Is it a ‘sharing economy’ when we pass the buck?

An article in The Atlantic earlier this month reviewed the origins of sharing in society and concluded two things – the sharing economy was the norm, not the exception for most of human existence, and today’s sharing economy is not really a sharing economy.

While it appears novel today, sharing in society has been taking place since the times of the hunter-gatherers. Work by Lewis, Vinicius, Strods, Mace, and Migliano (2014) say these societies adopted the social norm of ‘demand-sharing’, whereby food brought into camps were claimed and divided among group members, even those who rarely hunted.

This is explained by the nomadic lifestyle inherent in the hunter-gatherer society. Families who shared while on the move through widely varying climates survived, while non-sharing and sedentary families tended to die off. As civilization migrated to an agrarian society, towns sprung up, trades specialized, homesteads were established and the idea of private property took hold.

Today, globalization is transforming the aspirational futures of millions of citizens of developing nations. These aspirations will help fuel the growth of the middle class in Africa and the Middle East to leapfrog in technology, entrepreneurship, and educational models. The Organization for Economic Cooperation and Development (OECD) forecasts the world’s middle class will grow from 2 billion to almost 5 billion people by 2030, with most of that growth coming from developing nations. The world’s buying power is shifting toward this growing middle class and these aspirations will fuel the demand for assets.

The sharing economy that has emerged recently is remarkable in the face of globalization, but the basic necessity driving social norms that allow ‘sharing’ are little changed from the early days.  It’s survival.  Today the threat is not death by starvation, it’s running out of usable natural resources.

Today’s ‘sharing economy’ is in reality an extension of flea markets, swap meets, garage sales, car boot sales, and second-hand shops.  The difference is that today this system is internet-enabled, accessible through mobile technology, and promoted through social media.  Known as ‘collaborative consumption’, it doesn’t involve sharing in the pure sense, but involves “consumers” and “obtainers”, who do not only “obtain” but also “provide” resources to others.  As the Atlantic concludes, “Ownership is still private; everything is rented, not truly shared. The sharing economy might be a significant step toward more efficiently tapping into the wealth of physical things owned by individuals—as opposed to corporations—but it’s still vastly different from the kind of sharing that defined humanity for tens of thousands of years.”

Today sustainable consumption is forming a virtuous partnership with collaborative consumption for the benefit of mankind.

I found you!

After the New England Patriots earned another trip the to Super Bowl, CBS aired the premier of Hunted.  For those who are unfamiliar with the show’s premise, “Hunted follows nine teams of two in a real-life manhunt as they attempt the nearly impossible task of disappearing in today’s vast digital world as highly skilled investigators combine state-of-the-art tracking methods with traditional tactics to pursue and catch them. From searching their targets’ homes and scouring their internet and cell phone histories, to identifying behavioral patterns, Hunters in the field and Command Center investigators work together to identify clues to potential hiding places and collaborators that can ultimately lead to capture.”

What’s fascinating to me about the show isn’t the game, it’s the technology available to both the law enforcement teams and the contestants that make it virtually impossible to escape traceability.  It’s not only the tools at the disposal of law enforcement but also the tremendous digital footprint we generate continuously when we possess operating computing and mobile devices.

Last evening I read in Bruce Schneier’s book Data and Goliath, that by using public data from the 1990 census, a computer scientist found that 87% of the U.S. population could likely be uniquely identified by their five-digit ZIP code combined with their gender and date of birth.  We’re not talking deep dark personal data here.  Upon reflection, I guess this shouldn’t surprise me too much. According the the US Postal Service, there are 7,489 people in the average zip code, so the odds of one of 7,489 people being male and having my birth date are really small.  What does fascinate me is the means to store and process the data so cheaply enables a data scientist with various lists to identify me.

Does the sharing economy use this type of data and analysis?  Absolutely.  In fact, it relies on it.

This thought is clogging up the rest…

Today I’ve been pondering a comment I overheard recently – “the internet is made up of  only marketplaces and communities.”  Okay, profound, but isn’t the real world made up of marketplaces and communities too?

Out of this background, I’ve been thinking about players who have successfully turned a marketplace into a community.  Big sharing economy websites like Uber and Airbnb have created a situation where money is dealt with in advance, so the experience, when it occurs, goes from being transactional to social.  When people act on a social level, they are more open with each other and can build relationships.

Is it as simple as the act of changing money that takes the joy out of experiences?

Boy, I’m glad I got that out of my system…

Share and share alike…

The Sharing Economy (or the Gig Economy, or the Collaborative Economy) is a model that’s disrupting inefficient industries in ways that provide a more convenient experience for the consumer and change the nature of work for the provider.  The Economics and Statistics Administration of the U.S. Commerce Department issued a report in June 2016 defines this sector through the four following characteristics:

  • They use information technology (IT systems), typically available via web-based platforms, such as mobile “apps” on Internet- enabled devices, to facilitate peer-to-peer transactions.
  • They rely on user-based rating systems for quality control, ensuring a level of trust between consumers and service providers who have not previously met.
  • They offer the workers who provide services via digital matching platforms flexibility in deciding their typical working hours.
  • To the extent that tools and assets are necessary to provide a service, digital matching firms rely on the workers using their own.

As the implications of the sharing economy are being debated, one area is getting a good amount of focus from researchers and the press.  It relates to whether the sharing economy is simply bringing more wage-earning opportunities to more people, or whether its net effect is the displacement of traditionally secure jobs and the creation of a land of part-time, low-paid work.

I believe it’s in this debate that reputation, of both the buyers and sellers, will prohibit a race to the bottom in terms of quality provided by the provider and lowest price provided by the buyer.  In other words, a favorable provider reputation will extract value out of this efficient value chain through a higher demand for services which the provider can ask a higher price for than a similar provider with an unfavorable reputation or none at all. Conversely, a favorable buyer reputation will demonstrate value for the buyer through more options at a lower cost than a buyer with a limited or unfavorable reputation.

I think it’s time to explore the notion of online reputation.  More to come.

Why consider reputation?

“Character is like a tree and reputation is like a shadow. The shadow is what we think of it; the tree is the real thing.” – Abraham Lincoln

A week ago I wrote that the purpose of this blog is to explore personal data and the interplay of trust, privacy, reputation, and influence.  Allow me to lead you down the path that sets the foundation for my work.

I believe that trust is the oil that will continue to lubricate the e-commerce engine.  As this engine has transformed from an extension of the real world to a sharing or collaborative economy.  In this transforming economy, more buyers want access to assets, not ownership of assets and sellers are willing to share their assets when not in use.  Because assets in this economy can include skills and time, the sharing economy will require trust between strangers.  The basis of this is an individual’s online reputation.

There are major privacy concerns that surround establishing and maintaining an online reputation.  Much of what I have read about privacy falls into one of two themes.  One is how to preserve as much of one’s privacy as possible, and the other is to call for us to ‘own’ our privacy through control of personal data.  The implication being, “if I share my personal data with you, it’s worth something to you and I want a piece of it.”  After working with this notion for awhile I’ve concluded that privacy is not the objective of personal data management.  I believe the objective of personal data management is to build, nurture, and manage your reputation, especially your online reputation.

Influence is related to, but not equal to reputation.  The waters are very muddy around this distinction in the online world, because many confuse the number of ‘likes’ or ‘shares’ with a numerical reputation score.  “Likes’ and ‘shares’ are influencing mechanisms, not a reflection on the character, behavior, skills and results of an individual.

So why write about personal data privacy and reputation?  Because in a sharing economy a person can leverage their reputation into real value in the form of more engagements at higher rates for sellers and better terms and more options for buyers.

 

Say what?!?

I love my Amazon Echo.  I don’t consider myself hip, but Christmas 2015 found an Echo under our tree and it has been an affair to remember.  All the things it can do – play music tracks and radio stations, tell jokes, capture my shopping and to-do lists, answer trivia questions, wake me up, time my meals, hail an Uber, and control smart appliances – for me makes this device one of most indispensable items I own.

Voice assistants such as Alexa and Siri are changing the way we consume computing power.  Apps are so 2013.  Why get a reminder app when you can dictate your to-do’s to a list?  Why have an app for every one of your favorite radio stations when you can call your station from Alexa?  Why type when you can talk?

Talking is our natural means of communicating. Voice technology is the means toward transforming the way we interact with computers.  This technology could make texting obsolete!  (Pause for a minute to savor this future…)  Fewer distracted drivers, more attentive students, less neck and thumb pain, not to mention more coherent messages.

 

Improvements in the technology and privacy issues aside, consumers will continue to adopt voice technology as it transforms the nature of computing and how we interact with our machines.