Commons, zebras and team economy

The platform economy is much more than business giants Uber, Amazon or Google. Platforms can facilitate a transformation in ways of organising work, value creation, sharing, and resources. While the currently dominant development direction tends to favour large platform companies with monopoly statuses, alternative undercurrents can be identified.

Why is this important?

The focus in the platform economy has largely been on how it enables new ways to create value. Value comes from both users and producers while the platform adds its value to the ecosystem by providing tools for matching and curating the content. Network effects further multiply the value based on the extensiveness of the network.

The sole focus on value creation has, however, lead to ignoring the mechanisms by which value is distributed in the network. Platforms both mediate value creation and add value through connecting actors, sharing resources, and integrating systems, but the question is, how is this value shared? Especially platforms with near monopoly status tend to aggregate much of the value to the platform itself and not share it back to the users of the platforms in a fair amount. Platform companies, like other companies, give the surplus to their shareholders. In some cases, it could even be said that platforms exploit their users by treating them as workforce without benefits or as sources of data to be sold to advertisers. At the same time, little attention is put into how platforms serve society. The discussion is more about how they disrupt existing industries and navigate in the gray areas of legislation.

Three approaches challenging the dominant platform business

Although the big platform companies produce most of the headlines, there are interesting initiatives for alternative forms of platform economy. One is the revitalisation of the idea of commons. In the context of platforms and peer-to-peer economy, commons is understood as a mode of societal organisation, along with market and the state, and combines a resource with a community and a set of protocols. A key question related to platform economy is what data, tools or infrastructure should be treated as commons, how to govern them and how to build both for-profit and non-profit services on top of them. These and other questions of a “commons economy” are being experimented with in peer-to-peer initiatives, platform cooperatives, and blockchain-based distributed autonomous organizations.

In the same way that commons challenges the notion of ownership, a growing number of companies called “Zebras” are challenging the notion of growth. “Zebras” are companies that aim for a sustainable prosperity instead of maximal growth like “Unicorns”. They can still be for-profit but also do social good. An interesting question is whether platform economy can be used to transform the current growth-based economic system towards a more sustainable version, or will the “Zebras” as well as cooperatives and commons be left to the margins in the dominance of platform monopolies.

A third interesting idea utilising the new possibilities of connecting and collaborating through digital platforms is the idea of team economy by GoCo. It challenges the idea of a permanent organisation. In team economy, groups form around an issue or a problem and disperse once the work is done. In contrast to gig economy, the tasks aren’t simplified or clearly defined, but rather what needs to be done is jointly explored with the customer. A platform is needed to connect and offer a collaborative workplace but also provides a record of everything a person has done, a sort of online CV for the platform age.

It remains to be seen to what extent commons, “zebras” and team economy can influence the development of platform economy, but they are interesting ideas to keep an eye on.

Selected articles and websites

Mikko Dufva

Research Scientist VTT Technical Research Centre of Finland Ltd
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Gig economy

The new ways of working enabled by platforms are referred to with term such as gig economy, on-demand economy or open talent economy. What is common to all of these is that they redefine the relationship between the employer and employee. While connecting supply and demand of work through a platform is nothing new, there is currently a massive growth in the size of the gig economy, fuelled by increasing online access and willingness to do disparate tasks.

Why is this important?

The welfare system, especially in the Nordic Countries, is based on the assumption of a steady employment with one employer. The current legislation and regulation is not capable of dealing with the new ways of working emerging from the platform economy as traditional criteria for what is considered as taxable income or work regulated by labour legislation no longer fits the scheme. Is everyone an entrepreneur in the platform economy or should the platform be viewed as an employer? How can social security and fair working conditions be ensured?

Gig economy proponents highlight the flexibility and freedom that platforms provide for the worker as well as the company. Especially SMEs benefit from the gig economy, as they are often agile enough to recruit quickly and are more prone to experience changing demand. Critics state that the work is unstable, isolating, stressful and devoid of welfare benefits. Gig economy favours highly skilled people with good health and thus may contribute to societal polarization. Furthermore, it is driving wages down globally, as platforms enable outsourcing of a variety of tasks, thus expanding the global marketplace.

Things to keep an eye on

To ensure fair and decent working conditions, a mix of regulation, new practices and worker collective action is required. The big benefit but also the central challenge with gig economy is that it is global. Regulation puts countries at different positions and workers have a tough time coming together and bargaining in a dispersed global network. For new practices and ways of operating, platform cooperatives are worth keeping an eye on.

For a company wanting to benefit from gig economy the focus should be on improving human relation practices. Employing should be swift and there should be a good balance between full-time and temporary workers. Different metrics to gauge employee satisfaction and working conditions should be in place and up-to-date.

Selected articles and websites

What’s After The Gig Economy? The Talent Economy
What the Gig Economy Looks Like Around the World
How The Gig Economy Will Change In 2017
The Gig Economy Celebrates Working Yourself To Death
Harnessing The Power Of The Open Talent Economy
10 Ways the Gig Economy Can Help Small Manufacturing Businesses
LinkedIn Finds Small Businesses Driving Gig Economy
Ukko.fi saa tuhat uutta asiakasta kuukaudessa – “Lainsäädäntö ei pysy mukana”
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Mikko Dufva

Research Scientist VTT Technical Research Centre of Finland Ltd
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Workers in platforms

Why is this important?

Moving towards platform economy is changing the way people work. Platforms enable more flexible and efficient matching of labour and tasks, provide new ways of working (e.g. Uber) and offer ways to monetize existing assets (e.g. Airbnb). Simply talking about platform entrepreneurs or gig workers leads to a narrow view of the diversity of the workers in the platforms of tomorrow.

Things to keep an eye on

Working through global platforms is a problem especially for governments: how to make sure taxation and welfare works? From the worker’s point of view the interesting question is whether it is possible to earn a decent living from a platform, or will platform economy lead to a polarization of wages: some top experts can earn huge amounts, while a majority is competing at very low salaries.

Selected articles and websites

Voices of workable futures
Independent work: Choice, necessity, and the gig economy
The situation of workers in the collaborative economy
Here’s Why The Freelancer Economy Is On The Rise

Mikko Dufva

Research Scientist VTT Technical Research Centre of Finland Ltd
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