The American media scholar Trebor Scholz coined the term platform cooperative in 2014. Together with colleague Nathan Schneider, he popularized it as a possible solution to problems in the platform economy(1), such as the precarious position of platform workers and the lack of influence for platform users. Platform cooperatives were already emerging at the time as an innovation from within the cooperative sector. They combine the organizational model of a cooperative with that of digital platforms. Since there are different types of cooperatives and various types of platforms, platform cooperatives can take many forms. In general, a platform cooperative can be defined as a cooperative “in two- or multi-sided markets that uses the internet to facilitate interactions between two or more distinct but interdependent groups of users, in order to create value for at least one of those groups.” (2)
How does a platform cooperative emerge?
A platform cooperative can arise in three main ways (3):
Citizen collectives play an important role in this. They can organize themselves as a platform cooperative from the outset, gain ownership over platforms interested in an “exit to community,” or evolve into a platform cooperative through digital innovation.
A common perception is that platform cooperatives compete directly with large capitalist platforms, such as Fairbnb versus Airbnb, CoopCycle versus Deliveroo, and The Drivers Cooperative versus Uber. However, it is unlikely that they will win this battle in the short term. Major obstacles include the market power and financial resources of large platform companies, as well as slow-moving government policy regarding platforms. Platform cooperatives therefore have a greater chance of success in sectors where platform giants are less active, or as forms of social entrepreneurship offering ethical and sustainable alternatives. Citizen collectives can play a key role in this.
Oppertunities and challenges
Platform cooperatives create both opportunities and challenges from which citizen collectives can learn (4).
First, the opportunities. Citizen collectives are increasingly confronted with the fact that more and more social and economic activity takes place online. Expanding their collaboration through a digital platform can therefore increase their impact. Platforms can also broaden the reach of a citizen collective, enabling participation from more people, including members who live further away. Moreover, a platform can attract new groups, such as younger participants. Another opportunity lies in using digital platforms to organize collective decision-making and democratic oversight, for example through discussion forums or digital voting. Compared to traditional, offline citizen collectives, a platform cooperative generally requires less start-up capital. Fewer physical resources are needed, and value is created through interaction or the exchange of goods and time between participants.
However, platforms do not solve everything and also raise new questions for citizen collectives. Many familiar considerations when starting a citizen collective remain equally relevant for platform cooperatives, such as the tension between economic and social goals. In addition, a broader reach through platforms does not only bring advantages. It can be more difficult to define shared goals when members have fewer common interests and social ties. Organizing digital or hybrid decision-making and democratic oversight requires ensuring that all members are able to participate. Finally, platforms can also create a certain level of competition between participants, making it all the more important to establish rules that discourage opportunistic behaviour and encourage cooperation.
References
- T. Scholz & N. Schneider (Eds.), 2016. Ours to Hack and to Own: The Rise of Platform Cooperativism, A New Vision for the Future of Work and a Fairer Internet. New York: OR Books.
- European Commission, 2015. Public Consultation on the regulatory environment for platforms, online intermediaries, data and cloud computing and the collaborative economy. https://ec.europa.eu/digital-agenda/en/news/public-consultation-regulatory-environment-platforms-online-intermediaries-data-and-cloud
- E. Como, A. Mathis, M. Tognetti & A. Rapisardi, 2016. Cooperative platforms in a European landscape: an exploratory study. Paper presented at ISIRC Conference, Glasgow – Cooperatives Europe. https://coopseurope.coop/resources/news/collaborative-economy-opportunity-cooperatives-new-study-released
- D.J. Bunders, 2021. Gigs of their own: reinventing worker cooperativism in the platform economy and its implications for collective action. In V. Daskalova, G. Jansen, & J. Meijerink (Eds.), Platform Economy Puzzles: A Multidisciplinary Perspective on Gig Work. Cheltenham, UK, Northampton, MA, USA: Edward Elgar Publishing.