How the Internet of Things Influences the Sharing Economy

8.8.2016, Written by Nora Hartman

iOtThe influence of the digital world is having more of an impact on our everyday lives than we could have predicted. Although we don’t yet have flying cars, in many ways we’re living in a pretty futuristic society, and a lot of that is thanks to the Internet – specifically, a concept known as “the Internet of Things.” This concept has been quietly changing the way that we connect with the world around us, as well as how the world can connect with us through integrated technology. Combine this innovation with another forward-thinking concept referred to as “the sharing economy” and you have a partnership that could have a dramatic impact on our society’s industries.

So where can you see this combination in action right now, and what does the future hold for this dynamic duo? Let’s find out:

Behind the Concepts
The Internet of Things and the sharing economy both appear quite complicated, but in fact, they’re pretty easy to understand. The former— although it sounds like a metaphysical concept at first—refers to how “smart” digital technology is beginning to be installed in everything from roads to cars to streetlights. This technology is tapped into an information grid that can obtain data from various points and use it to adjust for convenience and speed; essentially, machines talk to each other, and inform each other in ways that can make our lives easier.

“The Internet of Things really comes together with the connection of sensors and machines,” explains this article about IoT from Wired. “That is to say, the real value that the Internet of Things creates is at the intersection of gathering data and leveraging it.” And it all means that big things could be ahead for how our environment interacts with us.

The sharing economy is something that goes hand-in-hand with the Internet of Things. It’s more than just Craigslist and Uber – it means using social networks to find ways to share resources or make money over the Internet. The sharing economy is one that removes the middleman of a sales broker or a bank; two people can arrange the sale of a product or service online and then use an app to pay for it. The digital world is making the sharing economy that much easier, and when you add the Internet of Things, that’s where it starts to get interesting.

A Symbiotic Partnership
Anybody can buy or sell a product or service online, but everyone has a few basic necessities: that the transaction be secure, that it be quick, and that the process be seamless. And although you can go through an online car-rental booking process step by step, or send emails back and forth with a prospective buyer of your unused furniture, many people in the tech industry know that there can be a better way. Enterprising individuals have been finding ways to apply the Internet of Things to the sharing economy to make it more advanced and more convenient for people to use.

The example you’ll find used most often is AirBnB. The revolutionary system that allows homeowners to rent out their residences was created to enable direct communication between hosts and travelers, creating a more personal – and economically viable – alternative to large-scale hotels. This is the sharing economy: the idea of taking a space that one might not be using and allowing another person to pay a fee to occupy it.

Now imagine how the Internet of Things could be used to make renting through AirBnB even more advanced. GigaOM talks about the idea for a type of “smart key” called Lock-Bot, which offsite AirBnB owners could use to allow guests to access the units they’ve rented. Here’s how Lock-Bot would work:

“The cylindrical device holds harmonically combines cellular, Wi-Fi and RFID. After a booking is confirmed, the renter is sent a code that is used to unlock the Lock-Bot, which opens to reveal a physical key attached to an RFID keychain. At the end of the rental, the renter returns the key to the Lock-Bot, which return notified the renter that the key has been returned.”

Although this concept didn’t reach its Kickstarter goal, GigaOM notes that it would be wise for AirBnB to consider utilizing something like this in the future. Making sure that the home rental process is both secure and streamlined using the Internet of Things could put AirBnB light years ahead in its field. “As the cost of connectivity continues to drop, sharing economy companies will have increasing incentives to equip their customers with tools that make their members more competitive with centrally managed ways of accessing services,” says the article.

What the Future Holds

Aside from new advances in secure transactions, combining the Internet of Things with the sharing economy could yield some interesting results in the near future. For example, a post on the IBM blog envisions how much easier car rental could be: “Discovery can occur in real-time, just looking around for cars that announce they’re available for rent through Bluetooth beacons. Unlock and drive away using your smartphone or wearable as a kind of bluetooth identity card, and upon return, a GPS can let the owner where the car has been returned and calculate miles traveled for an automatic charge to your credit card.” Definitely a lot smoother than having to pick up a physical key and drop it off in a specified location afterward.

The blog post goes on to point out that many of our useful goods sit idle throughout the day – everything from our cars to our home appliances – and that finding a way to profit from them would “reshape entire global industries.” This sort of movement feels almost like a revolution: a new way to put money in the hands of the people who know how to use the Internet of Things – and the sharing economy – to their wallet’s advantage.

The Future of The Internet

In many ways, combining new technology with digital connections is creating the futuristic world that we once saw in science fiction movies. Fortunately, this isn’t including any sort of robot war – rather, the Internet of Things is working to make the world around us reach an even higher level of convenience. Put this together with the sharing economy, and you have a partnership that could go a long way in changing how industries both large and small operate across the world.

How do you think combining the Internet of Things with the sharing economy will change our lives? Tweet your thoughts to us @fieldnation.