‘The collaborative economy is growing rapidly. Gross revenue in the European Union from
collaborative platforms and providers was estimated to be 28 billion Euros in 2015. Growth in recent
years has been spectacular with revenues almost doubling from 2014 to 2015.’
This quote from the communication on the collaborative economy by the commission demonstrates
the growing importance of a new form of business called the collaborative or sharing economy.
Uber is one of the prime examples of companies operating through the sharing economy. According to the commission staff working document that accompanies the communication Uber is one of the largest companies in the sharing economy of the EU.
So what is Uber and what is the sharing economy that they participate in? Uber describes itself on twitter and their website as a ‘way to evolve the world by seamlessly connecting riders to drivers through their app.’ Uber is an online platform that everybody can use which connects consumers to other consumers. On one side they provide a way to get a ride for consumers on the other side they provide an opportunity for other consumers to offer rides in their own cars. This is also the essence of the sharing economy, companies that provide a platform for consumers to connect with each other and provide services. Uber started out as an app to request rides in 2008 and has spread to hundreds of cities throughout the world, expanding its service portfolio (UberEATS e.g.).
This huge growth has lead to an enormous amount of resistance both on the ground, where
Uber offers its services, and on a political level. As it is with all things new, people are afraid of
change initially, this is true for Uber and the whole of the sharing economy as well. On the ground
level Uber has faced enormous difficulties with traditional taxi companies that feel threatened by this new competition. In multiple big European cities this has led to witch hunting and violence by taxi drivers against Uber drivers. 4 But it is not just on the ground level where Uber has run in to trouble, individual EU member states have also tried blocking Uber from operating. For instance in Spain where Uber was banned by the court and forced to stop all activities.
These unrests are a reaction to the feeling that Uber provides unfair competition to the more traditional companies. But what turns out is that legislation and frameworks in general have proven to be insufficient in protecting old-fashioned companies in the sharing economy era. Fortunately, because they shouldn’t. Disruption is nothing new. What’s new is that with the current information technology, disruption can happen faster than ever. Old-fashioned companies should not hope for regulators to protect their market share; disrupt or be disrupted would be my advice.
Sources
• European Commission, ‘The Collaborative Economy’, http://tinyurl.com/hfhrnfl (2-6- 2016)
• European Commission, ‘European agenda for the collaborative economy – supporting analysis’, (Brussels 2-6-2016) 9.
• Uber, https://twitter.com/Uber.
• L. Westcott, ‘The Fight Against Uber Gets Violent in France’, in: newsweek, http://tinyurl.com/h62l2my (25-6- 2015).
• BBC, ‘Uber taxi app suspended in Spain’, http://www.bbc.com/news/business-30395093(9-12- 2014).
