SAN FRANCISCO — Airbnb has charmed and strong-armed lawmakers around the world to allow it to operate in their communities. But two cities, Airbnb’s hometown, San Francisco, and New York, the service’s largest United States market, have not been so compliant. On Monday, Airbnb sued San Francisco over a unanimous decision on June 7 by the city’s Board of Supervisors to fine the company $1,000 a day for every unregistered host on its service. If Airbnb does not comply, it could face misdemeanor charges. The suit follows a bipartisan move by New York lawmakers who voted this month to heavily fine anyone who uses Airbnb to rent a whole apartment for fewer than 30 days, a practice that has been illegal in the state since 2010. [more inside]
How the “sharing economy” has turned San Francisco into a dystopia for the working class. Oh, Canada! I’m writing you from Berkeley, California to warn you about this thing called “the sharing economy.” Since no one is really sharing anything, many of us prefer the term “the exploitation economy,” but due to its prevalence many in the Bay Area simply think of it as “the economy.” Whatever you want to call it, the basic idea is that customers can outsource all the work or chores they don’t want to do to somebody else in their area. [more inside]
'It’s only a matter of time until something terrible happens,' The New York Times’s Ron Lieber wrote in a 2012 piece examining Airbnb’s liability issues. My family’s story — a private matter until now — is that terrible something.Writer Zak Stone about a tragic family death and the lack of regulations and liability in the sharing economy at the example of Airbnb.
The rating game: How Uber and its peers turned us into horrible bosses. Josh Dzieza writes about how customer rating systems for "sharing economy" on-demand services like Uber, Airbnb and Taskrabbit has made already tenuous employment even more precarious. "We’re not just working for money," an Uber driver told me. "We’re working for ratings, but ratings have no value. Ratings serve only to prevent you from getting fired. Only bad things can happen to you. We’re scurrying like rats after these things with no value." [more inside]
New Uber Service Sounds Suspiciously Like a Bus — New Uber "Smart Routes" feature offers passengers fare discounts in exchange for pick-ups along predetermined high-ridership routes. Rather than trying to compete with public transit, FiveThirtyEight points out that Uber and public transit can complement each other. Meanwhile, the yellow cab industry is trying to fight back against Uber with an Uber-like smartphone app for NYC passengers.
"Leading technology companies are increasingly soliciting their users to take political action on their behalf to defend controversial business models from regulation, support new programs, and promote their moral values in active political battles." Matt Stempeck explores the implications [alt link] of Uber and Facebook (among others) turning their users into lobbyists for the companies.
Lawrence Schall, the President of Oglethorpe University, decided to learn more about Uber by becoming a driver in his free time. He writes: "I wanted to understand the sharing economy. Instead, I got schooled in the failures of Atlanta's public transit system. . . . I assumed the people who used Uber fell into three basic categories: young people (including lots of students at my own university) responsibly avoiding drinking and driving on nights out, business people who had switched to Uber for a faster response and lower cost, and folks like me who occasionally used Uber to avoid the hassles of traffic, parking or just because it’s the cool new thing to do. Yet in my dozen-plus Uber forays thus far, I’ve encountered no one who fits those categories." [more inside]
Disruption’s Tragic Flaw The case of Uber shows why European companies should not follow the example of their American competitors too closely. It pays to take the needs of customers and contractors into account.
Tuesday night, the Santa Monica (CA) City Council unanimously passed one of the most restrictive laws in the nation on short-term rentals. The ordinance (which strengthens and enforces laws already on the books) explicitly bans vacation rentals – rentals of 30 days or less where the primary occupant of the home or apartment is not present – while legalizing and taxing “home-sharing” – i.e. renting a couch, spare room or backyard cottage - providing at least one of the primary residents lives on-site throughout the stay. Santa Monica (pop. 92K) receives over 7 million visitors annually; Salvador Valles, the city's acting chief administrative officer for Planning and Community Development, estimates the number of available listings on home-share sites would go from 1700 to 300. The ordinance goes into effect June 15. [more inside]
Meet the lawyer taking on Uber and the rest of the on-demand economy. Shannon Liss-Riordan has filed lawsuits against five of the largest "sharing economy" start-ups (Uber, Lyft, Homejoy, Postmates, and Caviar), contending that they pay the people who supply the equipment and manpower that power their businesses like independent contractors, while burdening them with the work expectations of employees. Previously.
Ben Smith of Buzzfeed reports: Uber Executive Suggests Digging Up Dirt On Journalists [more inside]
In the Billfold: a tale of a day-long tryout for an early stage startup, the author dubs The Start-up From Hell. The COO responds in Valleywag, "While it posted today (October 21), the article [...] relates to an experience she says she had 15 months ago. [...] At that time, Handybook employed less than 15 people. Today, Handy is two and a half years old and employs 200 people. [...] In short, as we continue to grow we're working every day to ensure the happiness of our customers and employees." [more inside]
Regulators 1, Lyft 0 (or perhaps 0.5). After trying to launch its unlicensed "ride sharing" model in New York City, Lyft has capitulated to the regulators' demands and will instead launch as an ordinary livery car service -- using only TLC-licensed cars with TLC-certified drivers. [more inside]
The Case Against Sharing: "The sharing economy’s success is inextricably tied to the economic recession, making new American poverty palatable. It’s disaster capitalism. 'Sharing' companies are not embarrassed by this — it appears to be a point of pride." [more inside]
Mealku is a service designed to help people obtain home-cooked meals, by connecting strangers online. It's sort of like AirBNB for leftovers as takeout meals, though right now it's only in New York City. An article from The Atlantic Cities describes Ted D’Cruz-Young's vision for the network and addresses concerns. “There’s always food left over. It’s nice to know it could be someone’s dinner", said one fan.
The Locust Economy
I was picking the brain of a restauranteur for insight into things like Groupon. He confirmed what we all understand in the abstract: that these deals are terrible for the businesses that offer them; that they draw in nomadic deal hunters from a vast surrounding region who are unlikely to ever return; that most deal-hunters carefully ensure that they spend just the deal amount or slightly more; that a badly designed offer can bankrupt a small business. He added one little factoid I did not know: offering a Groupon deal is by now so strongly associated with a desperate, dying restaurant that professional food critics tend to write off any restaurant that offers one without even trying it.[more inside]