Paper: Resource reorganization and service growth in highly connected societies

Abstract: The analysis of this paper shows that the development of modern technology, especially network technology, is changing the basic nature of service industry, causing a wide range of resource reorganization and aggregation, the basic challenges of traditional economic theory, such as The hypothesis of low service productivity is no longer established, the neo-classical price theory is difficult to explain the formation of service prices, people's consumption rationality has changed. At the same time, the economic problems associated with the Internet, such as Internet economics, platform economics, information product pricing and other issues also need to be studied. The future needs of the theoretical level of analysis, trade-offs and choices, such as the Internet to bring 'privacy protection and data efficiency' dilemma and 'spiritual and psychological consumption' complexity and other issues, the urgent need for theoretical research and innovation.

First, a high degree of Unicom society and extensive reorganization of resources

Internet era, information dissemination speed, economic and social aspects of a high degree of connectivity, transaction costs and resource allocation costs. These important changes in the fundamentals will inevitably lead to extensive resource restructuring and aggregation.

(A) competition for attention: aggregate demand resources

With the Internet, everyone is caught in a huge amount of information, for the focus of competition for the focus of competition. In order to quickly gather a large number of users, there have been many new business models.

1. free to use.

Internet service form is easy to imitate, innovative business model needs to be widely and widely used, waiting for users to accumulate slowly will lose the opportunity. Therefore, after the emergence of a new service on the Internet, usually its basic functions can be used free of charge, in order to gather a large number of users in a short period of time, resulting in positive feedback: the greater the amount of users, there will be more people concerned, To the free service outside the huge business opportunities. WeChat is a classic case: the beginning of the form of social tools for people to use free of charge, quickly gathered to a large number of users, the commercial function to develop, involved in mobile payment, financial management, games, maps, electricity and life services, and many other areas , To build a new service delivery system. By the end of 2015, WeChat active users has reached 560 million, users cover more than 200 countries; more than 20 languages, WeChat payment users reached 400 million or so.

2. Fans, net red and anchor.

Compete for attention and the relative curing, the need to cultivate loyal consumer groups that fans groups. Fans are entertainment, sports, fashion and other industries in the highest quality, the most important target consumers, while other consumers are only ordinary users. For example, the number of fans determines the ratings of a television program, and ratings determine the number of its sponsorship advertising to determine the profitability. Yao Ming to join the NBA, attracting a large number of Chinese fans concerned about the Rockets and NBA, as long as Yao Ming race, China TV broadcast, print and online media is a hot topic; NBA through commercial sponsorship, television, product sales, Of the income of up to 1.2 billion US dollars. With large data, fans also have a huge derivative of business value, large data to capture the fans of the information, through excavation analysis, for these potential consumers to push all the full range of consumer information, which evolved as soon as possible the new business system and business model.

Competition for the attention of the network that the red network that red generation. These network red people with their own hobbies, taste, fashion and other labels, to the fans to display and marketing of goods, or directly to the social traffic sold to advertisers to realize. For a long time, the brand mainly refers to enterprises and commodities, and the emergence of red, marking the individual began to become a brand and quickly occupied the market, this brand fresh and interesting, and fans from time to time to share life, emotion, fashion, feelings And dreams, and so on, with the spirit and psychological needs of the characteristics of a high degree of fit. Competition for attention also contributed to the development of the so-called host industry. Web anchor is a new career, diverse forms, including news, sports and other professional anchor, including all kinds of entertainment sites personalized anchor.

3. Search.

Search the website to help people find the information they need in the vast ocean. Search is almost omnipotent, goods and services information everything and free, is the highest degree of attention, the most widely used Internet functions. Search site attractiveness from a variety of, comprehensive, fast these key factors, and thus survive in the competition are well-known large enterprises, such as Google, Baidu and so on. Search sites can lead the searcher's attention, such as the search for the business, goods, services and other content, will be able to pay more attention to consumers in the search results ranked the more forward, the higher the degree of concern. Therefore, for the search site in the results of the front show, as many businesses to attract attention to the key, and thus produce many new business models, such as the search site by the enterprise to pay the number of results in the rankings, pay high priority Ranking. PPC is considered acceptable in the general industry, similar to the television section of the gold section, the newspaper gold layout of the advertising auction. But in some industries but bring problems, such as the pharmaceutical industry is about health and life, consumers and the lack of ability to identify the domestic and foreign consumers have been misled several cases. Search can also solve more complex problems, machine translation technology is a typical. Over the past half century, the basic logic of machine translation is to imitate people's way of thinking to build the translation process, after numerous hard work, extremely complex procedures can not reach the most basic quality of translation. A few years ago, Google proposed a new solution to the idea, relying on mass translation database, through the matching method to translate. This logic, regardless of grammar and rules, will be the original text and the Internet translation data comparison, to find the most similar to the most frequently cited translation results. Practice shows that this idea is sometimes not accurate enough, but enough to reach the level of mutual understanding. Since then, many network service providers are based on this idea to develop real-time translation system, make full use of the network's strong memory, search capabilities and computing power.

4. Information push.

In an information overload environment, every consumer is faced with the dilemma of information filtering and information selection, and personalized information becomes a general requirement. Which media can more accurately achieve the content transmission and audience attention, it is more likely to win the market and create value. Push is a personalized demand for a business model innovation, intelligent Internet to record the user's behavior on the Internet characteristics, enterprises accordingly take the initiative to push the consumer personalized service. For example, in June 2014, 'today's headlines' occupy an important market share of mobile information, its business characteristics and business model by the high degree of concern, its core competitiveness is the use of large data mining technology, by crawling the user to read the behavior of data , And then according to a certain algorithm, the analysis of the user's interest in reading, to achieve intelligent personalized recommendation.

(B) platform enterprises: aggregate market resources

Internet era, a number of operating platform for the characteristics of the rapid development of large enterprises. The platform integrates interdependent groups into low-cost, efficient peer-to-peer connections. American Amazon, ebay and China's Taobao, Jingdong are typical. Platform business is not a new thing, before the Internet popular, there are many forms of platform enterprises, for example, large supermarkets, large commercial MALL are platforms, buyers and sellers focus on this platform point to point transactions. However, the scale of the physical platform is limited, and relying on the Internet platform is very large, low cost of connectivity, with the principle of self-centered automatic matching algorithm as a technical support, has a strong competitive edge. From an academic point of view, the Internet platform has the following characteristics.

First, the platform has changed the conditions for a single enterprise to generate economies of scale. Relying on the network, producers and consumers direct trade, eliminating the traditional business model from production to consumption in the middle of the multi-level marketing system, significantly reducing transaction costs. Especially small micro-enterprises, can get rid of small-scale adverse effects, relying on a very wide range of market platform, from geographical restrictions, to provide services to consumers around the world.

Second, the platform has an asymmetric cost allocation mechanism. Platform fees to consumers and suppliers are usually asymmetric, most of the platform by the supply side to bear the cost of all platforms, and consumers free use, or even use the platform to get subsidies, shopping sites are so much. However, there are opposite examples, the consumer charges are free of charge to the supplier, the typical such as the provision of paper retrieval and download services of the Chinese knowledge network, the collection of papers is free, but the user fees. However, in the capital market mode of operation, investors are sometimes not sensitive to the profitability of large-scale platform enterprises, can be very 'patient' to wait, so for enterprises, to achieve the balance of income / cost balance is weak, Run at a loss and continue to scale. For example, Jingdong operation for more than a decade has not been profitable, but can rely on the capital market to raise the amount of money to maintain the operation.

Third, the platform for the tripartite business model. The real economy is the supply and demand relationship between the two sides of the two business model, although there are supply chain and marketing, but only as part of the whole process of business. In contrast, Internet companies, especially search engine sites, mainly provide free search services, supply and demand sides do not have a typical relationship between the sale. The income of the enterprise is mainly by advertising, so the advertiser becomes the basic condition of the operation of the enterprise, and is regarded as the third party of the platform. Large search companies have achieved an effective tripartite business model: the enterprise itself, a huge number of free users and a large number of advertising providers.

(C) feedback mechanism and large data: aggregate quality signal

For long-term repeated trading of goods, the price is the basic quality of the signal. In addition there are many quality signals, such as warranty, Returns, quality inspection and so on. However, many of the services are one-on-one, one-time, procedural, and contains a lot of professional information, the quality of service has been difficult to judge. The Internet provides a large number of new quality signals, or can be scattered and personalized signals together, for example, many sites have established user reviews, reputation evaluation, credit query and accountability system to address information asymmetry, help Customers and consumers to choose, for those who perform well to win more opportunities. Large data can provide more quality signals. The famous second-hand car market and the labor market are typical cases. In the used car market, the same models, the same life and driving kilometers of the car, the situation can be a lot worse. Similarly, there are labor markets, employers can only get job seekers education status, physical examination results, previous experience and other categories of information, based on these limited information can not assess the true level of each job seekers. With a large amount of information, personalized information can be a lot of access, such as each used car in the sale before, will have a lot of itinerary, route, refueling, maintenance, traffic violations, insurance costs, claims and other information, buyers can spend Less cost through professional companies to obtain this information, the relative objective and accurate assessment of each vehicle's vehicle conditions and give the corresponding price.

(Four) inclusive industry chain: polymerization of production resources

In recent years, the Internet industry chain continues to expand, not only the goods, services and consumers to link up, this link will be extended to the manufacturing process, service process and information feedback throughout the process. The typical scenario is: the consumer will place the order with the mobile phone, the network will automatically send orders and personalized requirements to the intelligent factory, by its procurement of raw materials, design and production, consumers at every stage to understand the situation and participate in the views of products Produced after the distribution through the network delivery to consumers, consumers and then feedback through the network to the various links in the industrial chain. At this point the Internet weaving a demand for information, raw materials procurement, intelligent manufacturing, logistics network distribution, consumer experience all to accommodate the network of production organizations, I called the inclusive industry chain. At this point the production from large-scale standardization to the decentralization of personalized changes, the product from homogeneous to heterogeneous change, the production of small quantities, and more varieties, and even single product single, accurate production by order, the user involved in the whole. Similarly, the provision of services is also inclusive of the trend, such as medical services, health care providers to provide wearable health monitoring equipment, the relevant data automatically analyzed by the database to find the problem prompts to consumers, consumers can remote diagnosis and treatment, you can also make an appointment Treatment, the doctor's prescription automatically uploaded by the pharmaceutical business distribution home. If the condition is complex, the treatment time is longer, you can buy remote monitoring services, the treatment situation and timely access to treatment guidance. It can be seen that the whole industry chain reshaped the whole process of goods and services, greatly improving the efficiency of resource allocation.

(5) sharing the economy: polymerization debris resources

There is a special type of platform, individual and business consumers on the platform to sell surplus time and service capabilities and small idle funds, which is shared economy. The Internet can use almost zero cost to aggregate these fragmented resources to create value and maximize resource efficiency. An example of an online housing rental website Airbnb whose business is to integrate idle homes, get out of vacation and other short-term people who leave their homes can rent their homes through the website to the people who need it. The company has more than 1 million listings in 34,000 cities worldwide.

Second, the theoretical challenges and their innovative development

(A) the traditional service economy theory challenges

1. The judgment of low service productivity has been difficult to set up.

Spiritual and psychological needs is the inherent needs of mankind, why in the contemporary breed a large-scale cultural and entertainment industry? A fundamental reason is that the network provides a variety of very diverse and very low cost of entertainment, supply innovation promotion Demand for progress. Traditional economics will see the rapid growth of cultural consumption as high-income earners have the behavior after idle, such as regular listening to concerts, watching movies or theater performances, ordering more books and magazines. With the Internet, low-income consumers can also use a very low cost of access to a large number of entertainment consumption, the provider also formed a click-through rate based business model for the supply of services provided ample incentives. For a long time, the traditional service industry is a low labor productivity sector, which is derived from the essential characteristics of traditional services. Many service processes require production and consumption to face to face, at the same time, and therefore have a non-storage, not long-distance trade such derivative characteristics. Such as education, medical services, art performances, security services, etc., must face to face and at the same time. The labor productivity of the service sector has remained at a constant level for a long time due to the inability to use efficient machinery and equipment and the lack of economies of scale. The Internet has changed the way services are offered, and the nature of services has changed. To music consumption, for example, this change has been widely covered, a considerable part of the traditional service industry has a new business model, can use the most advanced technology, large-scale provision of services, productivity generally improved. Such as distance education, Muji, telemedicine, video conferencing, electronic security systems, etc., have made the past must be provided on-site services can be cross-time, long distance or even cross-country. Overall, the productivity of the services sector is significantly higher, and some are even beyond the level of modern manufacturing, such as video and text information on the network can be very low cost to copy numerous times, economies of scale is extremely significant, the benefits of increasing almost no boundaries , Any manufacturing products can not be compared with.

2. The price formation mechanism has changed.

According to neo-classical price theory, utility, average cost, marginal cost, supply and demand and other factors determine the product price. Prices will fluctuate within a certain range according to supply and demand, and gradually reach a balanced price, that is, supply and demand equal to the price. In the Internet economy, the conditions underlying traditional price theory change, for example, in traditional business activities, the average cost of products and services can be calculated by total investment and total output, which is difficult for information services. Information services tend to have a high fixed cost, the marginal cost is very low or even near zero, the average cost, the marginal cost is difficult to calculate, the total demand is difficult to grasp, the market update speed quickly, the price volatility is normal, The traditional process is difficult to observe, so the traditional price theory has been difficult to explain the reality of information services. The pricing of Internet companies in the capital market is also different from that of traditional firms, and the financing costs are not closely related to the expected returns within the foreseeable time. Many Internet companies do not rush to show good performance, and even continue to long-term losses. According to the data released by Fortune magazine in 2015, the loss in Jingdong was close to RMB 5 billion, but this did not affect the capital market's investment in the company, which is clearly not in line with the traditional capital pricing theory. In the past, the proportion of information products in the market is not high, there is no significant impact on the entire market, but the current situation has been very different. How is information products pricing? This is a key issue in information economics research.

3. Highly interconnected society in the rational changes.

Traditional economic theory has some important prerequisites, one of which is the pursuit of their own interests to maximize, and to determine the interests of which to make a rational choice. For example, although the information obtained by each person is limited, but the price signal is the market situation of integrated information, producers, consumers can make a rational choice accordingly. However, in the Internet era, the market highly interconnected, the information is extremely rich, people on the market signal collection and accordingly to make the behavior of choice has undergone great changes. For example, when we can widely understand the behavior of others, with the flow may be the mainstream choice, because people believe that these actions are improved through the wisdom of others integrated information, the market signal is very strong. This is the aggregation behavior of the Internet, that is, when a person to see more and more people to do something, he is likely to do, this time the market has a self-amplification mechanism, the so-called epidemic To control the people's choice of behavior, then the mechanism of the mechanism of the market mechanism has changed.

What is commonly seen on the Internet is that a new business model can aggregate a large number of users in a short period of time, triggering a huge market effect. In recent years, WeChat development of the red envelope function is extremely successful, after all, no one is willing to be in a family and friends are in them, through the red envelopes and entertainment circle outside the circle. However, it is not clear how popular to start the epidemic compared to the determinism of positive feedback after the start of the epidemic, and the relevant factors mentioned by the researchers are complex, predictable, probable, and compatible with existing systems And so on, but its explanatory power and predictive power are far from enough. In the study of the Internet, the behavior of people in the era of economic theory, but also the need for psychology, sociology and many other disciplines of the joint efforts and cross integration.

(B) the economic problems associated with the Internet

Internet economics.

The term 'economicsofnetworks' appeared earlier than the network economy or the Internet economy we talked about today, mainly referring to the economics of telecommunications, electricity, transportation, radio and television industries, because these industries have a network of Industrial characteristics. The core of the content from the traditional industrial organization theory: analysis of the network industry in the manufacturers structure, vendor behavior, industrial performance and the corresponding government regulation. The core problem is that when these infrastructure industries have the characteristics of natural monopoly, other enterprises that rely on these infrastructure to provide value-added services to enter the network under what conditions and prices, also known as access strategy.

Since the 1980s, with the rapid development and widespread use of the Internet, Internet economics (interneteconomics) soon became an independent new discipline. In addition to access to pricing, construction and profit model, competitive behavior, government regulation and other issues, there are different types of network competition, games, cooperation and other issues. These are the network economy era of industrial organization thinking and research. For example, what is the result of competition between firms under the network effect? Some scholars believe that although the Internet is open, and telecommunications networks and other closed network is different, but because of the scale effect is very significant, the results of competition still tend to In a product to dominate the market. Even if the different technologies used by different companies are similar, once the enterprise to get a little more users, it may start the positive feedback process, and finally dominate the market, such as Microsoft's personal computer system. This positive feedback led to the network era monopoly power is more powerful, and the greater the larger, the stronger the stronger the rich the richer. As the first entry occupies the market to bring the ability to lock the market, there is the possibility of relatively poor product-led market. These are the network era of industrial organization issues of particularity.

Platform economics.

In recent years, relying on the new business model of the Internet to develop rapidly, the corresponding led to a number of new research needs, platform economics is one of the hot spots, the focus of the study of the network platform, asymmetric costs, monopoly, competition, Externalities and controls. Take the network effect of the platform as an example. The so-called network effect means that the value of a product or service will increase with the increase of the user who uses it, and the mechanism of positive feedback, such as social networking sites, the more people gathered To enter more people, many people mean that the value of advertising. Obviously, the platform enterprise network effect is remarkable, which can be derived from the conclusion that is bound to produce a giant platform. With the traditional economic theory point of view, such enterprises must form a market monopoly position, the reality also exists this phenomenon. However, the competition between the platform has its own characteristics, that is, consumers in a number of platforms at the same time consumption, which is the characteristics of information products consumption. Consumers who buy a brand car usually do not buy other brands of cars at the same time, but consumers who search for information are likely to visit multiple search engines at the same time. Thus, antitrust principles based on physical economy are not always applicable in the platform market (Wong-Ervin, 2016).

3. Pricing of information products.

The traditional price theory is based on cost and tends to balance. Shy (2001) makes it clear that the cost of network information products is less meaningful because of the low marginal cost of network information products, so that cost-based pricing of network information products is less meaningful, differential pricing is sold or products sold at low prices The Later, people began to refine the pricing strategy for different types of network products. Summarize the research in this field, there are several more consensus concerns. First, the price of any product is affected by the value, cost, market supply and demand and other factors, network information products are no exception, so the pricing of other products have the same factors. Second, the influencing factors of the price of network information products are specific, including product life cycle, consumer preference, sales style, long tail structure, derivative industry chain, mental and psychological evaluation of differences and so on. Third, with different characteristics of information products, pricing strategy is not the same, although you can put forward a number of pricing rules, but how to pricing each product is uncertain, and business-to-market understanding, risk tolerance, long-term development strategy, market Possession strategy and other factors related. The contents of the study are very rich and complex, many are special cases, has not yet formed as the price theory as simple, universal analysis model.

4. Explain the Internet problem with traditional theory.

Some researchers continue to focus on incorporating new phenomena in the Internet age into existing economic analysis frameworks, examining how to design more efficient market mechanisms, and optimize the functionality of market allocation resources in the Internet environment. In all kinds of traditional economic theory, game theory may be most suitable for analyzing economic problems in the network. Game theory studies the situation that people's decisions depend not only on their own choices but also on the choices made by others who interact with them. The most classic and well-known is the prisoner's dilemma, there are many similar problems, such as the pricing of two similar products, auction auction bidding and so on. When the outcome of each decision-maker depends on the decision of others, it is appropriate to use game theory analysis. In a highly interconnected and widely influenced network society, game theory can provide theoretical analysis framework and decision-making ideas for a large number of problems.

(C) new problems and theoretical innovation

Internet and large data age, economic life, social order and people's lives face many new confusion and new problems. Some problems can be directly judged and chosen, but more problems need theoretical analysis, trade-offs and choices, theoretical research and innovation requirements.

1. trade-off between privacy and data utilization.

Personal information on the Internet should be strictly protected, without permission shall not be used, which is the direction of the efforts of regulators. Since the 1990s, the European Union has repeatedly adopted or amended a decree on network data protection, 2012 proposed data owner's personal data deletion (also known as 'data is forgotten.' This clause gives data to all The right to control their online information, when they do not want their own personal data on the network, the relevant business or organization must immediately and unconditionally remove all of its personal data.However, the forgotten power at the beginning of the cause of the uproar, the law community , Internet companies, relevant experts and the relevant aspects of social debate, Google, Facebook and some other Internet giants and some experts and scholars believe that a large part of the value of large data from the data sharing, data capture and summary of the huge amount of data in the information Is the essence of large data, does not allow data collection, big data out of the question.For example, drug manufacturers need to understand the medication and purchase information to grasp the efficacy of health departments need to understand the behavior of people know the behavior of an infectious disease Popularity, etc., these are the parties In 2008, Google predicted the emergence of the flu epidemic two weeks before the government and the epidemiologist, who sought to use their online questions about people's health when they were conducting web searches Help the behavior to predict the flu, such as by tracking words such as coughing, fever and pain, can accurately determine where the spread of the flu in November 2008, Google officially launched a project called Google Flu Trends, and the US disease control Unlike the Preventive Center (CDC), which usually takes several weeks to organize and publish a flu outbreak report, Google's flu trend report is updated daily to provide an early warning system for the outbreak of influenza, but the collection of such network information leads to privacy Problem concerns, people worry that their behavior on the network by the network company aware and retained the case, although Google claims that its flu trend is from hundreds of millions of search results in the polymerization, does not contain any information to determine the user's identity, But did not dispel the public's concern. Also questioned Google released the flu Actually demonstrate to potential pharmaceutical market, Google search results through its ability to provide complex and accurate analysis to help pharmaceutical manufacturers release more accurate advertising.

In short, is the emphasis on data protection to protect privacy or data utilized to emphasize the development of large data industry, this is a dilemma. In this debate, on December 15, 2015, the Executive Committee of the European Union adopted the General Data Protection Ordinance, which defines the principles and regulatory methods for the protection of personal data in the form of EU regulations, including data owners ( User) to delete the personal data. This reflects the trade-offs between data privacy and data utilization at the current stage of the public and regulators.

2. Lok consumption of economic and social value of the conflict.

Internet age, music consumption that meet the spiritual and psychological needs of consumption has become an important service industry. However, such consumption has been controversial. First of all, for the music and pay is worth? The skeptics believe that the practical value of goods is affordable, and the pursuit of luxury in the spirit and psychological enjoyment is vanity, is not conducive to the formation of a frugal lifestyle. Secondly, when some of the mental and psychological needs are reasonable and whether they should be met? For example, when parents are more likely to be employed and have a higher level of income after graduation, many parents and students still choose those who are learning longer and harder to learn Ordinary colleges and universities, was criticized as blind. However, many parents are able to go to college and spiritual and psychological needs of children, is a sign of many non-income quality intelligence, ambition, accomplishment, of which the music can not be measured in a visible revenue. The author's point of view is: if that goods and services in the economic development of the same important, we must recognize the material consumption and spiritual, psychological consumption of two acts is equally important, cars, electrical appliances to improve the quality of human material quality, online games increased many people Mental pleasure, high level of education to provide a sense of psychological satisfaction. In short, the service industry to develop, music this spirit and psychological needs will become an important consumer destination. As long as consumers derive satisfaction, joy, happy feelings and are willing to pay for, mental and psychological consumer to create value.

However, the human spirit and psychological needs constitute a complex, in addition to the positive and doubtful needs, but also show off their wealth, adventure, comparisons and even jealousy and other needs, which will induce spy on others privacy, manufacturing spread rumors, ridicule slander others The manufacture and dissemination of information. Regardless of people's recognition and likeness, such psychological needs are prevalent, and the collection and dissemination of various information, especially negative information, of rich, expensive and astronauts is an important part of network information, attracting a wide range of attention. High degree of attention is the advertising area, creating a variety of commercial operations, in the entertainment industry occupies an important position. However, such information will be included in the economic analysis of service provision, included in the statistics of GDP, both theoretical difficulties, more questioning on values. How to deal with such demand research service industry? Whether in the service sector statistics should reject this kind of output? We are long-term controversial issue.

The analysis of this paper shows that the development of modern technology, especially the network technology, is changing the basic nature of the service industry, posing a fundamental challenge to the traditional theory of service economy, and the theory needs innovation and development. In the era of large Internet data, people have a lot of information sources, case analysis, research statistics, measurement analysis and other types of empirical research is easy to carry out, it can be said that the results of a lot of views divergent form; many large enterprises have their own research institutions, It is clear that this is not easy, and it is clear that this is not easy. So all need theoretical research to provide judgments, interpretation of the facts, weighing the various options, express public interests, look forward to future trends. These are the information age demand for theoretical innovation. (Source: 'Economic Research' text / Jiang Xiaojuan Editor: Free Paper Download Center)

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