The seemingly unstoppable rise of companies such as Google, Amazon, eBay, Uber and Airbnb has left many feeling powerless over their economic security. But could a more ethical business model challenge their dominance? The Phone Co-op founder Vivian Woodell makes the case for co-operatives
We’re seeing the consolidation of a trend in the online economy towards the creation of what I call ‘unnatural monopolies’. These are businesses which are eminently capable of being replicated, but which have become so dominant in their area of business that they are very hard to challenge.
The likes of Google, Amazon, eBay, Uber and Airbnb have dominance in their spheres. Some of them have almost complete dominance. And they display typical monopolistic behaviour.If you are a trader on eBay, you’ll know they sometimes force you to take a loss on things like postage, and impose rules that put you at a disadvantage in disputes. An Uber driver once told me that the amount charged to customers and paid to drivers was supposed to fluctuate with supply and demand. But he had seen situations where the price to the customer had gone up, while the pay he received had not.
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Some of these new behemoths seem to be ‘here today and gone tomorrow’, reaching considerable scale and then vanishing. Remember Myspace? What’s particularly galling for co-operators is that these unnatural monopolies make their money by taking a hefty slice of exchanges between people, freeing up value that was previously unused – someone’s empty house for example. Hence the misleading title of ‘the sharing economy’.
The co-operative movement has succeeded in carving out a role in some of the industries that were once considered ‘natural monopolies’. The Phone Co-op has proved that we can operate in a former state monopoly with a real culture of public service, financed entirely by our own members, pioneering ethical ways of doing business, and making a real difference.
The Midcounties Co-operative has shown through Co-operative Energy – which now has a quarter of a million customers – that a co-operative approach can work in energy supply. Many co-ops have been set up to generate renewable power too.Our challenge now? To take on the space occupied by the unnatural monopolies. This looks simultaneously easier, and more difficult. Easier because all we need to do is create the software platform, and find the users. Easier because many people hate the overbearing behaviour of the new monopolists, and are looking…
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