More Moats and AI
In a recent post I speculated as to what business positioning and models would be defensible in an AI-powered world. Since then I’ve had several conversations that suggest additions to my list. For quick reference, the earlier list was:
- Brand
- Network Effects
- Physical Integration
Sports is another defensible area. Who cares whether the New York Robot Giants defeat the Philadelphia Robot Eagles, or how many rebounds Robot Dennis Rodman pulls down? Sports are quintessentially about human performance, and I don’t see that changing. So the production of human sporting events will remain defensible, because there are strong limits and heavy competition at the highest levels. While AI may optimize the grooming of the talent and alter how clubs operate, I don’t see any AI-powered substitute for the athletic play itself.
Another suggestion that sounds correct to me, but is both difficult to characterize clearly and somewhat fickle are status-oriented business models. This could take the form of a rare product that establishes your status. Or it may consist of the ability to sell genuine human touch rather than robotic touch at a premium. Think massages or hospice care. This one depends enough on prevailing fashion that I find it difficult to understand the breadth of its appearance. Nevertheless, it does seem entirely likely that wealthy buyers may pay for genuine human service and thereby differentiate themselves from the ordinary buyer of the robotic service.
So the list now reads:
- Brand
- Network Effects
- Physical Integration
- Sports
- Status Goods and Services