PaaS - Tech endgame x2?!

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2| Platform as a Service - the end game in tech fields: two big Platform as a Service ecosystems in mobility?!

We will investigate the different of "as a Service - business models". And we will look at the progress in automotive transition on sales, liquidity, tipping points, externalities.

We compare the Tesla approach (Orchestrator-centric ecosystem) with the European partnering approach (Integration-centric ecosystem).

Quote of the week:

“I would say there's either sustainable business or no business”

Daniel Schmid - Chief Sustainability Officer at SAP

Platform as a Service - the end game in tech fields: two big Platform as a Service ecosystems in mobility?!

A term which pops up more and more often, let′s dive in and double-click on it comparing with other "as a Service models" vs. traditional IT...

Are you ready to discover the game-changing potential of Platform as a Service (PaaS) business model?

Let me enlighten you with three of the best definition lenses of PaaS and unveil the five exhilarating advantages that come with embracing this revolutionary approach.

1| A focal point of Innovation

Imagine PaaS as a launchpad for innovation, where ecosystem participants (developers, tech partners, service providers...) converge to create and deploy solutions.

PaaS acts as a digital ecosystem, offering a comprehensive set of tools, services, and frameworks that empower users to build, test, and scale their applications seamlessly. It serves as a fertile breeding ground, nurturing collaborative opportunities and catalyzing the birth of groundbreaking technologies.

2| An Orchestra guided by focus and simplification

With PaaS, the cumbersome tasks of infrastructure management fade away, freeing developers to focus solely on crafting exceptional applications. It provides an abstraction layer that shields them from the complexities of hardware provisioning, networking, and software stack configurations. PaaS is the symphony hall where simplicity reigns supreme.

3| The Catalyst for Digital Transformation

PaaS is the chameleon of the business world, adapting to the evolving needs of organizations seeking digital transformation. It enables businesses to leapfrog traditional approaches, accelerating their journey towards agility, scalability, and innovation.

Leaps following tech disruption, new legislation offensive or defensive ecosystem strategy can be easier, given not all digital layers need to be moved. Experimentation is less risky.

More definitions from #Microsoft here.

Comparing you can see that Tesla is still on its way.

PaaS advantages

1. City Marketplace: PaaS creates an ecosystem that attracts developers, partners, and customers, generating a virtuous cycle of innovation and value creation. Like a vibrant city square, PaaS fosters collaboration, facilitates partnerships, and ignites a flurry of synergistic interactions, expanding the possibilities for everyone involved.
2. Picture a rocket: hurtling towards the stars, propelled by the force of scalability. PaaS empowers businesses to scale their operations rapidly and effortlessly. By providing an elastic infrastructure that dynamically adjusts to demand, PaaS ensures organizations can handle both growth spurts and sudden fluctuations with ease.
3. Collaborative playground: diverse minds unite to shape the future. PaaS encourages co-creation, enabling businesses to tap into the collective intelligence of their ecosystem. By opening up APIs and offering development frameworks, PaaS facilitates the creation of complementary products and services, enriching the overall value proposition.
4. The Spider web surpassing Industry Boundaries: Imagine a world where industry lines blur, creating new opportunities and disrupting the status quo. PaaS allows businesses to transcend traditional boundaries, fostering cross-industry collaborations and partnerships. It enables organizations to leverage the strengths of diverse sectors, merging technologies, and capabilities to unlock untapped value. PaaS is the bridge that connects industries, unlocking a universe of untapped potential.
5. Tailor-made suit: meticulously crafted to fit perfectly. PaaS empowers businesses to customize their offerings, catering to the unique needs and preferences of their customers. Through APIs and modular architectures, PaaS allows for seamless integration of third-party services, enhancing the overall user experience and removing frictions to delight customers with Personalisation, automation and more

The text poetry was created with AI ;-) to make it even more memorable.

Where is the PaaS journey going?

The two paths and the unknown...

Digital first companies will become the operators and orchestrators of PaaS models.

Followers and incumbents that cannot transform fast enough or are too small will leverage PaaS and focus on differentiating their experiences and brands building on top of the platform.

Let's put the limelight on for Automotive to show one example each for this:

OPTION 1: #tesla the Vertical Integration-PaaS

Starting with one after the other carmaker joining the "Platform" starting with charging.

• Charger Network
• Charging Operating System
• APIs to runtime, occupancy, etc.
• Repair
• Infrastructure, energy supply, storage
• Enhancing services like cafe, toilet, restaurants

Orchestrator-centric Ecosystem: Tesla is leading the way and leveraging first the Tesla Brand. In its history it always shared (free IP, access) because they are mission-driven and understand platform business models.

You see I stretch the pure software architecture definition here. But you get the point.

Now of course all brands will communicate "joining Tesla, is the best option for the consumer, and shareholders avoiding huge investments.

Tesla Supercharging leads already today:

• Uptime 99+%
• AI routing Tesla cars based on occupancy and availability
• Seamless payment - Plug - charge - go - trace

This of course puts competition like #EVGo or #ElectrifyAmerica and also #Ionity and #Oil companies under pressure given the sheer size of the network and increasing liquidity on supply side and demand going where it is easiest.

Even though fragmentation is only high on the demand side, the orchestrator will be in a good position given standardisation of plugs, battery management and long adaptation cycles with high cost will ensure that a good fraction of the few carmakers that exist worldwide will join and not cause disintermediation or disruption risks. You will see this in the coming weeks accelerate - for now.

PaaS - Expansion: start with charging - complete the PaaS play!

CHARGING: Car companies that are late in their transition most likely will join very soon. I.e. #Stellantis, #Honda, #Toyota and others.

BATTERY MANAGEMENT SYSTEM: given superior charging and kWh performance this will follow fuelled by on the growing footprint of own 4680 battery capacities over time.

FSD: Given the data set lead which is unassailable, companies will join this as a service because the want to tap into the training model and chip set Dojo

This set up will lead the world. Not only in cars.

This model is not easy to be copied. A similar example is #Apple with their vertically integrated Ecosystem. They are more classic platform for developers and marketplace for users buying apps. with GMV and Take rate - #Appstore.

OPTION 2: #CantenaX and #Cofinity-x #PaaS

This is the approach initiated by German Automotive sector with top OEMs and Tier 1 players. It is driven by regulatory, innovation and circularity considerations. I have copied here from the CatenaX webpage the key building blocks:

Integration Ecosystem: The Catena-X Automotive Network creates the first open and collaborative data ecosystem. This is leveraging the "Orchestrator"-brand "CatenaX" which is governed together and "neutral" enough for competition to collaborate.

This approach is far more time-consuming but has potential. Especially, given these elements:

1. Public - private initiative
2. Orchestrated by the key players
3. Neutral governance as an association "Verein"
4. Based on standardization
5. Global expansion with speed creating critical mass on the supply side from #Germany, #France, #Japan, #USA, to #China integrating the sector and plays. (it was tagged as the "CX HUB-CONCEPT" that empowers regional adoption and ensures flow of data across regions)

I anticipate this to be data-driven in phase 1, but actually becoming the other PaaS down the road, if liquidity and relevant solutions can be achieved quick enough.

Principles of CatenaX:

• On equal footing: all partners have equal rights and sovereignty. Access to the data ecosystem is non-discriminatory for all participants.
• Trustworthy: The provided solution and governance are convincing and provide a basis for trust in the community.
• Open: The foundations of the Catena-X ecosystem are based on open source solutions that are transparently available to all.
• Standardized: Open (industry) standards are welcomed.?
• Certified: Catena-X will test and certify services and applications.

Source: #CatenaX

Catena-X value proposition

First time offer of a sovereign, multi-tier data exchange and use case collaboration across the entire value chain.

Start as data ecosystem - become a PaaS most likely down the road.

The architecture is driven by standardisation and protocols:

The data ecosystem is based on a system architecture that meets the following technical aspects based on the preliminary work of?Gaia-X?and the International Data Space Association (IDSA):

• Data Sovereignty and Security, and Interoperability:
• Implementation of contractually secured, technologically secure and highly efficient peer-to-peer communication with end-to-end semantics, provided with the Eclipse Dataspace Connector (EDC) designed within Catena-X as the central communication component.
• Provision of network services for data discovery and mediation as well as certified applications based on contractual agreements (brokers)
• Policies and services for identification, authorizations and their monitoring for cross-company cooperation (in terms of federated services)
• One of the most user-friendly environments for setup, operation and collaborative use.

Circularity insulation

I could imagine the integration across the globe (partially ex Tesla) could be the insulation and lock in that fuels #Catena-X because the efforts go from country of origin to end of life with maximised loops. This will be relevant in other ecosystems as well.

Too late?!

The big question remains, is this too complex and too late for the integration ecosystem while Tesla has many layers of a PaaS up and running and is fully aligned to it's own Purpose "accelerating the transition to sustainable energy" and Ambition "20 Mio cars by the end of this decade".

If this is the case, then the Catena X- PaaS option for those powerful brands in automotive is the only left. Leveraging the brand and specific experiences. This strategy could be the luxury path of #Mercedes while leveraging the Catena-X ecosystem

Ecosystem Competition and Outlook

Apple iOs - Google Android

We have seen this before in mobile phones where only two options remain:

Given Tesla's lead this could actually minimise politics and ensure speed also in Catena-X:

> Ultimately value will be captured by #Tesla in the orchestrator-centric ecosystem, like #Apple.

> Volume might be with the Integration Ecosystem, like #CatenaX.

Assumptions:

• Core tech will not be available for all (Dojo chip). Apple Silicon is not sold to the outside.
• The degree of vertical integration, principles-led and empowered supplier partners and tech stack of Tesla cannot be copied in the next 5-7 years.
• Another reason is that Tesla will not be constrained by "car" but mobility - energy - labor problems to solve.
• There might be a third "unknown" like in the image with the 3 rivers joining in Passau up there. This is a Chinese, Apple, Google solution. Time will tell.

So What?!

• For the world this is a good development to have two players most likely, because the competition forces to move fast. In addition to that regulatory requirements in the #EU and other regions following the role model.
• If you do not have a circularity strategy and platform thinking with a full digital transformation working, you might be gone.
• We cannot work with Tesla, but we would be delighted to help boost you #CatenaX and #CofinityX with our expertise and services :-)

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Alex