More Stories

An inclusive sharing economy

Sharing Economy Hero 270716

Published: Monday June 27, 2016
By: Faris Yahaya

The sharing economy is here to stay despite some hiccups and unhappy conventional businesses and regulators. It’s important that all stakeholders engage and try to work out solutions in which you could grow the proverbial pie so that everybody wins.

WHEN we first discussed the sharing economy last year, it was an industry still in its infancy.

But companies like Lyft, Uber and Airbnb have taken tech advances like big data analytics, cloud storage and location-based GPS to create enterprises that brought new life to old-fashioned concepts like car-pooling and crashing for the night at a friend’s house while travelling (because hotels are just too expensive).

More importantly, these enterprises took advantage of what the Internet and mobile technology had to offer to organise the “sharing economy” from something informal and ad-hoc into something bigger, better and accessible to anyone with a smartphone.

And because this is expected of many disruptive business models driven by technology, many may argue that the sharing economy has come of age within a very short span of time. People continue to discover new things to share for profit — from home-cooked meals to valet services. And PWC projected the sector’s revenues at US$335bil globally by 2025.

But as with any fast-growing sector, governments, regulators and industry incumbents have taken a greater interest in what’s happening in their backyard, and the teething pains of growth are becoming harder to ignore.

For instance, Airbnb has found itself in and out of battles with regulators all over the world. In 2014, a report by the New York State Attorney General concluded that 72% of the site’s rentals violated state zoning regulations over other laws. Meanwhile, authorities in Paris, Barcelona and Berlin have found the service to be in “serious breaches of local laws” and levied heavy fines.

And then on the other hand, Uber has seen class action lawsuits levelled against it — in Massachusetts, one such suit asserts that Uber exploits its drivers, misclassifying them as independent contractors to avoid paying them as employees with the same benefits.

Here in Malaysia, taxi groups have demanded that Uber (and GrabCar, another ridesharing app) be made illegal amid several strikes in KL and isolated confrontations with ridesharing drivers — the latest incident occuring just a few weeks ago in Penang.

Ultimately, the collaborative economy — collabor-anomics, shall we say? — is propped up by the power of many. What’s more, it is entirely possible that the disruptive technology driving these business models can help build a more equitable economy. One lesson that we can learn from the experiences of others is the importance of engagement.

As Malaysian startups explore and innovate in this space, we have to remind ourselves that this drive towards openness, problem-solving and sharing shouldn’t just relate to service providers and customers — but to regulators and the Government.

If an inclusive collaboration that extends to all stakeholders is built into the startup DNA, we can then extend this culture of open collaboration beyond the primary objectives of creating a better product or better service and towards growing a market in which every player, incumbents and upstarts alike, wins.

Quite simply put, success isn’t about how you slice the pie but how you grow the pie. And that’s what the collaboration economy is about.

So how do we go about growing this proverbial pie?

We believe that it takes two to tango. While innovators should demonstrate a greater willingness to collaborate with regulators and help shape emerging regulatory frameworks, the authorities, in turn, should keep their doors open for engagement and dialogue.

If you want examples of how much of a difference engagement can make, look at London, where retroactively dated regulations that would have conflicted with Airbnb’s operation model were scrapped, underscoring a refreshed commitment by the British government to make the UK a “global centre for the sharing economy”.

In 2014, a group of six companies formed Singapore’s first sharing-economy association. That body engages in close dialogue with the government to try to resolve some of the challenges that have emerged in this fledgling industry and in response, the country has introduced a law that allows drivers of private cars to accept payment for carpooling — previously forbidden.

That’s what can happen when the tech industry and governments work hand in hand to untangle how new tech innovations can be integrated into a system of legislation created long before such innovations were invented.

Such forward thinking and processes of engagement (though difficult in the beginning) will surely prove invaluable in the long term — particularly when it comes to addressing some of the concerns surrounding the sharing economy, including accusations that it could contribute to a deterioration of labour standards through the creation of low-paid, part-time work.

At Cyberview, we are trying to create an environment to help streamline and facilitate communication channels between all stakeholders.

As the tech-hub enabler, Cyberview is here to facilitate all aspects of collaboration. Collaboratively with other key stakeholders, we heve built the physical and non-physical infrastructure of Cyberjaya, Malaysia’s own tech-hub, which is now home to 86,000 brilliant minds, 1,275 thriving businesses, as well as 38 MNCs, 800 enterprises and 470 MSC status companies.

And now we are focused on building the soft assets and networking and support infrastructures that will help companies set themselves up, grow and connect.

From tailor-made incentive packages to suit company needs, business matching and strategic partnerships, to facilitation in regulatory matters and talent facilitation, we encourage Malaysian inventors, entrepreneurs and startups to bring their ideas to life through our Living Lab programmes.

This will help them connect with the tech giants and investors and public agencies and institutions through our public-private collaboration programmes, and then take a step back to let the magic happen.

At the end of the day, we believe collaboration isn’t just the key to the sharing economy; it’s the key to making innovative ideas successful and accessible to everyone.

Faris Yahaya is managing director of Cyberview Sdn Bhd.