2024 has been about survival… so what’s next, and the digital wallet wars will not be over wallets
Plus: The Great AI Divide and AI agent payments are going to be huge
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Each week I unpack the disruptive shifts around digital wallets, Personal AI and digital customer relationships.
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So. Many. Things. Going. On.
More and more ripples of activity around Empowerment Tech.
From the bubbling realisation that digital wallets aren’t just for payments. To reusable ID and ‘acceptance’ and ‘authorisation’ networks. To the vast sums of money now flowing into ‘Agentic AI’.
It’s coming. And it’ll happen in two ways.
Gradually, then suddenly.
This week’s Customer Futures view covers the jobs market. And how it’s feeling for those of us working in - or looking for work in - identity, digital wallets and Decentralised ID. So what’s coming in 2025?
As ever, it’s all about the future of being a digital customer. So welcome back to the Customer Futures newsletter.
In this week’s edition:
The Customer Futures View: 2024 has been about survival… so what’s next?
The digital wallet wars will not be over wallets
This week in EU Digital Wallets: What about payments?
More on ‘A-Commerce’: AI agent payments are growing, and going to be huge
The Great AI Divide
… and much more.
Let’s Go.
The Customer Futures View: 2024 has been about survival… so what’s next?
I’m delighted to say that this week’s View is co-written with David Morgan from IDNexa.
It’s been a hard 12 months for many.
Investment uncertainty. Political uncertainty. Job uncertainty.
Projects slipping to next year. Budgets cut back. Hiring frozen.
It’s happened to people we know, and to companies we know. Here’s the statistic you’ve felt but didn’t know about:
97% of tech businesses made layoffs in 2024.
It’s from a new report by consultancy RSM. And it’s pretty startling. Yes there was some over-hiring in the recent years of low interest rates and bullish innovation. But 97% isn’t an over-correction in a couple of corners of the market.
It’s a sector-wide tightening that’s impacting us all.
If you’re interested, there’s an excellent crowdsourced list showing which companies have been laying off which teams here.
So we must ask: will this uncertainty continue into next year? And what does it mean for the digital ID and wallet market?
This year in the virtual corridors and halls of the Digital ID bubble, there have also been some ripples, sometimes waves, about what’s going on.
For example the shutting down of decentralised ID teams like TBD. The closure of ID networks like Sovrin. Trinsic’s ‘pivot’.
There’s also been a frothy public debate if there will ever be a role for ‘horizontal’ (general) wallet platforms, and a lot of hand wringing around the lack of adoption of ‘SSI’.
But the report reveals a silver lining in the job market more broadly. Both for those looking for their next gig in digital ID and digital wallets, and those planning to hire in 2025.
Here are some of the takeaways:
Market Stabilisation
Despite the headlines, the tech industry is showing signs of stabilisation. With that comes more certainty, and we can expect businesses to loosen budgets and take more risk. That will unlock demand for skilled people in software and digital, and we should expect some of that confidence to flow through to digital ID and digital wallets.
Skills-Based Hiring
The report underlines the importance of skills-based hiring. While technical expertise is important, ‘adaptability’, ‘continuous learning’, and ‘proficiency’ in emerging technologies like AI and cybersecurity will be something to look for in a CV.
People hunting for roles in digital ID and wallets should focus on how their practical skills - both technical and non-technical - can have an immediate impact on businesses with short term goals and tight budgets.
Compensation Trends
Interestingly, non-tech companies are hiring more IT workers. 79% of organisations are planning to expand their tech staff next year. Now might be a good time to look beyond your existing job profile and industry, and see what’s out there around digital ID and customer empowerment.
Work Environment Shifts
Pay attention to where the work is. Yes, many digital ID and Empowerment Tech companies are now ‘work from anywhere’, but the larger companies are shifting towards an ‘office normal’.
We’ve gone from one day a week in the office to now an average of 3.4 days. It’s obviously much better for teaming, collaboration and mental health. But also think about how co-locating with other identity and wallet experts can give you new opportunities to network, especially around AI and Empowerment Tech.
Emerging Technologies
While AI continues to be a hot topic, digital ID, digital wallets and digital twins are gaining traction. The global market for digital twins alone is projected to exceed $75 billion by 2027. And Gartner expects 500M people to be using digital ID wallets regularly in only a couple of years. So think about where the market is headed, not just your skills and experience today. AI agents anyone?
OK, so what’s the advice for 2025?
Hang in there. The mantra of those we’ve spoken to has been simple. ‘Survive Until 2025’.
While the jobs market is sluggish, there are projects. There are many, many digital ID and wallet PoCs and pilots being run. Business cases being developed. Go-to-market strategies being cooked up.
Yes, many businesses and projects are in stealth, some in private beta. But they are coming. And we’ve spoken to quite a few companies over the last few weeks and we can see green shoots. Many are planning to hire next year… just not yet.
It’s clear that experts are going to be needed. More specifically, we believe it’s going to open up a wider market for expert contractors. Day, week or even month-long assignments to accelerate existing projects who can’t (or don’t want to yet) hire.
That means experts on wallets. On identity. On SSI. On data protocols. And especially on AI Agents, the Big New Thing.
Because Empowerment Tech is coming.
So keep going.
It’s going to be a tough winter. Investment and hiring teams are keeping their power dry for now. But there is pent up market demand for the right skills, and the signs are that the first half of 2025 is going to warm up.
Having worked in this market for over 15 years we’ve never been more excited about what’s coming.
Yes, you should expect more uncertainty. Around investment. Around politics. And around jobs. But you should also plan for the coming demand around digital ID, wallet and AI skills.
The very experience, passion and vision in this Customer Futures Network.
Are you thinking about your next move? Or are you an expert looking for the next gig? Drop us a line. We might be able to help.
Or if you are hiring (perm), or looking for a contractor in digital ID or wallets (temp), we can help you find the skills you need.
We’ll be at the Customer Futures Christmas Meetup (11th Dec) if you want an informal chat. Or just drop us a note to experts@customerfutures.com.
We certainly don’t have all the answers. But we can definitely help you find the expert that does.
Welcome to the Customer Futures Network.
Jamie and David
The digital wallet wars will not be over wallets
Steve ‘Lockstep’ Wilson has been working on identity technology and assurance longer than most. And he’s seen a lot of new ideas come and go.
There’s clearly progress around decentralised ID. But he’s rightly sceptical of much of the snake oil around verifiable credentials, SSI, DIDs, reusable IDs and many of the new identity protocols.
His latest post covers how we got here, and why identity networks need to be more like payment networks. With robust and scalable rules and frameworks around acceptance.
Not just wallets.
“The superpower of the payment card networks is they allow you to use a credit card anywhere on the planet, without the merchant knowing you. More significantly, neither does the merchant need to know your bank (the issuer).
“It’s going to be the same reality with verifiable credentials. No Relying Party will know what to do with a VC presented by a user unless prior arrangements are in place.
“But no one can afford to have bilateral arrangements between every RP and every issuer. Instead, VCs and digital wallets need to be supported by acceptance networks which scale globally just like the credit card networks scale.”
Required reading for anyone working on digital ID.
Especially for anyone who has a slide with the word ‘ecosystem’ on it.
This week in EU Digital Wallets: What about payments?
There’s a new white paper out from one of the EU Digital ID ‘Large Scale Pilots’. Worth reading.
Yes, the digital ID wallet will be able to hold identity data and much more. But can it support payments? The answer is absolutely, and perhaps quite disruptively.
Dig in, and you’ll see that this fast becomes a discussion about platform and product strategy. Not about wallets.
Why?
Well, is the wallet:
1. One tool for one thing.
Aka the ‘bread knife’. Like the coming ‘EU Travel App’.
One tool is great for a vertical play within a specific domain. For finding product market fit. And for distribution (you know who needs it, when, and how to get it to them).
OR:
2. A multi-purpose tool.
Aka the ‘Swiss Army Knife’. Like the EU Digital ID Wallet that can do ID, e-signatures, payments and potentially messaging.
A multi-purpose tool is great for a horizontal play across an ecosystem. Great for reuse of data across contexts. But harder to make the case that it’s better than a dedicated tool for each job.
But here’s the thing. Payments is different.
Because you can now argue that payments will be BETTER with identity.
Lower fraud
Better experiences (you can embed payments and ID into other transactions... from ‘embedded finance’ to ‘embedded identity’)
More context and value… as you can now provide more than ID
In other words, you can add ‘proof of anything else’ to a payment. That could be
IS-Over18
IS-Student
IS-Employee
IS-VIP
But also… (drumroll)… IS-AIAgent.
These credentials are soon going to become critical to enable AI-powered commerce. Or put another way, digital identity wallets will enable ‘Payments Plus’.
More trusted. More secure. More valuable.
Bravo to the pilot team at ‘EWC’ for this payments paper. It’s a great start on a critical topic, including Secure Customer Authentication (SCA).
Can’t wait to see where this one goes.
More on ‘A-Commerce’: AI agent payments are growing, and going to be huge
The unparalleled payments expert Panagiotis Kriaris has just laid out some of the main players in AI Agent Payments. And it’s a growing field.
Worth reading the whole post. His main takeaways:
“1. This a race to capitalize on the new AI agent economy, which is why interest is huge with over $1 billion invested in 2024 alone.
“2. It’s an infrastructure game taking place across several layers.
“3. It’s a matter of time before more big players join the race (directly or indirectly).
“4. Crypto is emerging as a promising rail, mainly because of facilitating agent-to-agent transactions without identity verification.
“5. Main challenges across 2 directions: a) Regulation (i.e. is KYC or AML needed and how do you perform them on AI agents?) b) Controls and safeguards for bots managing our personal and business accounts.”
I would add a couple of important questions:
Who will operate these Personal AI agents? Which Brand and right to play? Who has the balance sheet to handle liability?
How will we know that it’s my AI agent? We need KYA, not just KYC. Digital wallets and credentials are going to become A Thing.
This will mean fundamental disruption to e-commerce as we know it. Who are the biggest losers? Online marketplaces? Human-checkout service providers?
Who is asking these questions? Anyone?
Yes, my feeds are rammed full of posts about the ‘Agentic Web’. And It really does feel like A-Commerce is the next wave.
But we need to be asking the right questions. Not just shouting about the latest answers.
The Great AI Divide
I often talk about the ugly underbelly of the ‘digital divide’. It’s the ‘data divide’.
Separating the data-haves from the data-have-nots.
Splitting apart those with vast digital footprints and a world of digital convenience, seamless experiences and lower prices… from those without digital devices or rich digital histories.
Endlessly locked-out from critical parts of the economy like democratic representation, credit scoring, lending or even life-saving digital health interventions.
It’s a significant problem, and getting worse.
Worth reading everything you can find by the excellent Ada Lovelace Institute. They did some really important work on the Data Divide during the pandemic.
It matters now because we’ll soon be wrestling with the AI divide.
Between the AI-haves and AI-have-nots.
As AI payments and ‘the agentic web’ begins to sprawl, there is going to be an uncomfortable split between those with AI-powered devices and enough money to pay for smart personal agents… and a new AI underclass, humans without representation, without an (AI) voice.
And to make matters worse, we already know that AI can be biased. Against certain cultures, religions and skin colours.
Put these together and you’ll see that our Personal AIs will have both an equity problem and a bias problem.
By being clear-eyed about these issues we can begin to fight back. But when the tech moves faster than we can pay attention, it will be like fighting with one hand tied behind our back.
AI bias is going to be one of our biggest societal risks. But so will leaving billions of people behind.
OTHER THINGS
There are far too many interesting and important Customer Futures things to include this week.
So here are some more links to chew on:
News: Block Contributes Digital Identity Components to the Decentralized Identity Foundation READ
Article: Bots Buying From Other Bots: A New Frontier For The Payments Industry READ
Post: IEEE7012 and FedID: Addressing Two of the Web's Fundamental Problems READ
Report: Bringing Dark Patterns to Light (FTC report) READ
News: Sam Altman’s WorldID (formerly Worldcoin) adds physical passport scanning to avoid iris scanning READ
Report: EU Drivers demand transparency from garages amid growing vehicle data security concerns READ
And that’s a wrap. Stay tuned for more Customer Futures soon, both here and over at LinkedIn.
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