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Digital

Buzzword “Digital“: Global interconnection, dramatically increased computing power and the spread of portable multi-purpose mini-computers, the smartphone, over the last years have initiated far-reaching societal and economic changes. The topic thus surged to the top of the agenda in business, politics, media and research. The feedback of technological developments to socioeconomic processes is certainly not new but rather on the contrary runs like a thread through human history. However, the potential implications of current rapid progress in particular in the fields of artificial intelligence and robotics together with the proliferation of platform- and data-based business models are so far-reaching that both optimists and pessimists offer wild speculations on how this could influence the societies and economies of tomorrow. But what will turn out to be lasting developments, short-lived hypes or simple exaggerations?

54 Documents
January 23, 2024
Region:
Germany lags behind in digitalization. E-Government is a case in point. Historically, public projects are often based on complex coordination across many various entities. We think, switching from this traditional approach to a clear central governance is essential to implement a public cloud, to digitalize registers and offer digital services for citizens and businesses. Interestingly, Bavaria outperforms and seems to have a more central approach than other Länder. [more]
1
December 1, 2023
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Topic:
The AI boom has had important implications for the semiconductor market. In particular the logic chips are in high demand. In 2023 surging demand was constrained by shrinking supply. This resulted in a substantial fall in units sold whereas prices surged. Here we analyze the underlying economic and technological drivers and forecast the development of global sales of the semiconductor market until the end of 2025. [more]
2
October 20, 2023
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Current advances in AI and a media-savvy generation - in combination with the Internet of Things, edge computing and 5G - provide the opportunity to rethink smart city models such as City 5.0 and soft city. We discuss some use cases – and the trade-offs to be resolved – that arise from connecting and automating a city. Besides digital platforms – now augmented by AI –, smart city market segments such as smart buildings, digital energy and environmental solutions are expected to grow strongly in the coming years. Since not all of these are likely to be publicly funded, interesting investment opportunities do arise to create more efficient, sustainable, and livable urban spaces. [more]
3
July 6, 2023
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Analyst:
To strengthen the EU’s strategic autonomy, its authorities are also pushing for a retail payment solution provided by European players. A market-backed project and a state-backed project have emerged. While the European Payments Initiative (EPI) will build on existing instant payment infrastructure and the wallet is supposed to go live early next year, the legal and technical foundations for the digital euro are still under development. As both solutions could easily cannibalize each other, better coordination would benefit Europe. [more]
4
April 25, 2023
Topic:
We dig into how the world of payments is moving away from cash towards digital payments. This structural shift from cash to digital payments is expected to continue in 2023 with further evolution of digital IDs and digital wallets. Amid a macro slowdown, we expect financial solutions offered by non-financial firms, such as embedded financing, to play a major role in the further adoption of digital payments. [more]
5
February 27, 2023
Topic:
In the first part of series 4 of our Future of Payments series, Marion Laboure and Cassidy Ainsworth-Grace take a look at how the end of a rare macroeconomic environment, featuring near-zero interest rates, stimulus packages, and excess liquidity, could clean the market of bad actors, much like the dot-com bubble did two decades ago. [more]
6
November 23, 2022
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Semiconductors rank first as the most traded goods in global trade statistics in 2020, representing 15% of total global trade in goods. Before 2015, they were surpassed by computers and crude oil, based on the HS4 categorization by the World Customs Organization (WCO). Prices for semiconductors have fallen dramatically and steadily since 1995, both in real and nominal terms. Our new Trade Chain Complexity Index (TCC Index) allows for a comparison of the ratio of global trade with sales of various goods. For semiconductors, the TCC Index shows a peak of 7.2 for 2008. Since then, the complexity value has steadily decreased with a value of 5.9 for 2020. This trend might be the first sign of more cautious supply chain strategies in a challenging macro environment - and a downward trend for semiconductor globalization in a new era of digital sovereignty. [more]
7
November 1, 2022
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Global sales of semiconductors reached an all-time high in 2021. At the same time, global tensions and growing awareness of the fragility of supply chains have led to a reassessment of the strategic importance of global supply chains and semiconductors. We use our Structural Semiconductor Sales Model (3SM) to explore the extent to which government initiatives on digital sovereignty in the US, Europe, and Asia will impact chip manufacturing capacities. In doing so, we calculate structural (i.e., non-cyclical) supply and demand for the period up to 2030. Assuming a continuation of historical supply and demand trends and a further tightening of the ratio of sales to investments (sales-to-capex ratio), it is our forecast that a huge structural demand gap will emerge in 2030 that cannot be closed by the government subsidy programs announced to date. From this perspective, today’s temporary supply chain issues may overlap with or be succeeded by structural shortages. [more]
8
October 25, 2022
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Digital policy has become increasingly important in recent years. With its digital strategy, the German government has presented an agenda for which a digital budget is to be adopted in the Bundestag in November 2022. This is an important contribution by Germany to the EU's Digital Decade, particularly in the four areas of connectivity (5G and fiber coverage), digital skills, the use of digital technologies and AI in companies, and the provision of digital public services. Further legislative initiatives at EU level have as their goal the creation of a digital space in order to be able to compete internationally with Asia and the USA. To this end, the German government's digital strategy sets priorities in 25 fields of action. The next three years will be decisive for an effective implementation of the digital reform program for Germany. [more]
9
July 19, 2022
Analyst:
Stablecoins and the DeFi ecosystem have taken a hard hit recently. However, the current stress for cryptos caused by tighter monetary policy may reveal which services offer real value for customers. In fact, leading collateral-backed stablecoins have weathered the storm quite well. The ecosystem will probably face further losses but emerge consolidated and well positioned for continued growth. [more]
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