Reuters - Video

EDITION: U.S. | U.K. | IN

Personal Finance

The sharing economy's growing pains

Thursday, July 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.

▲ Hide Transcript

View Transcript

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.

Press CTRL+C (Windows), CMD+C (Mac), or long-press the URL below on your mobile device to copy the code

The sharing economy's growing pains

Thursday, July 31, 2014 - 03:13

Top News »

Investing 201 »

Arian Foster = BlackBerry? Arian Foster = BlackBerry?

Fri, Oct 25, 2013 - (3:16)

Don’t miss these red flags for IPOs Don’t miss these red flags for IPOs

Thu, Oct 10, 2013 - (2:34)

Copycat currency trading Copycat currency trading

Wed, Oct 02, 2013 - (2:28)

When to dump a winner When to dump a winner

Tue, Sep 24, 2013 - (1:55)

Where gold might again attract Jim Rogers Where gold might again attract Jim Rogers

Thu, Sep 19, 2013 - (2:05)

Why savings interest rates won't budge Why savings interest rates won't budge

Fri, Sep 13, 2013 - (2:09)

Buy local? ETFs try the trend Buy local? ETFs try the trend

Thu, Sep 05, 2013 - (2:42)

The better bond funds The better bond funds

Wed, Aug 07, 2013 - (2:40)

Best bargain in 40 years? European stocks Best bargain in 40 years? European stocks

Thu, Aug 01, 2013 - (2:24)

Invest like an activist Invest like an activist

Fri, Jul 26, 2013 - (2:49)

Money Clip »

3 things to do before disaster strikes 3 things to do before disaster strikes

Wed, Sep 18, 2013 - (1:39)

Your must-do money list Your must-do money list

Wed, Sep 11, 2013 - (1:24)

The worst "best" financial advice The worst "best" financial advice

Wed, Sep 04, 2013 - (1:42)

Forget gold: The case for REITs Forget gold: The case for REITs

Fri, Apr 26, 2013 - (1:19)

3 rules for buying a house now 3 rules for buying a house now

Thu, Apr 18, 2013 - (1:39)

“Stalking” your dream home - Money Clip “Stalking” your dream home - Money Clip

Wed, Mar 27, 2013 - (2:50)

3 hidden tax deductions - Money Clip 3 hidden tax deductions - Money Clip

Thu, Mar 21, 2013 - (1:33)

Moving Pictures »

Still missing – MH370 Still missing – MH370

Fri, Sep 05, 2014 - (2:05)

Images of August Images of August

Fri, Aug 29, 2014 - (1:00)

Burning Together Burning Together

Mon, Sep 01, 2014 - (2:23)

Mending dolls, teddies and hearts Mending dolls, teddies and hearts

Fri, Aug 22, 2014 - (3:12)

"Old timers" sail the Chesapeake Bay "Old timers" sail the Chesapeake Bay

Mon, Aug 11, 2014 - (2:27)

Burned memories Burned memories

Fri, Aug 08, 2014 - (3:02)

Images of July Images of July

Thu, Jul 31, 2014 - (1:20)

World Cup: passion on the pitch World Cup: passion on the pitch

Fri, Jul 11, 2014 - (1:00)

A refugee in America gives back A refugee in America gives back

Wed, Jul 02, 2014 - (3:25)

A long search for refuge A long search for refuge

Fri, Jun 20, 2014 - (3:04)

Reuters Investigates »

Re-homing victim: "I could have been dead" Re-homing victim: "I could have been dead"

Wed, Feb 19, 2014 - (8:24)

Cops and loggers in the Amazon rainforest Cops and loggers in the Amazon rainforest

Fri, Jan 10, 2014 - (4:01)

"Passed around like a dog" "Passed around like a dog"

Thu, Aug 29, 2013 - (6:32)

Adopted, then abandoned online Adopted, then abandoned online

Thu, Aug 29, 2013 - (13:21)

How the DEA keeps its secrets secret How the DEA keeps its secrets secret

Mon, Aug 05, 2013 - (1:36)

How education lost its role as the great equalizer - Reuters Investigates How education lost its role as the great...

Mon, Dec 17, 2012 - (7:52)

Jihad Jane: From abused child to American jihadist - Reuters Investigates Jihad Jane: From abused child to American...

Sat, Dec 08, 2012 - (10:01)

Jihad Jane: The order to kill - Reuters Investigates Jihad Jane: The order to kill - Reuters...

Sun, Dec 09, 2012 - (10:39)