Aside from developing profitable business models, the biggest challenge for many share economy startups is regulatory. Everyone from Uber to Airbnb has faced complaints that the companies are cutting into city taxes, are encroaching on unionized territory, are trampling on insurance provisions, and are creating public safety problems.
I don’t think much of this will stick in the end, but for the time being it has to be addressed. And the ride sharing world got a step closer to legitimacy this week when the California Public Utilities Commission (CPUC) came to agreements with Uber and Lyft to allow “drivers not specifically licensed to drive a limousine or taxi” to provide rides. It’s a big win and I suspect the taxi lobbies are none too happy, given that taxi drivers have a legit argument that the tens of thousands they spend on taxi medallions in places like San Francisco is for nothing.
But the share economy rolls on, as smartphones and easy payment mechanisms make hailing a ride and paying for it from your iPhone, very appealing.