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Global Sharing Economy Worth $335b
World Economy

Global Sharing Economy Worth $335b

Indonesian consumers are benefiting from new ‘sharing economy’ platforms such as Uber and Airbnb, but barriers remain to collaborative firms.
Since 2013, Indonesia has seen the birth of home-grown sharing platforms such as Gojek, a startup that provides a platform for motorbike ride sharing, and Ojek Syar’i, which provides an online booking service for Muslim female motorbike taxi drivers in Indonesia, as well as the introduction of Uber and Airbnb, WEF reported.
Some 87% of Indonesians are likely to use products or services from others in a share community, compared to 66% of the global population, according to a survey conducted by Nielsen in 2014.
Globally, the sharing economy has grown faster than Facebook, Google, and Yahoo combined. Today, revenue from the sharing economy is still small compared to traditional rental sectors. However, the collaborative economy is growing rapidly and this year it is projected that the revenue of sharing economy will be $335 billion, equal to that of the traditional economy.
The projection is not surprising. The sharing economy offers a number of advantages: lower prices, stronger communities, a greater number of players in the market, and greater access to services that were once regarded as a luxury.
It allows consumers to fully utilize excess or idle resources, and to access resources without necessarily purchasing or owning them.

 Competition
The sharing economy is changing consumption patterns all over the world, not just increasing economic activity.
This is also the case in Indonesia. Hotel owners and Taxi drivers have been hit hard by new sharing platforms like Airbnb, and ride sharing apps like Go-jek and GrabBike.
It’s too early to know the impact of ride-sharing apps on traditional taxis, as they were initially banned by local government. However, one can look at differences to analyze how ride-sharing applications may affect competition in the industry.
The UberX fare is generally cheaper than regular taxis during normal hours, but the longer the distance being travelled, the bigger the fare difference between regular taxis and UberX becomes.
Assuming no stops occur during travel, regular taxis will generally be cheaper than UberX with 2x surge. This implies that in terms of price, there is a room for traditional taxi providers to compete, especially during peak hours.

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