Innovative technologies and their applications have always led to new business models for companies, but also to disruptions of entire industries. The emerging platform economy and the use of artificial intelligence, Internet-of-Things (IoT) applications and blockchain are enabling process improvements or entirely new products and services. Consequences are savings, revenue increases and growth. As part of Blockchain Europe, we are exploring the questions of what new business models are enabled by the use of blockchain technology and how blockchain will sustainably change value creation.
“A business model essentially describes which customer is offered which service, how this service is created and how it is remunerated. The customer is always at the center of the business model, and services pay off on a specific value proposition,” explains Carina Culotta from Blockchain-based Business Models at Blockchain Europe. The value proposition means that the company’s product solves a specific problem of the customer or creates a concrete added value. On the other hand, a business model clarifies the question of how value can be secured for one’s own company or which revenue logic, cost and sales structures are necessary.
The advance of digitization is permanently changing traditional business models: the availability of data and its tradability are giving rise to new products and services. For example, the business model of a machine and plant manufacturer today is not (only) to manufacture and deliver the machine, but to analyze the data generated by the machine and, based on the results, to offer its customers digital, sometimes platform-based services, e.g., in the area of smart maintenance. This transformation of business models can be found in almost every industry. Consequently, value creation within Industry 4.0 is made possible by networking as well as mapping, but also decoupling, the physical and digital worlds.
In the course of this upheaval, blockchain technology is often discussed as a possible solution. The blockchain as a cryptographically secured, distributed or decentralized and cooperatively used data store can solve challenges such as a lack of transparency and trust between different parties or the allocation of usage rights along data-based processes. Data can be stored in a traceable and immutable manner within a blockchain, thus allowing a transparent representation of the corresponding process steps. In addition, logical sequences or “if-then” conditions can be represented via smart contracts and linked to the blockchain. It is therefore possible to depict automated payment processes in a trustworthy manner with the corresponding data input.
Another relevant aspect of blockchain technology is the tokenization of values, rights and digital assets. So-called tokens can be used to represent exchangeable assets such as currencies or other material goods, but also non-physical, i.e. digital, individual and unique assets such as digital works of art or patents. What is particularly exciting here is that a digital asset can be assigned a unique authorship. This sometimes makes it possible for the first time to own, share and trade digital assets and their entities.
Thanks to its properties, blockchain technology can change almost all areas of a business model.
change. On the one hand, new customer segments are addressed and developed, new types of value propositions are made possible, and digital identities allow unique assignments or receipts. On the other hand, material flows can be traced, compliance violations identified, quality controls automated, or even the carbon footprint transparently displayed. Likewise, pay-per-use remuneration models can be implemented using smart contracts. “However, blockchain technology not only enables new business models, but sometimes also makes intermediaries obsolete. As a result, traditional intermediaries such as banks and central platform operators must also question their existing business models,” reports Carina Culotta.
To explore the ways of new value creation, new profit models and the impact of blockchain on business models, Carina Culotta and her team are currently looking for interview partners. Companies that already have initial experience with blockchain technology, belong to an existing blockchain network, or have piloted the technology and its applications are encouraged to participate in the interviews. As a result, new business model patterns can be identified and guidelines or recommendations for action can be published.