Growth of the Sharing Economy01/08/2014
While the term "peer-to-peer" is best known for its association with computing architecture and file sharing, a number of new online platforms have given rise to peer-to-peer commerce. The new sharing economy makes it easy for strangers to share practically anything, from car journeys and accommodation through to clothes and services. Tech-savvy consumers are making the choice to rent and collaborate rather than buy and specialise, sharing goods and skills with others through defined and active online communities.
The ride-sharing platform Uber is one of the biggest peer-to-peer services in the world, now operating in 37 countries with a market value of around $18 billion. Uber is an application which allows everyday people to summon car drivers at rates much cheaper than their local taxi service, while allowing others to earn money by driving people around. While Uber has a number of legal and insurance issues to overcome, its economic and technological pairing has inspired other companies to join the sharing revolution.
Airbnb is another example of a sharing platform, allowing travellers to book spaces from hosts while away from home. Whether you want to rent a single room or an entire house, Airbnb allows home owners to make money and develop personal connections at the same time. At the recent Football World Cup in Brazil, over 100,000 visitors booked their accommodation through Airbnb, with the service now boasting more rooms worldwide than the entire Hilton Hotel chain. Airbnb has raised $776 million in venture capital so far, while Uber has taken on more than $300 million.
In many ways, the new high-tech peer-to-peer economy harks back to more traditional times, when sharing goods and services was much more common. According to Rachel Botsman, author of a book about the sharing economy called 'What's Mine Is Yours', "It's amazing, actually – over the last three years, it's now a case of what's not being shared... There's everything from people's back gardens, parking spaces, homes, skills, [and] workspaces. People are realising they can share or access versus needing to individually own."
"I believe the collaborative revolution that's happening will be as big as the industrial revolution," said Botsman, adding "The sharing economy is the first manifestation of this, because what's happening is a very deep social and economic shift enabled by technology... We used to swap, we used to trade, we used to rent, we used to barter... Now these village squares, through technology, are becoming like a global village... It's much easier for these behaviours to exist on a scale that's never existed before."