Page 6 - SCBJ-201609
P. 6
NA BRIEFING South China Business Journal
SOShtpraperonirngtgtuhEnicitnoienNsouimnmyCbehrisn: a’s
by Cameron Turnbull, Dezan Shira & Associates
Advances in mobile technology and mobile app development employee insurance, benefits, etc. supplied by the company
have given rise to a new business model that has already had a (depending on location, of course) independent contractors do
profound effect on the transportation, e-commerce, and lodging not. Many people feel that Uber essentially enjoys the full time
industries. The sharing economy refers to third party online ser- labor of their drivers, without taking full responsibility for their
vice providers that help businesses and individuals turn excess well-being.
supply into revenue by linking them to consumers via various
online platforms. With high levels of mobile use and a rapidly Furthermore, with companies such as Airbnb insisting that
expanding consumer class, China has been quick to adapt to the they are simply a “communication platform,” they often absolve
sharing economy, presenting tremendous opportunities for those themselves of responsibility when users experience problems
who embrace new technology and business models. related to quality or safety. Taxi companies, hotel chains, and
other companies that operate in the more traditional sphere of
An Introduction to the Sharing Economy the service economy feel that it is unfair that sharing platforms
get to participate in the industry without incurring the same costs
Enterprises in the sharing economy create value by monetizing brought about by safety regulations.
surplus resources. Take Airbnb for example: the San Francisco-
based startup quickly became a global phenomenon simply The ambiguity that is presented by many sharing platforms has
by providing a platform where users could earn extra income caused headaches for policy makers around regulation and taxation.
renting out their unused rooms. The company identified an Some new business models presented by the sharing economy can
underserved market in the budget traveler, and linked them to a come into conflict with existing regulatory frameworks. For example
previously under-utilized group of suppliers. at what point should traditional bed & breakfast regulations apply
to an Airbnb host? Does it depend on the number of days the guest
Also known as crowd-based capitalism, companies active in stays? The amount of revenue generated? The services provided?
the sharing economy take many different forms, but all take Furthermore, politicians in the U.S. and Canada have accused
advantage of similar crowd-based networks and mobile/online sharing platforms of giving entrepreneurs an unfair advantage over
technology to operate. They exist in a unique sphere of the mar- traditional service providers.
ket economy that sits somewhere between personal and profes-
sional, work and leisure, employee and entrepreneur. While this China’s Sharing Economy
ambiguity largely benefits the users of sharing platforms (both
suppliers and customers) it has drawn the ire of tax authorities While the original concept and pioneers of the industry origi-
and traditional transportation and lodging companies in many nated in the U.S. and Europe, the sharing economy has yet to
countries. become fully accepted by both consumers and authorities in the
western world. Meanwhile, China is emerging as a leader in the
Sharing economy enterprises often come under fire for a lack sharing economy. In March, China’s National Information Center
of responsibility. Uber’s policy to not count their drivers as published a comprehensive report on the current condition and
employees but rather as independent contractors is an example future development of the Chinese sharing economy. This is
often cited by critics. While an employee typically requires basic significant for two reasons.
4
SOShtpraperonirngtgtuhEnicitnoienNsouimnmyCbehrisn: a’s
by Cameron Turnbull, Dezan Shira & Associates
Advances in mobile technology and mobile app development employee insurance, benefits, etc. supplied by the company
have given rise to a new business model that has already had a (depending on location, of course) independent contractors do
profound effect on the transportation, e-commerce, and lodging not. Many people feel that Uber essentially enjoys the full time
industries. The sharing economy refers to third party online ser- labor of their drivers, without taking full responsibility for their
vice providers that help businesses and individuals turn excess well-being.
supply into revenue by linking them to consumers via various
online platforms. With high levels of mobile use and a rapidly Furthermore, with companies such as Airbnb insisting that
expanding consumer class, China has been quick to adapt to the they are simply a “communication platform,” they often absolve
sharing economy, presenting tremendous opportunities for those themselves of responsibility when users experience problems
who embrace new technology and business models. related to quality or safety. Taxi companies, hotel chains, and
other companies that operate in the more traditional sphere of
An Introduction to the Sharing Economy the service economy feel that it is unfair that sharing platforms
get to participate in the industry without incurring the same costs
Enterprises in the sharing economy create value by monetizing brought about by safety regulations.
surplus resources. Take Airbnb for example: the San Francisco-
based startup quickly became a global phenomenon simply The ambiguity that is presented by many sharing platforms has
by providing a platform where users could earn extra income caused headaches for policy makers around regulation and taxation.
renting out their unused rooms. The company identified an Some new business models presented by the sharing economy can
underserved market in the budget traveler, and linked them to a come into conflict with existing regulatory frameworks. For example
previously under-utilized group of suppliers. at what point should traditional bed & breakfast regulations apply
to an Airbnb host? Does it depend on the number of days the guest
Also known as crowd-based capitalism, companies active in stays? The amount of revenue generated? The services provided?
the sharing economy take many different forms, but all take Furthermore, politicians in the U.S. and Canada have accused
advantage of similar crowd-based networks and mobile/online sharing platforms of giving entrepreneurs an unfair advantage over
technology to operate. They exist in a unique sphere of the mar- traditional service providers.
ket economy that sits somewhere between personal and profes-
sional, work and leisure, employee and entrepreneur. While this China’s Sharing Economy
ambiguity largely benefits the users of sharing platforms (both
suppliers and customers) it has drawn the ire of tax authorities While the original concept and pioneers of the industry origi-
and traditional transportation and lodging companies in many nated in the U.S. and Europe, the sharing economy has yet to
countries. become fully accepted by both consumers and authorities in the
western world. Meanwhile, China is emerging as a leader in the
Sharing economy enterprises often come under fire for a lack sharing economy. In March, China’s National Information Center
of responsibility. Uber’s policy to not count their drivers as published a comprehensive report on the current condition and
employees but rather as independent contractors is an example future development of the Chinese sharing economy. This is
often cited by critics. While an employee typically requires basic significant for two reasons.
4
