The development of the internet has considerably expanded the already well-established practice of making individually owned private assets or services available to other individuals. For instance, bed and breakfast accommodation or carpooling were commonplace concepts years before the appearance of Web-based platforms such as Airbnb, Uber or Blablacar. What is new with these concepts of the ‘sharing economy’

are their massive amplitude and their global spread. Short descriptions of three ‘collaborative consumption’ platforms and their global development follow.

Airbnb Founded in California in 2007 under the name of ‘Airbed and Breakfast’ by three young, freshly graduated entrepreneurs, this Web-based platform puts private home owners in contact with individuals looking for temporary accommodation. The concept is simple: the owners of an apartment, a house or a room subscribes to the platform

(later renamed ‘Airbnb’) which publicizes it on its Web page. Potential customers can contact the owner directly to arrange details of a rental. The website gets a commission from the transaction.

Launched and refined in the USA, Airbnb rapidly expanded its service in 2011 to European tourism hotspots such as France and Spain, thanks to the acquisition of a small German platform. By 2019 the service was offering 7 million places to stay in more than 100,000 cities in 220 countries to 750 million guests.23 In the process the company has developed tools such as translation software and online tourist guides. The company has, however, confronted local legal, administrative and taxation disputes provoked by what has been labelled

‘unfair competition’ by the traditional hospitality industry, and as a tax-evading device by local authorities.

Uber Uber Technology Inc. was founded in 2009 in San Francisco and benefited initially from venture capital funding. The business model was based on direct contact (via a mobile phone application) between a customer looking for a ride and an Uber driver using either their own car or a company car but acting as an independent driver. Compared with traditional taxis, the service is personalized, more prompt and cheaper. The main feature is that the driver is not an employee of the company but acts on their own.

Originally the market was limited to luxury cabs but rapidly expanded to all vehicles, competing directly with normal taxis. The first international expansion introduced Uber in Paris in 2011, London in 2012, Taiwan, Johannesburg and Bangalore in 2013, and China and Brazil in 2014. By 2020, Uber operated in 93 countries and 900 cities. The business model has attracted a lot of resistance from professional taxi drivers who claim that Uber competition is unfair because Uber drivers did not have to pay the normal extra taxes that taxis have to bear. However, Uber’s success has yet to be confirmed. Several local governments are imposing restrictions on Uber’s business model. According to a Fortune article, Uber recently revealed that it is losing more than $1 billion per year in China, and that ‘Beyond its well-documented troubles in China, it is also struggling in Europe. The young tech company has committed a classic globalization mistake:

it naively assumed that its business model and market approach, which ultimately solidified its market-leading position in the U.S., could translate just as seamlessly to other countries.’24 BlaBlaCar In 2004 a group of young French MBA graduates created a website to bring together people looking for long-distance rides and people travelling in their own cars. The ‘passenger’ would contribute to expenses. The site was named ‘covoiturage’

(‘carpooling’ in French) and later became BlaBlaCar in 2012 when the young company started a significant expansion programme through Europe. In 2014 it raised $100 million from a Californian investment fund in order to finance its international expansion. In 2015 it acquired Carpooling.com, its German main competitor. By 2016 BlaBlaCar had expanded to Turkey, Mexico, India and Brazil and was present in 22 countries with more than 90 million members.23 In its global expansion the company is looking for countries of more than 50 million inhabitants, good road networks and potential journey times between cities of one to four hours. In its expansion plans BlaBlaCar has to take into account local conditions, and cultures in which the concept of travelling with an unknown person in their car is not necessarily commonplace.

Questions:

1 Using these three examples, what is your assessment of the role of the internet in globalization?

2 Are the global expansion experiences of these three platforms similar to any other global expansion you know of?