1. IMMATERIAL WORLD FUTURE SIGNS LOWE COUNSEL LOWE AND PARTNERS
Immaterial World:
A Dematerialized Future
August 2010

2. IMMATERIAL WORLD FUTURE SIGNS LOWE COUNSEL LOWE AND PARTNERS
The dematerialzation of possessions
is emerging as a significant new
force in consumer culture.

3. IMMATERIAL WORLD FUTURE SIGNS LOWE COUNSEL LOWE AND PARTNERS
From the Real to the Virtual
Attitudes to ownership are evolving in response
to a shift in the value people attribute to physical
objects.
Friends, experiences and info-bites are replacing
possessions as status symbols.

4. IMMATERIAL WORLD FUTURE SIGNS LOWE COUNSEL LOWE AND PARTNERS
Drivers
- Digitization
- Speed of Change
- Cloud Computing
- Expansion of virtual worlds and trading
- Convergence of digital worlds and devices
- Burden of Ownership
- Ethical and Environmental concerns http://www.storyofstuff.com/

5. IMMATERIAL WORLD FUTURE SIGNS LOWE COUNSEL LOWE AND PARTNERS
A Dematerialized Future
WHILE IT CURRENTLY REPRESENTS THE ASPIRATION RATHER THAN THE REALITY, MANY PEOPLE
RECOGNIZE THAT DEMATERIALIZATION OFFERS A SOLUTION TO MANY OF THE COMMON ‘PROBLEMS
OF MODERN LIFE’.
SOME ECONOMISTS SEE THE MOVE TOWARDS DE-MATERIALISM AS PROVIDING THE NEXT STEP IN
HUMAN/ECONOMIC EVOLUTION, AS WELL AS A SOLUTION TO THE ISSUE OF SUSTAINABILITY AND
GROWTH.
THE RISE OF DIGITAL MINIMALISM AND ‘THE CULT OF LESS’
“Dematerialization has enormous implications for how economies should continue to evolve to be successful; for
how wealth and incomes get distributed across and within societies; and for how prospects for economic success
change through time.” Jeremy Rifkin, The Age of Access: The New Culture of Hypercapitalism, [1]

6. IMMATERIAL WORLD FUTURE SIGNS LOWE COUNSEL LOWE AND PARTNERS
The Cloud Revolution
THE CLOUD COMPUTING REVOLUTION IS STILL IN ITS INFANCY BUT WILL FUNDAMENTALLY AFFECT
ATTITUDES TOWARDS THE VALUE AND DESIRABILITY OF MATERIAL OBJECTS.
THERE IS A SHIFT IN THE BALANCE OF POWER FROM THE MATERIAL OBJECT TO THE DIGITAL CLOUD OR
‘GLOBAL DATA FIELD’.
“Cloud computing is a paradigm shift following the shift from mainframe to client service in the early 1980s. Details
are abstracted from the users, who no longer have need for expertise in, or control over the technology infrastructure
‘in the cloud’ that supports them. Cloud computing describes a new supplement, consumption, and delivery model for
IT services based on the Internet, and it is typically involved over-the-internet provision of dynamically scalable and
often virtualized resources.” [2]

7. IMMATERIAL WORLD FUTURE SIGNS LOWE COUNSEL LOWE AND PARTNERS
The Cloud Revolution
THE RESULT OF REMOTELY CONTROLLED DEVICES, WHETHER IT BE AN INTELLIGENT
FRIDGE OR WATER SPRINKLER SYSTEM WILL BE THAT THE DEVICE BECOMES ‘THE
SLAVE’, AND THE INTERFACE (APP) THAT CONTROLS IT WILL BECOME MORE IMPORTANT
AND VALUED.
THE TRANSITION FROM THE ‘MATERIAL WORLD’ OF DEVICES, TO THE ‘VIRTUAL WORLD’
OF CLOUD COMPUTING IS ALREADY REVOLUTIONISING THE MOBILE DEVICE CATEGORY.
IT IS TRANSFORMING THE WAY PEOPLE USE THEIR PC’S, HOME APPLIANCES AND MOBILE
TECHNOLOGY, FREEING THEM FROM THE CONSTRAINTS AND LIMITATIONS OF SPECIFIC
DEVICES OR LOCATIONS.
“The dematerialization of devices is the most incredible thing. You have access to the
same data from multiple devices.” [4]
— I.T. Manager EMEA, Paris

8. IMMATERIAL WORLD FUTURE SIGNS LOWE COUNSEL LOWE AND PARTNERS
Burden of Ownership
WE ARE SEEING A GRADUAL CHANGE IN ATTITUDES TO OWNERSHIP.
AS MEDIA, MUSIC AND FILM GO ON-DEMAND WE WILL CONTINUE TO SEE A DECLINE IN THE
‘STATUS’, AND VALUE OF COLLECTIONS. PEOPLE WILL SHIFT FROM WANTING TO OWN TO
WANTING TO HAVE UBIQUITOUS ACCESS AND ENJOY AT THEIR PLEASURE.
THIS PHENOMENA IS ALSO OCCURING IN THE AUTOMOBILE AND HOUSING SECTORS.
“Ownership is based on the notion that it’s worth the effort to keep physical items for a long period of
time…In market capitalism, ‘having’ and ‘collecting’ were important and cherished concepts. But they are
increasingly unimportant in an economy in which change is the only constant.” [5]

9. IMMATERIAL WORLD FUTURE SIGNS LOWE COUNSEL LOWE AND PARTNERS
Living Generously
MORE PEOPLE, ESPECIALLY THE SUPER RICH ARE PLACING GREATER VALUE ON MEMORIES
AND LIFE EXPERIENCES OVER MATERIAL POSSESSIONS.
THERE HAS BEEN A GROWTH IN PHILANTHROPY, WHICH IN ITS OWN WAY HAS BECOME THE
NEW WAY OF GAINING STATUS AND ADMIRATION – BILL GATES, PAUL ALLAN, WARREN
BUFFETT.
THE CASE OF THE AUSTRIAN MILLIONAIRE MR. RABEDER PROVIDES A GREAT EXAMPLE.
“More and more I heard the words: 'Stop what you are doing now – all this luxury and consumerism –
and start your real life'," he said. "I had the feeling I was working as a slave for things that I did not wish
for or need.” [6]

10. IMMATERIAL WORLD FUTURE SIGNS LOWE COUNSEL LOWE AND PARTNERS
Power of Experiences
DEMATERIALISM IS ALSO SEEN AS A WAY TO INCREASE HAPPINESS LEVELS ACROSS DEVELOPED
ECONOMIES BY REDUCING OUR OBSESSION WITH ACQUIRING MATERIAL POSSESSIONS.
STUDIES SHOW THAT BUYING EXPERIENCES ALSO MAKE US HAPPIER THAN PHYSICAL THINGS.
“We found that participants were less satisfied with their material purchases because they were more likely to
ruminate about unchosen options. That participants examined unchosen material purchases more than
unchosen experiential purchases; and that, relative to experiences, participants' satisfaction with their material
possessions was undermined more by comparisons to other available options. Our results suggest that
experiential purchase decisions are easier to make and more conducive to well-being.” [7]

11. IMMATERIAL WORLD FUTURE SIGNS LOWE COUNSEL LOWE AND PARTNERS
Implications

12. IMMATERIAL WORLD FUTURE SIGNS LOWE COUNSEL LOWE AND PARTNERS
Death of Stuff
MORE OF OUR TRADITIONAL POSSESSIONS WILL BECOME DEMATERIALIZED OR
DIGITISED.
MUSIC STREAMING WILL LIKELY SOON ECLIPSE MP3 PURCHASES IN POPULARITY.
IT INVOLVES NO FILE. IN ESSENCE, USERS WILL BE BUYING PERMANENT ACCESS
RIGHTS TO A SONG RATHER THAN BUYING AN ACTUAL FILE.
KINDLE SALES ARE ALREADY OUTSELLING HARDBACK BOOKS ON AMAZON.
“Kindle's digital book sales overtake hardcover, device purchases triple after price drop.” [8]

13. IMMATERIAL WORLD FUTURE SIGNS LOWE COUNSEL LOWE AND PARTNERS
Expansion of Virtual Platforms
ACCORDING TO A RECENT SURVEY BY NPD, AROUND 8 MILLION iTUNES USERS WOULD HAVE
‘STRONG INTEREST’ IN PAYING A MONTHLY FEE TO EITHER STREAM MUSIC OR TO ACCESS
THEIR MEDIA LIBRARIES ON MULTIPLE DEVICES. THIS COULD TRANSLATE AS A POTENTIAL
$1BILLION DOLLAR ANNUAL REVENUE STREAM FOR APPLE.
THE AMOUNT OF TIME AND MONEY SPENT VISITING AND INVESTING IN VIRTUAL WORLDS IS
INCREASING. FROM FACEBOOK TO FLICKR PEOPLE ARE GROWING USED TO THEIR
CONNECTIONS AND PRECIOUS MEMORIES EXISTING IN VIRTUAL SPACES. BACK-UP
SERVICES AND REMOTE STORAGE WILL WITNESS HUGE GROWTH.
A NEW $2 BILLION DATA CENTRE IN MAIDEN NORTH CAROLINA TO SUPPORT NEW ‘MOBILE
ME’ CLOUD SERVICES. EXPECT OTHERS TO FOLLOW SUIT.

14. IMMATERIAL WORLD FUTURE SIGNS LOWE COUNSEL LOWE AND PARTNERS
Virtual Goods
MIRRORING THE SUCCESS OF ONLINE APPS, THERE HAS ALSO BEEN A HUGE RISE IN
VIRTUAL GOODS, EITHER THROUGH ONLINE GAMES OR THROUGH ADDICTIVE
APPLICATIONS THAT CONVERT HARD CURRENCY INTO ‘VIRTUAL GOODS’.
FACEBOOK HAS INTRODUCED IT OWN CREDIT SYSTEM OF ‘FACEBOOK CREDITS’ AND IS
IN THE PROCESS OF REVAMPING ITS VIRTUAL GIFT SITE.
“Now, people playing social games such as virtual agriculture simulation Farmville on facebook are
using real cash to purchase game dollars for additions to their farm. Firms such as zynga, playdom
and playfish are all growing fast on the back of the rise in social gaming.” bbc news.com [10]

15. IMMATERIAL WORLD FUTURE SIGNS LOWE COUNSEL LOWE AND PARTNERS
Rise of Fractional Ownership
AS ATTITUDES TO OWNERSHIP EVOLVE THERE WILL BE A GROWTH IN SCHEMES LIKE FRACTIONAL LIFE.
SHARED OR PARTIAL OWNERSHIP CAN PROVIDE GREATER OPPORTUNITIES FOR INCREASING LONG TERM
CUSTOMER REVENUE STREAMS AS LONGER CONTINUOUS RELATIONSHIPS REPLACE SINGLE PURCHASES.
RENT A COW - KUHLEASING, OFFERS BUYERS THE CHANCE TO BUY A COW, NAME IT, SEE IT BEING MILKED THEN
CHOOSE WHAT TYPES OF CHEESE THEY WANT MADE FROM THE MILK. http://www.kuhleasing.ch/ [11]
HOME DESIGN - EVOLVING VOX PROVIDE TEMPORARY FURNITURE AND EQUIPMENT FOR COLLEGE STUDENTS.
http://www.evolvingvox.com/ [12]

16. IMMATERIAL WORLD FUTURE SIGNS LOWE COUNSEL LOWE AND PARTNERS
From Products to Experiences
AS ATTITUDES TOWARDS PHYSICAL PRODUCTS EVOLVE WE WILL SEE A RISE IN
DEMAND AND VALUE FOR SERVICES, AS PEOPLE PREFER TO SPEND THEIR MONEY
ON NON PHYSICAL PRODUCTS OR EXPERIENCES.
WE HAVE ALREADY SEEN A CONTINUAL RISE IN THE PERCENTAGE OF HOUSEHOLD
BUDGETS SPENT ON SERVICES IN COMPARISON TO DURABLE PRODUCTS OVER
THE LAST 20 YEARS IN THE UK. SEE TABLE.
AS A RESULT MORE COMPANIES ARE ALREADY INVESTING IN BUILDING SERVICE
LED REVENUE STREAMS.
- MERCEDES BENZ DRIVING ACADEMIES
- GERBER BABY FOOD COMPANY OFFERING INSURANCE Source UK Gov statistics. 2009

17. IMMATERIAL WORLD FUTURE SIGNS LOWE COUNSEL LOWE AND PARTNERS
From Products to Experiences
PUBLIX SUPER MARKETS, INC. (A U.S. SUPERMARKET CHAIN RANKED NO. 9 ON FORBES
2009 LIST OF AMERICA'S LARGEST PRIVATE COMPANIES), IS EMBRACING THE PRODUCT TO
EXPERIENCE IDEOLOGY.
PUBLIX CURRENTLY OPERATES 5 COOKING SCHOOLS AS PART OF ITS APRON'S FAMILY.
CLASSES ARE DESIGNED FOR BEGINNERS TO THE EXPERIENCED COOKS WANTING TO
EXPAND THEIR REPERTOIRE. FEATURING RENOWNED CHEFS, AUTHORS AND COOKING
CELEBRITIES, CLASSES ARE DESIGNED TO TEACH EVERYTHING FROM BASIC TECHNIQUES
TO WINE PAIRING.
http://www.publix.com/aprons/schools/cookingschools.do

18. IMMATERIAL WORLD FUTURE SIGNS LOWE COUNSEL LOWE AND PARTNERS
Dematerialism Services
THE SERVICE ECONOMY IS ADAPTING TO THE FRESH DEMANDS OF THE DEMATERIALIZED
WORLD.
SERVICES LIKE’ IPODMEISTER’ PROVIDE A SERVICE WHICH WILL DIGITIZE YOUR RECORD
COLLECTION, ENABLING YOU INCREASED ACCESS AND FREEING UP PHYSICAL SPACE IN
THE HOME
http://www.ipodmeister.com/ [13]

19. IMMATERIAL WORLD FUTURE SIGNS LOWE COUNSEL LOWE AND PARTNERS
Changes in Distribution
WE HAVE ALREADY WITNESSED HOW A CHANGE IN DISTRIBUTION OF PRODUCT MUSIC CAN
TURN AN INDUSTRY ON ITS HEAD.
DEMATERIALIZATION IS CURRENTLY ‘GAME CHANGING’ THE VIDEO/DVD INDUSTRY WITH NEW
PLAYERS LIKE NETFLIX MAKING LIVE STREAMING THE FUTURE DELIVERY CHANNEL FOR
FILM.
CAN YOU FORESEE HOW A CHANGE IN THE DISTRIBUTION OF YOUR PRODUCT AND SERVICE
COULD DRAMATICALLY ALTER YOUR INDUSTRY OR BUSINESS.
ARE THEIR OPPORTUNITIES THAT COULD ARISE FROM SUCH A POTENTIAL CHANGE?
“Now its streaming only. That’s a big difference – no warehouse, no integration with Royal Mail…we are a
lot bigger when streaming means less operational complexity.” Reuters, Jan 2010 [14]

20. IMMATERIAL WORLD FUTURE SIGNS LOWE COUNSEL LOWE AND PARTNERS
Insurance and Recovery Services
AS OUR MOST VALUABLE POSSESSION DISAPPEAR FROM THE TANGIBLE WORLD
INTO IN THE VIRTUAL REALM (PHOTOS, BOOKS, MOVIES, MEMORIES, MUSIC, ART…)
WE NEED VIRTUAL STORAGE:
WHAT HAPPENS IS YOU LOOSE YOUR ‘DEMATERIALZSED’ POSSESSIONS.
HARD DRIVES WILL BECOME SUPER-VALUED.
THE INCREASE IN DEMATERIALIZED POSSESSIONS IS LIKELY TO FUEL A GROWING
DEMAND FOR BACK UP AND MANAGEMENTS SERVICES.
EXPECT TO SEE DIGITAL RECLAMATION AS A GROWTH SECTOR AS SEEK TO
RECOVERY LOST FILES.
“Responding to this change in habits is vital, and our research also shows that there has been
an increase in the number of people wanting cover for their digital downloads. That's why, since
January 2009, our customers have enjoyed £2,500 digital download cover as standard.” More
Than insurance company website [15]

21. IMMATERIAL WORLD FUTURE SIGNS LOWE COUNSEL LOWE AND PARTNERS
1. Growth and Dematerialization: Why Non-Stick Frying Pans Have Lost The Edge, Danny Tyson Quah, (CEP’s Centre Piece 1996 October)
http://lse.academia.edu/DannyQuah/Papers/25282/PDF
3. Cloud computing http://en.wikipedia.org/wiki/Cloud_computing
3. ‘The internet of Things’, IBM Social Media. http://www.youtube.com/watch?v=sfEbMV295Kk
4. Counsel Thought Leader Research, Future of Mobile Devices, June 2009
5. The Age of Access: The New Culture of Hypercapitalism, Where All of Life Is a Paid-for Experience, Jeremy Rifkin (Tarcher, 2000)
6. Daily Telegraph, 8 Feb 2010
http://www.telegraph.co.uk/news/worldnews/europe/austria/7190750/Millionaire-gives-away-fortune-that-made-him-miserable.html
7. Fraction Life organisation http://www.fractionallife.com/
8. The relative relativity of material and experiential purchases. Carte TJ, Gilovich T, Department of Psychology, Cornell University.
http://www.ncbi.nlm.nih.gov/pubmed/20053039
9. Engadget, 19 July, 2010.
http://www.engadget.com/2010/07/19/kindles-digital-book-sales-overtake-hardcover-device-purchases/
10. bbc news http://news.bbc.co.uk/1/hi/technology/8320184.stm
11. http://www.kuhleasing.ch/
12. http://www.evolvingvox.com/
13. Ipodmeister. http://www.ipodmeister.com/
14. Reuters News, January 28, 2010
15. More Than insurance http://www.morethan.com/Pages/Products/Home/DigitalInsurance.aspx

22. IMMATERIAL WORLD FUTURE SIGNS LOWE COUNSEL LOWE AND PARTNERS
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