Digital payments continue to be fueled by the growth of such areas as ridesharing and wearable technology, as well as the images used by various web platforms to further engage consumers in eCommerce – and interactive online games. Those are among the findings in Mary Meeker’s annual “Future of the Internet” report, one of the most anticipated views of the web for investors and other observers.
Meeker is a longtime internet and digital economy expert who now works for Bond Capital, a venture firm. This year’s 333-slide report found that some 3.8 billion people around the world – more than half of the global population – are connected to the internet. That promises to have ongoing impacts on digital payments and commerce.
“When markets reach mainstream, new growth is harder to find, as evinced by declining new smartphone shipments in 2018,” her report stated. “While eCommerce continues to gain share vs. physical retail, growth rates are slowing. While internet advertising growth is solid and innovation is healthy, there are areas where customer acquisition costs may be rising to unsustainable levels.”
Those rising costs could lead to more free trials and other such promotions, the report said.
Beyond that, the deployment and use of wearable technology is booming, Meeker reported, with users of such devices doubling within the past year. As PYMNTS has covered, wearables can not only offer more options for consumers to engage in contactless payments and even room keys, but devices that track fitness can lead to insurance savings and changes in healthcare payments. As Meeker noted in her fresh report, digital processes and technology are reaching the mainstream of healthcare, which will influence not only the further growth of wearables, but also the future of digital payments.
Images, too, are becoming a bigger part of the digital payments future, Meeker said in her report, with Instagram and YouTube proving robust examples of the growth in image-based platforms that can also enable eCommerce. The ongoing growth of ridesharing – itself a part of the larger and expanding gig economy, as has been well-documented by PYMNTS – also is helping to further the acceptance of digital payments.
Gaming, too, will provide more opportunity for digital payments and commerce over the next few years. According to Meeker, there are some 2.4 billion gamers spread across the globe, a 6 percent increase from the previous year’s report. As well, the number of people who watch games via other platforms – which could include Twitch – is also on the rise.
In a more general sense, most U.S. consumers say they spend more time on their mobile devices than they do watching TV, with about 25 percent of adult U.S. consumers saying they are constantly online. According to data from the Meeker report, the average U.S. consumer spends 6.3 hours per day on digital media of some form.
That helps explain the 22 percent increase in internet ad spending over the past year, according to Meeker – and the increasingly fierce competition among the likes of Google, Facebook and Amazon to extend their domination in ads.
Challenges and Threats
That’s not to say all that growth and connectivity offers only benefits – negatives abound, and will continue to impact digital businesses and consumers, according to Meeker’s latest view of the internet landscape.
“Rapidly expanding connectivity has helped amplify voices of good and bad actors,” the Meeker report states. “This has brought new focus to an age-old challenge for regulators around the world – finding the most effective ways to amplify good and minimize (the) bad, often resulting in different regional interpretations and strategies. As internet systems become increasingly sophisticated, data-rich and mission critical, so has the opportunity for cyberattacks. We are in a new era of cybersecurity, where technology issues are increasingly intermixed with international diplomacy and defense.”
Indeed, as PYMNTS has reported, among the sharpest needs in the realm of cybersecurity – one that will likely persist into 2020 and beyond – is the hiring of more cybersecurity professionals, including for corporate and federal government positions. That has led in recent months to new programs and fresh technology offerings to address the ongoing shortage.
Privacy, too, promises to take on even more importance in the coming years, as all signs point to increasing awareness and continuing pushback among consumers and regulators about how their personal data is handled by digital- and mobile-focused companies and other organizations. That pushback is seen in various areas, as PYMNTS has documented, and is becoming especially acute around the issue of the growing Internet of Things (IoT) ecosystem. Even so, Meeker said that “privacy concerns are high but moderating.”
The world of digital payments and commerce is a constant work in progress, and the need to protect privacy and protect data from hackers will never be anything but vital.