Worker-Owned Apps Are Trying to Fix the Gig Economy

https://www.vice.com/en_us/article/pa75a8/worker-owned-apps-are-trying-to-fix-the-gig-economys-exploitation

by rmbryan • 7 years ago

210 143 7 years ago

jasonlfunk3• 7 years ago

Despite the loaded exploitation rhetoric in the article, if competitors can come into the market that is better for the workers, that’s great. And if it raises the standards for the privately owned apps, that’s even better. This seems like a win all around.

rmbryan2• 7 years ago

exploration =?> exploitation

jasonlfunk3• 7 years ago

Yes. Edited.

ptah4• 7 years ago

what if it makes it impossible for the "privately owned" apps to compete and wipes them out completely?

jasonlfunk3• 7 years ago

Why would that be a problem?

throwaway_tech• 7 years ago

Then that is the best case scenario. Let the exploitative founders and VCs test the market and find fit...then let the workers organize and steal their lunch.

coldtea• 7 years ago

Then we might have found a way to solve most of humanity's problems!

M2Ys4U• 7 years ago

Job done

Nasrudith2• 7 years ago

That is as much of a problem in itself as co-ops or literal cottage industries not being competitive with dedicated workforces. Sucks to be them but not a true problem to the economy overall.

If they can't compete with their advantages maybe they shouldn't be in that business. Just being able to do something efficiently isn't an abuse.

captainbland• 7 years ago

Net gain for humanity

danShumway• 7 years ago

Let me rephrase that question in terms of software -- what happens if someone develops an Open Source product that works better than the proprietary alternative, and the proprietary alternatives get wiped out entirely?

The short answer is that for-profit, privatized entities should not be privileged in competition. Community owned solutions, non-profit solutions, naturally occurring public alternatives to products, worker-owned and volunteer-maintained solutions, and so on -- these efforts are no less legitimate than a traditional Capitalist solution. If they produce better results than a VC-backed or privatized product, then they deserve to win.

In my mind, the difference between a free market and Capitalism is that a free market is OK with Capitalists losing sometimes. It's good for businesses to compete not only with each other, but also with forces and coalitions outside of traditional markets.

And worker-owned businesses aren't even that radical of an idea -- they're just a different way to manage the business and distribute profits. Open Source and nonprofits are much farther outside of traditional Capitalist markets than a worker-owned business is.

I'm all for efforts like this.

Nasrudith2• 7 years ago

Yeah - it would be a logical extension of disrupting gatekeepers in an efficient market. Also kind of obvious in retrospect when gig-workers or contractors require their own tools that they would be in a good position to subsitute for the rest of the company "chain". That makes them mobile and we already saw "multiapp" gig workers.

Of course the hard part is that owing to mindshare these markets tend strongly towards winner takes most.

wffurr3• 7 years ago

To add some data to the "exploitation" argument, consider this:

“Imagine developing a company specifically to take advantage of people’s ignorance of how expensive it really is to drive their own car. What would this company look like?“

(the answer is of course that it would look like very much like Uber or any other ridesharing company)

https://www.mrmoneymustache.com/2017/11/22/mr-money-mustache...

frockington1• 7 years ago

This seems like a fault by the individual being 'exploited'. I don't think it is the job of a corporation to run an a cost-benefit analysis tailored for watch individual. There is also no obligation to continue driving, so if the drivers cost-benefit isn't what they thought they can always find something else

TurkishPoptart• 7 years ago

Great article from the 'Stache. It seems like the people who benefit most from driving are those that lack the necessary documentation to get a "real job" - i.e. immigrants. If that's the target audience for Uber and Lyft's "clients" (because they are _not_ employees, right?), well, I find that somewhat immoral. I dunno. When I was between jobs I worked Postmates and Caviar (and Amazon Flex, until I was "fired by an algorithm" (no joke!) to make rent, and it was a modest success. I only ended up using the platforms for 2-3 months max, and starting off, I really enjoyed being the delivery driver and offering excellent customer service. I would go out of my way to ensure I grabbed extra napkins, utensils, sauces, etc. to go the extra mile, and when the tip reflected that, I was elated - the lizard parts of my brain that respond to video game achievements lit up - and I mentally competed myself to be better, faster, and more efficient. And this part of the brain, like the gambler's, forgets the bad times and cherishes only the good times. But I won't forget having to pace around in a pitch-black cul-de-sac, looking for a mysterious stranger who won't answer their phone, thinking that five minutes more, and these Greek fries are mine until...a college kid came out with a disposition reflecting both "hey bro" and "sorry bro" and we did the awkward exchange of "here's your food" and "here's me thanking you for it". Now I have a boring office job, and I tend to cook for myself.

aey3• 7 years ago

If your narrative was true, why wouldn’t drivers quit in droves?

My retired dad drives an Uber. He built a spreadsheet and did the math on car deterioration and gas costs and is happy with the result. If Uber is exploiting anything, it’s idle labor.

I don’t own any Uber or Lyft stock. I think worker owned apps could potentially hurt Ubers market share if the drivers collectively push them and prices are at least 20% cheaper or faster.

jjeaff3• 7 years ago

Before you call an enormous group of people ignorant, you might want to run your numbers again.

These kind of analysis all seems to make the same mistake. They use an average, linear depreciation of the value of the vehicle and they continue that depreciation into infinity. But the fact is, the depreciation curve is effectively flat as you get to zero. And the maintenance does not increase into infinity either.

After a vehicle has a few hundred thousand miles on it, the resale value is effectively the scrap value of the metal in it. Putting another 100k miles will not make it negative. And there are only so many parts to replace in a vehicle as far as maintenance goes.

bergstromm466• 7 years ago

Are you serious with 'loaded exploitation rhetoric'?

Consumer marketplace apps are black-boxes which completely disregard all the workers rights battles of our ancestors.

To not see this is to put too much trust in digital tech as a magic fix to all problems.

patrickaljord2• 7 years ago

the workers rights battles of our ancestors.

The consequence of these battles is that at least for low skill workers, all these jobs were shipped abroad (or just disappeared) where none of these rights exist. Creating huge unemployment, so now low skill workers have rights but no jobs and therefor make even less.

The fact that people are willing to take these jobs is a sign that low skill workers are ok with having lower wages and less benefits if this means getting a job and a better pay. We could ban all these jobs of course but that would not give these low skill workers rights, it would just make them unemployed again.

coding1232• 7 years ago

In the tutoring space markup is about $65 per hour. Tutors are often making less than 25. I don't know if there are apps for it yet, but don't pay the middle man.

SilasX2• 7 years ago

Sorry for the nitpick, but I think you mean, "buyers pay $65" or "price after markup is $65"; markup is the difference between input price and sale price.

coding1232• 7 years ago

No worries about the nitpick! However, in the market of "In home" tutoring my wife was working for a company that was indeed charging around 85 to 90. Markup was 60-65, tutor was paid 20-25. (prices depended on quality of tutor).

WalterBright16• 7 years ago

Back in the 1980's when we sold compilers through the mail, we had deals with various mail order aggregators. They'd run full page ads with lists of software they were selling mail order, along with prices.

I was horrified that they wanted us to supply them the product for less than half of what they were selling it for. No way, I thought, they're ripping us off.

I was told that there was no other way. The reality of running an aggregator business is you have to double the wholesale cost in order to turn a profit. Most lay people terribly underestimate how much money it costs to run a business. And it was worth it for us because the aggregator was reaching far more customers than we could.

Don't pay the middle man is nice in theory, but the middle man exists because they are worth the money.

deleteme3212• 7 years ago

the middle man exists because they are worth the money.

I strongly disagree with this statement.

Rent seekers are everywhere and it is never guaranteed that they are adding anything of value to the system, and often they are only extracting.

z3t4• 7 years ago

I think the problem is that you have two markets that are inaccessible from either. The business buy from one market, then sell on another market. And make a profit based on how inaccessible the two markets are to each other. For example clean water can be very expensive where there aren't any, while basically free where there's plenty. So the business takes water from where it's free, then sell it where there's demand.

asdff3• 7 years ago

On my campus the best tutoring businesses isn't chegg, but the former TA for the class that shows up in your library for $20 an hour.

rmbryan2• 7 years ago

my question is, as a consumer, how can I find cooperative platforms as distinct from exploitive ones?

toomuchtodo• 7 years ago

Great question. There doesn't seem to be a platform specific concept similar to "Certified Employee Owned" [1], but you might consider getting in touch with Certified EO to see if they would develop one.

I too would be interested in using only non-exploitive platforms, bonus if it cuts the legs out from underneath the traditional VC funded platforms.

[1] https://www.certifiedeo.com/eo/about

jawns• 7 years ago

One way is to do a google search for ".coop", which turns up a ton of cooperative organizations.

aitchnyu2• 7 years ago

They could make a directory. If a ZTaxi user opens the app in an unserved city, the app should recommend similar apps that serve the city. Cut out the search engine middle man.

jacquesm• 7 years ago

I'm not familiar with the ins and outs of app development, is it possible for one app to detect the presence of another? If yes then it won't take long before there will be retaliation.

severine• 7 years ago

Seems possible: https://sites.google.com/site/androidhowto/how-to-1/detect-i...

Anyone can explain more?

boomlinde• 7 years ago

Sounds like you are suggesting a clear cut antitrust case.

OrangeMango• 7 years ago

That's the kind of restriction an employer would place on an employee...

ska• 7 years ago

Even if you could, you would run into 1099 issues (US specific) pretty quickly.

I often see Uber/Lyft drivers monitoring multiple apps for example.

aitchnyu2• 7 years ago

Facebook used Onavo security app to recognise WhatsApp as a growing and valuable platform to buy, for 19 billion though.

cjg• 7 years ago

Seize the means of production.

tantalor• 7 years ago

Is it the car, or the app?

diggan• 7 years ago

The service itself, the economic value of it. Probably would refer to the network and it's data, and the app. The car is irrelevant. Some might get a car provided, others might use their own. Focus is to make sure there is no fight between owners of the service and operators/users. Put them all on the same level (or simpler, make the operators the owners).

m0zg• 7 years ago

You forgot to add:

???

Profit

dang• 7 years ago

Please don't post unsubstantive comments here.

sharemywin4• 7 years ago

my question is are these platforms(I'm including UBER in this) actually cartels? from a legal perspective? If they don't allow individuals to set pricing.

ptah4• 7 years ago

how are they stopping individuals from setting pricing. if anything it gives them more power than traditional gig economy apps

sharemywin4• 7 years ago

I talking about price fixing. we're multiple sellers collude to fix pricing.

Up & Go cleaners earn $25 per hour, more than double what workers typically earned independently, according to Project Manager Sylvia Morse. While apps generally take a cut of 20 percent or more, Up & Go only takes 5 percent, which it then reinvests in the platform.

laughingman2• 7 years ago

This one isn't a Cartel as its like a taxi company but co-owned by workers. But Uber could be considered a cartel because they don't consider the car drivers as workers, so they are effectively setting prices for the market of drivers.

roschdal• 7 years ago

This is a wonderful idea

joshuaellinger• 7 years ago

Austin Taxi Co-op is owned by the drivers. They have a decent app and are (slowly) working their way up to competing with Uber/Lyft. They've got the booking side down well enough but haven't tackled payment.

It will be interesting to see how that shakes out in the next five years.

sfifs• 7 years ago

I'm surprised there's not more of this kind of worker co-op apps. These gig economy apps largely cater to region specific markets - so having enough platform scale to cover an urban agglomeration seems is good enough. If members of a profession in a city choose to go with a specific app, the demand tends to follow by word of mouth. Seems like there's a business model in building white label apps for co-ops and unions on a costs plus kind of model.

rjtavares3• 7 years ago

Gig Economy + Economies of Scale + Open Source make cooperatives something that makes a lot of sense economically. It takes a lot of organization effort though, and I don't know who could be the leader on that movement (unions would make sense, but I don't think they're entrepreneurial enough for it).

TremendousJudge• 7 years ago

It doesn't seem that hard -- the things needed are a couple of free software nerds that build some sort of "UberFactory", and a city big enough where some workers unionize and are the first to create their own Uber with the UberFactory. After that other cities can copy them, and the only cost for the workers is to keep the servers running. Well, and customer support. They should be able to pay this with surplus and still get better salaries.

save_ferris2• 7 years ago

Austin got a non-profit ridesharing app after Lyft and Uber left a few years ago. It was pretty solid, although the mobile UX wasn't quite as good (which was to be expected).

When Uber and Lyft came back, they artificially lowered prices by subsidizing rides to claw business back from RideAustin, and it worked. Within a few months, RideAustin was pretty much defunct and hard to use since drivers were using the other apps.

Word of mouth only works when the local option is also the most lucrative. The problem with gig apps is the company can take their VC cash and underbid the market to weed out competition.

wffurr3• 7 years ago

Predatory pricing like that ought to be illegal.

jtuente• 7 years ago

That's ignoring the problem that outside of the greater Austin area, population 2.2 million, RideAustin is useless and suffers a bit from an advertising/discovery perspective for visitors. Both of those problems could have been solved by creating some kind of greater cooperative with other locale-driven rideshares, like say a RideHouston or RideDallas.

abathur2• 7 years ago

Ditto. I imagine there may be limited overlap between people who do the work a given coop could provide and those with the ability to start standing up a service and app. Tech hiring seems hard even for companies with large reserves of expertise...

Interested in doing this sort of work, myself.

abathur2• 7 years ago

Afterthought: an interesting test of coops like this are how well they identify and exclude/expel customers and workers that cause trouble.

woah• 7 years ago

The whole premise of these types of cooperatives is that they pay certain types of workers above-market wages. That puts them in a tough spot when facing competition that pays at market, since the competition can take that extra money and invest it back into the app and make a better service.

asdff3• 7 years ago

If it got large enough, how long until companies like uber try to ban you from the platform (like they did when people were driving for uber as well as lyft to increase their hourly rate)?

If they can lower pay and take away workers rights any more than they already could, these companies would not hesitate.

s1artibartfast2• 7 years ago

Worker co-ops have a long and successful history. In their favor, they can run at lower costs, treat workers better, and avoid inefficient worker/owner conflicts of interest.

The reason we don't see more, is because it is much harder to get off the ground without equity investment. Essentially, there is no exit to excite investors.

brenden2• 7 years ago

It would be interesting to make a unionization app for tech workers, too. Something like blind where you can share your salary history, insider stories, etc, and use it for leverage when negotiating salary. The one thing I don't like about blind is that most of the discussions are very low quality, but you could fix that by disabling the discussion part, focusing on salary data, and perhaps company reviews (like Glassdoor) anonymously.

tathougies4• 7 years ago

On the contrary, there is no exploitation. A driver for uber (or dasher for doordash, or whatever) is legally completely allowed to create their own app to take their own orders. This is because they are independent contractors -- businesses, from a legal perspective, doing business with other businesses. As such, neither uber nor doordash nor anyone else can prevent its ICs from joining other networks (hence why many drive for lyft and uber). It would be exploitation if these individuals were employees, which is what California has recently forced in that state. This state-mandated exploitation is immoral and unjust, because it precludes workers from doing things like this.

In California, now exploited employees would first have to quit their gig job in order to join a new app that benefits them. This creates an artificial moat around starting a new app because often times these individuals would not have enough capital to be able to finance even short periods of unemployment and migration to a new platform. That is really sad.

nacho2sweet• 7 years ago

It was cool when Uber financed all those bad car leases (because they had a certain level of new car) and made a bunch drivers indentured servants. Making them drive more and more while they cut the driver pay rate.

tomtheelder• 7 years ago

There is extreme exploitation, due to independent contractors not being afforded almost any worker protections. Each gig employer has no incentive, legal or otherwise, to provide for their workers. In their efforts to minimize labor costs they can employ tactics like reducing wages below minimum wage, offering no benefits, discriminating at will, and of course offering less work than could possibly sustain an employee. This last one is made particularly easy because of the ability of ICs to work for many operators: the employers know their workers will just pick up extra work on another platform, often with a cruel total of worked hours for minimal pay.

In California, these workers will now receive some of the protections offered to others. That is not a perfect situation or anything, but the current state of ICs in the gig economy is _abominable_. They will be free to seek new employment without quitting much like any other worker. Yes they wont be able to work oppressive hours for multiple employers, none of whom are providing for them. That is not a bad thing.

The gig economy is an unmitigated disaster. I'm not sure CA's solution is perfect, but it's a _big_ improvement.

tathougies4• 7 years ago

Oh, you mean the protection of being forced to work for a failing employer. Yes, so much protection /s

doctorpangloss• 7 years ago

an artificial moat around starting a new app

In the real world we actually inhabit, where Uber and Lyft have lost money every quarter, I'm not sure "state-mandated exploitation" is the "moat."

tathougies4• 7 years ago

This further demonstrates the need for a cooperative non-profit marketing agency made up of several independent small taxi-cab/logistics companies as members. It is clearly an unprofitable field but the individual merchants benefit quite a bit it would seem. Nevertheless, uber's unprofitability actually makes california's actions even more reprehensible, because not only are the drivers no longer allowed to work on their own app, but they are also forced to work, in the meantime, for a company that's losing money and likely to face bankruptcy. In other words, they're being exploited for temporary gain by the state of California, who likely just wants to get their hands on payroll tax.

WalterBright16• 7 years ago

There's also nothing stopping an Uber driver from doing a side deal with regular customers, where they phone the driver directly when they need a pickup, and they'll keep all the fare.

I wouldn't be surprised if that happens a lot.

tathougies4• 7 years ago

Yes, I've done that before several times. If I'm asking the guy to drop me off for something and I know I need a ride later, I will ask for them to name a price and pick me up, and I'll pay in cash or via venmo or whatever. They love it because they keep more of the money, and I love it because they treat you even better.

say_it_as_it_is2• 7 years ago

Don't forget what happened to Walnut when it priced its moving services for fairness and equity: https://medium.com/@nickbkim/why-were-closing-walnut-a452225...

Everyone wants fairness and equity until the time comes for each to pay for it.

I'm saying this in a disappointed tone as I really would like platform cooperatives to work but they're going to fail to compete in a relatively open market of a capitalist society. Also, everyone working in IT for these platforms becomes the exploited. It's inverted exploitation. Programmer: you're being paid less than what you'd make in a free market. If you're not getting your flat cleaned twice a week as a member of this cooperative, you're doing it wrong. You, my friend, are being taken to the proverbial cleaners.

antonkm2• 7 years ago

There's more to life then money. Being able to provide others with a fair and better platform would make me accept a paycut.

say_it_as_it_is2• 7 years ago

It's easy to give up what you don't have. A web dev in Sweden has a social safety net to maintain a quality of life that is unobtainable in the U.S. without earning as much as possible. It is never at someone else's loss but at the discretion of managers based on the value each gives to the organization.

sharemywin4• 7 years ago

I'm not sure I understand how IT workers would be exploited?

2010–2012 Instagram launches on the iPhone and grows to 13 employees and to 30 million users (closing at $50 million at a $500 million valuation). It eventually gets acquired by Facebook in 2012.

Seems like if you scaled like that you could still pay devs pretty well with minimal costs per transactions.

lonelappde5• 7 years ago

"exploited" is a subjective judgement that means some earns less than the speaker thinks they deserve.

Flat cleaners and programmers have different notions of how much each deserves.

lonelappde5• 7 years ago

Travis K is a billionaire. Statistically, almost everyone agrees that most of his wealth should be distributed to Uber workers. There is much less consensus regarding how much of consumers' money should be likewise distributed.

s1artibartfast2• 7 years ago

I couldn't disagree more.

Walnut is an example of what happens when amateurs move into an industry without understanding the fundamentals or doing sufficient dillagence.

There is no reason that Co-op workers and IT can't be paid market rates.

AlexTWithBeard• 7 years ago

The problem is that they are already paid market rates. The claim is that market rates are not fair.

imtringued2• 7 years ago

Yeah exactly, anyone can make a good expensive product. It takes true require entrepreneurial skill(= the ability to screw over your employees as much as possible) to deliver a product that everyone hates but buys anyways.

WalterBright16• 7 years ago

The great thing about free market capitalism is that people can form worker cooperatives anytime they want.

nickpp• 7 years ago

This pretty much sums up the entrepreneurial impact of socialism for me:

"You can be a socialist under capitalism but you can’t be a capitalist under socialism."

WalterBright16• 7 years ago

"Under capitalism, man exploits man. Under socialism, it's the other way around!"

BrainInAJar• 7 years ago

"you can choose not to own slaves under slavery, but you can't choose to own slaves without it"

MadWombat• 7 years ago

I just checked Up & Go site for prices. I am sure, Handy are terrible, exploitative, capitalist pigs, but they clean my place for about $40-50 less than Up & Go just quoted me. I think I am going to stick with the pigs for now.

moretai• 7 years ago

I don't get it. If there is an app that take a minimal cut, like a craigslist, wouldn't that be better for the company in the long run than suffering the PR disaster and distaste that will inevitably come after fucking over your sole reason of use?

dsalzman• 7 years ago

Gym owners should band together to make a cooperative owned alternative to MindBody. It’s a disaster. Any group of companies that are hyper regional and don’t compete should try this. Same thing with restaurants and Opentable/Ordering Apps.

ilaksh• 7 years ago

Decentralization technologies should help with efforts like this.

Worker-Owned Apps Are Trying to Fix the Gig Economy

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