This is all about sharing mobility and using modern communication to
manage it all. Applying it to other services is surely plausible if
it can be cost effective and also secure. We have a huge amount of
under used capacity out there that can be tapped cheaply.
The hard part is trusting the random user. That needs to be well
sorted out and damage control has to be as convenient. Do that and
confidence will soon make it a winner.
We will watch this phenomena over the next couple of years to see
just how it does shake out. All the problems will need to be well
worked out and the automotive industry has the best handle on this.
Peer-to-peer
sharing went big in 2012 — and so did opposition
By Susie Cagle
This year,
ride-sharing services Lyft and Sidecar amassed millions in new
funding. Uber, which lets passengers hail idle town cars with their
smartphones, expanded to new cities from San Francisco to New York.
And Airbnb, which makes it easy for people to rent out their homes or
rooms for short periods, expects to be filling more rooms per
night than Hilton by the end of the year.
And yet, in a number
of cities across the country, these businesses are illegal. New
things are scary. And new things that grow really fast are the
scariest.
2012 saw increased
acceptance and growth in sharing and peer-to-peer businesses,
presenting new options for consumers and new problems for established
businesses and government regulators. As these new businesses grew,
so did their collective disruptive force.
As Tim Wu wrote at The
New York Times, “Change isn’t always pretty, but a healthy city
is one where old systems — even the hallowed taxi medallion —
stand to be challenged by the winds of creative destruction.”
New tech makes these
businesses possible, but their sustained success doesn’t hinge on
advances in smartphone design or social networking. We’re choosing
peer-to-peer because we want to do business differently. We actually
kind of want to pretend like we’re not doing business at all.
Lyft and Sidecar
enable individuals with their own cars to find and drive customers,
keeping the majority of the fare with a small chunk going to the
company.
LyftThe detachable
pink mustache lets ride-seekers know this is a Lyft.
“The big difference
between the Lyft experience and the cab experience is supposedly
friendliness. That’s why they bill themselves as ‘your friend
with a car,’” Lyft driver Kate Dollarhyde told me. “A lot of my
customers tell me they prefer Lyft because they feel more safe than
they do in cabs, and also because they feel they can talk to and make
friends with drivers.”
In an increasingly
inhospitable, unfriendly world, peer-to-peer business sells you on,
well, your peers. Lyft, which launched in San Francisco this
summer with plans to expand into Seattle and Los Angeles in
2013, is selling community. But it’s also selling savings.
Dollarhyde says Lyft trains drivers to inform customers that the
rides cost about $4 less than a cab.
Even with those lower
fares, Lyft can be a real source of income for drivers: “I make
more money driving for Lyft per hour than I have doing anything
else,” said Dollarhyde.
Airbnb can also be a
significant moneymaker for participants. ”Ultimately, we want
to empower people and we have thousands of people around the world
that are making an incredible, meaningful amount of revenue,” Airbnb
cofounder and CEO Brian Chesky told CBS. “We’ve helped thousands
of people stay in their homes.”
Peer-to-peer business also empowers service providers
to not provide services to clients with bad reputations;
the companies let participants rate customers as well as car drivers
and homeowners. ”At the end of every ride, passengers rate
drivers and drivers rate passengers,” Dollarhyde tells me. “Five
stars is the baseline; everyone starts out at the top. You deduct
stars for rude behavior, like barfing in someone’s car, being a
jerk, or generally making a ride uncomfortable.” If a barfy
customer ends up with a bad rating, they’ll be peer-pressured out
of the system by drivers who just won’t choose to pick them up.
But with great power
comes great responsibility. (Sorry, had to.) While Airbnb helped a
lot of houseless folks in the wake of Hurricane Sandy, with many
people using the service to offer their homes and rooms for
free, Uber was slammed for price-gouging during a difficult
time.
A number of U.S.
cities have banned different peer-to-peer businesses or tried to
regulate them out of existence. Officials claim they’re protecting
consumers, but Wu says complaints about the companies often “have
the odor of industry protectionism.”
“Banning Airbnb
helps hotels more than homeowners; banning Uber helps taxi companies
more than passengers,” Wu writes. Owners of established businesses
often have ties to local politicians, unlike the random guy who wants
to rent out his studio while he’s out of town.
Wu suggests more
flexible approaches to regulation that hinge on openness and
real-time data. “Regulators could simply require Uber to disclose
the prices it charged and where its cars were going. If cities wanted
to ban rate hikes during emergencies, they could watch to see that
the law was obeyed,” he writes. “This kind of precise,
data-driven regulation could protect consumers while also protecting
their right to pay for a valuable service.”
It could, but
governments would have to put their fears aside first. So far, it’s
baby steps. Earlier this month, California regulators began an
inquiry into how to regulate ride-sharing services.
“We’re cautiously
optimistic that the investigation will result in rules that will
support innovation and support the benefits that Sidecar represents,
which are reductions in emissions and congestion and more affordable
transportation options,” Sidecar cofounder Sunil Paul told
the San Francisco Examiner.
California’s
regulatory commission will deliver its findings in six months — by
which time a whole new corner of the peer-to-peer industry will
likely be delighting new consumers and frustrating established
business owners.
Susie Cagle writes and
draws news for Grist. She also writes and draws tweets for Twitter.
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