The Inexorable Logic of the Sharing Economy
The Internet-led process of exploiting under-utilized resources – be they physical and financial capital or human capital and talent – is both unstoppable and accelerating. The long-term benefits consist not just in efficiency and productivity gains, but also in much-needed new jobs requiring a broad range of skills.
MILAN – When Amazon was founded in 1994, and eBay the following year, they harnessed the connectivity of the Internet to create new, more efficient markets. In the beginning, that meant new ways of buying and selling books and collectibles; but now e-commerce is everywhere, offering customers new goods and used goods – and becoming a global force in logistics and retail. Likewise, while today’s sharing-economy companies may be just out of their infancy, their services will one day be ubiquitous.
By now, most people have heard of Airbnb, the online apartment-rental service. The company has just 600 employees but a million properties listed for rent, making it larger than the world’s biggest hotel chains. Of course, what Airbnb offers is different from what hotels provide; but if Airbnb offered options for, say, maid service or food, they could become closer competitors than one might initially imagine.
The insight (obvious in retrospect) underlying Airbnb’s model – and the burgeoning sharing economy in general – is that the world is replete with under-utilized assets and resources. How much time do we spend actually using the things – whether cars, bicycles, apartments, vacation homes, tools, or yachts – that we own? What value do office buildings or classrooms generate at night?