Subtitles section Play video Print subtitles [intro music] [applause] Thanks for setting high expectations Remo [laughs], always good...um, so today I'm going to talk to you about the rise of collaborative consumption. I'm going to explain what it is, and try and convince you (in just 15 minutes) that this isn't a flimsy idea, or a short term trend, but a powerful cultural economic force, re-inventing not just what we consume, but how we consume. Now I'm going to start with a deceptively simple example. Hands up how many of you have books, cds, dvds or videos, lying around your house, that you probably won't use again, but you can't quite bring yourself to throw away? Can't see all the hands, but it looks like all of you, right? Um, on our shelves at home, we have a box set of the dvd, dvd series 24 (season 6 to be precise). Um, I think it was bought for us around 3 years ago for a Christmas present. Now, my husband Chris and I love this show. But let's face it, when you've watched it once, maybe, or twice, you don't really want to watch it again, Because you know how Jack Bauer's going to defeat the terrorist. So there it sits, on our shelves, whoops, um, obsolete to us, but with immediate latent value to someone else. Now before we go on, I have a confession to make. I lived in New York for 10 years, and I am a big fan of Sex and the City. Now, I'd love to watch the first movie again, as sort of a warm up to the sequel coming out next week, so how easily could I swap our unwanted copy of 24, for a wanted copy of Sex and the City? Now you may have noticed there's a new sector emerging at the moment called "swap-trading". Now, the easiest analogy for swap-trading is like, um, an online dating service for all your unwanted media. What it does is use the internet to create an infinite market place to match person A's haves with person C's wants, whatever they may be. The other week, I went on one of these sites (appropriately called "Swaptree") and there were over fifty-nine thousand, three hundred items that I could instantly swap for my copy of 24. Low and behold, there in Resdy, California, was Rondoron, who wanted to swap his or her "like new" copy of Sex and the City for my copy of 24. So in other words, what's happening here, is that Swaptree solves my Carrie and company sugar rush problem, a problem the economists call "coincidence of wants"- in approximately 60 seconds. What's even more amazing is that it'll print out a postage label on the spot because it knows the weight of the item. Now there are layers of technical wonder behind such sites such as Swaptree, but that's not my interest, and nor is swap-trading per se. My passion, and what I've spent the last few years dedicated to researching, are the collaborative behaviours and trust mechanics inherent in these systems. When you think about it, it would've seemed like a crazy idea, even a few years ago, that I would swap my stuff with a total stranger whose real name I didn't know, and without any money changing hands. Yet 99% of trades on Swaptree happen successfully, and the 1% that receive a negative rating, it's for relatively minor reasons, like the item didn't arrive on time. So what's happening here? An extremely powerful dynamic, that has huge commercial and cultural implications is at play. Namely that technology is enabling trust between strangers. We now live in a global village, where we can mimic the ties that used to happen face to face, on a scale and in ways that've never been possible before. So what's actually happening is that social networks and real time technologies are taking us back, we're bartering, trading, swapping, sharing, but they're being re-invented into dynamic and appealing forms. What I find fascinating is that we've actually wired our world to share, whether that's our neighbourhood, our school, our office, or our Facebook network. And that's creating an economy of "what's mine is yours". From the mighty E-Bay, the grandfather of exchange market places, to car sharing companies such as Go-Get, where you pay a monthly fee to rent cars by the hour, to social lending platforms such as Zoper, that will take anyone in this audience with a hundred dollars to lend, and match them with a borrower anywhere in the world. We're sharing and collaborating again in ways that I believe are more hip then hippy. I call this ground-swell "collaborative consumption". Now, before I dig in to the different systems of collaborative consumption, I'd like to try and answer the question that every author rightfully gets asked, which is where did this idea come from? Now, I'd like to say I woke up one morning and said, "I'm going to write about collaborative consumption", but actually it was a complicated web of seemingly disconnected ideas. Over the next minute, you're going to see, a bit like a conceptual fireworks display of all the dots that went on in my head. The first thing I began to notice was, a few years ago, how many big concepts were emerging, from the Wisdom of Crowds to Smart Mobs and how ridiculously easy it is to form groups for a purpose. A link to this crowd mania, for examples all around the world, from the election of a president to the infamous Wikipedia and everything in between, on what the power of numbers could achieve. Now, you know when you learn a new word, and then you start to see that word every where? That's what happened to me, when I noticed that we are moving from passive consumers to creators, to highly enabled collaborators. What's happening is the internet is removing the middle man, so that anyone, from a t-shirt designer to a knitter, can make a living selling peer to peer. And the ubiquitous force of this peer to peer revolution means that sharing is happening at phenomenal rates. I mean, it's amazing to think that in every single minute of this speech, 25 hours of YouTube video will be loaded. Now, what I find fascinating about these examples how they're actually tapping in to our primate instincts. I mean, we're monkeys, and we're born and bred to share and co-operate. And we were doing so for thousands of years, whether it's when we hunted in packs, or farmed in corp, farmed in co-operatives, before this big system called hyper-consumption came along, and we built these fences, and created our own little fiefdoms. But things are changing, and one of the reasons why are the digital natives, or Gen Y. They're growing up sharing, files, video games, knowledge, it's second nature to them. So we, the millennials (I am just a millennial) are like foot soldiers, moving us from a culture of me, to a culture of we. Now, all of this was flying through my head, around the end of 2008, when of course, sorry. Um, the reason why it's happening so fast is because of mobile collaboration. Er, we now live in a connected age where we can locate anyone, anytime, in real time, from a small device in our hands. All of this was going through my head towards the end of 2008 when, of course, the great financial crash happened. Thomas Freedman is one of my favourite New York times columnists, and he poignantly commented that 2008 was when we hit a wall. When Mother Nature and the market both said, "no more". Now, we rationally know that an economy built on hyper-consumption is a ponzi scheme, it's a house of cards, yet it's hard for us to individually know what to do. So all of this is a lot of twittering, right, was a lot of noise and complexity in my head until actually I realised it was happening because of all key drivers: One, a renew- a renewed belief in the importance of community, and a very re-definition of what friend and neighbour really means; a torrent of peer to peer social networks and real time technologies, fundamentally changing the way we, we behave; three, pressing unresolved environmental concerns; and four, a global recession that has fundamentally shocked consumer behaviours. These four drivers are fusing together and creating the big shift, away from the twentieth century defined by hyper-consumption, towards the twenty-first century defined by collaborative consumption. I genuinely believe that we're at an inflection point, where the sharing behaviours (through sites such as "Flickr" and "Twitter") that are becoming second nature on-line, and being applied offline to areas of our everyday lives. From morning commutes, the way fashion is designed, it's the way we grow food. We are consuming and collaborating once again. So, my co-author Roo Rogers and I have actually gathered thousands of examples from all around the world of collaborative consumption. And though they vary enormously in scale, maturity and purpose, when we dived into them we realised that they could actually be organised into three clear systems. The first is redistribution markets. Redistribution markets, just like swaptree, is when you take a used or pre-owned i-item, and move it from where it's not needed to somewhere, or someone, where it is. They're increasingly thought of as "the fifth", which is reduce, reuse, recycle, repair, and redistribute, because they stretch the lifecycle of a product, and thereby reduce waste. The second is collaborative lifestyles. This is the sharing in resources of things like money, skills, and time. I bet in a couple of years, that phrases like "co-working" and "couch-surfing" and "time-banks" are going to become a part of everyday vernacular. One of my, er, favourite examples of collaborative consumption, er, collaborative lifestyles, is called land share. It's a scheme in the UK that matches Mr Jones, with some spare space in his back garden, with Mrs Smith, a would-be grower. Together they grow their own food. It's one of those ideas that's so simple yet brilliant, you wonder why it's never been done before. Now, the third system is product service systems. This is where you pay for the benefit of a product, what it does for you, without needing to own the product outright. This idea is particularly powerful for things that have high idling capacity. And that can be anything from baby goods, to fashions, to, how many of you have a power drill? Own a power drill? Right, that power drill will be used around 12 to 13 minutes in its entire lifetime. [laughter] It's kind of ridiculous, right, because what you need is the hole, not the drill. [laughter and applause] So why don't you rent the drill? Or even better, rent out your own drill to other people and make some money from it? These three systems are coming together and allowing people to share resources without sacrificing their lifestyles or their cherished personal freedoms. I'm not asking people to share nicely in the sandpit. So, I just want to give you an example of how powerful collaborative consumption can be to change behaviours: The average car costs eight thousand dollars a year to run. Yet that car sits idle for 23 hours a day. So when you consider these just, these two facts, it starts to make a little less sense that we have to own one outright. So this is where car sharing companies such as Zipcar and Go Get come in. In 2009, Zipcar took, sorry, two hundred and fifty participants from across 13 cities, and they're all self-confessed car addicts and car sharing rookies, and got them to surrender their keys for a month. Instead these people had to walk, bike, take the train, or other forms of public transport. They could only use their Zipcar membership when absolutely necessary. The results of this challenge, after just one month, were staggering. It's amazing that 413 pounds were lost, just from the extra exercise. But my favourite statistic is that one hundred, out of the two hundred and fifty participants, did not want their keys back. In other words, the car addicts had lost their urge to own. Now, product service systems have been around for years, just think of libraries and launderettes. But I think we're entering a new age, because technology makes sharing frictionless and fun. There's a great quote that was written in the New York Times, it said, um, "sharing is to ownership what the iPod is to the a-track, what solar power is to the coal mine". I believe also, our generation, our relationship to satisfying what we want is far less tangible than any other previous generation. I don't want the dvd, I want the movie it carried. I don't want a clunky answering machine, I want the message it saved. I don't want a cd, I want the music it played. In other words, I don't want stuff, I want the needs or the experiences it fulfils. This is fuelling a massive shift from where uses trumps possessions, or as Kevin Kelly, the editor of Wide magazine puts it: "where access is better than ownership". Now, as our possessions dematerialise into the cloud, a blurry line is appearing between what's mine, what's yours, and what's ours. I want to give you one example that shows how fast this evolution is happening: This represents an 8 year time span. We've gone from traditional car ownership, to car sharing companies (such as Zipcar and Go Get), to ride sharing platforms that match rides, to the newer century which is peer to peer car rental, where you can actually make money out of renting that car that sits idle 23 hours a day, to your neighbour.