In the open source society, the sharing economy is referred as the peer to peer economy, where the access to the services and goods are shared by the community. In the B2C (Business to Consumers) economy, it refers to many things and mostly it is described as a social and economic activity involving the online transactions. The sharing economy is also called the peer economy, shareconomy or collaborative consumption.
Sharing economy revolution
The sharing economy evolved due to the rise of the new companies that helped the people to share their underused assets like the toolkit or property or vehicle with the consumers who are ready to pay for the services and goods.
- Ridesharing giant
Uber is the leading multinational transportation company that is headquartered in San Francisco and it provides ride hailing services with fares lower than the normal taxi rate. The main aim of the transportation company is to connect the drivers who own a car and are willing to make money out of it with the riders. All the drivers who are driving the car under the name of Uber are considered as individual partners and not as employees. Anybody who owns a car can register with the company and start driving the vehicle.
- Rental marketplace
Airbnb is an online marketplace that helps the people to rent their rooms, condos or cottages for the tourists for a temporary stay. This online marketplace enables both the renters and the tourists because the renters can share a room or their property for rent and earn money, while the tourists can stay with the locals of the place and understand more about the place. The costs of the rental properties are cheaper than that of the hotels.
- Web platform
The TaskRabbit is a mobile and online marketplace that allocates the freelance workers with the demands of the local consumers. The day to day works like the handyman works, the moving and delivery work and the cleaning work of the consumers meet with the freelance workers in that local neighborhood. This service offered by the company helps the freelance workers with jobs for their livelihood and at the same time the consumers are benefited with the help of these people.
These companies made use of the new technology like the internet and smartphone to connect both the ends of the economy, the producers and the consumers. They were able to change the perspective of the entire community because a few years back, people were not comfortable with sharing their vehicle or property with strangers. But now the same community is overwhelmed with the fact that they are able to earn money with their underused things.
The first step
The first reform was started by the music sharing service called the Napster, which gives the facility to share the audio files that are encoded in the MP3 format. It became the largest online music store. This was the first company to start with the concept of sharing economy. Followed by the online music service, in 2009 Travis Kalanick and Garret Camp founded the online ride hailing service called the Uber. The ride sharing service operates in many countries and values $62.5 billion and its competitor Lyft operates in around sixty five cities in the United Sates. Similarly, Brain Chesky the founder of the Airbnb rented 3 air mattresses and now his online marketplace operates in one hundred and ninety countries providing the best rental service in the industry.
When people go on vacation they leave their pets in the kennel, but with the help of the DoyVaycay the owners can leave their pets at home. This service has helped several pet owners to leave their pets in safety hands and enjoy their trip. There is an ecommerce marketplace which allows the people to swap or sell their accessories or clothes with the others and it is called the Vinted and Poshmark. So, people who have their prom dress or party wears unused can sell them and earn money from it.
Last year a survey was conducted and the results reported that around eighteen percent of the Americans are the consumers of the sharing economy and out of those 18%, nearly 83% of the consumers said that the concept of the sharing economy is efficient and convenient for them.
Dark side of sharing economy
The development of sharing economy was expected to be beneficial, but on the contrary, it seems to create major issues in the economy. In the initial stage it was considered as an idealistic concept, but later it is a misnomer. The founder of the P2P foundation, Michel Bauwens said in a group interaction in the research of the peer to peer that the darker effect of the sharing economy is because of the commoditization of all resources which were supposed to be given free. The same fact was pointed out by Jonathan Askin, Professor of Brooklyn Law School and he said that many people were taking advantage of the sharing economy and the smartphone technology and tries to even sell the parking lots in the public areas. He said that the concept of sharing economy has turned into a selfish economy. Many startups are considered to be harmful to the public by the Government.
In recent times, the sharing startups are not abiding by the rules and regulations for the consumer protection. Many of the drivers of the ride sharing company like Lyft and Uber were accused of sexual assault and many of the drivers who have given many rides have criminal records. Since these companies are not considering the protection of the passengers, the District Attorney of San Francisco, George Gascon said that the companies and startups are not given license to affect and mislead the consumers. Similarly, in the case of the rental marketplace, Airbnb, the listings are not given by the property owners, but the people who run the de facto hotels and professional landlords are taking advantage of the increasing rates.
The sharing economy has provided many job opportunities for the people, but the drawback is that the sharing startups and companies consider the people working under them as individual partners and not as employees, thus they are losing many benefits like the retirement plan, paid vacations, paid leaves and health care. The main aspect of the workplace protection is that it provides a steady job.
A large sum of the money goes to the organization that owns the software while the scraps go to the workers. But some argue that the jobs from the sharing economy are for those people who do not want a full time job, but for those who wish to do the job they like to do at the desired time.
However, the changes that are taking place in the society have its own pros and cons, and the success or failure and the trial and error method are the gateway for new inventions. Each and every innovative ideas and concepts provides a new dimension to the economy of the society, so the organizations and corporations and the individuals must keep experimenting new methods and technologies with unique ideas as it leads to the change in the society and its economy.
Anand Rajendran is CEO and Co-Founder of Dectar, best PHP scripts development company located in India. Dectar is a part of Casperon Technologies a leading social and mobile development company which is Developing Uber for X apps like Couriero – On Demand Delivery Services App for the past 3 years. I’m a Tech geek, Digital marketing expert, Entrepreneur, and Atheist who loves to write everything about PHP Scripts and mobile application development.