What is New About the Digital Economy?

Abstract

We argue that we are facing a new industrialization. While mathematical physics provided the base for the mechanization of processes in the physical world, computer science does the same in the realm of information. We look then at the effects of this new mechanized form of information on different places of the value chain. First, the value chain undergoes a transformation, resulting in a cheaper and ubiquitious availability of production means (resources), and often-revolutionary changes in the value system (as with e-mail, or MP-3). Then, the process of designing products (whereby a product is considered as a solution for a problem) undergoes changes, making use of powerful design platforms. In digital economy, the scarce resource shifts from production to communication, in a novel way: While the implementation of a given design in the manufacturing process - we call this 'implementation I' - is mastered in less and less time by more and more suppliers in a state-of-the-art quality, its implementation in the customers' brains - we call this 'implementation II' - remains as costly as ever, or becomes even more expensive. Finally, the new industrialization will materialize in a new media industry, and new digital information products as Distributed Virtual Environments will dominate the basket of the future.