The mayoral candidates and the sharing economy

Housing, transport, wages – All major concerns for the London electorate linked to the sharing economy.

IMG: Dozens of black cab drivers stage a protest in central London under the hashtag #Blackcabprotest against competition from app-based taxi services.


Housing, transport, wages – All major concerns for the London electorate as they decide on their next Mayor later this year, and all concerns intrinsically linked to London’s new ‘sharing economy’ – the flexible technological ecosystem based on pooling resources, assets and labour. The speed of growth in this new economy has left Mayoral policy teams, old and new, scrambling  to keep up with its impact on the city.

Boris Johnson, Mayor of London, has had a tumultuous relationship with the sharing economy. Its impact on London has developed since Boris took office  in 2008. Airbnb, the largest Sharing Economy rental market was launched just four months after he became London’s Mayor . There are now 52,000 hosts on the platform in the UK alone. Uber which has had such a significant impact on the City with 25,000 drivers on its platform only entered the London market in 2012.

The Mayor has straddled a difficult line between enthusiasm and scepticism, particularly in his relationship with the two biggest players Uber and Airbnb – welcoming on the one hand their benefits to  consumers while worrying about the impact of their rapid growth.

Critics complain the Mayor has shown ‘selective hearing’ to the industry; cheering when new figures show Airbnb has broadened access to the London tourism market while trying to limit the  disruptive potential of the sharing economy by threatening regulation for other platforms. This is a pattern we should expect to continue under the new Mayor as London’s policymakers try and keep up with economic and social impact of the sharing economy.

Zac Goldmsith, the Conservative candidate for Mayor has been unusually vocal about the “threat” of Uber echoing some of the language of the black cab trade who are concerned about Uber’s impact on their established businesses. Goldsmith’s solution to the rise of Uber  includes recommending a limit on the number of licenses issued, while resisting the more radical demands of Ubers opponents  such as limiting the Uber app’s ablity to show real time availability of cars . Regulation he describes as “misguided.”

Details on Goldsmith’s proposed cap are yet to be fleshed out. One avenue  he is pursuing is tapping into the resources of a regulatory authority, preferably the Competition and Markets Authority (CMA) (who’s inflated confidence I discussed here), with whom he made a direct approach last year.

Labour’s Mayoral candidate, Sadiq Khan has an even tougher line. In June last year the Member for Tooting told The Guardian he would operate a “one strike and you’re out” policy when it comes to ride-sharing services. If one driver is found to have improper paperwork, then Khan wants to suspend the entire service. Khan is increasingly ditching this radical proposition as he attempts to win over London’s Labour-agnostic business community. His current position increasingly sounds like his Conservative adversary, recommending a simple “cap or limit” on the market.

Both camps realise that taking on the Sharing Economy is dangerous business. New York Mayor Bill De Blasio recently went on the offensive against Uber in New York, and lost. Although unions and associations representing traditional industries are increasingly vocal, the sharing economy has a huge, largely un-tapped, body of consumer advocates.

As Isabel Hardman rightly points out “Uber now has one million unique users in London, which is the same as the popular vote Boris Johnson won in 2012”. The voice of voters and consumers has mostly been missing from the debate as disruptors and incumbents have faced up against each other.  Perhaps both candidates need to consider what voters in London want when entering the debate about the sharing economy.

There is, however, the wider question of the social and environmental impact of the sharing economy. London has been very open to start-ups, but established businesses have been  pushed into considering the impact of their actions on the places they operate in. As their influence grows shouldn’t disruptors also have to consider their impact? If Uber drivers are adding to congestion or Air B&B based short term let businesses adding to the problems of London’s housing crisis ,isn’t the need for regulation and acknowledgment of their success?  These will be some of the issues that whoever wins the Mayoral election in May will have to deal with.