There Are Only Two Places To Shelter
This is the Agri mountain, which is believed to be where Noah’s arc landed after surviving the biblical flood that ended a generation of humans on Earth.
In similar veins, a massive flood of commoditization is coming to Earth, and there are only 2 places to shelter: Metaverse and Universe.
Generative AI, robots, and AI converging to general intelligence are bringing a massive flood of commoditization to all skills. Musicians, painters, photographers, screenwriters, drivers, doctors, lawyers, consultants, baristas, teachers, scientists, and countless other jobs are now subject to competition with AI. Even AI models are under hyper-competition and tend to get commoditized quickly. Compared to models, AI solutions can command an advantage via learning curves, but even this advantage is leveled with virtual training environments.
Similarly, robots started commoditizing all human crafts, especially those requiring precision, reliability, and stamina. So, even dentists and surgeons are now subject to competition with robots. But robots themselves are getting commoditized fast. Humanoid robots seemed like super advanced technology for a long time. But now, it is a contested market. In the USA, you can easily find more than 20 humanoid robot companies in addition to renowned ones such as Boston Dynamics and Tesla. Moreover, the advent of capable Chinese players with bold visions, and examples like this small Turkish company being able to produce solutions similar to Boston Dynamic’s most venerated Spot are signs of the rapid commoditization awaiting robots.
I think anything digital or mechatronic is subject to rapid commoditization unless wrapped with a bulletproof IP strategy or defended by regulatory barriers to slow down or intimidate new entrants. Of course, good old network effects will continue to work without expiration; this means platform businesses are not subject to the flood of commoditization I am pointing at. However, the successful examples of these platform businesses have already passed valuations north of 30 P/E and reached 100s.
This leaves 2 places to sail: Metaverse and Universe.
© Saip Eren Yilmaz, 2023
