The success of many of the most popular digital companies is in part based on a similar idea: disrupting an existing industry, by decreasing overhead costs of employment. The initial concept of ride-hailing companies, like Uber and Lyft was to not have any drivers as employees but connect independent contractors directly with the customer. The business model of transporting a person (by taxi) is not new but was often expensive and inconvenient. These start-ups did invest a lot in the development of user friendly, easy to use digital ecosystems which the traditional companies are now also catching up. Nevertheless, the main driver for their success was the low cost compared to the conventional offering. These low costs were achieved by, on the one hand not having to operate profitably due to enormous investments. More importantly, though they managed to drive prices down by not employing the people responsible for delivering the service. When Uber launched in Germany, every person with a car could sign up to the platform and with little checks, start transporting passengers and make some money in a short time. Today companies like Uber are fighting regulations around the world, which would make their services much more expensive. Their “employees” demand that they are fully employed by the respective company, including social security and health care benefits.

In California, the home of many of those companies, a law was passed to classify drivers as employees, with benefits like sick leave. It was immediately appealed, and new legislation called Prop 22 was proposed, which is heavily backed by the companies in question. According to the Washington Post, Uber and other gig companies spend nearly $200 million to promote this legislation, which would reverse the initial ruling and ensure that the workers would stay as independent contractors in the future (with some minor benefits).

In conclusion, it is crucial to keep in mind, that the low prices offered by ride-hailing apps do not just come from highly sophisticated algorithms, which calculate the most efficient routes for the drivers, and from the heavily backed companies’ possibility to not be profitable for many years. A significant additional reason is that low-income workers are exploited for cheap labour.

Sources:

Techcrunch: “I’m a software engineer at Uber and I’m voting against Prop 22”; https://techcrunch.com/2020/10/06/im-a-software-engineer-at-uber-im-voting-against-prop-22/

Washington Post: “Uber and gig companies spend nearly $200 million to knock down an employment law they don’t like – and it might work”; https://www.washingtonpost.com/technology/2020/10/09/prop22-uber-doordash/

Tech gadgets and, where applicable, their respective operating systems have a significant impact on our everyday lives. The kind of laptop, tablet and especially smartphone we use, decide how we interact with the digital world at all times. These gadgets, of course, differ wildly across different brands, but even within the same brand, new hardware and software features are added usually yearly, which further increases the variety of the available tech. This makes deciding on which gadget to buy and when to upgrade from old tech increasingly tricky. It is impossible to test every phone extensively for an extended period before making the purchase decision. Therefore, potential buyers of those gadgets have to trust the opinions of others, who have been using these products already.

One way of getting these opinions is by looking at user-generated reviews like on Amazon. An alternative, which this blog article focuses on, is trusting dedicated tech reviews from selected tech influencers, like Marques Brownlee or Linus Sebastian (two of my personal favourites). These content creators aim to provide an unbiased first look and subsequently a review of various tech products, which can either help make a purchase decision or, if the quality of the content is high enough, can be watched or read by tech enthusiasts for pleasure. Some of these tech influencers have amassed a considerable following, like the YouTube channel unbox therapy, which has over 17 million subscribers. Tech companies have of course noticed the increasing popularity of these types of YouTube channels and try to leverage the influencers reach for their benefit, by for example sending early review units before launch or inviting the creators to product events. The goal of these brands is to put out their product in front of the influencer’s audience and hopefully get a positive review, as many people (me included) base their buying decisions on the opinions of these review channels.

In today’s world, many potential buyers want to get their product as soon as possible after launch (or even on launch day), and they expect to see these reviews beforehand. This means, the reviewers are depended to be invited to these sales events or even get an early free review unit sent by the tech company, as otherwise, they can only publish their review long after the “hype” is over and therefore will not reach the desired audience reach. Companies have no obligation to send review units to anybody and therefore could refuse to do so if, for example, the reviewer has made negative comments about another product of that brand in the past. This can lead to tech influencers being biased, which opinions they can or cannot say publicly, as a negative review might impact them negatively later on. As such, not every reviewer can be trusted per se. Viewers must view the opinions voiced very critically and check to the reviewers track record. If the influencer has made negative comments about a product of a certain company in the past, but still receives early review units, it increases the trustworthiness of the reviewer (and the company). Furthermore, one should not trust one single source of truth and try to get as many opinions as possible, including the above-mentioned user-generated reviews.

In conclusion, there will never be a perfect way of finding out if a product matches the expectations, especially in long-term use, but the combination of finding trustworthy reviewers, checking user-generated reviews and if possible, trying out the gadget yourself, can help one to make the most educated purchasing decision. But even with these guidelines, spending more than 1000€ on a smartphone, at least for me, still induces FOMO (Fear of missing out).