As technology lowers transaction inefficiencies and costs, startups everywhere are focusing on unbundling services of large incumbents to better serve their customers. This trend is particularly acute in fintech, where insurgents are chipping away at banks' monolithic architecture - from lending to wealth management and savings.
We’ve been living in a bundled world. ESPN packaged with Nickelodeon, healthcare tied to employers, learning wrapped up in colleges and degree programs. We’ve grown up surrounded by so many bundled products that we've become blind to the flexibility and value presented by unbundling. Bundling can occur for a couple of reasons. One scenario is when companies try to force consumers to buy something they don’t really want by packaging it with something they do — like albums that only contain one good song. But bundling can make sense when transaction costs for individual products are too high to justify buying those products separately. As Internet-based technologies reduce transactional inefficiencies, we have new opportunities to abandon unnecessary bundling in favor of choice and flexibility. We’re seeing this disruptive effect everywhere — from entertainment to work to enterprise technology.