How sharing apps are reshaping our cities

The recent bloom of the peer-to-peer (P2P) economy is changing the running order of our cities, and reworking the dense tapestry of socio-economic relations between people and their possessions. Enthusiasts claim that initiatives such as Airbnb are able to connect people directly to what they need or want and thus ensure a more efficient use of resources. Sceptics, however, are concerned that such a rewiring of economic transactions will result in unregulated markets and less job security.

This debate has been particularly heated in the field of urban mobility – including bans in Berlin and Brussels, organized gridlock in London, and upheavals in the streets of Paris as taxi drivers smashed windows and slashed tires. Mainly targeting the ride-sharing app Uber, taxi lobbies expressed concerns that new app-based peer-to-peer urban mobility solutions are undercutting markets and avoiding stringent and cumbersome laws.

Djump, a mobile transport app based in Brussels and Paris, is one of the newest entrants in this field. Sleek and user-friendly, it enables passengers to request a ride and registered drivers to answer the call. So how does it differ from an unregulated taxi service? According to the president of the Brussels Taxi Association, it doesn’t. He launched a scathing attack on Djump and Uber earlier this year, accusing them of operating illegal unlicensed taxi services, costing the formal taxi establishment over 26,000 euros per day. While being reduced to a common denominator by the threatened taxi lobby in Brussels, Djump and Uber are fundamentally different. Moreover, distinguishing between the two is essential to contemporary debates on regulation in the peer-to-peer economy.

Uber, on one hand, essentially is a repackaged taxi service running on the back of a nifty app. Pioneering an extremely efficient dispatch algorithm, Uber successfully competes with traditional taxi services by providing a more user-friendly and efficient service at a lower cost, while also offering its drivers flexible working hours. Initiatives such as Uber thus provide a welcome challenge to traditional business models, kickstarting local economies, supplementing dwindling incomes and giving consumers exactly what they want. However, staffed by a legion of freelance drivers operating beyond the stringent purview of the state, Uber also furthers recent trends of precarious labour, reduced social security and an overall reduction of regulation.

The debate concerning Uber is thus about how new forms of innovative app-enabled freelance employment should be integrated with state-regulated employment. Ultimately, this boils down to striking a balance between encouraging innovation, offering customers and providers the flexibility they need, and also making sure the benefits of these new business models are captured equitably.

Djump, on the other hand, works as follows: anyone with a car can register and, once screened by the community management team, can start offering rides to fellow users. Djump, however, is about more than just a ride – it’s about getting around town while meeting and sharing with the community. There are no formal costs because passengers are simply invited to give a donation. Mediated by profiles and ratings, passengers decide who they ride with and how much they donate, while drivers are flexible with when and with whom they share rides. This sharing community thus prunes itself, as tardy or dangerous drivers and stingy unpleasant passengers are penalized with negative ratings and filtered out. The result is a voluntary user-driven interpersonal mobility network that has been championed as a revolution in urban transport; reclaiming the car as a resource to be shared rather than an emblem of individualism.

While it seems intuitive that employment should be (at least somewhat) regulated, this is not necessarily the case with sharing-oriented initiatives. Djump is not profit-oriented and, like Couchsurfing, revolves around meeting new friends, visiting a new part of town or heading to a party you had never heard of. At a time when cities are under an increasing environmental and economic strain, initiatives like Djump also provide an important step towards a more sustainable future. Car sharing provides a low-cost solution to reducing urban congestion and pollution, while also reducing the cost of travel.

This distinction between Djump as sharing and Uber as employment is critical for contemporary debates on the peer-to-peer economy. As new P2P initiatives continue to rework how goods, capital and people move in and around cities, the extent to which they will be regulated hinges on their status as either economic (employment) or social (sharing) activities. This murky terrain, however, is to some extent ideological – or better yet, political – and its scrutiny will lead to heated debate and disagreement. One can, for example, easily foresee the convergence of both models. If Uber loses its competitive regulatory advantage (cheaper operating costs due to lower regulatory standards), affective labour under Djump’s sharing mantra could become a means for desperate drivers to avoid newly imposed regulation, scrambling for a donation as opposed to a fixed price.

While finding the difference between employment and sharing for a donation is indeed tricky, the decision in Belgium to simply crack down on the peer-to-peer economy has rightly been critiqued as conservative. Mobile technology is here to stay and will continue to reshape society, meriting a serious discussion on the relevance of regulatory models devised well before the rise of contemporary economic models. While state apparatus has historically lagged behind enterprise, it is perhaps time to start exploring how think-tank incubators and policy pitchathons can help governance stick with the times.

Read the new Competitiveness of Cities report here.

Author: Claus Mullie is a research assistant at New Cities Foundation.

Image: Taxi drivers block the Mall in central London June 11, 2014 in one of the biggest ever protests against Uber, a US car service that allows people to summon rides at the touch of a button. REUTERS/Luke MacGregor