STATE OF THE PLATFORM REVOLUTION 2021 - by Sangeet Paul Choudary

1. A Platformation Labs Production PLATFORM REVOLUTION SANGEET PAUL CHOUDARY The State of the   PLATFORM REVOLUTION 2021

2. Contact Us: Share:2 NINE THEMES The post-pandemic world will witness many important shifts. Executives who anticipate these value shifts early and reorganize their business model portfolio around platforms will be best positioned to gain advantage. Reliance Jio demonstrates that incumbents may leverage their deep infrastructural and regulatory moats and partner with BigTechs to dominate the ecosystem together. Public and private actors in China are working in close cooperation—in a country- level platform strategy—to create digital infrastructure, to promote standards, and to strengthen China’s control points in the digital economy. MASSIVE VALUE MIGRATION THROUGH A YEAR IN CRISIS1 THE RISE OF PLATFORM CARTELS6 COVID ACCELERATES BIGTECH TAKEOVER OF HEALTHCARE4 CHINA'S COUNTRY-AS-A-PLATFORM STRATEGY 3 THE POST-PANDEMIC DIARIES: BIG GOVERNMENT TAKES ON BIG TECH8 THE GIG ECONOMY AND THE K-SHAPED RECOVERY 9 REWRITING THE INCUMBENT PLAYBOOK 2 EMBEDDED FINANCE IS REBUNDLED FINANCE5 THE PANDEMIC DIARIES: BIGTECH TAKES ON BIG GOVERNMENT7 THE STATE OF THE PLATFORM REVOLUTION 2021 In the platform economy, cartels coordinate on two specific aspects - data usage and ecosystem governance - to exert new forms of influence over ecosystem-wide activity. BigTech platforms have positioned themselves as powerful global actors. Tech companies are now gaining greater leverage by showcasing themselves in roles usually occupied by governments. As platforms set up competitive bottlenecks, they often act against the interests of their ecosystem. As a result, ecosystem participants, and society and markets at large, may get adversely affected because of the platform’s dominance. The BigTech platforms have made strategic moves into healthcare over the past decade. Covid-19 has further accelerated their efforts as they leverage their resources to respond to the global health crisis. The last 10 years were largely about unbundling finance, the winners in the next 10 will be the ones who successfully rebundle finance. The K-shaped recovery of 2020 was most visible in the increasing divergence in the platform economy. While platform businesses soared to new valuation heights, the workers in many of these platforms’ ‘ecosystems’ were increasingly commoditized and disenfranchised.

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4. 4 Share:Contact Us: ABOUT THE AUTHOR Sangeet Paul Choudary is the best-selling co-author of Platform Revolution and the author of Platform Scale and the founder of Platformation Labs. He has advised the leadership of more than 35 of the Fortune 500 firms and has been selected as a Young Global Leader by the World Economic Forum. Sangeet's work on platforms has been ranked by the Harvard Business Review as one of its top 10 strategy articles ever, alongside the works of Michael Porter, Clayton Christensen and others, and has been featured on four occasions in the HBR Top 10 Must Reads compilations, including the HBR Top 10 ideas 2017. Sangeet serves on several boards and committees, including the Global Innovation Council of the ING Group, the advisory committee to the Ministry of Housing and Urban Affairs, Govt of India, the WEF's Global Future Council on Platforms and Systems, and the board of the ASEAN Financial Innovation Network. He has also served as an Entrepreneur- in-Residence at INSEAD Business School and as the co-chair of the MIT Platform Strategy Summit, and is the youngest ever recipient of the IIMB Distinguished Alumnus Award. He is a frequent keynote speaker at leading global forums including the G20 Summit, the World50 Summit, the United Nations, and the World Economic Forum. LEARN MORE ABOUT OUR WORK

5. Theme 1 PLATFORM REVOLUTION A Platformation Labs Production © Sangeet Paul Choudary 2020 MASSIVE VALUE MIGRATION THROUGH A YEAR IN CRISIS

6. 6 Share:Contact Us: Migration VALUE MIGRATION The economic shock of the coronavirus pandemic has accelerated several pre- existing trends while also giving rise to entirely new ones. In the face of such rapid change, executives are piecing together the future landscape of value and the new rules of competitive advantage. New value shifts are being driven by shifting customer needs and behaviours on the demand side, increased value chain uncertainty on the supply side, and a reversal of many of the trends that have defined pre-pandemic globalisation. Competitive positions, likewise, are more vulnerable during such shifts, spelling out both promise and peril for executives. Variously referred to as 'the new normal', 'the big reset', and with other such elaborate monikers, the emerging landscape will be characterised by the emergence of new value pools and the erosion of existing ones. There is hope in the midst of such uncertainty. Migration of value to these new value pools can be predicted, prepared for, and harnessed. Indeed, executives who 'take the tide at the flood' and anticipate these value shifts will be best positioned to seize tomorrow. This essay provides a framework for executives to identify potential new value pools and realign their business portfolio to these new positions. NEW VALUE POOLS, SHIFTING CONTROL POINTS The keys to transformation beyond a crisis may often lie in new value pools created through the crisis. Times of crisis are accompanied by sudden changes in supply-side and demand-side dynamics. These changes lead to the migration of value from established business positions to new ones, enabling new players to emerge and new business models to be created. Such migration of value is also accompanied by a shift in value network control points. This value migration commoditizes some business positions and empowers others. To understand this migration of value, we need to start by identifying key trends impacting a value space. These trends may be classified into demand-side and supply-side effects.A combination of demand-side and supply-side effects helps us determine the emergence of new value pools. Next, we need to determine whether shifts in value will be accompanied by shifts in control points. Control points refer to control of key assets, relationships, and data flows in a value network. Firms that emerge stronger from a crisis are those that can respond swiftly to a shift in control points. MASSIVE VALUE MIGRATION THROUGH A YEAR IN CRISIS “Thereisatideintheaffairsofmen,Whichtakenattheflood,leadsontofortune...Onsucha fullseaarewenowafloat.Andwemusttakethecurrentwhenitserves,orloseourventures.” William Shakespeare

7. Contact Us: Share:7 THE FOOD RETAIL INDUSTRY To illustrate this further with an example, consider the food retail industry. Compared to other retail categories, food retail has been a relative laggard in moving to ecommerce. In emerging markets, in particular, the online food retail model never took off pre-pandemic. Grocery deliveries typically involve many more items per order than other ecommerce, leading to high costs of fulfilment. These models become profitable only at scale when fulfilment can move from the store to automated fulfilment centers. However, the convenience of informal neighbourhood grocery stores, especially in emerging markets, never drove demand scale in online grocery. However, the pandemic has driven massive value migration, through a combination of supply side and demand side effects, which is unlikely to be merely transitory. Consider demand-side shifts in behavior. With many countries moving into lockdown during the pandemic, there's been a significant shift towards ecommerce in food retail. In the US, more than 40% of grocery deliveries in the week ending March 13 were made to first-time customers. This is further reinforced by the disruption of food supply chains during the pandemic, a supply-side effect. A combination of these demand-side and supply-side effects is leading to value migration towards online grocery retail. In emerging markets, the situation is no different. Online grocery has accelerated at an unprecedented pace since the start of the pandemic. Neighbourhood grocers are feeling the squeeze as they struggle with a lack of technology to take online orders and an over-reliance on informal supply chains that have been disrupted because of the pandemic. Many of these stores are going out of business owing to poor cash flow and high rents. Control points over demand shift significantly in the midst of a crisis, leading to an aggregation of demand with a few large players. Aggregated demand, when combined with a shift in supply, allows these players to reconfigure the value network around their business. In this new value network, neighbourhood stores may be relegated to serving as logistics providers to the larger players with relatively resilient supply chains. With centralized demand as a control point, large online grocery firms will best orchestrate the entire value network and might even leverage third party warehouses, delivery agents, and fulfilment centers to create strong network effects that further strengthens their position. As we note with further examples below, firms that orchestrate such ecosystems using digital platforms are the ones best positioned to harness value in these new value pools. Meanwhile, demand is increasingly getting centralized with a few large online grocery providers who can use centralized demand data to better predict demand patterns, improve stocking of fulfilment centers and better inform their supply chain. Greater centralization of demand data also creates a machine learning advantage for large online grocery firms, further moving value away from smaller stores. In addition, a post-Covid 19 world is likely to feature supply chain inspections and quality control requirements that will also favor larger players. This combination of demand and supply side effects will strengthen large grocery players. As we note with this example, a combination of demand-side and supply-side effects reinforce each other to move value away from small stores to large grocery retailers. This value migration is further reinforced through a combination of machine learning on demand-side data and scale advantages in a consolidated food supply chain. Smaller players, meanwhile, are increasingly commoditized. MASSIVE VALUE MIGRATION THROUGH A YEAR IN CRISIS

8. Contact Us: Share:8 BUT… THIS TIME IS DIFFERENT? Value migration has happened during other periods of crisis in the past. The SARS crisis of 2003 forced consumption behavior to move online across China, enabling Alibaba move into B2C ecommerce. Alibaba launched the Taobao website in May 2003, in response to a self-imposed quarantine prompted by SARS. Consumers across China were staying home from work out of fear of contracting SARS, not very different from the lockdowns during Covid19. Chinese consumers, stuck at home, took to ecommerce. Duncan Clark, the author of “Alibaba: The House That Jack Ma Built” notes that the SARS outbreak “came to represent the turning point when the Internet emerged as a truly mass medium in China.” Firms like Alibaba benefited from this period of intense change, building demand-side control points by aggregating online consumer demand, and strengthening this with a network effect by opening out the supply side to third party merchants. As more merchants came on board, the demand-side control point became even stronger. As evidenced by the grocery example above, we're seeing similar shifts in value pools during the coronavirus pandemic. However, these shifts are not specific to pandemics. In fact, they are not even specific only to times of crises. Shifts in control points and the creation of new value pools result from any combination of technological, market, or regulatory shifts. MASSIVE VALUE MIGRATION THROUGH A YEAR IN CRISIS

9. © Sangeet Paul Choudary 2020 For more Insights on the Platform Economy, Visit platform.blog PLATFORM REVOLUTION Source: Platformation Labs Research THE STATE OF THE PLATFORM REVOLUTION 2020 STREAMING WINS BIG, QUIBI 'FAILS FAST' MAR APR MAY JUL AUG SEP JAN FEB JUN OCT NOV DEC Quibi Disney + Netflix DISNEY REPORTS 26.5 MILLION DISNEY+ SUBSCRIBERS FEB 4 VIDEO STREAMING SERVICE QUIBI, RAISES A TOTAL $1.75 BILLION BEFORE LAUNCH MAR 4 NETFLIX WILL REDUCE ITS EUROPEAN NETWORK TRAFFIC BY 25 PERCENT TO MANAGE SURGE MAR 19 NETFLIX REDUCES VIDEO QUALITY IN MORE COUNTRIES TO HANDLE SURGE MAR 26 EUROPE PUSHES TO REIGN IN VIDEO STREAMING QUIBI GAINS 300K LAUNCH DAY DOWNLOADS, HITS NO. 3 ON THE APP STORE APR 7 DISNEY+ SURPASSES 50 MILLION INTERNATIONAL SUBSCRIBERS APR 8 DISNEY+ HOTSTAR GETS APPROX 8 MILLION SUBSCRIBERS IN FIRST WEEK AFTER ITS LAUNCH IN INDIA APR 10 NETFLIX SHOWS A HUGE UPTICK IN NEW SUBSCRIBERS APR 21 DISNEY+ HOTSTAR TO PREMIERE BOLLYWOOD FILMS, BYPASSING THEATERS JUN 30 NETFLIX BREAKS HBO’S RECORD FOR THE MOST EMMY NOMINATIONS EVER JUL 28 DISNEY+ SURPASSES 100 MILLION INTERNATIONAL SUBSCRIBERS AUG 5 JUL 28 QUIBI SHUTS DOWN AFTER JUST SIX MONTHS OF OPERATION

10. Contact Us: Share:10 How much value is created in these new value pools depends on two factors. The first is the duration of value migration – the longer these shifts persist, the greater the value creation. The second, often less visible, factor is the shift of control points. In fact, seemingly transient shifts may result in permanent effects, when accompanied by the shift of an important control point. Since the start of the coronavirus pandemic, we're seeing such a phenomenon play out in the movie distribution industry. Streaming platforms like Netflix and Amazon Prime have witnessed a surge in engagement during lockdown. However, this seemingly transient shift in demand-side behavior is reinforcing a much more permanent supply-side shift. The closure of major theatre chains, owing to the pandemic, is driving studios to break what's known in the industry as the "window" – the three-month period between when a movie hits the big screen, and when it's offered for video on demand purchase or rental, and then on streaming devices. This “window” that movie theatres have to launch movies exclusively, is a moat protecting theatre revenues. Since the start of the pandemic, studios have been launching directly on streaming channels, thereby eroding the “window”. Universal was the first studio to take these steps, announcing that it will make movies available at home on the same day as their global theatrical release, starting with "Trolls World Tour," which had been scheduled to open April 10, 2020 in the U.S. In India, Amazon Prime secured rights to premiere several Bollywood movies on Prime Video. These movies were originally scheduled for a theatrical release. TRANSIENT SHIFTS, PERMANENT EFFECTS We’re likely going to see new revenue models emerge as well. In China, Huanxi Media has partnered with Douyin, a streaming platform, to launch direct to streaming on a new business model. Under this agreement, Douyin’s parent ByteDance would pay Huanxi at least 630 million yuan (US$90.8 million) for new content to stream first on its streaming video platforms. With this deal, ByteDance gets exclusive access to a portfolio of Huanxi movies and TV shows. Huanxi gets a licensing deal and a share of the advertising revenues. Within two days of the deal, Lost in Russia - one of Huanxi's movies - was released on ByteDance and gathered 600M views. Studios will get to test the success of movie releases on streaming platforms and use that to negotiate post-lockdown. Though theatres won’t go away, their negotiating power may decrease, leading to a shift in value. The longer the lockdown, and the more the hits released away from the theatres, the more likely we are to see this shift. Within the first three months of the WHO declaring Covid19 a global pandemic, we have already seen several permanent shifts. For one, AMC Studios blocked off Universal movies from ever launching a movie in their theatres after the studio went direct-to-streaming. With AMC Theaters struggling post-pandemic, Amazon is looking to acquire its assets, further driving the consolidation we see during such periods of value migration. In India, Amazon was already increasing its negotiating power against movie theaters pre- pandemic by getting into online sales of movie tickets. If Amazon gains enough control over ticket sales, it can negotiate windowing with movie theaters, leading to more fresh content launching first on Amazon Prime. With the pandemic, this balance has further tilted in Amazon's favor. We note with this example that a relatively transient demand-side shift can reconfigure bargaining power in the value network because of a massive shift in control points. A transient demand-side shift may lead to a permanent supply-side shift by changing bargaining power of players in the value network. MASSIVE VALUE MIGRATION THROUGH A YEAR IN CRISIS

11. © Sangeet Paul Choudary 2020 For more Insights on the Platform Economy, Visit platform.blog PLATFORM REVOLUTION Source: Platformation Labs Research THE STATE OF THE PLATFORM REVOLUTION 2020 COVID19 ERODES THE RELEASE WINDOW AND TRANSFORMS BARGAINING POWER IN THE MOVIE INDUSTRY MAR APR MAY JUL AUG SEP JAN FEB JUN OCT NOV DEC Movies start launching online Theaters face historic setback Streaming eats the 'window': Permanent shifts in the value chain CHINA’S TIKTOK HOSTS FIRST MOVIE PREMIERE ON A STREAMING PLATFORM JAN 24 MOVIE TICKET SALES FALL TO HISTORIC LOW MAR 15 UNIVERSAL PICTURES RELEASES ITS THEATRE BOUND MOVIES ONLINE MAR 17 CINEMAS CLOSE NATIONWIDE, DISNEY POSTPONES 'BLACK WIDOW' MAR 18 AMC THEATRES BANS UNIVERSAL FILMS AFTER UNIVERSAL BYPASSES A TRADITIONAL THEATRICAL RELEASE OF TROLLS WORLD TOUR FOR A DIGITAL EXCLUSIVE APR 28 WALMART PARTNERS WITH TRIBECA TO TURN 160 STORE PARKING LOTS INTO DRIVE-IN THEATERS JUL 2 Cinema owners protest the new normal CHINA'S THEATRES, STUDIOS PROTEST AGAINST DEAL TO STREAM MOVIE ONLINE FOR FREE JAN 25 MULTIPLEX ASSOCIATION OF INDIA (MAI) WRITES TO PRODUCERS TO NOT RELEASE MOVIES ON OTT MAY 4 PRODUCERS GUILD RESPONDS TO THEATRE OWNERS IN INDIA- "WE NEED TO STAY IN BUSINESS" MAY 15 MOVIE THEATRE CHAINS CUT AUDIENCE CAPACITY BY HALF OUT OF CORONAVIRUS FEARS MAY 13 AMAZON CONSIDERS ACQUIRING AMC ENTERTAINMENT MAY 14 JUN 4 AMC ISSUES A “GOING CONCERN” PUBLIC FILING, STATING THAT THE COMPANY IS UNSURE OF ITS FUTURE AMC THEATERS AND UNIVERSAL REACH A NEW AGREEMENT TO SHORTEN THE THEATRICAL EXCLUSIVITY WINDOW AND ENABLE EARLY DIGITAL RENTALS JUL 8 CINEMA OWNERS PROTEST AS INDIAN GOVERNMENT HOLDS BACK REOPENING AUG 31 REGAL CINEMAS PARENT COMPANY CINEWORLD ANNOUNCES TEMPORARY CLOSURE OF OPERATIONS AT ALL 536 OF REGAL’S U.S. THEATERS OCT 5 AMC ENTERTAINMENT PLANS $47.7M STOCK SALE NOV 2 WARNER BROS. SENDS ALL 2021 FILMS DIRECT TO HBO MAX THE SAME DAY THEY HIT THEATERS, SIGNALLING POTENTIAL PERMANENT SHIFT DEC 3

12. Contact Us: Share:12 CONSOLIDATE YOUR POSITION REARCHITECT YOUR VALUE NETWORK In traditional value chains, value migration largely manifests as a shift in bargaining power between the supply side and demand side. In platform-mediated ecosystems, value shifts can rearchitect the entire value network. Migration of a demand-side control point can lead to a reframing of the value network on the supply side. In certain instances, as with the rise of Taobao during the SARS crisis of 2003, this migration may result in a more open value network, mediated by a platform, and allowing for participation of third parties. In other instances, players in an open and distributed ecosystem may get rapidly commoditized leading to greater consolidation of value around a few players. We're seeing such consolidation play out in the restaurant and food delivery space in the aftermath of the pandemic. During the first three months of the pandemic, China's Meituan hit a $10Bn valuation. In the West, we're seeing increasing consolidation among players with Amazon buying Deliveroo and Uber making an offer to Grubhub, which eventually merged with JustEat Takeaway. While these valuation and acquisition plays are important, the pandemic has accelerated deeper value shifts in this industry. Again, let's start by looking for demand-side and supply-side effects. On the demand-side, social distancing regulations and lockdowns have led to falling demand for in- restaurant dining and a corresponding increase in demand for in-home food delivery. A combination of rising delivery fees paid to aggregators, high rents, and falling demand for dine-in is squeezing restaurant profits, leading to important supply-side shifts. As restaurants go out of business, delivery businesses are integrating into cooking and food processing operations, and setting up 'dark kitchens' exclusively for delivery, without a restaurant dine-in experience. Food delivery platforms have the advantage of a demand-side network effect where more consumers attract more restaurants onto the platform and vice versa. This demand- side network effect reinforces supply-side scale in kitchen operations as more dark kitchens are set up. ‘Dark kitchens' benefit from a more profitable operating model. They are typically located closer to residential areas, leading to lower real estate costs and lower delivery costs as kitchens and delivery hubs can be located closer to demand, enabling superior route optimization. Using superior demand data from their delivery business, delivery platforms can also apportion cooking and sourcing across different kitchen locations based on demand patterns near those locations. These dark kitchens also leverage market-wide demand patterns to better predict sourcing and preparation, leading to lower food waste costs. 'Dark kitchens' consolidate value away from restaurants towards a few central food delivery platforms. These platforms, now, own the demand-side control point with their delivery business and the supply-side control point with their dark kitchen business. MASSIVE VALUE MIGRATION THROUGH A YEAR IN CRISIS

13. © Sangeet Paul Choudary 2020 For more Insights on the Platform Economy, Visit platform.blog PLATFORM REVOLUTION Source: Platformation Labs Research THE STATE OF THE PLATFORM REVOLUTION 2020 California's New Fair-Food-Delivery-Act Requires Food Delivery Platforms To Obtain Authorisation From Restaurants To Take Orders And Deliver Meals THE FOOD DELIVERY INDUSTRY IN 2020 JUN 18 Doordash Raises $400 Million Ahead Of Public Listing JAN 22 Zomato Acquires Uber Eats India To Gain 50% Market Share FEB 06 JD'S Autonomous Delivery Robot Delivers Order To Hospital In Wuhan APR 17 Amazon Allowed To Invest In UK Based Deliveroo MAY 08 National Restaurants Association Of India Plans To Launch Its Own Food Delivery Platform JUN 29 Tencent Invests $300M In Grocery Delivery Startup Xingsheng Youxuan JUN 23 Carnival Group, India’s Third Largest Multiplex Chain, Partners With Zomato To Start Delivering Food Through A Hundred Cloud Kitchens JUL 06 Uber Acquires Postmates For $2.7B JUL 25 Kitchen Space Startup, Karma Kitchen, Raises £252M To Acquire, Equip And Manage New Kitchen Sites Across Europe JUL 25 Tata's Taj Launches Gourmet Online Food Delivery Platform Qmin AUG 19 Food Service Giant US Foods Launches Ghost Kitchens Program For Its Customers AUG 26 Delivery Hero Acquires Online Grocery Platform Instashop SEP 4 Just-Eat-Takeaway Acquires US Based Grubhub For $7.3B SEP 16 Delivery Hero Acquires Glovo’s Latam Delivery Operations SEP 08 Meituan Tests Driverless Food Delivery In Beijing, Explores Wide Spread Adoption SEP 28 OCT 6 C3'S Digital Kitchen Brands Powered By Lunchbox Digital Platform To Develop Virtual Food Hall OCT 08 Delivery Startup Gopuff Raises $380M Valued At $3.9B OCT 12 Lunchbox Ventures Into Autonomous Food Delivery At University Of Denver OCT 16 The Kroger Co. Opens Ghost Kitchens With Clustertruck OCT 20 Uber Founder Travis Kalanick Moves Into Cloud Kitchens. OCT 27 Tesco Pilots Drone Deliveries In Ireland With Irish Startup Manna NOV 11 Nuro Raises $500 M For Automated Pizza And Grocery Delivery NOV 14 Zomato Raises $195M In Funding At $3.6B Valuation NOV 23 Multiple Cities Cap Service Fee By Food Delivery Apps At 15% NOV 30 Doordash Looks To Raise $2.8 B In IPO DEC 01 Wendy's Partners With Rebel Foods To Open 250 Cloud Kitchens In India Tata Set To Buy 80% Of Alibaba Backed Online Grocery Firm Bigbasket DEC 02 DEC 02 Southeast Asia's Grab And Gojek Close In On Merger Across Ride Hailing, Food Delivery And Payments Food delivery attracts massive funding amid lockdowns Restaurants counter food delivery platforms Consolidation across the industry The rise of dark kitchens Innovations in contactless delivery

14. 14 Share:Contact Us: Future A BLUEPRINT FOR THE FUTURE We’ve talked extensively about shifts resulting from the pandemic but there are many other equally important macro shifts that present opportunities for new value pools. Technological shifts continue to accelerate and artificial intelligence is rapidly advancing across sectors. More importantly, traditional industry boundaries are disappearing, often leading to creation of new value pools and business models where none existed in the past. Geopolitically, the rise of China is reshaping the global economic order and the rise of stakeholder capitalism will further create new value pools as business priorities shift to embrace larger societal and environmental value. Finally, investor activism and regulatory shifts will also play an important role in determining future value pools. The ability of executives to benefit from such shifts is dependent on three factors: how early they spot the shift, their ability to innovate and reconfigure their business model portfolio to position themselves in the new value pool, and the strength of the control point that consolidates their position in this new value pool. Firms that develop a strong sense of market shifts and an ability to harness their value network towards these shifts will be best positioned to win. The importance of harnessing your value network makes agility and digitization ever-more important priorities for executives. More importantly, firms that compete through ecosystems will be best positioned to rearchitect their value network. Ecosystems are fluid and dynamic, and the most successful orchestrators govern them through digital platforms. Businesses that orchestrate ecosystems can leverage external assets and benefit from demand-side economies of scale. They may also selectively capture supply-side control points by owning important assets of their own. The post-pandemic world will witness many important shifts. Executives who 'take the tide at the flood' and anticipate these value shifts early, reorganize their business model portfolio, and consolidate their control points will be best positioned to seize tomorrow. MASSIVE VALUE MIGRATION THROUGH A YEAR IN CRISIS

15. The pandemic forces companies to reimagine their assets into new business models. Movie theaters transformed to dark kitchens and grocery retail parking lots transformed to movie theaters. MOVIE  DISTRIBUTION PRE- PREPARED  FOOD DELIVERY GROCERY RETAIL Carnival Group, India's third largest multiplex chain, partners with Zomato to start delivering food through a hundred cloud kitchens Walmart converts its driving lots into drive-in theaters Doordash launches grocery delivery fulfilled by Adecco staff in supermarkets Meituan expands its logistics network to take more groceries to consumers MIGRATION ACROSS INDUSTRY BOUNDARIES MASSIVE VALUE MIGRATION THROUGH A YEAR IN CRISIS PLATFORM REVOLUTION © Sangeet Paul Choudary 2020 For more Insights on the Platform Economy, Visit platform.blog Source: Platformation Labs Research

17. © Sangeet Paul Choudary 2020 Theme 2 PLATFORM REVOLUTION REWRITING THE INCUMBENT PLAYBOOK © Sangeet Paul Choudary 2020 A Platformation Labs Production

18. 18 Share:Contact Us: Future BIGTECH RELIES ON RELIANCE During the pandemic-ravaged summer of 2020, many of Silicon Valley's top tech giants (and leading investment firms) invested more than 20 billion dollars in Reliance Jio, a seemingly traditional telecom company in India. Over the course of 14 weeks, the company raised capital from Facebook, Google, Intel, Qualcomm, and a host of investment firms. This was all the more confounding because Reliance was essentially playing a traditional telecom game and building an asset-intensive business. Since the mid-2000s, the telecom industry has been impacted by two waves of disruption, first when Apple and Google built their app platforms and next when Skype, WhatsApp, and other providers of free communication services eroded traditional telco revenue streams. Many have hailed this as the rise of the platform business, the shift from asset-intensive to asset-light businesses, and the rise of over the top (OTT) players. The results had been declared. Telcos had lost the game and had gotten relegated to commoditised, asset-intensive businesses while the bigtech firms had won with asset-light platform business models. Why then were the same BigTech firms scrambling to invest in a traditional telecom business, no less one that had invested more than $30 Bn in building out traditional telecom infrastructure and had more than $20 Bn of debt on its books? Industry observers tried hard to explain this. Some heralded this as the triumph of ‘free’ but couldn’t quite explain why that made any business sense. Others pointed to Jio’s investments in new digital services but struggled to explain its larger investment in 4G infrastructure. Some called this a new form of vertical integration but were further confounded when Jio opened up its most capital intensive asset - its 4G network - to its competitors, where vertical integration would have protected it. None of these adequately explain Jio's strategy nor the tremendous upheaval it has brought about in India's telecom industry. Since Jio’s arrival, 4G has become the default network for most of India, with Jio accounting for ~70% of the country's 4G traffic. In less than 5 years, the company has amassed more than 400M customers and propelled India from #155 to #1 in the world in mobile data consumption. To understand Jio’s strategy, we need to understand a deeper shift in industry structure that’s playing out across the economy. REWRITING THE INCUMBENT PLAYBOOK

19. Contact Us: Share:19 From Vertical To Horizontal Through most of the twentieth century, businesses scaled through vertical integration, integrating multiple activities across supply, production, and distribution. This offered greater control and greater capture of profits, and was a natural solution to the problem of transaction costs - costs incurred in coordinating activities across the value chain. Transaction costs determine an industry’s structure - the manner in which firms organize themselves and interact with other players. To minimize transaction costs, most firms engaged in vertical integration. Most industries, accordingly, took on a vertical architecture with a few large vertically integrated firms competing with each other. As digital technologies proliferate across industries, we’re seeing a fundamental shift in this architecture. Digital technologies enable cheaper inter-firm communication, greater interoperability, and higher standardization. These factors together reduce transaction costs and enable firms to more effectively coordinate without requiring vertical integration or bilateral contracting. As a result, the links in the vertically integrated value chain start to break up and new specialized competitors emerge that are more agile and innovative in delivering a specific task in the value chain. The vertical industry architecture is increasingly giving way to a more horizontal ‘layered’ architecture where firms at every layer specialize in a particular value creating activity, and where firms, across layers, are The mobile communications industry has itself weathered this shift. The vertical structure of the telecommunications industry was first dismantled by Apple and Google, which dominated the horizontal operating system layer, and subsequently by WhatsApp and Skype which dominated the communications services layer at the top. These shifts relegated telecom operators and handset manufacturers to commoditized asset-intensive business models. The response of telecom operators to these shifts have been predictable, with some trying to directly copy the new business models, while others resort to competing among themselves, launching aggressive price wars. None of these responses acknowledged the new competitive landscape, as telcos grew increasingly commoditized. That is, until Jio came along. WhatsApp/Skype Device iOS/Android Data traffic Infrastructure REWRITING THE INCUMBENT PLAYBOOK

20. 20 Share:Contact Us: Future THE NEW INCUMBENT PLAYBOOK - PART 1 Jio invested more than $30 Bn in setting up cell-phone towers and laying out a country-wide fibre-optic network. It launched the world’s cheapest 4G phone and set up deals with 20 smartphone manufacturers to bundle its SIM card. It then made a series of investments in digital services, investing more than $3 Bn in upcoming startups. Jio was pursuing a strategic selection of business positions and a calculated choice of competitive moves that acknowledged the new value stack and positioned Jio for domination across multiple layers. At the infrastructure layer, Jio’s aggressive investment monopolized 4G infrastructure in India, unleashing data consumption across the country, which now is the second largest internet market in the world after China and also the one with the lowest data tariffs. At the device layer, Jio built out the world’s cheapest feature phone on KaiOS, a Hong Kong-based operating system, deliberately avoiding the Android operating system to minimize dependence on a third party. At the communications layer, Jio massively subsidized voice calls as well as data tariffs, triggering a price war that consolidated the industry and accorded Jio the leadership position at that layer. Services Device Operating System Data Traffic Infrastructure JioPhone (4G Featurephone) Partnership with KaiOS Subsidized data traffic Jio's 4G infrastructure REWRITING THE INCUMBENT PLAYBOOK

21. © Sangeet Paul Choudary 2020 For more Insights on the Platform Economy, Visit platform.blog PLATFORM REVOLUTION Source: Platformation Labs Research THE STATE OF THE PLATFORM REVOLUTION 2020 Investments in Jio Jio product launches Reliance and Facebook pilot JioMart grocery shopping on WhatsApp Jio launches HD video conferencing app JioMeet, a remote working application similar to Zoom Jio launches UPI payments on MyJio app India approves Reliance’s $3.4 Bn deal with Future Group Reliance plans to launch a new low-cost phone on Google’s android platform Jio launches 'Made in India' browser JioPages with regional language supportJio launches video and voice over Wi-Fi (VoWiFi) service in India. Facebook invests   $5 Bn in Jio for a 9.99% stake Jio sells 2.3%  stake for  $1.5 Bn to Vista  Equity Partners General Atlantic buys   1.34% stake in Jio $870 Mn Google backs Jio with $4.5 Bn investment Intel invests $253.5 Mn in Jio or a 0.39% stake Reliance Retail raises $1 Bn from Silver Lake Reliance offers $20 Bn stake in retail arm to Amazon GIC and TPG invest $250 Mn in Reliance Retail Reliance fibre optic business raises $1 Bn from Abu Dhabi Investment Authority (ADIA) and Saudi Arabia’s Public Investment Fund (PIF) Qualcomm invests $97 Mn in Jio for a 0.15% equity stake Jio becomes no.1 telco by user base and revenue Jio launches OTT Aggregator platform JioTV to ease content discovery Jio announces a mixed reality headset called JioGlass for virtual office meetings and virtual school lessons JAN 08 JAN 17 JAN 20 APR 22 APR 27 APR 30 MAY 02 MAY 08 MAY 17 Reliance Retail acquires a majority stake in furniture and decor platform Urban Ladder JUN 07 KKR invests   $1.5 Bn in Jio JUN 22 JUL 03 JUL 12 JUL 15 JUL 15 JUL 16 SEP 09 RELIANCE REWRITES THE INCUMBENT PLAYBOOK SEP 09 SEP 10Jio sells a stake of  1.16% for $750 Mn  to Abu Dhabi  Investment Authority (ADIA) OCT 03 OCT 20 OCT 30 Reliance Industries   becomes first Indian firm  to hit USD 150 Bn  market cap NOV 15 NOV 20 THE STATE OF THE PLATFORM REVOLUTION

22. 22 Share:Contact Us: Future Having gained 400M users across India with a monopoly at the infrastructure layer and a dominant position at the communications layer, Jio reached out to investors painting a full picture of the ecosystem with the specific positions each investor would occupy within it. Intel and Qualcomm would further strengthen Jio’s bid to not just expand to 5G but also become a global exporter of the technology and an alternative to Huawei. Google, now with a seat at the table, would help build out a low-cost smartphone, enabling domination of the OS and device layers. Facebook, most importantly, would provide user-facing services and position WhatsApp as a ‘super app’ within which all apps would sit. Reliance Jio demonstrates that incumbents may leverage their deep infrastructural and regulatory moats and partner with BigTechs to dominate the ecosystem together. It also demonstrates the sobering reality that such large ecosystem plays require a bold vision, an appetite for high-risk investment, and the execution chops to scale and dominate rapidly. In this new landscape, power concentrates with players that dominate a specific layer. The strongest players leverage their dominance at one layer to occupy multiple positions across different layers without requiring traditional vertical integration. Firms can effectively excel at both innovation and efficiency by choosing a combination of such positions. Services Device Operating  System Data Traffic Infrastructure WhatsApp Jio Smartphone Android Commoditize telcos Qualcomm, Intel:   5G Infrastructure Jio's example demonstrates how comprehensive ecosystem strategies will increasingly define the next generation of industry winners. Economic value is increasingly created not within individual firms but through the interactions among firms across the ecosystem. Understanding value creation at the level of the ecosystem is more important than merely understanding it at the level of a single firm. Competitive advantage, in turn, is no longer determined merely by a firm’s activities but by the layers those activities occupy in the value stack. THE NEW INCUMBENT PLAYBOOK - PART 2 REWRITING THE INCUMBENT PLAYBOOK

23. © Sangeet Paul Choudary 2020 PLATFORM REVOLUTION BUILDING A PLATFORM BUSINESS? PLATFORM STRATEGY AND BUSINESS MODEL DESIGN PLATFORM EXECUTION AND INNOVATION GROUP-LEVEL COMPETITIVE STRATEGY PLATFORM EDUCATION AND EVANGELISM LEARN HOW WE CAN HELP

24. © Sangeet Paul Choudary 2020 CHINA'S COUNTRY-AS-A-PLATFORM STRATEGY Theme 3 PLATFORM REVOLUTION © Sangeet Paul Choudary 2020 A Platformation Labs Production

25. Contact Us: Share:25 In the digital economy, platforms require us to rethink the economics of exchange. Platforms such as Uber and Airbnb and the app stores run by Apple and Google don’t provide their customers with any tangible good. Rather, they create marketplaces for consumers and businesses to exchange goods. In building hugely successful platforms, these companies have built massive communities in which apps are bought and sold, rides are hailed, and apartments are rented out. Successful platforms also create points of control. Take Google’s Android operating system, which has allowed the company to dominate the smartphone software industry. On the one hand, the software is entirely open source: Anyone can review it and write apps for it. But to achieve effective distribution to the full ecosystem of phones running Android, apps have to go through Google’s app store review. By controlling Android and the app store, Google sets the standards for how the ecosystem works and what apps appear in it. As platforms continue to grow, control over the trade in goods and services is shifting from countries to digital platforms. And as trade, labor, and money grow increasingly digitized and are exchanged on platforms, countries need to rethink their positions in the global flow of these goods. If they are to gain a competitive advantage, countries need to increasingly pursue a platform strategy. No country is doing this as effectively as China, which in recent years has set up a concerted country-as-a-platform strategy, aggressively exporting its digital infrastructure, playing a critical role in the development of technical standards, and developing unique points of control in the digital economy. Much like Google established itself as a dominant player in the smartphone ecosystem, China is attempting to do the same in an increasingly digital geopolitical landscape. Understanding this dynamic will be key to a future Biden administration getting the U.S. relationship with China right. China’s National Informatization Strategy calls upon China’s internet companies to go out into the world and support the creation of a “Digital Silk Road”—which refers to the export of Chinese technology alongside the Belt and Road Initiative (BRI), China’s massive global infrastructure investment project. The “Digital Silk Road” is China’s bet on a country-as-a- platform strategy. Public and private actors in China are working in close cooperation—in a country-level platform strategy—to create digital infrastructure that aligns with the BRI, to promote standards that drive the adoption of such infrastructure, and to strengthen China’s points of control in the digital economy. This strategy extends across four key themes: trade, payments, smart cities, and social credit. If successful, this strategy could fundamentally shift trade and financial flows toward a China-centric economic order and could even reshape political systems in participating countries. CHINA'S COUNTRY-AS-A-PLATFORM STRATEGY INTRODUCTION

26. © Sangeet Paul Choudary 2020 For more Insights on the Platform Economy, Visit platform.blog PLATFORM REVOLUTION COUNTRY-AS A-PLATFORM EXPORT OPEN INFRASTRUCTURE ENGAGE IN STANDARDS DEVELOPMENT ESTABLISH KEY CONTROL POINTS COUNTRY- AS-A- PLATFORM "As trade, labor, and money grow increasingly digitized and are exchanged on platforms, countries need to rethink their positions in the global flow of these goods. If they are to gain a competitive advantage, countries need to increasingly pursue a platform strategy." CHINA'S COUNTRY-AS-A-PLATFORM STRATEGY

27. 27 Share:Contact Us: Future Linking up global economies through trade is the first step in China’s efforts to export its digital infrastructure. To do so, Chinese tech companies are building the digital tools to facilitate trade—and to do so using Chinese technology. In 2016, Alibaba announced it would launch the Electronic World Trade Platform (eWTP), which enables small- and medium-sized business to easily participate in global commerce by creating a global trade network between China and participating countries. First, the eWTP established two central hubs in China: an imports hub in Hangzhou and an exports hub in Yiwu. Next, it set up eHubs with local partners in each participating country, allowing small businesses in those countries to trade internationally. Each eHub provides a centralized logistics and fulfilment facility, as well as digital payment and financing capabilities, supported by local banks. These eHubs are connected back to the central hub in China through Alibaba OneTouch, the company’s global cross-border supply chain management platform. The eWTP worked with governments to create Digital Free Trade Zones (DFTZs), which enable cross-border trade with low or no import duties and faster customs clearance. These eHubs and DFTZs, when connected globally to each other and to the central hubs, aim to create a global digital trade network. Coupled with the DFTZs, China is also setting up international courts in Beijing, Xi’an, and Shenzhen to arbitrate trade disputes between countries that use this trade infrastructure. In March 2017, Alibaba helped launch a digital free trade zone in Malaysia, consisting of a regional logistics center serving Southeast Asia, an e-commerce platform, and a digital payments and financing service. Since its launch, three more countries—Belgium, Rwanda, and Ethiopia—have joined. Two more hubs in China complete the eWTP network of six hubs, as it stands today. The creation of these hubs is expected to accelerate cross-border digital trade for small businesses. At the Yiwu eHub in China, small businesses recorded more than $41 billion in international trade, across three million active buyers in 2019-20, with an 82% year-on-year growth in online transactions. The Malaysian eHub expects to manage a total trade volume of $65 billion by 2025. Belgium has invested nearly 100 million euros in hopes of a similar boost in digital cross-border trade. Growing international ecommerce allows companies like Alibaba and Ant Group to create points of control in the international economy. As countries sign up with the eWTP, Alibaba and Ant are winning customers and growing their ecommerce and financial platforms. And as their platforms grow, Alibaba and Ant are helping to write the rules for how small businesses engage in international trade. Between them, Alibaba and Ant provide key logistics, payments, and ecommerce capabilities to the eHubs, positioning them as matchmakers between the global market and small businesses. TRADE CHINA'S COUNTRY-AS-A-PLATFORM STRATEGY

28. JAN FEB MAR APR MAY JUN JUL AUG SEP OCT DEC ACTIVISTS TARGET ALIBABA'S EUROPEAN HUB PLANS EWTP'S BELGIAN HUB FACILITATES DISTRIBUTION OF 500,000 SURGICAL MASKS IN BELGIUM ALIBABA EWTP CONTINUES GLOBAL EXPANSION WHILE EXTENDING COVID19 RELIEF Feb 25 Mar 14 Mar 21 JACK MA FOUNDATION AND ALIBABA FOUNDATION DONATE MEDICAL SUPPLIES TO 10 ASIAN NATIONS May 15 eWTP AND TMALL GLOBAL JOIN FORCES TO DRIVE SALES FOR GLOBAL BRANDS IMPACTED BY THE COVID19 NOV Jun 21 ALIBABA AND THE MUNICIPAL GOVERNMENT OF YIWU AGREE TO DEVELOP A DIGITIZED COMPREHENSIVE BONDED ZONE UNDER THE EWTP Jul 17 MALAYSIAN INVESTMENT DEVELOPMENT AUTHORITY SIGNS MOU FOR INITIATIVES AT ALIBABA- MALAYASIA AIRPORTS JV KLIA AEROPOLIS Aug 06 ALIBABA EWTP INVESTS IN SWEDISH ESPORTS STARTUP Sep 17 ALIBABA UNVEILS DIGITAL FACTORY TO OFFER SMEs SMART MANUFACTURING CAPABILITIES Nov 04 ALIBABA'S CAINIAO AEROPOLIS EWTP HUB STARTED OPERATIONS AT KUALA LUMPUR INTERNATIONAL AIRPORT. THE STATE OF THE PLATFORM REVOLUTION 2020 PLATFORM REVOLUTION © Sangeet Paul Choudary 2020 For more Insights on the Platform Economy, Visit platform.blog Source: Platformation Labs Research

29. Contact Us: Share:29 China’s platform strategy includes an ambition to create an alternative payments infrastructure. China’s leading payment systems—Ant’s Alipay and Tencent’s WeChat Pay— serve 28 million and 50 million merchants, respectively, in China, covering more than 90% of the mobile payments market in the country. These payment systems provide a digital wallet service, an offline payment app enabling instant payments by scanning barcodes or QR codes on smartphones, and an escrow service, among other functionalities. Both payments players have rapidly expanded internationally to enable merchants to serve Chinese tourists. Prior to the pandemic, nearly 150 million Chinese travelers traveled abroad every year, 32% of them paying for transactions overseas with their mobile phone. By early 2019, WeChat Pay was accepted in 49 countries outside China, while AliPay was accepted in 42. The payment systems have also demonstrated rapid growth, with the number of Europe-based merchants on WeChat Pay growing 350% year-over-year in 2019. Ant’s ambitions extend beyond just proliferating its payment system to creating a new infrastructure and standard for global payments. To do so, it must solve major challenges related to global payments interoperability. Payments interoperability typically plays out at three levels. First, scheme interoperability involves two or more financial institutions agreeing to work on the same payments system, or scheme, enabling payments to readily flow between them. Check settlements and electronic fund transfers between two financial institutions are examples of scheme interoperability. Second, to enable cross-border payments, network interoperability is required so that payment schemes across countries may negotiate exchange agreements with each other. For example, when a domestically issued credit card is used for international payments, it benefits from network interoperability. Finally, parallel system interoperability allows a seamless experience across different payment schemes. For instance, a store that accepts both Visa and AmEx delivers the same user experience to the customer because of parallel system interoperability. In order to create an alternative across all three layers of payments interoperability, Ant is providing a common technology backend to financial institutions around the world. By using common backend technology, participating financial institutions are effectively part of the same “scheme” and benefit from scheme interoperability. With one standardized backend, the need for parallel system interoperability is obviated. Finally, Ant manages cross-border settlements within its infrastructure, enabling network interoperability. Ant also provides traditional lenders with cloud computing and open banking solutions, backed by its AI-powered risk engine and credit scoring models. As more banks around the world get on board, Ant seeks to create a common financial infrastructure powering small to mid-size banks across countries. One of Ant’s key value propositions to banks is the ability to lend to merchants in the cash economy. Ant’s credit-scoring models have been trained on loans made to merchants in the Alibaba ecosystem, with rich data profiles. These AI capabilities allow banks to extend their loans to cash economy merchants on whom they may have limited data and to whom they would otherwise be reluctant to lend. Alibaba and Ant have also invested in leading e-commerce and payments companies in countries that have signed up with the Belt and Road Initiative, including EasyPaisa in Pakistan, Ascend in Thailand, GCash in the Philippines and PayTM in India. As part of these investments, Alibaba and Ant are providing backend technology to their investee companies. The investment terms typically require investee firms to move their technology stack to the Alibaba Cloud. By moving diverse payment firms to the Alibaba cloud, Alibaba is homogenizing the backend infrastructure and the AI capabilities that power these different payment systems, which could create greater interoperability across payment systems and grant a stronger control point to Ant, whose credit-scoring and anti-fraud capabilities power these diverse payment systems. PAYMENTS CHINA'S COUNTRY-AS-A-PLATFORM STRATEGY

30. Contact Us: Share:30 By exporting its infrastructure but not directly participating in lending and deposits businesses, Ant can expand globally without being hindered by local regulation or needing to acquire local banking licenses. By providing a common infrastructure to banks and payment wallets, Ant is also better set up to define standards for payments between participating countries. Chinese regulators are closely watching Ant’s transformation into a global financial giant, and earlier this November forced the company to suspend its highly anticipated IPO after regulators rolled out new rules for the financial sector. Draft regulations would require companies like Ant to underwrite loans with their own funds, demonstrating the leverage that Chinese authorities continue to exert over the country’s largest platforms and the regulatory tools at their disposal to wield control. The intense regulatory scrutiny on Ant may stem from the fact that control of payments infrastructure and standards represents an important foreign-policy tool. American credit card firms process a large portion of global payments, global infrastructure such as SWIFT and CHIPS support the U.S. dollar payments system, and the U.S. dollar remains the international reserve currency. The dollar’s position as the reserve currency allows the United States to impose unilateral sanctions against transactions between other countries, and moving away from a dollar-based international financial system would be a major boon to China by diminishing U.S. control over Chinese transactions. American officials understand this risk. In 2018, the U.S. government blocked Ant’s acquisition of Moneygram, a U.S.-based money transfer company. And the U.S. government is currently considering imposing a ban on Tencent’s communications and payments app WeChat. China’s ambitions to set up an alternative payments infrastructure are perhaps best manifested in its creation of a state-backed cryptocurrency known as Digital Currency Electronic Payment (DCEP), a centrally managed Chinese digital currency that acts as a digital bearer instrument and obviates the need for settlement through an intermediary. As of July 2020, Didi—China’s largest ride-hailing and transportation platform—is piloting the DCEP with its customer base. The DCEP can be implemented to enable digital devices to directly exchange information and money. Consider, for example, a self-driving truck automatically paying a toll to an autonomous highway tollbooth without any human intervention. The DCEP could eventually be offered for other such autonomous machine-to- machine payments along the Belt and Road Initiative. It could also serve as a low-risk currency for international trade between countries with highly volatile currencies. A decentralized escrow system could let foreign businesses engage in trade while hedging their exchange rate risk. CHINA'S COUNTRY-AS-A-PLATFORM STRATEGY

31. ANT FINANCIAL MAKES BIG TECHFIN MOVES BEFORE REGULATORS BLOCK ITS IPO ANT LAUNCHES BLOCKCHAIN-BASED CROSS-BORDER TRADE PLATFORM TRUSPLE Jan 02 ANT FINANCIAL APPLIES FOR SINGAPORE DIGITAL BANKING LICENSE Jan 10 ANT FINANCIAL INVESTS $150M IN INDIAN FOOD DELIVERY PLATFORM ZOMATO Feb 07 ANT FINANCIAL PAUSES CREDIT RATING SERVICE AMID CORONAVIRUS OUTBREAK Mar 04 ANT FINANCIAL BUYS A STAKE IN SWEDISH FINTECH START-UP KLARNA Mar 25 ANT FINANCIAL INTRODUCES OCEANBASE SAAS FOR SMALL AND MEDIUM- SIZED BUSINESSES Apr 27 ANT FINANCIAL OPENS BLOCKCHAIN PLATFORM TO DEVELOPER AND SME COMMUNITY TO HELP IN THE CREATION OF MULTI-USER TRUST- BASED DIGITAL APPLICATIONS May 18 ANT FINANCIAL PARTNERS WITH MYANMAR’S WAVE MONEY TO PROMOTE FINANCIAL INCLUSION in the country JAN FEB MAR APR MAY JUN JUL AUG SEP OCT DECNOV Jun 10 ANT FINANCIAL- BACKED FUND INVESTS IN SINGAPORE FINTECH WALLEX FOR FOREX AND CROSS BORDER PAYMENT NEEDS OF SMBs Jul 23 ANT GROUP CREATES ANTCHAIN - A NEW BLOCKCHAIN-BASED TECHNOLOGY UNIT Aug 18 ANT GROUP PLANS CONSUMER FINANCE FIRM IN GROWTH PUSH AHEAD OF IPO Sep 25 Nov 03 THE SHANGHAI STOCK EXCHANGE AND HONG KONG EXCHANGE SUSPEND ANT GROUP’S IPO PLATFORM REVOLUTION © Sangeet Paul Choudary 2020 For more Insights on the Platform Economy, Visit platform.blog Source: Platformation Labs Research THE STATE OF THE PLATFORM REVOLUTION 2020

32. 32 Share:Contact Us: Future The third theme in China’s platform strategy is smart cities. China made smart city development a priority starting 2012 and was home to 749 pilot smart city projects by 2019. Leading Chinese firms—Alibaba, Huawei, ZTE, and others—provide technology infrastructure for managing smart cities. These include cloud-hosted services to integrate city management databases as well as central AI capabilities to manage city operations. Huawei smart city systems are active in more than 200 cities around the world. Alibaba provides a similar smart city management system and is currently piloting its “City Brain” project in Kuala Lumpur, Malaysia, where it uses traffic light information and traffic camera feeds, as well as data from the ride- hailing service Grab, to predict traffic patterns and reduce traffic congestion. Smart city infrastructure needs 5G technology, and Chinese firms have been at the forefront of the 5G race. ZTE and Huawei are key partners to major telecom operators globally and are deploying 5G and related technologies that are core to autonomous driving, industrial automation, and smart cities. In countries where ZTE and Huawei deploy 5G networks, these companies will have greater leverage to promote their smart city infrastructure. Along with China Mobile, these firms have increased their participation in international standard-setting bodies for 5G. As of April 2019, Chinese companies were involved in 52 5G initiatives across 34 countries, according to the Australian Strategic Policy Institute, which may position them to advance proposals in line with Chinese industrial policy. By setting the standards and providing the infrastructure, China establishes important control points over the equipment, the technical services, and the shape of future technology across participating countries. As providers of a smart city’s data operations, Huawei’s “Intelligent Operation Center” and Alibaba’s “City Brain” project gain visibility into patterns of citizen behavior and city infrastructure utilization. By aggregating data flows across these global smart city implementations—particularly those along the Belt and Road— Chinese companies like Huawei are well positioned to centralize smart city AI and create control points over cities along the Belt and Road. By creating the best trained and centralized AI brain for city operations, these companies could directly influence city-level governance and decision-making, including by controlling the profiling of citizens, citizen access to city services, and city infrastructure management. The combination of smart city infrastructure exports, investment in 5G standards, and smart city management AI sets up China’s platform ambitions in urban infrastructure. CHINA'S COUNTRY-AS-A-PLATFORM STRATEGY URBAN INFRASTRUCTURE

33. © Sangeet Paul Choudary 2020 For more Insights on the Platform Economy, Visit platform.blog PLATFORM REVOLUTION Source: Platformation Labs Research THE STATE OF THE PLATFORM REVOLUTION 2020 CHINA CONTINUES TO ADVANCE PLATFORM PLAY IN URBAN INFRASTRUCTURE EVEN AS HUAWEI FACES US-EU BACKLASH Platform play in urban infrastructure NOS, Vodafone, and Altice decide not to use Huawei kit in their 5G networks Ericsson exits, Huawei enters Iran 5G market Belgian telcos drop Huawei for Ericsson and Nokia to overhaul systems to be free of Chinese equipment by 2023. Sweden bans Huawei from participating in its 5G networks. US officials push for Huawei 5G ban in Britain Smart city projects help China contain coronavirus Tencent plans sustainability themed ‘smart city’ campus project in Shenzhen Huawei and Saudi based SC2 collaborate to operate smart city platforms in Saudi Arabia Oriental Pearl and China Electronics Technology Group establish joint venture for smart city and intelligent urban management services. Alibaba cloud signs MOU with Kingdom of Saudi Arabia to drive Smart Cities Innovation Alibaba and China mobile evaluate 3 billion yuan investment in China's second-largest surveillance equipment maker Dahua Huawei announces plans for new 5G technology manufacturing bases in Europe Trump issues executive orders banning transactions with Chinese companies Tencent and ByteDance that own WeChat and TikTok China launches sanctions regime in retaliation to U.S. moves on WeChat and TikTok JAN 13 FEB 05 FEB 16 JUL 30 MAR 28 JUN 17 JUN 29 U.S. tries to get Huawei blocked from Brazil’s 5G networks with $1 billion financing pledge AUG 13 Huawei launches Serbia's city data center in Kragujevac AUG 24 AUG 27 SEP 16 AUG 06 SEP 19 OCT 09 Serbia chooses links with china to develop its economy as a key cog in the digital silk road OCT 20 OCT 24 Huawei and Beijing jointly develop municipal blockchain directory as part of smart city infrastructure OCT 21 OCT 22 Backlash against Huawei and others OCT 28 BT signs 5G deal with Ericsson to help phase out Huawei equipment THE STATE OF THE PLATFORM REVOLUTION

34. Contact Us: Share:34 Social credit and national identity constitute the final component of China’s platform strategy. These social credit programs create a national-level reputation system for both individuals and businesses, built on data captured from government programs as well as data-sharing agreements with private actors like Alibaba and Tencent. These scores are used to determine citizen rights and qualify their access to services, including the ability to buy property, access loans, and even book a flight. China is home to many social credit programs and is now exporting them to other countries after having trained the social credit systems on domestic data flows. China’s ZTE launched the “Fatherland Card” program in Venezuela, a social credit and mobile payments system, which centralizes data about citizen activity and gives the government greater visibility into individuals’ activities. Beyond its borders, China has exported facial recognition software to Zimbabwe to train its AI on a wider range of facial image data. ZTE is working with several other governments on similar projects. These projects raise concerns around the development of surveillance states, especially when such technology is exported to countries with authoritarian regimes and fragile democratic systems. Chinese firms have trained their surveillance systems and scoring algorithms on millions of data points in China, providing them a unique control point to deliver such infrastructure to other countries. Alibaba’s Sesame Credit system, for instance, is trained on data from commercial and financial activity in the Alibaba and Ant ecosystems. The export of social credit systems allows China to export not just its technology but also its preferred governance model to partner countries. It also enables the export of various AI surveillance technologies that feed data into these social credit systems. By building these systems abroad, China’s AI benefits from a wider range of data gathered across these countries, strengthening it further as a control point. CHINA'S COUNTRY-AS-A-PLATFORM STRATEGY SOCIAL CREDIT

35. 35 Share:Contact Us: Future PLATFORM STRATEGY FOR THE POST-PANDEMIC WORLD The COVID-19 pandemic has created a global public health crisis and an economic slowdown that is likely to further drive the adoption of country-as-a-platform strategies. As the world recovers from supply chain disruption, countries will likely adopt alternate digital trade infrastructure to empower small businesses to digitize and easily participate in global trade. As countries turn to surveillance and contact- tracing to manage COVID-19, countries will need to import digital urban infrastructure from cities that have demonstrated the ability to trace and stop the disease’s spread. With its platform strategy, China is well-positioned to increase export of its digital infrastructure and standards in a post-pandemic world. But the export of China’s platforms and standards come with risks to partner countries. For one, Chinese government interests in private actors like Huawei raise geopolitical and security concerns. 5G technology itself is fraught with security vulnerabilities and could enable backdoor access into critical infrastructure, putting participating cities and supply chains at risk. The export of social credit systems, backed by surveillance tech, raise significant privacy and human rights concerns, as evidenced by Chinese repression, monitoring, and internment of ethnic minorities and political dissidents using biometric and other surveillance data. In Uganda, the government has used surveillance systems to take action against the opposition, while Venezuelans remain concerned that the Fatherland Card will eventually be used to track members of the political opposition. The export of surveillance systems threaten to undermine opposition movements and democratic systems in partner countries. More broadly, AI-based systems continue to be plagued with errors, which could have unintended consequences when rolled out as large scale digital infrastructure. In trade and financial services, this may result in incorrect sanctions. Implemented in social credit systems, these systems could erroneously strip individuals of their rights. CHINA'S COUNTRY-AS-A-PLATFORM STRATEGY

37. © Sangeet Paul Choudary 2020 Theme 4 PLATFORM REVOLUTION COVID ACCELERATES BIGTECH TAKEOVER OF HEALTHCARE © Sangeet Paul Choudary 2020 A Platformation Labs Production

38. Contact Us: Share:38 BIGTECH ENTERS HEALTHCARE The BigTech platforms - Google, Apple, Amazon, Alibaba, and others - have made strategic moves into healthcare over the past decade. The Covid-19 pandemic has further accelerated their existing efforts, while also enabling them to leverage their resources to respond to the global health crisis. In response to the pandemic, Google and Apple - which together dominate the global smartphone operating system industry - partnered to create a global contact-tracing infrastructure, which aims to help public health agencies track and manage the spread of COVID-19. Amazon meanwhile launched a global initiative to accelerate COVID‑19 diagnostics, research, and testing. The pandemic has also changed consumer behaviour, accelerating demand for remote healthcare, even as regulations like the Digital Healthcare Act (DVG) in Germany have emerged to facilitate reimbursement of digital medical solutions by payers. Through the course of the year, Google launched its Healthcare API, Microsoft launched its Cloud for Healthcare, Apple integrated an electrocardiogram and sleep monitor in its Watch, and Amazon launched the health tracker Halo. These moves are not merely opportunistic moves into a new industry driven by the onset of the pandemic. They are part of a larger strategy that these platforms have been putting in place over the last 5 years. As BigTech platforms advance from one industry to the next, incumbents need to better understand the effects BigTech entry and expansion can have on an industry's structure. COVID ACCELERATES BIGTECH TAKEOVER OF HEALTHCARE

39. 39 Share:Contact Us: Future The healthcare industry architecture is becoming more modular, unbundling healthcare delivery from traditional care facilities. Technological shifts coupled with deregulation have enabled more diverse models of healthcare delivery. Simultaneously, the nature of healthcare demand has also shifted away from a need for episodic interventions only to an increasing demand for wellness, preventative healthcare, and management of chronic conditions. Together, these shifts in healthcare needs and healthcare delivery models are restructuring healthcare consumption. First, the proliferation of sensor-enabled wearables has led to an increase in self-assessment by consumers as well as remote monitoring of patients by providers. 40%+ consumers use personal technologies to measure fitness in 2020, compared to only 17% in 2013. Wearables and other forms of remote monitoring devices also generate health data, which may be used by physicians to better design the care regimen. Next, urgent care clinics and retail medicine have also increasingly unbundled care from traditional institutions. As patients move to alternate channels, hospitals are increasingly shutting down, further driving specialisation of actors. The use of telehealth has further been accelerated by the pandemic as patients prefer avoiding visits to care facilities and payers extend their reimbursement policies to cover telemedicine. For instance, Epic Systems had less than 50,000 appointments on its telehealth services in February 2020, but that number had risen to 2.5 million by April 2020. Parts of primary and specialized medicine are also unbundling from large hospital networks and operating as specialized independent entities, driving further modularity in the healthcare delivery landscape. For instance, the East River Medical Imaging Center in New York specialises as an independent center for MRI and CT scans, and X-rays, while Pure Cardiology specialises in cardiology-related services and operates as a user-centric membership plan, and the Surgery Center of Oklahoma specializes in various forms of surgeries. On the other hand, remote monitoring solutions with integrated messaging and alert systems enable care providers to monitor patients remotely. Remote monitoring is particularly relevant for chronic disease management and for eldercare, where risk indicators like glucose, blood pressure, respiratory strength may be monitored on an ongoing basis without requiring clinic visits. For these patients, care extends across interventions by providers as well as ongoing care, which may be self-administered or delivered by a care team, comprising informal caregivers. THE UNBUNDLING OF HEALTHCARE COVID ACCELERATES BIGTECH TAKEOVER OF HEALTHCARE

40. Contact Us: Share:40 Despite the unbundling, the lack of data interoperability - e.g. Electronic Health Records (EHRs) interoperability - has created a fragmented patient journey, as patients cannot easily port their data from one provider to another, or integrate data from wearables with their EHR data. Despite greater consumer choice, the coordination costs to drive end-to-end patient care increase. However, two key shifts - increasing data interoperability and improvements in AI and machine learning - are driving down coordination costs, leading to the rise of platforms in healthcare. The first shift - increasing data interoperability - is being driven through the adoption of FHIRs or (Faster Healthcare Interoperability Resources), which create standards for data exchange, allowing developers to build APIs to access datasets across different systems. The second shift - improvements in artificial intelligence (AI) and machine learning (ML) - changes the economics of healthcare production and delivery. Incorporating AI into healthcare platforms takes on two broad forms. First, machine learning (ML) models that analyse structured data - imaging, genetic, EMR data etc - may be employed to study patient groups or perform diagnosis for specific patients. ML models can also be used to improve quality of medical data. Second, natural language processing (NLP) techniques process unstructured data - clinical notes, voice recordings etc - to create, enhance and enrich machine- readable, structured data. The NLP procedures turn texts to machine-readable structured data, which can then be analysed by ML techniques. Let's first consider the impact of AI and ML on diagnosis. Advances in AI and ML have commoditized prediction - the ability to anticipate future outcomes based on available data. Improvements in computational speed (using superior GPUs and TPUs) as well as data processing and analysis techniques over the past decade have worked together to bring down the cost of predictions based on machine learning, thereby commoditising them. At the same time, greater investment and regulatory push towards data interoperability increases the availability and accessibility of data, making predictions more accurate as well as more applicable across a wider scope of diseases. The commoditization of predictions reduces the cost of medical diagnosis, which can now be increasingly performed by machines. This, in turn, makes it feasible to perform diagnosis more frequently and easily. For chronic diseases, in particular, cheaper diagnosis, allowing for wider testing, may enable early detection and effective treatments. An increasing number of diagnoses may be performed as ongoing assessments to aid disease management outside the care facility, either self-administered by the patient or by an in-home care provider. Further, doctors and radiologists can now spend less time diagnosing, allowing their team to be freed up for other activities, in particular making more granular judgments on the appropriate intervention on the basis of these diagnoses. Next, consider the impact of NLP techniques on extracting information from unstructured data. This, again, has important implications. For instance, a home-based voice assistant can better capture patient data without requiring the patient to visit a care facility. By commoditising data capture, the frequency of data capture may be increased, allowing for superior disease monitoring. Extraction of data from voice also plays an important role in the effectiveness of telehealth, where data may now be extracted from remote patient consultations more easily, making telehealth interventions more effective. Finally, the ability to extract data from unstructured notes and voice records reduces operational overhead for doctors, allowing clinical staff to serve a larger number of patients. Effectively, improvements in AI and machine learning, coupled with increasing data interoperability, further reduce coordination costs. These two shifts are driving the rise of platforms in healthcare. HOW AI AND DATA INTEROPERABILITY DRIVE THE RISE OF HEALTHCARE PLATFORMS COVID ACCELERATES BIGTECH TAKEOVER OF HEALTHCARE

41. 41 Share:Contact Us: Future Against the above shifts, let’s look at how BigTech platforms - Apple and Google, in particular - are now rapidly moving into healthcare. APPLE - MANAGING THE PATIENT HEALTH RECORD Apple is pursuing a platform strategy centred around the Apple Health Record. Apple’s Health Record aims to be the central health record for users, combining data from acute care - currently stored in EHRs - with data from a variety of wellness and disease management devices and services, using FHIR-based integration. Apple’s partnerships with health systems and EHR vendors enable it to integrate EHR data with the Health Record. Apple also partners with Health Gorilla, a clinical data API exchange, to integrate diagnostic data. Apple’s Health Record acts as a key control point attracting five diverse communities of producers looking to access these consumers - developers, device manufacturers, healthcare providers, pharma companies and medical researchers. First, Apple provides access to its health record API to third parties through a software development kit called HealthKit. Every app connecting to HealthKit may access data from the Personal Health Record, aggregated across other third party data providers, while also contributing its own data to make the Personal Health Record richer. Nike, Jawbone, Withings, and other prominent device manufacturers use the HealthKit API to integrate their devices as complements to the Personal Health Record. Next, Apple's CareKit provides a central platform for caregivers, physicians, patients, etc. to monitor a patient across the care pathway, by enabling them to develop apps to monitor patients in real-time. CareKit is specifically focused on chronic disease management and surgical episodes (pre- and post-operative) and enables the creation of complementary devices and services to assess, diagnose, and manage these conditions. Apple's large scale aggregation of its user base can also enable population health interventions focused on driving large-scale behavioural changes, including improving medication adherence. Finally, Apple's ResearchKit enables medical researchers to conduct studies leveraging the iPhone's user base. As an aggregator platform, Apple makes it easier to identify, target, and recruit eligible candidates for a research study, based on data in their health record. Leveraging Apple's consumer-facing services, these studies can be managed at much larger scale than traditional research studies. For instance, the Apple Heart Study has recruited nearly 420,000 people in less than a year. ResearchKit's customisable templates also make it easier to manage informed consent and obtain data access permissions from participants. Beyond academic researchers, pharma manufacturers can also use ResearchKit for conducting remote clinical trials. Traditional site-based recruitment and testing is restrictive and expensive. Utilizing sensors, ResearchKit participants can more easily participate in the study virtually, enabling Pharma manufacturers to capture real-world data about the performance of their drugs. Moreover, the continuous assessment enabled by sensors enables data capture during episodes of relevance, such as during an asthma attack. Leading pharma manufacturers, including GlaxoSmithKline, Novartis, and Pfizer have partnered with Apple to conduct such studies. BIGTECH MOVES INTO HEALTHCARE COVID ACCELERATES BIGTECH TAKEOVER OF HEALTHCARE

42. © Sangeet Paul Choudary 2020 For more Insights on the Platform Economy, Visit platform.blog PLATFORM REVOLUTION Source: Platformation Labs Research THE STATE OF THE PLATFORM REVOLUTION 2020 GOOGLE AND APPLE MOVE INTO HEALTHCARE MARCH APRIL Google APR 20 :Google launches Cloud Healthcare API MAY JULY AUGUST Google AUG 21 : Google venture funds invests IN Klara, a patient engagement solutions company. AUG 21 : Google Health, Philips and others join the consumer technology association's new initiative to establish standards for the use of digital therapeutics. SEPTEMBER Google SEP 16 : Google invests in home- based care startup Ready SEP 23 : Google maps adds new layer to show Covid-19 hotspots. Apple SEP 15 :Apple watch series 6 launched to monitor blood oxygen saturation (SpO2) levels. SEP 15:The government of Singapore and apple announce their partnership on the health initiative Lumihealth SEP 17 :Apple rolls out ECG support on apple watch JANUARY FEBRUARY JUNE OCTOBER NOVEMBER DECEMBER APPLE AND GOOGLE CREATE INDUSTRY- WIDE CONTACT TRACING INFRASTRUCTURE APR 10 : Apple, Google announce partnership on Covid-19 contact tracing technology MAY 20: Apple and Google launch Covid-19 contact tracing system

43. 43 Share:Contact Us: Future BIGTECH MOVES INTO HEALTHCARE GOOGLE - THE DATA INFRASTRUCTURE OF HEALTHCARE Google's platform strategy involves provisioning clinical and operational infrastructure that underpins production across healthcare operations, diagnostics, drug R&D, surgery, and claims management. This combines a HIPAA-compliant Google Cloud with the Google Healthcare API, enabling healthcare providers to store and aggregate data across multiple sources. Further, Google’s DeepMind enables access to diverse, siloed data in a standardized format, enabling a wider scope of data elements to be analyzed for clinical decision making. Google's infrastructure platform also includes capabilities like DeepVariant, which provides an open-source deep learning tool for genomic analysis, aimed at the life sciences industry. Leveraging its capabilities in data storage and processing, information management/indexing, and AI, Google is setting up a platform to provide core capabilities in healthcare production. Google aims to provide data storage, processing, and management infrastructure to a wide range of actors in the healthcare production ecosystem. As mentioned earlier, data silos and poor data interoperability pose one of the key challenges to effective coordination across healthcare ecosystems. 1. Data storage and management: To execute on its healthcare ambitions, Google has invested heavily in making its existing infrastructure - including its data warehousing, machine learning, and G Suite tools - HIPAA-compliant. For instance, the STRIDES Initiative, a partnership between Google and NIH, provides Google Cloud's storage, computing, and machine learning capabilities to 2,500+ research institutions. Google's G Suite for healthcare is a HIPAA- compliant cloud service which is positioned as an alternative way for healthcare firms to share files (X-rays, CT scans etc.) without being restricted by the constraints of EMRs. 2. Data logistics and interoperability: Beyond data storage and management, Google is also looking to enable data logistics and interoperability with its infrastructure platform play. As noted earlier, the healthcare industry's shift towards FHIRs (Faster Healthcare Interoperability Resources) enables greater interoperability and innovation around healthcare datasets. Apigee, an API management company acquired by Google, was one of the early movers in building FHIR-based APIs, and has worked with healthcare firms like Walgreens, McKesson, Cleveland Clinic, and others . For instance, Walgreens uses Apigee's API management capabilities to enable customers to order prescription refills online and gets these refills electronically approved by a doctor's office connected to Walgreens by APIs. This end-to-end connectivity eliminates delays and increases patient adherence to medication programs. Google Healthcare API enables health care providers to store and access healthcare data in Google Cloud. The API also enables connectivity between traditional care systems and applications hosted on Google Cloud. 3. Data standardization and innovation: Beyond interoperability, Google's infrastructure platform aims to encourage innovation by enabling data normalization across a wide range of data sources and formats. Google’s DeepMind enables access to diverse, siloed data from EMRs, devices, and clinic software to be accessed in a standardized format. This standardization enables new innovation by allowing analysts and app developers to analyse different data elements in one standard format. 4. Information indexing and querying: As the leading search engine, Google has developed deep expertise in information indexing and retrieval, and is looking to extend those technologies to its healthcare data infrastructure. BigQuery, its HIPAA-compliant data warehouse enables healthcare providers to develop personalized therapies for patients by combining and analyzing multiple datasets - genomics data, insurance claims, public health data, and environmental data - with EMR/EHR records. COVID ACCELERATES BIGTECH TAKEOVER OF HEALTHCARE

44. 44 Share:Contact Us: Future 5. Google's infrastructure platform also includes capabilities like DeepVariant, which provides an open-source deep learning tool for genomic analysis, aimed at the life sciences industry. Google benefits from infrastructure lock-in. For instance, as more researchers build on top of Google Cloud, Google becomes a more integral part of the healthcare infrastructure. Google's expansion into the healthcare industry further involves bundling key components to its data management infrastructure. These complements include complementary datasets that may be accessed by companies using the infrastructure, diagnostic services that aid clinical decision making, robotic surgical tools, data capture tools that capture unstructured data from across the clinical and operational workflows, as well as clinical and operational services that assist healthcare producers in delivering care, leveraging the data infrastructure platform. Healthcare datasets serve as complements that increase the attractiveness of Google's platform. Research programs run by Google collect health data from participants and store these datasets in Google Cloud. These datasets may eventually be accessible to researchers using Google's infrastructure. As Google expands, it is likely to further open up the platform to other dataset providers, particularly organizations that are already using Google Cloud to store their research datasets. Google's Deepmind is also building and bundling its own applications to demonstrate the value of its infrastructure platform. For instance, DeepMind's Streams app detects acute kidney injuries by analyzing information across diverse sources, managed by Google's infrastructure platform. Eventually, DeepMind will likely open this to a larger number of third party developers. Surgical capabilities, enabled by robotics, also act as complements to Google's infrastructure platform. Verb Surgical - created by Google's Verily and Johnson & Johnson - is building out robotic surgery complements that aim to use machine learning capabilities in Google's platform. These robotic surgery tools are aimed at augmenting surgeons' abilities to perform surgery. Next, Google bundles data capture tools, which act as important complements to the data infrastructure platform. Google's MedicalDigitalAssist, a project in partnership with Stanford Medicine uses speech recognition to transcribe conversations and extract relevant notes by recognising medical terminology and other relevant keywords in the discussion, with the goal of helping doctors with note-taking and paperwork. Suki, another complement to Google Cloud - is a voice assistant capability to help physicians with administrative tasks like documentation or EHR information retrieval. Eventually, Google's infrastructure play may open up to integrate other third party tools that similarly extract unstructured data and store it in structured form in its data infrastructure. Google's Study Watch, by Verily, is another important complement to its infrastructure and may be deployed in clinical studies to collect physiological data from volunteers, eventually stored in Google Cloud. Google's venture fund investments include Klara, a system to automate workflows across the patient's care journey, including scheduling, pre-visit instructions, reminders and no- show engagement. It integrates with hospital EHR and practice management systems and may, in future, be bundled with Google's infrastructure proposition to healthcare providers. BIGTECH MOVES INTO HEALTHCARE COVID ACCELERATES BIGTECH TAKEOVER OF HEALTHCARE

45. Contact Us: Share:45 GOOGLE AND AMAZON -   IN-HOME PLATFORM PLAYS Google's platform play also focuses on in-home care and aggregates interactions across connected devices, telehealth services and on-demand, in-home care services. Google Home, Google’s voice assistant, could be used to ensure medication adherence, assist with disease-related lifestyle management, and ask questions to assess a patient’s health risk. Google has been running several projects on AI-enabled diagnostics. While many of them may translate to devices and services for providers, Google is also likely to build connected devices in the home that enable in-home testing, assessment, and diagnostics. Alphabet’s subsidiary Verily is working on a range of data capture and diagnosis mechanisms to enable a superior condition assessment, diagnosis, and disease management experience. Verily's Study Watch - a sensor-based wearable device for non-invasive, continuous monitoring - plays a strategic role in data capture and monitoring of several health conditions, by collecting "biometric health information." Verily‘s Personalized Parkinson’s Project combines data from the Study Watch with clinical data to identify the onset of Parkinson's Disease. Google's investment in Ready provides another key component of Google's platform play targeted at in-home care. Ready provides access to an on-demand network of “Ready Responders” — trained as paramedics and nurses — to patients’ homes, with relevant testing and monitoring equipment. Google Cloud's $100 million investment in Amwell, a telehealth operator indicates that Google is also looking to engage in patient-facing services to connect in-home care to the hospital. Telehealth services, integrated with Google Cloud and its AI assets, could play an important role connecting the consumption ecosystem with the production ecosystem. Telehealth software, in combination with doctor assistance capabilities like MedicalDigitalAsssist could seamlessly enable data capture. Doctors using the telehealth service could also benefit from Google's AI-enabled diagnostics capabilities. Also on the connected devices front, Nest - Google's home automation subsidiary - is targeting assisted living facilities. and nursing homes in the eldercare market. For instance, Nest has indicated using its motion sensor to track movements and automatically turn on the lights when seniors get up in the middle of the night. Amazon is following a similar strategy. Amazon Alexa developed software that would meet HIPAA regulations. By becoming HIPAA-compliant, Alexa is allowed to receive and transmit information that is protected under the U.S. HIPAA (1996). After gaining HIPAA compliance, Amazon also onboarded six business partners to bundle complementary Alexa Skills for the healthcare industry. These skills allow consumers to make appointments, access medical instructions, or track a prescription, among other things. Amazon’s wearable Halo captures a variety of healthcare indicators using 3D body scans and voice tone analysis and will also play an important role in in-home care. COVID ACCELERATES BIGTECH TAKEOVER OF HEALTHCARE

46. © Sangeet Paul Choudary 2020 For more Insights on the Platform Economy, Visit platform.blog PLATFORM REVOLUTION Source: Platformation Labs Research THE STATE OF THE PLATFORM REVOLUTION 2020 MARCH APRIL MAY JULY AUGUST SEPTEMBER JANUARY FEBRUARY JUNE OCTOBER NOVEMBER DECEMBER Amazon MAR 26 : Amazon launches Covid-19- focused Alexa skills and a public symptom checker Microsoft APR 15: Microsoft and GE Healthcare launch the Thoracic Care Suite, which uses AI to scan for chest X-ray abnormalities related to Covid19 Microsoft MAY 19: Microsoft launches Cloud for Healthcare Microsoft JUL 08 : Microsoft releases text analytics for health JUL 13 : All scripts and Microsoft extend partnership for another five years Amazon JUL 29 :Sisense, and G-Med to create an AI- enhanced knowledge base to combat Covid-19 using Amazon comprehend medical Amazon AUG 27 :Amazon launches halo, a fitness band that tracks body fat and voice tone AMAZON AND MICROSOFT MOVE INTO HEALTHCARE

47. Contact Us: Share:47 By acquiring mail-order pharmacy PillPack, Amazon has established a platform position in the pharmaceutical distribution value chain. It may further complement Pillpack by setting up a retail pharmacy network across Whole Foods locations to provide a way to fulfil same-day prescriptions. Amazon’s Whole Foods acquisition also provides it a storage and distribution network with the physical infrastructure (including cold storage) required for perishable pharmaceuticals. In addition to the licenses gained from the PillPack acquisition, Amazon has also filed for wholesale pharmacy licenses. With the additional acquisition of a manufacturing license, Amazon would be well placed to set up a logistics infrastructure platform to manage pharmaceutical logistics end- to-end. AMAZON - HEALTHCARE LOGISTICS STANDARDS DEVELOPMENT In addition to building proprietary platforms, BigTech firms also engage in open standards development when entering a new industry. Open standards development may help change the competitive dynamics in an industry by commoditizing incumbent advantages. While traditional firms, particularly EHR vendors, resist interoperability in healthcare, the BigTech firms are working together to promote open standards. Google and Amazon have joined efforts to support FHIRs through Project Blue Button, which aims to make it easier for patients to view and download their health records. They are also implementing the standard in their cloud infrastructure and consumer-facing applications. Google’s“Cloud Healthcare API” provides a solution for storing and accessing healthcare data in FHIR format, while Apple has implemented FHIRs in its consumer-facing Health Records. COVID ACCELERATES BIGTECH TAKEOVER OF HEALTHCARE

48. © Sangeet Paul Choudary 2020 For more Insights on the Platform Economy, Visit platform.blog PLATFORM REVOLUTION Source: Platformation Labs Research THE STATE OF THE PLATFORM REVOLUTION 2020 ALIBABA AND TENCENT MOVE INTO HEALTHCARE MARCH APRIL MAY JULY AUGUST SEPTEMBER JANUARY FEBRUARY JUNE OCTOBER NOVEMBER DECEMBER Tencent APR 22 : Tencent Trusted Doctors launches tele health in partnership with AXA ASIA MAY 13 :Alibaba's eWTP at KILA serves as global hub for delivery of medical supplies Alibaba SEP 29 :Tencent invests in china’s largest animal hospital chain Tencent Alihealth MAR 19:Alibaba cloud, Damo academy and dingtalk join forces to launch a series of ai technologies and cloud-based solutions to support companies and organizations worldwide in the fight against Covid-19. MAR 09: Alihealth offers online consultation for overseas Chinese via Alipay, as coronavirus spreads globally Tencent health JUL 22: Tencent develops a model to calculate the risk of a patient’s health severely deteriorating from Covid-19. SEP 18 :Ali health's online pharmacy launches its medication safety program for Chinese families. SEP 18 :Ali health and sinovac biotech launch the internet + vaccine program families. Alihealth SEP 15 :Tencent-trusted doctors sets up a healthcare industry fund Tencent health Alibaba AUG 22:Alibaba cloud establishes the Healthcare Fintech Alliance. To improve healthcare sector services in southeast Asia Alihealth AUG 05 :Alibaba raises $1.3b for push into online pharmacy business

49. © Sangeet Paul Choudary 2020 Theme 5 PLATFORM REVOLUTION A Platformation Labs Production THE GREAT REBUNDLING OF FINANCE

50. Contact Us: Share:50 The last 10 years were largely about unbundling finance, the winners in the next 10 will be the ones who successfully rebundle finance. Fintechs began by “unbundling” financial services. They identified one traditional banking function, and executed it with finesse. However, unbundling creates a fragmented customer journey and increases search costs for consumers. The next decade will be dominated by financial services players that can successfully “rebundle” services to cater to the evolving financial needs of its customers. Unbundling economics Several factors drove fintech unbundling. A few are outlined below: • Niche market targeting - Clearbanc catered to entrepreneurs while SoFi focused on students. These players targeted an underserved customer, underwriting customized loans, to develop primacy of user relationship. • Automation - Mutual funds and ETFs had already been using algorithms. Client advisory, however, continued to be manual. Robo-Advisors such as Wealthfront and Betterment did away with this by automating routine functions of financial advisors. As a result, they were successful in providing balanced, diversified portfolios at lower management fees. • Margin arbitrage - Fintechs, with lower cost operating structure, can offer more credit at better interest rates than incumbents. • Saving platforms - Some fintechs ‘gamified’ savings, using rewards systems and social benchmarking, again promising a higher return on their savings accounts. THE GREAT REBUNDLING OF FINANCE THE FIRST PHASE OF FINTECH DISRUPTION UNBUNDLED THE BANK Banks have primarily served to collect deposits and pay interest on savings. Payments, lending, and asset management were other key functions that banks performed. Across the 90s and the early 2000s, banks emerged as “one-stop shops” or financial supermarkets that essentially offered bundled financial services to customers. However, these bundles were not centered around customer needs. They were structured around the capabilities of a bank’s delivery channel. By the late 2000’s, fintechs disrupted this traditional banking model offering niche banking services and executing it better than incumbents that were struggling with legacy issues. Venmo and Square specialized in P2P payments, Mint specialized in budgeting and Lending Club helped consumers identify P2P loans at best interest rates.

51. 51 Share:Contact Us: In the music industry, file-sharing services like Kazaa and Napster unbundled the music album (the original bundle) but Spotify’s playlists rebundled them. News media provides a more powerful example. The traditional newspaper bundle was unbundled by digital distribution on the web. Eventually, Facebook rebundled it as a news feed and arguably Google did the same through its search engine. Both ‘rebundlers’ then centralized advertising power and moved it away from the old bundles. Previous instances of unbundling and rebundling show a template for the future of financial services. The first phase of unbundled financial services is unlikely to sustain unless some of those unbundled services serve as beachheads to attract customer engagement and then rebundle services to serve those customers. HOWEVER, UNBUNDLING IN ITSELF DOESN’T CREATE SUSTAINABLE BUSINESS MODELS. Creating value through rebundling Square expanded from an easy-to-use payments terminal for on-demand workers to a financial services bundle centered around a business’s needs. Ant Financial started out as Alipay and has rebundled lending and other financial products around it. Stripe, similarly, started as a payments API and now combines small business solutions and treasury-as-a-service. Paypal’s prepaid debit card that includes bank transfers, deposits, and cashing checks. Both incumbents and startups are driving this rebundling of financial services. PSD2 and other open banking directives make banking services more fluid, further driving this unbundling. THE GREAT REBUNDLING OF FINANCE