Growing share business!

Growing share business!

As we enter a new era, our business is undergoing major changes. The share business, which is expanding all over the world, is currently expanding.

A new law of share business that survives the corona wreck ... "Dormant assets that do not come into contact with people" are sleeping in the city

Uber announced a total of 6,700 layoffs in May 2020. Share eco-businesses with many physical contacts such as Uber and Airbnb have been hit hard by the corona wreck.

Getty Images / Justin Sullivan

Hello. I'm Tomoai Ishizuka, CEO of Palo Alto Insight and AI business designer. Today, I would like to consider the sharing economy business that is changing in the new normal society.

The share eco-business is said to have been hit by the spread of coronavirus infection, but let's review the current situation first.

After all, mobile apps such as Uber, Lyft, and Lime, travel companies such as Airbnb, and coworking spaces such as WeWork where an unspecified number of people gather are the ones that have been hit hardest.

In addition, the share of clothes and other items is not only decreasing due to the decrease in going out, but also hygiene is becoming an issue. For example, Rent the Runway, which rents luxury dresses, is greatly affected by the coronavirus, such as dismissing all employees involved in the retail business in a 30-minute zoom.

On the other hand, home delivery systems (UberEats, DoorDash, Instacart) are growing.

On the other hand, home delivery services such as UberEats, DoorDash, and Instacart are growing due to the increase in remote work and movement restrictions.

Getty Images / DigiPub

Uber Eats saw a 54% increase in sales compared to the same period in 2019, despite the lack of profits due to the growth of online orders, and with that momentum, Postmates, which offers similar services, will be launched in July. Announced acquisition for $ 2.6 billion.

Uber is a food delivery service because we cannot expect an increase in the number of people who use Uber, which is our main business, due to the sudden increase in remote work and the restriction of movement itself in the long-term fight against the coronavirus. I shifted my focus to strengthening.

Similarly, there are changes in the "gig economy" realm of sharing people (and their time and skills).

Crowdsource or matching companies that do physical labor such as furniture assembly such as Thumbtack are slowing down due to physical contact.

However, many dismissed people have registered as freelancers, such as Fiverr, which crowdsources desk workers. For example, in the Los Angeles area, the number of freelance registrants for video editing and music editing will increase in March 2020. It is said that it has doubled.

However, in relative terms, the sharing economy and the gig economy have been hit hard, and one survey estimates that the sharing economy and the gig economy will decline by 30% in the next 1-2 years. ..

The essence of the share economy is "idol economy"

A world where various common senses have been destroyed by the new coronavirus. How will the sharing economy change in the meantime?

Photo: Toshiharu Takei

Under such circumstances, how will the share eco-business change in the new normal world? What are the areas of the sharing economy that are expected to grow in the future?

Below, I will introduce the New Normal Sharing Economy Matrix that I created. It is a simplification, so please use it as a reference to understand the outline.

New Normal Sharing Economy Matrix. It is expected that business will increase in the area circled in red.

Source: Yuai Ishizuka

I think that the share eco-business will increase in the area circled in red.

That is, the sharing economy of After Corona is

Platform for sharing digital assets
Service area that can be done without contact
I think that these two keywords will be important.

The essence of the sharing economy lies in the idol economy of "utilizing and monetizing assets that are in an idling state."

For example, renting an unused room to another person, renting an unused car or clothes, and so on. If you lend it to a specific customer, it is just a rental, but due to economies of scale and network effect, the sharing economy can be established by making it a platform.

What was shared until now was "physical assets", but in New Normal, "cloud", "online", and "remote" will progress, and it is thought that it will shift to digital assets. ..

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Pros and cons of a service that "shares cloud assets"

There are pros and cons, but there is also a new model of sharing the services you subscribe to with others. In addition, it is not surprising that a new platform for sharing the "digital assets" that I actually own will be born in the future.

Getty Images / wutwhanfoto

One example is the new business model of the subscription sharing economy, where you share the subscription services you pay each month with others. It's a business that "thinks your password as a digital asset," so to speak.

Now, with the influence of Corona, more time is spent watching online content, and one report says that Americans paid an average of $ 640 for subscriptions to digital content services and other services throughout 2019.

After Corona, subscriptions are on the rise, and consumers may eventually reach the threshold of "overpaying various subscription fees."

In a survey, 80% of Americans between the ages of 13 and 24 said they had shared their online service login information or used someone else's information with someone outside their family in the past. 69% say they have seen Netflix with someone else's password in the past.

John Backus, who dropped out of Stanford University and graduated from Peter Thiel's Thiel Fellowship, started an app company called Jam, a social network that turns passwords into links and shares them with friends.

Jam says it has less risk of data breaches because it is encrypted on the local device. It is not uncommon for password services to have a sharing function, but Jam has a strong SNS element, and it is possible to choose which app password to share with which friend, and to add a function to split the subscription cost in the future. There is also.

Also, in a more open form, there is a service that "shares your password in encrypted form to strangers who do not know at all" (a company called DoNotPay launched a few months ago. ..

However, it seems that there is no active movement at this time because the browser extension is blocked).

At this stage, these "services that share services" involve legal risks such as violating the terms of use of each service and being exposed to privacy issues, and there are also major psychological barriers for consumers. I can say.

However, many share eco-businesses were not existing services when they were first launched. We have come to this point with the aim of promoting consumer understanding, striving to overcome chasm (the watershed of general spread or not), and growing in an environment where legislation has not caught up.

The sharing economy is also a "creative destruction (disruption) of traditional vertically divided businesses that were protected by vested interests", so I have not noticed the "digital assets" I have until now. It can be said that it is not strange that a shared platform will be born.

"Share your own computer or your company's computer" New business sprout

An increasing number of companies are "marketing out computing power" to lend the computing power of unused PCs to other users.

Getty Images / AFROG DESIGN UNIT

When it comes to sharing digital assets, another thing I'm paying attention to is the sharing economy of computing assets for personal computers.

For example, my computer is idling while I'm sleeping and doesn't create any value. However, if I can lend it to someone who wants to use the CPU and storage space of my computer at that time, I can make money and become two birds with one stone.

The same is true for companies that have PC assets with expensive GPUs. Recently, many companies have been born to make such "computing power marketplaces". A notable feature is the use of encryption technology to build a decentralized and open network for added security.

A startup called Dfinity, based in Switzerland and Palo Alto, which raised $ 102 million from venture capital firms such as Andreessen Horowitz a few years ago, is developing a new form of cloud service called "Internet Computers."

Dfinity is developing a blockchain-based platform called "Internet Computer". The photo is the Dfinity website.

Photo: Yu Ito

The cloud business is dominated by giant IT companies such as AWS, Microsoft, and Google, but the problem is that the cost is high on the user side.

Therefore, it is a grand vision to launch a new form of cloud "Cloud 3.0", securely network all PCs in the world using blockchain, and create a decentralized and non-exclusive open cloud data center. This can also be taken as a kind of sharing economy where you want to utilize your PC as an asset when you are sleeping.

Similarly, an Atlanta-based startup called Storj uses blockchain to bring personal computer storage space to a distributed storage network, providing a service that connects people in need of space. In this way, an interesting startup that can be called "computer version of Airbnb" has appeared.

In the future, a new type of share eco-business that has never existed may be born, and disruption unique to New Normal may occur.