Tech and the industrial landscape
Wilmington Trust Investment Advisors chief economist Luke Tilley offered members of the Williamsport/Lycoming Chamber of Commerce insights on economic trends expected in 2019 at the Williamsport Country Club Friday morning.
Tilley’s presentation, titled ‘The Fourth Industrial Revolution’, gave the audience a view of how the emergence of ecommerce, such as streaming and online shopping, are changing the landscape of industry and investing in 2019 and beyond.
Tilley pointed to global digitization and how it is changing the way traditionally non-technology based businesses are now having to change the way they do business to adapt to tech businesses entering markets that they previously had little competition with on the world stage.
This shift, Tilley said, is not truly a change in what products a company offers, but instead different companies changing how consumers receive their products from a company.
“When you look at the first and second industrial revolutions, you see that steam, steel and electricity greatly changed how companies made things. But as you move forward, the focus goes to less about you make things and more about how you deliver things to people,” said Tilley.
To illustrate this point, Tilley referenced now defunct movie rental chain Blockbuster and streaming powerhouse Netflix. For his example, Tilley noted they both essentially did the same things, but Netflix changed the way it delivered its service to its customers.
“The commonality there is that it’s the same thing. It’s a movie, right? They didn’t really change what they’re showing us, its just that it’s being delivered in a different way,” Tilley said.
Tilley spoke at length that these changes are part of a practice termed “horizontal digitization,” where
technology revolutionizing business is not exclusive to the tech sector, but “this technology is filtering through multiple sectors, and all of the sectors of the economy.”
“You’ve heard of these things; cloud computing, big data sets, artificial intelligence, robotics, block chain. These are all things that the major companies that you hear about like Amazon or Google are buying into in the headlines, but companies across the economy are buying into new production and delivery processes as well,” said Tilley.
As a whole, Tilley projects that the U.S. economy will fare well for the rest of the year, although not quite as well as the year prior.
“We expect the economy to do fairly well in 2019, not as strong as 2018. We’re going from a growth rate of three percent in 2018 to 2.25 percent this year, but that should be supportive of the U.S. stock market.”