MISMATCH

The US government’s new name for the sharing economy is the worst one yet

The sharing economy is in. Uber, Airbnb, TaskRabbit, etc. So is coming up with new names for “the sharing economy.”

Already, we have the following:

Most of those names are pretty bad. But the US government has come up with the worst one yet: “digital matching firms.”

That’s the phrase the US Department of Commerce has settled on, according to a paper it released June 3. It’s proposing four “defining characteristics” of these firms:

  • Digital matching firms use information technology (IT systems), typically available via web-based platforms such as mobile “apps” on Internet-enabled devices, to facilitate peer-to-peer transactions.
  • Digital matching firms rely on user-based rating systems for quality control, ensuring a level of trust between consumers and service providers who have not previously met.
  • Individuals who provide services via digital matching platforms have flexibility in deciding their typical working hours.
  • To the extent that tools and assets are necessary to provide a service, digital matching firms rely on the workers using their own.

There are also some weird exemptions—what the department describes as “‘sharing’ firms that are not digital matching firms.” These include:

  • Firms that provide online classifieds such as Craigslist do, in fact, match consumers with goods and service providers, but lack rating systems and also do not process transactions via their own digital platform.
  • Firms that facilitate the matching of a service without facilitating a monetary transaction. Examples of these platforms include [C]ouchsurfing, [F]reecycle, Maine Tool Library, Neighborgoods.

While it’s important to establish definitions for research purposes, this new terminology seems more likely to confuse than to clarify. What is Couchsurfing, for example, if not a digital matching platform? Where would Waze Carpool—a service that facilitates a monetary transaction but isn’t designed to generate a profit—fall under these conditions?

The government says “digital matching platforms,” but there’s a plainer English translation. It’s “companies that look like Uber.”

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