The Future of Portland’s Shared Economy
Wednesday, April 29, 2015
From vacant homes when owners are on holiday and empty parking spaces on Sundays, to bikes and cars that sit unused in driveways – communities across the globe are participating in a network where anybody can make a buck on their underutilized assets.
And Portland is no stranger to this collaborative consumption.
On Thursday, April 30 at OMSI’s Empirical Theater, TechfestNW is bringing together business and tech innovators, CEOs of Spinlister and Rover, and Mayor Charlie Hales to have a frank conversation about the future the Portland’s sharing economy.
What transpires is likely to be a mix of enthusiasm and skepticism about an unregulated marketplace that’s getting the full potential out of goods and services, while disrupting existing industries under positive branding.
PDX, The Ideal Sharing City
Before people started capitalizing on their things, there were the good old days of borrowing without currency. Lending libraries and swapping organizations in Portland still allow members to borrow everything from kitchenware and tools to gardening equipment and children’s toys, all for free.
But with Portland’s surplus of well-educated and tech-savvy residents, the city has become a targeted market for a number of start-ups that boast reuse as a business model.
And like Airbnb, Uber and Lyft before them, they’re likely to spread like wildfire.
Portland’s Citifyd offers peer-to-peer parking for residential and commercial spaces. The city’s huge pet population has made Portland a top market of Rover, one of the largest dog-sitting networks in the nation.
Spinlister – which allows users to rent out their bikes, boards and skis – has recently launched intentional efforts to grow in PDX.
“We always say we came to Portland because our users there demanded us to,” said Andrew Batey, Chief Marketing Officer at Spinlister. “They are some of the most responsive, helpful, and community-driven users we have. We love what Portland stands for, we love the community, and we love the culture.”
Batey believes that sharing economies will ultimately grow to function like other marketplaces, and include existing corporations that could adapt to the “sharing” revenue stream.
“The one danger to the marketplace, I see, is if governments implement rules and regulations on private citizens who participate and the networks that connect people for the exchange,” said Batey.
But regulating sharing networks is indeed what the City of Portland is considering. After its much-publicized battle with Uber, the City has finally allowed the car-sharing platform for a trail period of 120 days.
“The sharing economy is part of the community’s economy now, in a way it wasn’t five or 10 years ago, and the City’s policies ought to reflect reality,” said the mayor's communications director Dana Haynes.
“These companies are already woven into the nation’s economy, and the international economy. So the mayor’s question wasn’t, should these companies be here, if they pose a risk? But rather, should they operate while regulated or unregulated?”
More Like The “Renting Economy”
The sharing economy has been tied to promises of saving money and consuming less. It’s also made individual ownership not so cool since sharing has been crowned king.
But some say it’s a utopian ideal, because no matter how it’s spun the economy of sharing is really an economy of renting.
“They are about making profit, which they do not intend to share,” said Dean Baker, co-founder of the Center for Economic and Policy Research (CEPR). “No one would have called Hertz or Hilton a sharing economy company. These companies have no better claim to that term.”
Sharing companies have also been accused of accelerating gentrification and dodging taxes and regulations, which impose costs. Whether they ensure the safety of taxis and passengers, or hotels from fires, and provide handicap services and quality control, regulations have been put in place for a reason.
“If we allow a parallel economy of unregulated competitors, they could undercut the regulated sector,” said Baker. “This would mean that both legitimate public interests are not being served and the businesses that were in compliance with the law would be faced with bankruptcy.”
Baker cites Amazon, which grew into one of the biggest companies in the world largely based on avoiding the sales tax that its smaller brick-and-mortar competitors were obligated to collect.
Another critic is Jeremiah Owyang, founder of Crowd Companies. On his blog he lists a host of reasons as to why the collaborative economy could be disruptive. Among them: challenging legal liability, start-up saturation, and exploiting the economically deprived.
A Shared Future
According to Price Waterhouse Cooper, in the next 10 years the collaborative economy will grow from $15 billion in revenue to $335 billion.
And in Portland, much like the rest of the world, it’s just getting started.
“In the next 20 years the sharing economy is going to explode,” said Andrew Batey of Spinlister. “Trying to prevent that is futile. Instead, companies should be thinking about how to position themselves inside this new environment.”
Rover CEO Aaron Easterly will also be speaking at TechfestNW’s A Shared Future presentation on Thursday. He too thinks the sharing economy will only continue to grow and innovate by getting closer to being on-demand.
Easterly also says that once people realize how convenient and affordable sharing economy services are, “they’ll reconsider the cost of time, stress and effort associated with things like running errands, doing housework and so on.”
“Many will realize that while it is technically free, the non-monetary costs of time and energy are too expensive,” continues Easterly. “They’d rather hire someone else who'll tackle those tasks for them.”
So why hold back a market that can satisfy customers with quality goods and services? The fact that “sharing” services have become so popular might say something about the faults in these existing regulations.
Or maybe the sharing economy is simply a by-product of the inequality gap, creating incentive for people to capitalize on the things the already have, like a costly apartment in the Lloyd District, or a car they’re still trying to pay off.
Only time will tell where the sharing economy is headed – on-demand or under regulation.
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