Stop calling it a sharing economy

Vancouverites are celebrating this week after the B.C. government opened the door for services like Uber and Lyft. The move has everyone talking about the sharing economy again. But Sunil Johal wants to remind us all: companies like Uber and AirBnB aren't sharing very much with us.
Sunil Johal says we shouldn't be fooled by the language of the 'sharing economy' because "the companies themselves are taking a cut of the proceeds". (Tyrone Siu/Reuters)

Years after ride-hailing companies like Uber and Lyft have set up in some Canadian provinces, the B.C. government announced this week it is opening the door for the companies to operate.

The move has everyone talking about the sharing economy again.

But Sunil Johal wants to remind us all: companies like Uber and AirBnB aren't sharing very much with us. 

We're taught from a young age that sharing is caring. 

Maybe it was splitting a sandwich with your friend who forgot their lunch or a ride to work for your sister when it's raining out. 

Uber succeeded in making its plan to operate in Vancouver a reality on March 7 when the B.C. government announced it is letting ride-hailing companies like Uber set up. (Twitter/@Uber_VAN)

We feel good remembering times we helped someone out in a crunch by offering them something of our own.

But in recent years, the sharing economy has quickly risen from a curiosity to a disruptive, industry shaking force. 

Multi-billion dollar companies like Uber and Airbnb are at the vanguard of this new online, on-demand economy.  

They connect people looking for rides, loans, places to stay or personal services with like-minded individuals through the convenience of smartphones.

And the model has proven popular. 

There are over 500,000 Uber riders in Toronto and more than 1 million Canadians have used Airbnb to take trips.

But for all their success, are these firms really sharing anything? 

You might get a better deal on Uber or Airbnb than you would through a taxi or a hotel, but you're still paying for the service.

And, the companies themselves are taking a cut of the proceeds. 

In the case of Uber, drivers don't even get to set the rates they charge, they are determined by algorithms.

And, realistically, a significant part of the reason you're getting a better deal on these platforms is that they aren't typically subject to the same level of regulation as traditional operators in their sectors and
can undercut them on price.

Sunil Johal, policy director at University of Toronto's Mowat Centre says it's worth considering how much is actually being shared in the so-called "sharing economy" (provided)

The sharing economy blurs lines between the commercial and the personal. 

You're using your own personal car as an Uber driver, or, often, your own primary residence as an Airbnb host. 

For government policymakers that's a conundrum.

They're used to stamping things as either commercial or personal, not dealing with an odd hybrid emerging from the venture capital fields of Silicon Valley.

By wrapping themselves in the language of sharing, collaboration and community, Uber, Airbnb and other major players in the sharing economy have found a clever way to focus policymakers and the
public on their uniquely personal, non-commercial features. 

That's both good marketing, and good for business.

So the next time you use Airbnb or Uber, consider whether they are really sharing, or leveraging the power of language. 

Sunil Johal is Policy Director at the Mowat Centre, School of Public Policy and Governance at the University of Toronto. 


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