The "Sharing" Economy: Issues Facing Platforms, Participants, and Regulators A Federal Trade Commission Workshop
Above all, let these sharing platforms flourish. I believe these platforms heavily benefit the consumer, and should not be made illegal due to dated laws. -What are the advantages and disadvantages for consumers of engaging in transactions facilitated by a sharing platform; for example, convenience, diversity of offerings, additional sources of supply, safety, quality? -Advantages: Better utilization of resources cheapens price for consumers. -Disadvantages: Quality control may be an issue, as there are thousands of "suppliers" - What are the advantages and disadvantages for suppliers engaging in transactions facilitated by a platform, for example, transaction velocity, broadened access to consumers, discrimination based on individualized preferences, competition with suppliers that do not use platforms? -Advantages: Easier to reach consumers. -Disadvantages: They may receive less money due to increased competition. - What features distinguish these sharing platforms from other internet platforms? -These platforms deal in the physical world, not simply a transfer of bits like a social network. - What economic considerations might lead to the adoption of a peer-to-peer platform model as opposed to a one-sided online sales platform? -More choices and cheaper prices for consumers. - How do platforms address challenges in developing a successful marketplace? -Platforms should ensure their suppliers are offering consistent expected experiences. - To what extent do sharing platforms exhibit network effects? What are the sources of these network effects? -There is a great network effect because the more people use it, the more people talk about it, which causes more people to use it. Though this would most likely cause a decrease in cost of the service, rather than an increase. Due to economies of scale and better utilization of resources. - To what extent may network effects lead to the development of dominant platforms in particular sectors? What other factors might affect the likelihood and durability of platform dominance from network effects? -Increased network effects may lead to one dominant sharing platform, stifling competition. - As sharing economy platforms evolve, how might they adjust the services they offer, for example, to earn higher profits or better serve participants? Are there particular sectors in which these platforms likely will be more (or less) successful? -Can earn higher profits by creating several different levels within their service e.g. Uber has luxury rides, SUVs, etc.