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The sharing economy's growing pains

Thursday, Jul 31, 2014 - 03:13

Companies from Airbnb to Uber have been widely celebrated, despite constant battles with regulators. But has asking for forgiveness, as opposed to permission, become the long term strategy for these companies? Lily Jamali reports.

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For all the regulatory pushback against some parts of the so-called sharing economy, companies from Airbnb to Uber just might be winning the P.R. war. NAT SOUND: AIRBNB COMMERCIAL (ENGLISH) SAYING: "My name is Carol Williams and I'm an Airbnb host." It's no accident. In New York, home-sharing website Airbnb has been appealing to public sentiment with this ad campaign for the last several weeks. NAT SOUND: AIRBNB COMMERCIAL (ENGLISH) SAYING: "When I lost my job, my husband Paul and I really didn't know what we were going to do. We had a friend and he suggested Airbnb." The point: that they're helping keep people in their homes by opening the door to extra income. New York University's Stern Business School Professor Arun Sundararajan says he's pleased to see these kinds of appeals. SOUNDBITE: ARUN SUNDARARAJAN, PROFESSOR, NEW YORK UNIVERSITY STERN SCHOOL OF BUSINESS (ENGLISH) SAYING: "There's so much of a story to be told here about the kind of impact these businesses are going to have on local economies that I'm glad to see them starting to tell this story." REPORTER ON CAMERA: LILY JAMALI, REPORTER, REUTERS (ENGLISH) SAYING: "The appeal of companies in the sharing economy runs the gamut from cheaper services to convenience. Here in New York, car sharing services like Uber and Lyft are seeking to disrupt the traditional yellow cab economy, promising to provide something better for consumers and service providers." SOUNDBITE: ARUN SUNDARARAJAN, PROFESSOR, NEW YORK UNIVERSITY STERN SCHOOL OF BUSINESS (ENGLISH) SAYING: "You might not think of this as a job - but it's actually productive work that's generating work for you and generating activity for the city you live in." But the sharing economy's glow is catching some glare - not just from regulators. Journalist Susie Cagle has written - and drawn about what she calls its "casualization" of work: SOUNDBITE: SUSIE CAGLE, JOURNALIST (ENGLISH) SAYING: "The thing that's been happening with especially Lyft and also Uber is now this sense of 'anyone can do this' - it's not really a job. It's something you do to make a little bit of extra money." A concern as the job market contends with a steep rise in part-timers at the expense of full-time work. Regulators have gone after these companies for everything from failing to collect and deliver tax revenue to evading safety rules. For participants, "disruption" can be lucrative, but carries risks. One Airbnb host's renter became a squatter who'd stayed long enough to qualify for California tenant rights. Mark McSweeney is the Executive Director of Vacation Rental Managers Association. He calls the incident a cautionary tale. SOUNDBITE: MARK MCSWEENEY, EXECUTIVE DIRECTOR, VACATION RENTAL MANAGERS ASSOCIATION (ENGLISH) SAYING: "The local property management company would know that - would be well versed for that, as opposed to an individual owner, who with the best of intentions, is unfortunately doing it on an amateur and oftentimes misinformed level." For their part, companies in the sharing economy are constantly adjusting - rewriting their own rules as they go - while pushing for regulatory change. NYU's Professor Sundarajan says their road to survival comes from "proving" their worth. SOUNDBITE: ARUN SUNDARARAJAN, PROFESSOR, NEW YORK UNIVERSITY STERN SCHOOL OF BUSINESS (ENGLISH) SAYING: "A very strong argument for regulatory change is demonstrating that you're valuable, demonstrating that you're creating value for society." They're hoping that winning the public's support will help them win over *regulators one battle at a time.

The sharing economy's growing pains

Thursday, Jul 31, 2014 - 03:13

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