Since sharing economy platforms have arisen in the digital economy in recent years, an increasing of people have started to be concerned about and employ these platforms.
This allows people to rent more individual items to consumers, such as unused umbrellas, and portable chargers. Currently, Big Tech in the sharing economy includes Airbnb and Uber, which provide consumers with convenient accommodation and transportation.
However, some people consider that using sharing economy platforms is more likely to cause the leakage of privacy and data (Martin, 2019). At the same time, they might be concerned about the effect of measures regarding privacy and data on their daily lives and possible restrictions on the platform. This article will analyse how the measures of user privacy protection and data security can promote greater user benefits and sustainable development of these platforms. Meanwhile, it will introduce Airbnb and Uber as case studies to support the argument of this article.
It is necessary for platforms to have strict protection of user privacy and data because this can directly boost user loyalty to the platform. Users’ trust in the platform and the protection of privacy and data provided by the platform to users are mutually affected. When user privacy is protected and data is secure, user trust in the platform can be constructed. User trust can affect the platform’s reputation in the market and further increase the frequency of utilization for users of the platform. It means the platform has a competitive advantage and a stable consumer base in the sharing economy market.
“Car sharing with miniature automobile model and smartphone with location sign” by wuestenigel is licensed under CC BY-ND 2.0.
Case Studies: Increasing user loyalty
- For instance, Airbnb has been a relatively widespread online rental accommodation platform in recent years. It gives privacy issues measures mainly in digital and physical privacy. The platform provides secure digital privacy protection measures for consumers’ private information including identity verification, and physical privacy protection for providers’ individual belongings in physical spaces (Chen et al., 2022). This provides consumers with basic trust and security to improve the consumer’s good experience. In addition to consumers, it also provides providers to maintain property safety. Therefore, Airbnb is the platform that can be trusted by more consumers and providers, which has become a relatively leading platform in the market.
- Furthermore, Uber as another example serves as the main sharing economy platform for people for daily transportation. This platform confronts the issues of user privacy violations and harassment from drivers (Hoffman et al., 2021). This has resulted in a gradual decline in user trust. However, the platform actively implements relevant measures to protect consumers’ safety, including identity verification and background investigation for drivers, emergency contact binding, and transparency in trip sharing (Lee et al., 2018).
These measures can increase users’ trust in these platforms and increase platform usage. Therefore, users’ trust in the platform improves the credibility of the platform, which can promote these platforms to be ahead of other platforms in the competitive market.
Users with secure privacy and data security protective measures can significantly reduce harassment and fraud on the internet for users. Privacy and data serve as the main resource and basis for users to access the platform. Platforms usually have to rely on collecting user data to improve users’ experience using the platform. Meanwhile, it is important for platforms to avoid leaking users’ privacy and data information to third-party platforms, which causes possible risks related to individual information on users.
Case studies: Reducing Internet fraud
- For example, in the case of Airbnb, the platform has an internal messaging system called OMNI for consumers and landlords to communicate, as well as include some promotional information. It can achieve relatively effective and secure information-protected communication platforms both for consumers and landlords.
- At the same time, the payment system of Airbnb supports a large number of currencies and secure processors in safe privacy and data protection measures, thereby reducing consumers’ risk of online fraud. In addition, as data information may still be presented to the public transparently, identity verification is more required to support the platform.
- In the case of Uber, after encountering a user information leakage incident in 2016, it formulated measures for multi-factor authentication and special password requirements to provide users with account security (Baksh, 2018). This greatly increases the requirements for people to access the platform and reduces the risk of strangers logging in.
- In addition, Uber also proposed that users cannot access the credit card information on this platform in any way.
This further increases the protection of users’ privacy information and data issues, while reducing the risk of users being defrauded and the account being logged in from another place, as well as minimizing the loss of platform profits.
“Benedetta Brighenti, Deputy Mayor of the Municipality Castelnuovo Rangone, Italy – CoR rapporteur on “sharing economy’” by PES Group in the European Committee of the Regions is licensed under CC BY-ND 2.0.
Short-term impact: possible limitations
However, some people believe that strict privacy and data protection measures might limit the everyday user experience, leading to a decline in the potential revenue of these platforms. The primary purpose for most users to use these platforms is convenience, rather than strict privacy and data protection (Geissinger et al., 2019). Overly strict privacy protection procedures might complicate user experience, including facial identity recognition and access permission.
This can lead to the loss of long-time users of the platform and may reduce its attraction to new users. Moreover, users need to spend more time adapting to the complex protection mechanism of the platform. It causes users may compare similar and more convenient platforms in the market, users might choose other similar platforms instead. This leads to a decrease in the frequency of use of the platform and activity levels on the platform.
For instance, Airbnb requires consumers to provide age certification including official identification (Chen et al., 2022). These additional verification steps complicate the booking process for users and make daily use of the platform inconvenient. Therefore, this might reduce the number of users, which decreases the revenue of the platform and limits the development of the platform.
Strict privacy and data measures may result in the loss of some users and reduced revenue in the short term. But in the long term, strict control of privacy and data is significantly necessary. Because users rely more on the platform when they realize that their personal data is adequately protected by the platform. At the same time, when users adapt to strict privacy and data protection such as identity authentication to access the platform, it is possible to safeguard the user’s personal interests and enhance the user’s daily experience.
In terms of the sustainable development of these platforms, strict privacy and data protection can greatly increase transparency and openness for users in these platforms. Likewise, these platforms may receive more positive feedback from users and enhance credibility (Geissinger et al., 2019). It can attract new users to join, and the platform’s revenue will not decrease but increase. In addition, focusing on protecting users’ privacy and data is more attractive to consumers and strengthens the platform’s consumer base. Therefore, this enables these platforms to have a dominant market status and maintain sustainable development.
To sum up, strict control of privacy and data is not only beneficial to consumers’ own interests but also has absolute advantages for the future development of these platforms. Focusing on the cases of Airbnb and Uber, the analysis shows that although in the short term, strict privacy and data measures may lead to a decrease in users and a decline in platform revenue, in the long term this allows users to better safeguard their interests and has an upward trend for these platforms’ profit.
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Baksh, M. (2018). Uber settlements with 50 states require multi-factor authentication, spell out specific security practices. Inside Cybersecurity.
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