easily discriminate against people and can be very dangerous for those in the weaker socio-economic classes. Even though I like the digitization and ease with which you can apply for the mortgage, I worry this may lead to some predatory practices where the computer algorithms based on race, address, credit rating, salary, profession, family size, etc. automatically create a worse mortgage plan than would have otherwise been done by a person that is adding the human touch. Granted humans are inherently biased, but I worry that computers can be taught that biased behavior over and over again, which leads to worse off structures for the poor. Doubt this would happen but throwing out there: just like I think companies should publish salary data for all tenures to be transparent on what everyone is making so there is no discrimination among men and women salaries, similarly the banks should publish their mortgage plans for different categories of people. If this transparency is enforced, I would be more comfortable with this inevitable digitization shift.
Thank you for raising this topic – while reading this article, I am asking myself why does this technology and platform not already exist on a large scale and why isn’t this how we run the healthcare system? I think the answer is a LEAD one. The customer promise of having access to a doctor is an important one, but if you can get convenience, speed, accuracy, and cost – then perhaps consumers can bypass an actual exam. However, the doctors may not want this. This commoditizes their specialty and they will want to protect that as much as possible. Also, the health regulatory environment is also set-up to be complicated and have a lot of moving pieces so that each piece can make money in the process. This would make the health care system smoother but also take out cost (and thereby value for many players).
The consumers have the most to gain from this and companies such as this should be pushing forward their agenda full on!
This is an interesting question, and quite relevant to a lot of countries that are dependent on foreign production and globalization or favorable trade policies to continue business as normal. I would like to draw a parallel – Romania depends heavily on natural gas for energy from Russia. That natural gas is particularly important during the winter months to heat houses and buildings. In the past, whenever Romania has tried to take a stand against Russia on a political position, the natural gas pipelines often “just mysteriously stop working.” The Russian government never officially says it had anything to do with the political agenda but the Romanian government can read between the lines because it directly impacts the Romanian government’s ability to provide an energy source for their residents. As a result, the Romanian government feels strong armed to give in and agree with Russia. This shows how sensitive and vulnerable countries can be if they depend heavily on a global trade for true essentials that may not have a clear alternative. Though this is an extreme example relative to the dairy production discussion, I think the underlying principal is the same – globalization is great because it gives you access to resources you may not be able to produce yourself, however, there can be many negative consequences of over reliance.