Why Tesla Is Worth More Than GM

The digital economy has transformed the way we communicate with each other; the way we consume information, products, and services; the way we entertain ourselves. It's revolutionized seemingly non-digital industries--think of how different financial services, for instance, are today from what they were two decades ago--and investors expect it to soon transform others, which is why Tesla Motors is worth more than General Motors despite making a tiny fraction as many cars as GM makes and earning a tiny fraction of the revenue. This phenomenon explains why the so-called Big Five of the digital economy--Apple, Alphabet, Microsoft, Amazon, and Facebook--have, at various points over the last year, been the five most valuable companies in the world. So you might say that the digital economy has lived up to the expectations people had for it 20 years ago, in the early days of the Web. In other important ways, however, its consequences have been smaller than you might think.