Global digital economy witnessing structural transformation

Staff Reporter, Gulf Today

Dubai: The world is witnessing a profound transformation in the structure of the digital economy. The way software and applications are sold and consumed has fundamentally changed, said Engineer Ahmed Bahgat Hassan, an IT expert and consultant.

He added, “Users no longer purchase and permanently own software as they once did; instead, they increasingly rely on monthly or annual subscription models. Major companies such as Microsoft and others have adopted this approach to ensure financial sustainability and stable recurring revenue streams.”

Hassan explained, “This shift can be viewed as a natural evolution in response to the growing complexity of modern technologies and rising operational costs. However, it also places cumulative financial pressure on individuals and businesses. Today, users are paying for the “right of access” rather than ownership—marking a significant shift in the very concept of digital property.””

While some critics describe this dynamic as “digital feudalism,” a more accurate term may be “digital dependency.”

He added, “Users subscribe voluntarily, yet they can become heavily reliant on a single platform—particularly amid increasing market concentration and wealth centralization among global tech giants. This reality highlights the importance of diversifying digital tools, supporting alternatives such as open-source software, and demanding stronger rights related to data portability and protection.

At the same time, rising digital service prices are largely driven by the high operational costs of Generative AI technologies. These systems require massive computing infrastructure, advanced processing power, continuous security investments, and large-scale data storage. As a result, part of the price increase is economically justified.”

“Furthermore, strict privacy regulations worldwide—such as the General Data Protection Regulation—have reshaped the advertising-driven business model. The focus has shifted from collecting vast amounts of user data to minimizing data collection, relying on explicit consent, and emphasizing contextual advertising, all while compliance costs continue to rise.”

Hassan concluded, “Ultimately, the central challenge lies in achieving a fair balance between the profitability of digital companies and ensuring user access to secure and reliable essential services without creating a new digital divide. A healthy digital economy should not resemble a “lord-and-user” relationship, but rather a partnership built on mutual benefit—where users pay a fair price for real value, and companies achieve sustainable growth without compromising their ethical responsibility.”