FTC: Let’s talk ‘sharing economy’

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Should Uber be allowed to collect its users’ locational data? Has Airbnb leveled the playing field for travelers or does its business model unfairly hurt traditional hotels?

Although the Federal Trade Commission doesn’t name names, these are the types of questions it will seek to answer during a June workshop on the so-called “sharing economy,” a largely app-enabled set of businesses that allow you to hail a ride, board your dog or order handyman services.

The FTC says it wants to make sure these businesses can operate while protecting consumers and maintaining a competitive marketplace.

“We are seeing a dramatic growth in products and services that are built on peer-to-peer platforms, such as ride-sharing and property rentals, as more entrepreneurs harness the power of technology to reach more consumers,” FTC Chairwoman Edith Ramirez said in a press release. “The resulting business models have great potential to benefit our economy and consumers.”

Some of that potential has already been realized. The FTC says sharing economy transactions reached $26 billion in 2013 and could explode to as much as $110 billion annually in the near future.

Share your thoughts

Prior to the June 9 workshop in Washington, D.C., the FTC wants to hear from consumers regarding the following questions:

  • How can state and local regulators meet legitimate regulatory goals (such as protecting consumers, and promoting public health and safety) in connection with their oversight of sharing economy platforms and business models, without also restraining competition or hindering innovation?
  • How have sharing economy platforms affected competition, innovation, consumer choice, and platform participants in the sectors in which they operate? How might they in the future?
  • What consumer protection issues — including privacy and data security, online reviews and disclosures, and claims about earnings and costs — do these platforms raise, and who is responsible for addressing these issues?
  • What particular concerns or issues do sharing economy transactions raise regarding the protection of platform participants? What responsibility does a sharing economy platform bear for consumer injury arising from transactions undertaken through the platform?
  • How effective are reputation systems and other trust mechanisms, such as the vetting of sellers, insurance coverage, or complaint procedures, in encouraging consumers and suppliers to do business on sharing economy platforms?

Comments received by May 26 will be considered for discussion at the workshop. You can submit comments to the FTC website.

Do you use apps like Uber and Airbnb? What do you think about these businesses that have disrupted traditional models?