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Is wrap the killer app that will finish off IFAs?

Paul Bradshaw makes a powerful case for the revolutionary impact of wrap services but he appears to stop short of the inevitable conclusions resulting from his own analysis.

From time to time, every industry experiences points of singularity when the old order is destroyed and a new order emerges, fundamentally different and often spawning new industries in its wake.

In the computer world, the triggers are called killer apps. Examples of killer apps are the microprocessor, the spreadsheet, the Windows graphical user interface and the internet browser.

Is the wrap service concept described by Bradshaw a killer app? Potentially, yes. But one thing is certain. Every seismic change fundamentally alters the value chain, resulting in a massive transfer of value to the consumers at the expense of the intermediaries and the suppliers.

Bradshaw&#39s own example is a case in point. Budget airlines redefined the value chain by cutting out the travel agent and operating in a virtual low-cost internet-based environment. The value released resulted in a massive drop in airfares and the consumer got the lion&#39s share.

If the wrap concept is a killer app, it would ultimately lead to one scenario – a huge transfer of value to the consumer via an incredibly powerful and intelligent software infrastructure, owned by new forms of organisations. This enabling technology, together with the FSA and Government drives for transparency, and simplicity would allow a customer to buy services from and manage his or her own wraps directly with the suppliers, cutting out all forms of intermediation.

Another scare story proclaiming the death of the IFA? Maybe. But you would be wise to cover your bases.

Ram Daryanani

Programme manager,

ARJ Enterprises,



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