Are services the limit to the sharing economy ?

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Digital and sharing economy

The sharing economy is disrupting traditional approaches and questions the position of former leaders. Its growth made possible by the web and the platform economy (it’s easer to find people to share with when time and space are not a limit anymore rather than when one is constrained by his own environment) looks unstoppable and even unlimited.

Does the sharing economy have no intrinsic limits ?

Before going further it’s important to remind that words have meanings at that “sharing” is often led astray for marketing purposes. When it comes to the sharing economy or even to the collaborative economy, it’s easy to realize that there’s in fact very little sharing or collaboration but only people who want to make the most out of their assets in businesses (platforms) who want to replace the current intermediaries. But that’s not my point today.

One of the first limits I see to the craze about the sharing economy the “owning is old-school, sharing is hype” is we can’t share what’s not been produced. So I won’t say that sharing will kill the old economy.

Sharing products is easy, sharing products is harder

Products and goods will still be produced but in lesser quantity, what is certainly a good thing regarding to natural resources management. But is it’s clear that sharing works for goods which have a significant cost (ex: cars..even if it’s not true in every country), it’s not taking off for cheaper things no one cares about buying once and leaving them in a closet for a while.

And there are things that are much more difficult to share. Services. If sharing works well for physical goods, it’s harder for services. If I can share my Wifi connection under some conditions, it’s not the case for most of the services I used

• because I pay a monthly fee I want to make the most of them in my benefit

• because most of services are nominative and non-transferable.

Things become even much more interesting if we have a look at the “servicization” of economy which is barely anything becoming “product as a service”. Let’s have a look at it in the context of the internet of things and the economy that comes with.

When a product is the byproduct of a service one loses the right to freely dispose of it;

What matters in the internet of things is not the thing but the connected service that comes with. To some extent we can imagine an economic model where people pay for the service and get the thing for free. A little bit like with mobile phones but at another scale.

So the product can’t work without the service, the service is nominative and, consequently, any ability to share is killed for two reasons.

• because the one with whom the product is shared will have a very limited use of it until he pays for the service

• because  the terms of service will disclose that the so-called service is neither transferable nor sharable

• because since the service is about my personal data (it’s nearly always the case), I’m less likely to break the terms of service to share it.

In short we’ll be customers of a service and not owner of a product. And when one is not the owner anymore he loses rights that comes with ownership.

Connected services are a barrier to the sharing economy

We are ,of course, still far from such a future. But as the economy is becoming a service economy where tangible products will be accessories, it’s possible that the ability to freely dispose of our goods will be limited by the terms of use of the service.

Unless…oh wait. It’s already happening. Did you know that some farmers are not considered as the owner of their vehicles ? Since the vehicle is only an accessory of the real product which is said being the software operating the vehicle, the ownership of the vehicle is governed by the terms of service.

Closer to us, as goods like CDs and books became digitized, we lost the right of property over them. It’s impossible to sell old CDs like we used to, and even to lend them. If Amazon tried to make it possible to lend Kindle books to friends, publishers did not see it that way and, in the end, lending electronic books to friends is difficult and will even become impossible soon.

So the sharing economy will surely find breakwaters on its way. And I have absolutely no doubt that “old” businesses will use digital connected services to prevent people from sharing too much…and even from sharing anything.

Image credit:  Sharing by Rawpixel.com via Shutterstock