Peter Smyth: Battle looms over sharing economy

It’s been over a decade since I first heard the term the “sharing economy” and like many, probably felt the idea was a passing fad that would fade into obscurity. I couldn’t imagine having paying holidaymakers staying in my spare room or random strangers paying for lifts in my car.

Business which use the so-called "sharing economy" model have taken off in recent years.

Yet today, the size and scale of companies such as Uber and AirBnB far surpass some of their more “traditional” sector rivals.

Looking at these behemoth organisations you can’t fail to be impressed by the ways in which they have scaled up in a fairly short period of time.

From a business perspective they have tapped into a growing demand from consumers for a more efficient, on-demand service. That has to be applauded.

However, behind that business success lies a trail of policy and regulatory challenges shared by towns and cities across the globe. Some areas have embraced change, whilst others have been more resistant.

Indeed, where that resistance has been most fervent there have been opportunities for professional campaigners to harness these disputes and turn them into full-blown political campaigns.

And these political campaigns will be coming to a short-term let or taxi-cab near you very soon.

In fact, they’re actually in place already, working behind the scenes and feeding into legislative proposals similar to the just-announced members’ bill on rent controls lodged at Holyrood by Pauline McNeill MSP.

Not that it’s all a matter of campaigners whipping up confected controversy. Rather, they are tapping into the very real concerns of citizens grappling with rapid change.

In a modern-European city such as Edinburgh, just ask a licensed cab driver about the threat of Uber to their livelihoods, or a city centre tenement owner-occupier about the sudden appearance of key-boxes outside shared stairwells accessed by holidaymakers. It’s hard not to notice or have a view on such change when it is literally happening at your front door.

The Scottish Government has realised that short-term lets (particularly in Edinburgh) are the subject of much controversy and as a result are now consulting on how or indeed if they should be regulated. It’s clear a balance needs to be struck between the concerns of local communities whose members feel their streets or apartment blocks are filled with transient visitors and those who recognise the wider economic benefits that such guests bring. And that’s before we even turn to the impact that short-term lets have on housing supply in a city where the ratio of supply and demand is well out of kilter.

We’re somewhat behind the curve on regulation with other cities such as Amsterdam, Paris, Barcelona all enacting laws to mitigate the impact of AirBnB for example.

In the year ahead, what you’re likely to witness is an all-out public affairs battle between the pro and anti-regulation brigades and between those advocating localised approaches to regulation and those who prefer more sweeping one-size-fits-all change.

It promises to be an interesting debate, weighing up the advantages of tighter regulation against the pitfalls of unintended consequences that usually inevitably come with top-down market intervention.

As with any campaign with entrenched beliefs on either side, it will be important for those with “a horse in the race” to navigate the debate with sensitivity, but also to ensure that their key messages are delivered timely to those in a position to influence change.

This is indeed the art and power of effective public affairs work.

l Peter Smyth is director of public affairs for Indigo