How the Internet Economy Changes the Rules

(This is the abstract I wrote for the session on the sharing economy I was invited to chair at the 7th Global Drucker Forum in Vienna, November 5-6, 2015. The Drucker Forum 2015 focused on the technology revolution, looking at topics like robotics, big data, Artificial Intelligence and cloud computing. Speakers on this session were Rachel Botsman, Robin Chase, Isabella Mader and Oussama Ammar. A video recording of the complete session is available here and the related discussion here.)

Labour intermediaries were a feature of capitalism long before the emergence of technology companies such as Uber and Airbnb. Businesses have been discarding their identities as large, centralised employers by outsourcing work to smaller independent contractors, individual freelancers and temps for decades. What’s new about the current shift to the distributed structure of the professionalized sharing economy is:

1) the intermediaries are no longer agencies for outsourced labour but data-driven platforms or apps, making it difficult for workers to negotiate for better pay and conditions – you can’t negotiate argue very easily with the logic of an algorithm;

2) the workers are not a coherent group of formally contracted employees, even if they are often managed as though they are – now anyone can ‘collaborate’ and ‘share’ (e.g. by renting out excess capacity in their car or home to someone they don’t know);

3) both the customers and workers are managed on an individual, micro, finely-grained, real-time basis using networked mobile media, GPS-enabled location services, and trust-measuring reputation engines.

This panel will discuss the extent to which the new, more networked and collaborative ways of organising business and labour – of which the sharing or ‘rental’ economy is actually just a subset – are undermining the market competitiveness of those asset-heavy companies still operating according to the rules of the ‘old’ economy, with its employment regulations, unions, public services and welfare. What are the challenges and opportunities of any such changing of the rules? If we wish to restore the balance between social democracy and what, building on former U.S. Secretary of Labor Robert Reich’s notion of supercapitalism, we can call ubercapitalism, does human capital need to be given more protection against the algorithmic, inhumane excesses of the internet economy? Is a less rigid and closed model of ownership and IP required for distributed collaboration and sharing among peers to really take place in the era of VC-funded platform capitalism? Or is the emergence of companies that are using the power of data to disrupt the conventional ways in which organisations are built, work gets done and reputations maintained, part of a larger structural shift toward a new paradigm?

In short, the question raised for those taking part in the 2015 Global Drucker Forum by this session will be this: is the internet economy’s changing of the rules post-capitalist or ubercapitalist?