Instructor: David Schuff, Section 003


Airbnb’s next disruption? The airline industry.

Recently, Airbnb co-founder and CEO Brian Chesky hinted at the company’s plans to establish an airline and enter the “end-to-end” trip business. Currently, Airbnb uses an online platform to connect people looking to rent their homes with people who are looking for accommodations. Airbnb creating an airline would likely cause a great disruption in the aviation industry. By establishing an airline, Airbnb would become an online travel hub and expand their services. According to reports, Airbnb has been building a flight booking system since December 2016.

Ten years ago Airbnb disrupted the hospitality industry with their innovative accommodations platform, which is now the largest in the world. Now, Airbnb offers the ability to book tourist experiences and business travel accommodations. The addition of an airline would further expand Airbnb’s reach within the travel industry. Airbnb’s strategy to build a one-stop shopping for travel seems similar to Amazon’s strategy. Unlike other one-stop shop travel websites, however, Airbnb would create their own airline. Airbnb has a similar valuation as the major U.S. air carriers, but unlike the major legacy airlines, is a private company.

What do you think of Airbnb’s strategy to become a one-stop shop for travel?

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Uber’s Unsustainable Business Model May Be Banking on A.I.

Ride sharing apps like Uber and Lyft were so disruptive in nature and changed consumer behavior to such an extent that a new type of “sharing economy” seems to have formed around them and similar applications. The key features of the applications are their affordability and the access provided to this type of “on-demand transportation” that essentially became democratized. Despite the widespread use of these apps, their business models may prove unsustainable. According to the BloombergView, “Eighty percent of [Uber’s] $9.7 billion in quarterly revenue was eaten up by a combination of driver payouts and bonuses, along with discounts to riders. Toss in insurance costs, and you’re up to 90 percent—and that’s before spending on marketing, research and development, overhead and so on”. Without the aid of venture capitalists, Uber will be in huge financial distress in the future. However, the firm does not operate as one that is concerned about future financial uncertainties. In fact, Uber is one of the many firms conducting research on and testing autonomous vehicles. Could this be its long-term strategy that will make its business model viable? Will the firm be able to weather these challenges long enough to see its investments in A.I. pay off?

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Be more like Tesla

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Soon cars like Ford F-150 can be fully electric and compete with their own gas and diesel counterparts according to Wall Street Journal. Ford is planning to invest $11 billion dollars in electric car development to grab some of the customers from Tesla. This initiative is part of a $70 billion investment by major car manufacturers like Porsche, Jaguar, and Toyota. While current interest from American consumers is low, it has grown over 1000% since 2011. To relate this to what we learned, Ford is trying to serve undershot customers to whom existing products are not enough. While Tesla models and other manufacturers have a reasonably good market offering, their models are too expensive when compared to their gas counterparts. Additionally, Tesla’s and GM products don’t serve the same needs for customers like a Ford electric truck would. While Ford does not create a disruptive innovation, it could change the electric marketplace by driving the prices of electric cars down by offering a greater variety of electric cars. Do you think there are any potential innovations in the electric car market? What advantages do you think Ford has over Tesla or GM? Would you purchase an electric car in the future?


FInd more here.

I’m Gonna Pop Some Tags (online): ThredUp Changes the Way People Thrift

Changing consumer trends towards more cost-conscious spending has enabled companies to carve a space for themselves in the sharing economy. ThredUp in particular aims to change the way that buyers shop for second-hand clothing. It has grown to become the largest online thrift/consignment shop in the country. ThredUp doesn’t utilize peer to peer transactions to sell items. Instead, ThredUp collects and organizes the clothing it receives then photographs, sells, and delivers the items on their site. ThredUp is a new market innovation because it changes the process of shopping for second-hand clothing and makes it more convenient. Instead of spending hours sifting through racks of unorganized clothing, users can simply search for an item or brand they’re looking for, and all relevant items will populate their screen. Users can benefit from the cost savings of buying second-hand clothing, without having to spend a lot of time searching for desired items. Creating an easy to use, online platform for thrifting makes it more appealing and could attract customers who wouldn’t be keen to try it otherwise. Do you think that ThredUp will gain more popularity over traditional thrift/consignment shops? Do you see it being a different type of innovation when applying a different incumbent, like eBay? Are there any other retail innovators you can think of?

Click Here to Read More about ThredUp

Ride-Hailing Business Now Better Than Ever

Since Uber and Lyft have come into play, a lot of people have started utilizing these means of transportation rather than driving their own car. The automobile industry believes that personal car ownership will be plummeting in the upcoming years. Due to this belief, companies, like Sony, Bosch, and Avis, are partnering with automotive, ride-sharing companies. The percentage of personal use of cars has fallen below because it is more convenient now to use ride-sharing sources. Consumers are looking for a quick way to get from point A to point B. With parking as the biggest issue, they choose to not utilize their own vehicle, ultimately leading to the question of ownership of one. Uber, Lyft, and other means can be considered a disruptive innovation due to this. It has caused and will continue to cause a change in the automobile industry, as well as transportation industry. 


Google Glass Created a New Market For Eye-Wearable AR

Rick Osterloh, Head of Google’s Hardware Division, said to The Telegraph that hi-tech glasses are “very interesting to [Google]… we’re trying to determine what the best future will look like for other kinds of ways to experience AR than just phones.” Google Glass was introduced to the public in 2014 in open beta, where “Glass Explorers” in the US could purchase a pair for $1,500. Google Glass is an optical head-mounted display developed with the mission of producing a ubiquitous computer. The announcement of Glass was met with high excitement, creating demand among non-consumers. In 2013, there was a lot of buzz going around about the potential of augmented reality, as AR was not easily accessible to consumers through a mainstream product. Google Glass was a hit in the healthcare industry, where it helped doctors, emergency medical technicians, and paramedics save lives, especially in the spaces of surgery and radiology. With all of the excitement about Google Glass, there were a number of safety, health, and privacy concerns, which caused Google to withdraw the device from the market in 2015. Consumers within the new market of eye-wearable AR have been eagerly awaiting Google’s next move in the space of AR. After successfully creating a market for AR, Google hasn’t released much information about their next moves in the space, but there is a good amount of speculation and excitement about what the future of AR has to bring. What can Google do to mitigate privacy and safety concerns about the Google Glass? How else can Google capture demand among non-consumers within the space of AR, potentially outside of Google Glass?

Information Sources: X, Y, Z

Image Source: X

Is Amazon Capable of Transforming Healthcare?

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Many companies have attempted to immerse themselves into the healthcare industry in the past, although few have been successful in reducing healthcare costs. Amazon recently announced its healthcare alliance with Berkshire Hathaway and JPMorgan Chase, and it is argued that Amazon is the key component of this partnership, due to the company’s foundation of efficient operational procedures, strong customer focus, and technological integration. Chunka Mui’s Here’s How Amazon Could Disrupt Healthcare emphasizes several capabilities that Amazon has brought to the retail industry that will enable the company to disrupt the healthcare industry. Mui makes the interesting point \that if integrated into healthcare, Amazon’s comprehensive customer records, personalized user experience, price choice and transparency, and reliable reviews will lead the company to a future of vast amounts of patient health data to analyze, personalized health pages, cost options, and trustworthy ratings of healthcare providers. However, do you think that this is enough to make Amazon stand out as a player in healthcare? What roadblocks might arise for the future of this healthcare alliance?



Will self driving cars be safer?

In the future self driving cars will take over the automotive industry. Many car companies have been developing self driving cars for many years. The goal for creating self driving car is to lower the risk of accidents, allow travelers to avoid long boring trips, and etc. However will the self driving cars be more safer? Self driving cars right now are easily able to be hacked. In order to create self driving cars companies need to spend $10k on sensors that able cars to drive on their own. But it has been found that a low cost laser pointer can confuse and defeat the sensors. Self driving cars will always be  vulnerable to hacking attacks. Once self driving car become a popular trend and everyone uses them all people inside a car maybe in danger. So will self driving cars be a safer alternative to driving today?

3 CEOs plan to disrupt the healthcare industry

Berkshire Hathaway, Amazon, and JPMorgan Chase have a plan that could disrupt the entire healthcare industry. The CEOs of these companies hope to lower heath care costs for the companies’ employees and deliver significant advancements for all patients. This is a monumental challenge being that the health care spending represented 17.9% of the U.S. economy in 2016 and continues to rise. Many skeptics say that health care costs cannot be meaningfully lowered by three companies and that the sector will not change without government action. However; this would not be the first time Amazon has disrupted an entire industry. Amazon’s success has been based on removing entire layers of product sales and distribution, adopting new ways of thinking, and pursuing technological innovation. The new company these CEOs plan to establish will not seek to profit off of health care, but instead offer it at the lowest cost possible. One way to lower costs is to cut the number of people in the industry by moving toward more automation and adopting artificial intelligence in areas such as data input, automated health care tests, lab work and food preparation. Another way to lower health costs is by expanding telemedicine so health care providers could sharephysicians and nurse practitioners. Do you think this is something people will become more comfortable with or will the majority of people still want to physically go into a doctor’s office? With Amazon entering into health care do you think it has a long term goal of entering drug sales by launching an online pharmacy? This would also lower costs by cutting out the middleman. The last way this new company would reshape the industry is by tying payment to quality of care, so consumers would pay a fee based of the value of the care they received. Do you think these three CEOs will be able to create this new health care company and to what extent will it transform the healthcare industry?


Artificial Intelligence: A Growing Disruption

Intelligence photoArtificial (AI) is becoming the new “it” thing to invest in among technologies, and it has caused several disruptions to the technology industry. AI is a human-like computer tool that enables them to run large sets of data and self-learn different algorithms. They can also help companies make decisions in quicker time with higher levels of confidence. AI has become so popular of the past couple years due to a few reasons. All algorithms live in cloud based environments, something all companies have been switching over to. The cost of data has decreased 38% over the past few years, allowing companies to buy more and collect more data. The final reason why AI has become so popular is because investors are throwing billions of dollars in startup companies that focus on AI. All of this has started to see some true disruptions to the technology industry. We have seen AI implemented in sustainable updates, like YouTube and Netflix, to help give us more personalized recommendations. Both companies have reported an increase in viewer watch times. Perhaps the most prominent area we have seen AI take place is in a completely new market. AI has led to the creation of digital assistants like Siri, Alexa and Google which in turn have created products like Echo and Google Home. There is money behind these new speakers too, Amazon, creator of echo, currently holds around a 70% market share in what is soon to be a $25 billion market. AI isn’t going to stop at software updates and digital assistants it is starting to take over the marketing and health industries as well. What do you think is next for AI? Do you think AI is here to stay or just waiting to be phased out by the next innovation? Where would you like to see AI go in the next few years?



A new era: Artificial intelligence is now the biggest tech disrupter

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