Digital economy: new investment factors and new investment opportunities

The core of the digital economy is Internet technology. The past decade has been the age of Internet technology. In 2009, the top 10 global market capitalization companies were only Microsoft, and 1 was an Internet company. In 2019, the global market capitalization The top 7 of the top 10 are all Internet companies. Internet technology brings economic growth as an important driving force for global economic development. The process of Internet technology creating economic value is Internet industrialization, which can be considered a narrow digital economy.

The connotation of the current digital economy includes not only the digital industrialization of the Internet, but also the digitalization of other industries, that is, the digitalization of the industry. Industrial digitization is that traditional industries use the Internet and other technical means to create greater value in research and development, production, manufacturing, and sales.

The digital economy is a future-oriented economic form. In recent years, China’s digital economy has developed rapidly. According to data from the Ministry of Industry and Information Technology, China’s current digital economy totals more than 31 trillion yuan, accounting for 35% of GDP, and the contribution of the digital economy to GDP is significant. The report “Digital Spillover, Measuring the Real Impact of the Digital Economy” released by Huawei and the Oxford Economics Research Institute indicates that for every dollar increase in digital technology investment in the past 30 years, GDP can be increased by USD 20; Investment can only boost GDP by $ 3, and the average return on digital technology investment is 6.7 times that of non-digital technology investment.

Land, labor, capital, and data constitute factors of production in the digital economy era. The former three are still functioning as old factors of production, but their carriers and forms are different, and this difference will bring huge investment opportunities. . The investment opportunities created by data as a newly added factor of production are also gradually recognized.

Land Elements: Internet Data Center
Land is the core production factor in the agricultural economy, and the land element under the digital economy carries the functions of data storage, calculation, and circulation. The specific implementation method is the Internet Data Center (IDC).

IDC belongs to a subdivided field in the field of Internet infrastructure construction. It has comprehensive equipment (including high-speed Internet access bandwidth, high-performance local area network, safe and reliable computer room environment, etc.), professional management, and a comprehensive application service platform. IDC undertakes large-scale storage, calculation, and distribution of data, and implements rapid data exchange through the backbone network link.

If you want to be rich, build roads first. The same applies in the digital economy era. According to the broad IDC market size data from China’s IDC circle statistics, in 2018, the global IDC market size reached 625 billion yuan, an increase of 24% year-on-year, while the Chinese IDC market size reached 122.8 billion yuan, an increase of 30% year-on-year. Rapid development and the application of cloud computing in various industries have gradually landed. The market size is expected to reach 206 billion yuan by 2021, and the compound annual growth rate (CAGR) from 2018 to 2021 will reach 30%. Equinix, the world’s largest IDC company, has seen its share price increase more than 10 times since 2009; domestic IDC leading company IWC has seen its share price rise from $ 8.5 to $ 53 since its listing three years ago. Under the digital economy, land, a production factor, participates in a new round of economic value creation in the form of IDC, and brings generous returns to investors through income distribution.

Capital: Digital Currency
When it comes to digital currency, the first thing that comes to mind is bitcoin, which is based on the concept of blockchain decentralization and is considered to be a more advanced form of technology.Bitcoin has a competitive relationship with the official currencies of various countries, so in most countries Not recognized. In order to cope with the impact of future Bitcoin digital currencies on the financial systems of various countries, central banks of all countries are making intensive preparations for the issuance of legal digital currencies based on the concept of blockchain. The People’s Bank of China’s attitude towards digital currencies is very positive. On January 5, the central bank deployed key tasks in 2020, one of which is to steadily advance the development of legal digital currencies. And the famous American social platform Facebook tries to issue the digital currency “Libra”. Once successful, it may bring subversive impact to the existing central bank as the core currency system. The development of digital economy in the future will inevitably depend on the help of digital currency.

Compared with traditional currencies, fiat digital currencies have the following advantages: First, the risk is reduced. Existing banknotes and coins are easily forged anonymously, and there are risks for money laundering, terrorist financing, tax evasion and fraud. Using digital currencies can effectively Avoiding and reducing such risks; Second, reducing transaction costs. The introduction of digital currencies can more effectively reduce the cost of currency issuance, reduce friction in the flow of funds, and effectively reduce transaction costs. Third, compared with existing electronic currencies It can protect personal privacy more effectively. In the existing payment system, there are many links and there is a possibility of certain information leakage. Under the digital currency system, payment institutions other than the central bank cannot obtain information, customer funds flow and information. Streams are effectively separated, effectively protecting personal privacy. Fourth, the large-scale application of digital currencies will also bring more new business models, enabling consumers to enjoy more digital economic dividends.

Although bitcoin has not been officially recognized by most countries, in fact, bitcoin is the fastest-growing asset in recent years and has made amazing returns for participating investors. Although there is a hype behind the capital, it reflects from the side that capital is optimistic about the prospect of digital currencies.

Labor: Machine substitution and new job demand transformation
The typical advantage of the digital economy is to reduce costs and improve efficiency. One of the main trends is the crowding out effect of the digital economy on labor demand. The phenomenon of replacing people with machines caused by automation, artificial intelligence, and software has become a trend. Substitutes are typically large-scale applications of robots and other new technologies such as lasers.

The global sales volume of industrial robots increased from 78,000 units in 2001 to 422,000 units in 2018, with an average annual compound growth rate of 10.4%, far exceeding the growth rate of the global economy. As a large manufacturing country, China is also the largest source of demand for industrial robots, with sales soaring from 700 in 2001 to 154,000 in 2018, a compound growth rate of 37%. Unfortunately, global industrial robots The field has long been dominated by FANUC of Japan, Yaskawa Electric, ABB of Switzerland and KUKA of Germany. Chinese companies have a weak foundation in this field and have not enjoyed the development bonus of the industry. However, it has also benefited from the digital upgrade of the Chinese economy. With the application of other new technologies, such as laser technology, as the earliest listed laser company in China, it has brought rich returns to investors and fully enjoyed China’s automation upgrade. dividend.

Many people worry that the digital economy will cause long-term pressure on unemployment or labor compensation. In fact, this issue does not need to be overly concerned, because the digital economy has also created new demand. The most typical is the outbreak of the platform economy. For example, e-commerce and takeaway platforms will move offline malls and roadside stores. Being online has given birth to new careers such as courier and takeaway brother to complete the last mile of the transaction. According to statistics, in 2018, the number of Chinese courier employees exceeded 3 million, and the number of takeaway brothers exceeded 4 million, which greatly solved the reemployment problem of the digital upgrade of the Chinese economy. Although the digital economy has on the one hand suppressed the demand of the traditional industry for the labor population, it relies on innovation to generate new demand and new occupations.

Therefore, there is no need to worry too much about the repressive effect of the digital economy on the labor force. The reduced demand of machines for humans will be met by new professional needs, but the quality and form of the labor force required by the digital economy are different.

Data: Core Elements of the Digital Economy
Since the concept of big data was formally proposed, and written into the Chinese government work report, the concept of big data has become increasingly clear, and the development of the big data industry has also grown stronger. Data is already the core production factor of the digital economy. In the past, data was “water” for enterprises, and in the future, data was “air” for enterprises, and its importance has become increasingly prominent. The companies with the world’s largest market capitalization are basically big data companies: Facebook, Amazon, Google, Alibaba, Tencent Holdings, etc. Ma Yun once pointed out: “Alibaba is a manufacturing company, manufacturing data, using data, and applying data for services Business. ”

Whoever holds the data in the future will be able to gain the initiative to compete. In the past, the application of data highlighted Internet companies, that is, the value creation brought about by big data in the process of digital industrialization. Most typically, Facebook relied on big data to make accurate recommendations. Carrying forward the information flow, the information flow advertising business alone is enough to maintain a market value of $ 600 billion, and Facebook has also created generous returns for investors since its listing. The information flow products represented by today ’s headlines in China rely on the accurate recommendation of big data algorithms to successfully break through the BAT defense line, and also become a small Internet giant with a valuation of 75 billion US dollars based on advertising alone.

Although the value of data was first demonstrated in the process of digital industrialization, data + traditional industries, industrial digitization will be a new blue ocean market. By using big data, artificial intelligence and other technologies to digitally transform traditional industries, it will become a new one today. The most typical example of investment hotspot is C2M (Customer to Manufactory) of e-commerce.

E-commerce C2M lowers the threshold for factory market research and product development. Taobao, JD.com, Pinduoduo and other e-commerce platforms use the massive consumption data accumulated on the platform to analyze consumer preferences and market changes. Through the C2M model, manufacturers can design Produce marketable products, reduce the risk of merchants, and use the e-commerce platform for sales and branding, thereby greatly increasing the added value of the product and enhancing the competitiveness of the factory. Furthermore, the e-commerce platform can also use technology to empower the supply chain, allowing businesses to more accurately stock and organize production, thereby reducing inventory risks and eventually eliminating inventory.

Share