Is the collaborative economy digital by nature ?


In a previous post I discussed the fact the terms collaborative economy, collaborative consumption and sharing economy were often misused and used equally while they don’t refer to the same things. I also noticed that in some cases these concepts had really nothing new : some old good concepts are enjoying a resurgence with businesses communicating on digital transformation while few changes happen.

What raises a question : these new models are often refered to as “internet born models”, “models born form the digital culture”. Is it the case and, if so, to what extent does the digital economy contribute to disrupt old models and make new ones emerge ?

Let’s start by killing an easy shortcut : we can’t refer to “new internet born  business models” or “models built on the web values” as if internet was an autonomous body with principles everyone must comply with when doing anything on the network. All the principles the collaborative economy is based on existed long before and independently of the network. Thinking that the net created everything is like attributing to a tool a will and abilities it doesn’t have. Even if the idea of sharing and “doing together” mattered a lot for the “founding fathers” of the web, these principles are not imperative. Moreover a large part  of the web economy still relies on traditional models. Contrary to a common misinterpretation, internet did not revolutionize any industry but people did use internet to meet their own goals. Slight difference.

Then, most of so-called emerging models have nothing really new. People transportation (Uber) ? As old as the hills. If we consider that EBay is about collaborative consumption then classified ads magazines are too. Renting one’s flat out when away (AirBnb) ? Done long before the internet. Share a ride with people going to the same place ? Same (the pre-digital word was hitch-hiking).

In fact everything was there before the internet. Sometimes it worked, sometimes it was just an idea. So what’s the role of digital in this case ? Digital help models that need a critical mass of users scalable to make the run at full capacity. Renting one’s apartment is nice but it’s better when a leading marketplace helps to get in touch with the entire world. Same when one wants to share a ride. We all have something to share of to offer but the problem until now was to find someone who was interested. Classified ads were limited and did not help to know is someone was trustworthy or not. Classified  ads were limited and relying only on one’s contacts was too restrictive. In the end, such approaches used to work at a small scale, under the radar and required lots of efforts to manage them. Sometime they did not work at all because people were not able to reach a large enough market.

Internet was not the inspiration of such models but helped them to spread, to reach a critical mass that made them visible, scalable and sustainable. The idea ans the concept are independent and were there before the digital economy but their execution is made easier by the latter to a great extent.

If Uber is the sharing economy then we are in the share-washing era

Let’s end with some thoughts. Months ago I read in some french media that attacking Uber meant attacking the sharing economy vs the old economy. Let’s start from the beginning.

An Uber driver is someone who either owns a car or is employed by a company owning cars. Same for taxi driver.

The business of an Uber driver is to drive people from a place to another. Same for a taxi.

An Uber driver gets its clients from a dispatching center. Same for a taxi.

Uber drivers can’t load clients without reservations. Ok, taxis can.

Uber drivers have nice cars and dress well (even if it’s changing). Taxi drivers seldom do but major taxis companies have uber-like premium services for premium customers.

Uber drivers and their customers get un touch through a geolocation based market place. For taxis it’s the dispatching center.

They do the same job, organized the same way with the same processes and the only difference is…the geolocation based marketplace wich does the job humans used to do with a radio ? That’s a great improvement in terms of service but I can’t see to what extent the job has been reinvented, what is the business model shift towards the sharing economy ? If the difference between the old economy and the sharing one is to do with an app what used to be done by phone, I must be missing some point. As a matter of fact the business model of people transportation did not change : a client asks, a driver is assigned, he drives, the ride is paid. If we consider that the sharing economy is to have many customers using a same car one after the other in a sequential way then taxis are the sharing economy too ! Revolutionary, isn’t it ? Not at all. On the other hand it’s efficient and highly scalable. How if Uber’s success was more about allowing customers to access a level of service they did not know how to access before rather than a geolocation app ?

What’s been disrupted is the intermediary business, not the transportation one. If going digital is enough to switch from the old economy to the sharing one, I think we’re at the beginning of a not that good share-washing era.

Bottom line, collaborative business models are not digital by nature but of necessity.

– Internet does not need the collaborative economy

– The collaborative economy can exist without the internet

– The collaborative economy needs the internet to thrive.

Image credit : Connected Economy by Ellagrin via Shutterstock