Guest Writer
May 10, 2014

The Government Battles with the Growing Sharing Economy

The Sharing Economy is a misunderstood new wave of business, but it’s causing enough of a stir in a handful of industries that it has caught the attention of consumers and businesses alike. The Internet infused applications instigate exchange of goods and services among consumers – a far cry from the traditional business to consumer model of the most powerful and equally profitable industries. These apps have grown in popularity, and in certain instances with the type of zeal that has the potential to cause mass hysteria from consumers utilizing these new community-based businesses.

By Diana Zelikman from Fueled (New York’s leading mobile app development and once in a while they write blog entries for betahaus.)

As of now, the Sharing Economy ideal poses a number of legal questions surrounding government regulation that can’t be easily answered. We, at Fueled, thought we’d check out one business whose implicated itself below.

Company: Airbnb

Coming on the market, fast and loud, with a peer to peer exchange of a constantly sought after asset, Airbnb is an online community network that quickly connects individuals with rental properties to those who are seeking a place to stay on a short-term, temporary basis. Whether customers are looking for a quiet getaway in the mountains of Colorado or need a cozy penthouse with a view deep into the ever busy hub of Manhattan, this mobile app based company provides a means to an end, in a notably inexpensive way. Those who have property to rent on a short-term basis are able to do so with ease by posting the property online, giving way to a money making connection that would otherwise have been unavailable.

The Issue: Short-term Rentals and the Law

Although this may seem like a beautifully simple way to connect needy consumers without the overreaching arm of big business types, cities across the nation are concerned with the regulatory side of this apartment-to-bed-and-breakfast concept. The biggest issue? Regulations that relate directly to the business of short-term rentals are being called into play, specifically in the state of New York. Recently a statewide subpoena was issued to cease business activities for thousands of rental properties within the state, noting that the use of Airbnb to rent out a property violates these broad regulations.

The Basis for Complaint

The “Illegal Hotel Law,” an antiquated piece of legislation, was updated in 2010 to vaguely outlaw the “business” of renting an apartment for fewer than 30 days if the apartment owner is not present. This, in turn, has created a frustrating situation for the state while it attempts to collect potential tax revenue as well as enforce safety and insurance regulations that are applicable normally to solely traditional hotels.

The Complaining Parties

Both the State of New York, in this case, as well as the businesses that stand to lose a hefty portion of an otherwise solid market share - the booming (and outlandishly expensive) New York hotel industry - and are trying to save the changing dynamic of the hotel industry. Their reasoning is if large hotel chains are susceptible to government imposition through regulation, the same should be expected of Airbnb users since they provide similar services.

What’s Next?

Without viable regulations that can be applied directly to practicing sharing economy businesses such as Airbnb, it is nearly impossible to impose the type of control the state of New York is seeking. The concept that competition within an industry is only possible between big players is beginning to waver and large corporations are scrambling to create roadblocks wherever they can. Many similar issues were present when e-commerce sites like eBay and Amazon launched, so it’s clear that government regulations and the laws are out of date to say the least. There is no clear answer, however, to the New York Airbnb issue yet. But with the popularity of the Sharing Economy coming in strong, something will need to be done in an effort to remedy the problems facing renters – both those providing the property and those utilizing them – and the breakdown of big business as the only option within the hotel industry.

Want to read more insightful articles? Follow the link!

Due to increasing digitalization and convenience services in every area of people's lives, the smooth and flawless process of getting the delivery to one's doorstep is exceedingly becoming what customers care most about. On top of that, for companies that package being delivered is an extension of their brand. The consumer is basically coming face-to-face with the brand, which makes it the biggest opportunity to heighten customer satisfaction.


If you live in a city and have even slightly observed your urban surroundings you’ve probably witnessed it first hand - urban congestion and crowded cities make it pretty tough to satisfy the growing demand and rising expectations of super quick deliveries. Add unpredictability in transit (like weather conditions), an incorrect address or remote locations, just to name a few, and you can see where this is going.

The worst part is, all those delivery trucks and vans that also produce a fair bit of emissions, are often only half full when they roll out for deliveries. This is mostly due to low drop sizes and stops along the route that are far and few between.

It’s not all hopeless though - Where there is a problem, there are solutions.


Same old, same old - isn’t always all that bad. Sometimes, all that’s needed are some new perspectives! The city of Utrecht, for‌ ‌example, implemented a zero-emissions electric barge nicknamed the “Beer Boat”. 

Since 2010 it’s carrying beer and food to the city’s downtown restaurants by using waterways. Other electric barges in Amsterdam not only deliver but even collect organic waste, which is then turned into biofuel in processing plants! Isn’t that cool?

It becomes clear that cities, logistics, as‌ ‌well‌ ‌as‌ ‌urban‌ ‌planners, are equally part of solving the inefficiency of the last-mile. Tackling this mountain of issues calls for teamwork!


A centralized platform, hub or network for similar companies, could do the trick to fill up the delivery vans & trucks that are barely loaded. Parcels could be distributed more efficiently between different companies and their delivery vehicles.

Like a big pool of parcels from different companies with every single parcel going into that one van with the same route!


Delivery Driver Experience and Smart Delivery Vehicles are also areas with huge potential for improvement and innovation.


Ellie: Two years ago we adopted a new legal structure for Jolocom GmbH according to the purpose model of ownership, manifesting our commitment and dedication to building a self-sovereign organization. That means we can’t take VC funding or sell public shares of the company. 

Volker: Jolocom is a community driven organisation – both in a tech sense but also much further beyond. We’re hugely involved in the DWeb community where we organize and attend events for the decentralized community. Every year we also help organize and attend the DWeb Camp in San Francisco, which brings together all kinds of creatives so this technology of tomorrow is built in a collaborative way.


Next to that on-demand experiences have become firmly embedded into people’s everyday lives - be it a mobile app to book a ride, send flowers to your loved ones or order lunch to your office. It’s all possible and has made premium features like real-time tracking a standard.  The online consumer expects nothing less and certainly doesn’t like to wait.


Making that quick and instant gratification happen is another story though. Groundbreaking ideas and innovations are needed to tackle all these factors. Does your startup have one? 

Then head over to our Future Logistics Challenge! Applications are still open until September 23rd.

Volker: There is this really nice place, called Green Rabbit with salads and baked potatoes where I like to go to. Sometimes I just keep it simple and go to Lidl.

Ellie: I eat a lot in west.berlin cafe which is here around the corner and I love the Matcha Lattes from Starbucks.

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