Utopias, Dystopias and Today's Technology

The Sharing Economy, the Peer-to-Peer Economy and the Collaborative Economy

January 18, 2023 Johannes Castner Season 1 Episode 1
Utopias, Dystopias and Today's Technology
The Sharing Economy, the Peer-to-Peer Economy and the Collaborative Economy
Show Notes Transcript Chapter Markers

This is the first full length episode of Utopias, Dystopias and Today's Technology. 
Our guest is Somil Gupta: https://www.linkedin.com/in/somilguptaai/

The topic is, as the title suggests, about the terms "Sharing Economy", "Peer to Peer Economy" and "Collaborative Economy" what they mean and what this means for us all.   

This episode makes a few references:
The podcast, "What's the Buzz--AI in Business" by Andreas Welsch: https://intelligence-briefing.com/

Yanis-Varoufakis's claim that capitalism has been replaced by techno-feudalism, of which this writing is one example: https://www.project-syndicate.org/commentary/techno-feudalism-replacing-market-capitalism-by-yanis-varoufakis-2021-06

The book, The Entrepreneurial State, by Mariana Mazzucato:  https://en.wikipedia.org/wiki/The_Entrepreneurial_State.

Chapters:
0:00 Theme Song (written, performed, recorded and mixed by Neal Rosenfeld, sang by Jennifer Youngs)
00:35 Welcoming Message
0:57 Introducing Somil Gupta
1:52 What is the peer to peer economy, what is the sharing economy and what is the collaborative economy?
2:46 Historical Framing
5:56 The Peer to Peer Economy
6:45 The Sharing Economy
8:24 The Collaborative Economy
10:13 Incentives for the Collaborative Economy: Democratization
11:36 Solving The World's Problems
12:07 Building Socially Impactful, but Low Profit Solutions
13:38 Using the Tools built by Techno-Feudalists to solve problems in the peer to peer economy: a problem with that?
16:02 Economies of Scale
18:27 The Peer to Peer Business Model: low Volume, high Diversity
19:03 Is the Peer to Peer Economy the Solution to the Problems that arise from Scale
22:28 What comes around, goes around?
25:52 The Urge to do something good
27:17 Decentral and Central Organization
33:30 The Leverage of working with the Big Players (Techno-Feudalists)
34:36 The Shared, Peer to Peer and Collaborative Economies: three legs of a Chair
35:45 Do we have to play with the big Players?
37:03 Efficiency
37:53 Pragmatism over Purity
38:28 Natural Monopolies: Amazon and Google as new States
39:41 Are these new quasi States democ

Johannes Castner:

Hello and welcome. My name is Johannes and I'm your host for this show and I want to welcome Somil Gupta. Today we are going to be speaking about the P2P economy and also a collaborative and, uh, sharing economies, these terms, what they mean. And, uh, we. will have hopefully a great discussion. I wanna introduce you, to Somil. Um, so he, he was the , the Influe in the, in, in the Nordic region. And what better way to start the new year than we're such a guest. and also start a whole new show with, with with you as the first guest. Um, uh, so, and, and he, he's the CEO of algorithmic scale. I wanted to also say to the audience Somil was that he, uh, he was saying something very interesting on Andreas Welsch's, uh podcast "What's the buzz" um, about moving AI from a project management, perspective to a, to a pro product, product management perspective. And I think that fits very well with my, with my own ethic in this area. So I, I just contacted Somil, and uh, and here we are. let me start with the first, uh, with the first question, could you just explain to me and, and, and to, uh, my audience, what, what is the P2P economy? What is the sharing economy? What is the collaborative economy? These are terms that are being thrown around. What, what is their meaning? What differentiates them? And, and could you just give us a little introduction to them?

Somil Gupta:

Yes. So, um, I'm going, just given my interpretation, uh, because I think there are a lot of terms that are thrown out there, and I think, uh, I like to, uh, kind of define the terms in the context.. So here we are talking more about how do we, how do we solve some of the, some of the world's problems, uh, together. Uh, what is the way to accelerate, uh, the adoption of, uh, new technologies and new, uh, ways of working using AI? So in that context, okay, let's, let's maybe go back a few decades or maybe, uh, centuries. So, um, 200 years ago when we were starting with Industrial Revolution, uh, I just came across one, uh, newspaper article where people felt that they are being forced into employment. and that they were, uh, happy, uh, because then you had more agrarian societies and people would organize themselves into guilts and communities and things were good. Uh, productivity was not that high, but then there was no measure for productivity. So when the national evolution happened, uh, and people were concerned that they'll been, that they will be forced into employment. So it was not the primary, uh, kind of, it, it was, it was not a primary structure for people to operate in. And then it, it was something artificially created. Uh, fast forward 200 years and now we see, uh, organizations and, uh, employment models as standard. And, uh, entrepreneurship is something that is considered a little bit, uh, out of the way or something different than the norm. So, If you look at the, what organizations really bring, uh, if I to drill down to three elements, I would say they are efficiency, uh, orchestration and trust. So when organizations become a legal entity, Then they are under the government oversight and that's one way of us saying, okay, we can trust this entity and that we can have some, we can give, uh, give them some kind of accountability. So if they mess up, then there is a consequence for them and that prevents them from messing up. The second part is the orchestration, basically, which every organization there is a structure and the way it's organized so we ensure that the people are working in a certain direction and people are working together as a unit so that there is there so that there is alignment in what they do. And then there's, and there's synergy. And the third part is basically efficiency and that goes to the systems and processes and things like that. Now, over the last 50, 60 years, especially after, after the Second World War, uh, we saw a lot of progress in project into project management, program management in that was also the time when, um, the ERPs came into being, uh, the, the modern enterprise architecture came into being, and we have defined a way of working. But now, uh, I think 10 years, 10 or 15 years ago, we saw a new phenomenon, which was social networking. Uh, we saw a rise of startups like Uber or Airbnb, and if we see that the Airbnb or Uber provides the same three characteristics of an organization, they provide us with, uh, with a way to trust each other. They provide us a way, uh, to have efficiency by having a streamlined process of booking and delivering a service for both, uh, the rider and the drivers and they also have an orchestration and basically there's a way in which they help find, I mean, I, I don't get randomly connected with a driver somewhere in an other part of the world. So they have a means to orchestrate as well. So now the question comes, is, now do we really need the organizations? Or is there another way? And that kind of, can we, can we, uh, continue the way we were living? What what seemed like a natural way of working 200 years ago? Can we bring that back? Right, and have people become more accountable or peop have people do more than just kind of working in a organized setup. I think that's what the p2p, peer-to-peer, uh, economy in my sense is. How do we enable people to interact with each other in more, more meaningful ways so that we build synergies, which, for example, what we are doing here right now. I mean, I, I come from a background and all the sorts, and you have something, but together we're trying to create something new. And that's the synergy. That's the beauty of one plus one equal

Johannes Castner:

Yeah

Somil Gupta:

The sharing economy then is basically when we use this platform and then it's not owned by someone. I could just, I don't have to buy the software. I don't have to buy the license. I can just pay for one webinar. So I can use it as much as I need, and that's the issue about ownership. Because in the past, if you look at how the, uh, how the business has, uh, kind of, there was a sales era and then there was a marketing era, and then there was a branding era. Now we are living in the social media era. So back then in the sales era in 1940s and fifties, uh, availability of goods was a big challenge. And I come from India and we still had, uh, the license systems even until 19, uh, I think 89 or something like that. So things were not available. So hence ownership was a big issue. And owning stuff, owning things works, gave you access and owning things. Also, what gave you sta uh, status. But today I think we are living in the world of abundance. We have. More things than we need. So then, is ownership really a good way to manage the resources? Because you might talk about my resource and your resources, but uh, if you look at the planet as a whole, then there are only finite resources. So as we, as we see more and more, uh, As we build more and more things, we have to start thinking about more orchestrating these resources in a more effective way rather than just putting our label on it. I think that brings us to the sharing economy. How can we use these assets more effectively within our economy so that none of us gets, have, have unmet needs, but at the same time, we do not create wastage. In the environment and the collaborative economy, in my opinion, uh, is basically that we have, uh, one of the kind of after effects of industrial growth, of fast industrial growth and. Capitalistic. So I'm not making any point here against, uh, for or against capitalism as such. But one of the consequences is that it has created some imbalances in our world, and it has given, uh, it, it, we have now a situation where there are some very wicked problems. When we look at, uh, poverty, when we look at hunger, we look at, uh, the

Johannes Castner:

you know Yanis Varoufakis, uh, actually says that we are no longer in capitalism. We're now in, in techno feudalism is what he calls it. And, you know, so,

Somil Gupta:

Yep.

Johannes Castner:

really large organizations, Google, Amazon, um, and Microsoft, you know, they're basically dominate everybody because they have the computing power and they have the data that we give them, right?

Somil Gupta:

Yes.

Johannes Castner:

So you're speaking about this as well, right?

Somil Gupta:

So, so to solve some of these wicked problems, you need people, you need organizations, we need government, we need startups, we need the whole ecosystem to work towards them. I think, and, and that is how I define the collaborative economy. So rather than trying to put people into the, into the organization, how about we build organizations around people. Right. So that's more collaborative economy for me. Uh, how do we orchestrate different players in the ecosystem and align them towards solving a common problem? And then we, we, we basically divide the task between us. So the, the things that large organizations can do, there's things that that government can do, there's things can individuals do, and then how do we make sure that they can work together seamlessly without any friction and still get the job done. That's how I define a collaborative economy. But that, but that's just my definition.

Johannes Castner:

to have the right incentive structures for that. Right? So collaborative economy will have to pay a data scientist, um, you know, as much as Facebook does right now, you know, ideally or, or more.

Somil Gupta:

Ah, well, data scientists nowadays very difficult to, uh, get hold of. So it's., I mean, when, when we, when, when we work with smaller companies, I think there's a big need for, uh, because they can't afford and they can't have the resources to experiment, uh, with people. So we have to, we, we have to democratize these, uh, these skill sets and make these tools available. And I think leveraging on few key individuals with specialized skills doesn't scale, uh, in most situations.

Johannes Castner:

Example, does a lot of that, right? So it its so, so the skill sets that you now need to work on, on the Google Cloud with Vertex ai or on Amazon Web services with SageMaker is, is a much smaller one than the one I needed when I started working at eBay like whatever, like in 2015. So, so you actually, you can spin out amazing, algorithms pretty easily without having to know all of the, the mathematics that go into them any anymore, right? So,

Somil Gupta:

Yes, and we can actually now cater to many long tail problems. Do not fall into a typical organizational or, or an enterprise strategy. Uh, you know, so now we have an opportunity to also focus on those problems that are not a big market, so to speak for organizations, but they're still have a huge social impact or huge economic impact or, uh, who kind of, uh, make people

Johannes Castner:

yeah yeah But how do you do that? Because how do you fund that? Right. So this is, this is the real problem, I think with, with, this, with the capitalism or, or techno feudalism for that matter. um, is that, that, you know, you can't fund things that don't make an immediate profit, it seems. Right. You know, no one is interested in not getting the return that they could get elsewhere, so they want to invest in the thing that the highest return.

Somil Gupta:

Yeah, I, but I think it has gone a bit better, uh, because now when we look at these large companies, they are actually putting a lot of technology and tools out there, most of it, either free or very low cost, and also investing a lot on training. So I think, uh, what is missing now is have enough people who are aware of enough problems. Uh, you know, and then, uh, have the willingness to solve it so that, so you, you spoke about incentive model, right? So that, I think that is, so if everyone is working, I mean, I think there've been a lot of different, uh, kind of topics here. Universal basic income, for example, right? Things like this. So is there a way to. Uh, free people from the day-to-day, uh, to kind of, you know, help people so that they can afford the basic stuff and keep on with their life while focusing their effort on something bigger. Now that I think we are, we are still, uh, we still have a

Johannes Castner:

long way but then also I like to come back to this other thing, right? So, so Google and Amazon make it very easy to use their tools, right? So, and, and to build amazing things. So they democratize it, they make it cheap. So, but they are not part of the P2P economy, right? They are the giants. These are the things we were talking about earlier, why, you know, they are the, the dominant players and we cannot forget about that, right? We, we, we kind of, and, and in some ways we do something. I do, uh, I use their, their tools, but, uh, there is no such thing as such tools in the, in a peer to peer economy quite yet where it's nothing built that is really peer to peer that takes that profit model of, or that sort of what what you were speaking about. Right? And it offers the same sort of easy democratized you know, data science tools, for example, as Google and Amazon does.

Somil Gupta:

I mean, there are, I mean, uh, so let's say if I look at, uh, like Kickstarter for example. Which allows entrepreneurs to release their projects and almost anyone to kind of fund or microfund. So there are some things that is being driven, uh, in that way. I even consider like the gig economy, uh, maybe like Upwork or something like that, which also facilitates because I could see, uh, I mean, uh, from India, I mean, I, I could see a lot of big change in terms of how people used to work and now how they're working right now with the gig economy. So there is some work happening in the P2P world, but I think it is still limited, uh, to the needs of the business. I think what we are looking for when we talk about this data analytics tools is basically to look at needs of the people. So let's say there is a village in some part of the world, which is facing a problem, let's say erosion of soil lit top soil, and now you need a solution for that. Now, who is gonna work on that? Or there is, uh, uh, there is, uh, some part of the world where it's getting flooded every, every year. And they need a solution to ensure that the water doesn't come in and destroy everything. Right. Who's working on, on their problem? So I think the problems are defined right now. One of the things is that, you know, organizations work on the economies of scale. The problem with economics of scale is that the entire model that we have is financial in nature, right? And we are looking at financial profits

Johannes Castner:

Yeah Could we unpack this a little bit? what do you mean by, by, economies of scale? Could you just explain that so that, that, that people who haven't heard this term have, uh, you know, I, I, I know what you mean, because I studied economics actually. Um, but, but if I hadn't studied economics, I wouldn't know.

Somil Gupta:

So economies of scale, uh, in a very simple way. It says that as you do more of what you're doing, the cheaper it gets to do it. So if I'm manufacturing a product, if I manufacture a hundred, then it's gonna have cost per, let's say, unit cost of X. If I make it 10,000, then my unit cost is gonna be maybe 0.2 x or 0.3 x. So because I have commonalities, because I have synergies, because I can centralize a lot of infrastructure and fixed cost. So the fixed cost get, get distributed over a large number of items, and hence my unit cost for every item comes down. And that's the kind of basic logic of of, of economics, of scale. What it does, it incentivizes us to build more, produce more. Because now once I have the only, the problem is, let's say if I built, um, a factory for that can, that has a capacity of uh, uh, let's say 10,000 per month. And now I need to ensure that I keep making 10,000 because if the moment I make 5,000, my cost goes more than double,

Johannes Castner:

Clearly.

Somil Gupta:

So just like the economics of scale is also dis-economies-of-scale of scale at certain point of time, the things that the margin effort keeps, the marginal cost keeps increasing. And as you scale down in a high, high scale, uh, infrastructure, the, the, the unit cost increases, increases, uh, non-line.. So the incentive in working in, in economics of scale is that you need a way to produce a lot, and then some find ways to get rid of it. And then we see things like, you need to have a huge marketing budget to stimulate the demand. You need to have a lot of discounts so that to actually push this to the people, right? That's how, that's how the economies of scale typically works. So you need volume, you need mass. What we are talking about in the P2P is basically we are, we, we are solving a large number of smaller problems. So the business model essentially is profitable, even if it is for say, five people or 10 people. I am solving a smaller problem, but I can solve a number of those problem. So I have more diversity and low volume. So if I have volume on one side and let's say variability on the other axis, then low variability, high volume is where micros of scale is. What we need now is low volume, high variability solutions, and that requires a very different approach.

Johannes Castner:

Yes. And, and so, so you, you're saying that there are some, the, the solutions are in this thing called the the P2P or peer to peer economy.

Somil Gupta:

The P two? Yes. Yes. Because in P2P I'm not only concerned about the financial roi, I'm also looking at the social roi. I'm also looking at the economic roi. I'm, I'm looking at impact, so, Uh, in a typical organizational structure, when I'm, when I'm only, if I'm only built for high scale, um, interestingly, the, like the social cost or the environmental cost are called externalities. Things that are not that, that are, that are somehow impact, but something that I'm not responsible for. But that approach is not gonna work.

Johannes Castner:

the costs that are basically produced by the things of pollution, for example, they are born by all of society and not by, uh,

Somil Gupta:

Yes,

Johannes Castner:

person who does the polluting.

Somil Gupta:

Yes. Because for the organization, it's an externality. That means they're not responsible for it. But now, because as we are getting more and more integrated, uh, that model is not gonna work. So we need to, we need to consider the, consider the, the total cost, which includes the, the cost, uh, the human cost, the environmental cost, the social cost, the economic cost, all cost and optimize for that. So now when we look at that, if we look at the complete, uh, all the cost, then we can see that the scale or only big, like building a a lot of stuff and then try to push it, is not a good strategy because it might give you a good ROI on the financial cost. It, it, it doesn't give us a good ROI on the environmental cost and the social cost.

Johannes Castner:

say that, that, you know, also on the upside, right? So, so that is if you're building something that has a, a low cost, and it has an enormous potential that is actually also a positive externality in the sense that, so for example, a beekeeper, you know, to, to to, to just explain what that is to, to the audience, you know. So a positive externality is that when, when a be beekeeper keeps bees, um, uh, she, uh, uh, might, um, have, have all these pollinations that are going on to the farmer's land that, that they, Ben, that the farmers benefit from, that she actually doesn't uh, from herself because she just gets the honey at the end, and then she can sell the honey. And that's the, the, the money that she gets from that is her benefit, the private benefit. But then the social benefit from giving bees is much larger because all of these farmers have now pollinated plants and they get benefit from that. But, but the beekeeper could actually, if, if the beekeeper could keep an optimal number of bees, there would maybe be more of them, uh, because, you know, but then she doesn't get the benefit from it, and she, so she only op optimizes for her own honey, uh, production. just to explain this, and this could also be in technology, right? The same, the same thing could apply in, in, in technology, so that if we measure the, the, the costs, we should also me measure. the potential benefit, uh, uh, uh, uh, technology can, can, can have. Because if we can incentivize for that, right, we will be incentivized directly for building technologies that are maximally beneficial, not just, not, not harmful, right? So this is, I think this is a very important distinction and I think we can get there, right? Why, why should we only just consider the, the, the downside of, of technologies.

Somil Gupta:

Yeah, absolutely. Absolutely. And, and and, and there are some things that you can't buy, like clean air.

Johannes Castner:

right?

Somil Gupta:

You know, you, you, you just have to live with what you have. You can't buy that house. Doesn't matter how much money you have.

Johannes Castner:

maybe you can, you can buy it in a, in a locational sense, right? So if you can afford, uh, higher rent or higher mortgage, you can move to a place where the air is cleaner, then, uh, you know, so,

Somil Gupta:

for some time. Yes, for some time, yes. But then, you know, because the, the scale at which we are working, operating, and now that we have this global supply chains and we have global distribution and supply networks, and then we are shipping things from all over the world, I don't think the impact is gonna remain localized. Anymore. And I think we have seen that, uh, due to covid. I don't know. It had this weird weather, elastic, elastic effect that, uh, for the first time it became real, uh, for a lot of people. And I, I remember one of the thing, uh, there was one of the states where people could start, uh, could see Himalayas from their homes and they were able to see it after almost 200.

Johannes Castner:

Wow.

Somil Gupta:

After 200 years, they were able to see Himalayas from there, from the homes. So now they could register, see the impact

Johannes Castner:

yes

Somil Gupta:

Very, very, very

Johannes Castner:

oh this this is interesting because this would probably make them think about it a bit more, you know, hopefully, hopefully it

Somil Gupta:

yeah. Oh yeah. I hope so.

Johannes Castner:

a bit more. Yeah. I know this is, this is very interesting, uh, talking about these kinds of things, you know, but, but I think that, you know, definitely the, there is in inequal unequal, uh, effects in the short term, you know, or even in the medium term where, where people who are, who will be dying from climate change that are most likely going to be poor people and people in the, in the global south, so to speak, uh, rather than people in the global north. And that's, you know, and I guess, you know, the benefits of pumping more oil, into the atmosphere are also consumed mostly in the global north. Um, and not consumed in the global south. So it's, it's, it's in unequal on both sides. It's really, uh, something that also might wanna be, you might also want to consider

Somil Gupta:

It's very interesting that, uh, many of the large economies in the world, let's not name them, but you know, uh, they are now realizing that you can't just dump problems in someone else's backyard and wash your hands, uh, with it. So now we are so integrated that what, uh, goes around, uh, does come around and it comes around very, very fast these days. So you cannot just be saying, okay, let's do it. Do something elsewhere because it's not, uh, our problem. Uh, now it is your problem and it becomes your problem very, very quickly. So I think the mindset and the structures, political, social, uh, that we have built up, uh, it's interesting how they pro, how they progress, uh, because so far they did not have this feedback loops, and suddenly they're getting a lot of feedback on even small step change. thanks to the global connectivity of the world. So I think it's, it's also very interesting to see that how do these enable, because these are also enablers. We don't work in a vacuum. We work in societies governed by governments and you know, so we also see how, how does that ecosystem

Johannes Castner:

Mm-hmm And how does the peer to peer economy feed back into the conversa conversation about that, help with all of these problems?

Somil Gupta:

See, I think peer-to-peer economy is basically, I believe that people, uh, given the right incentive, given the right tools, uh, I think, uh, most people, they have the urge to do something good, uh, because, uh, After a point of time, uh, you realize that the, the true meaning, uh, that you derive is not so much from the things that you own, but it's the stuff that you do. And I, I personally see, I'm, I'm seeing that, uh, there's a lot of, uh, awareness about, uh, the legacy that we are leaving behind in one way or another. People are becoming more conscious of that, so they want to do more and. The meaning that you derive, uh, from working or helping someone else, that feeling is enormous. So I think if we can provide the, the opportunity, uh, the tools, the skills, the awareness, and the means to people, I think they, and also orchestration, again, we think about as a, just as an organization, efficiency, orchestration, and trust. You need all three if you can provide that, uh, in a non organizational framework. I think there is, there's a lot of potential to be that we can leverage here.

Johannes Castner:

wanna ask you there, because I, I was having this discussion with, um, Ashish Kumar Singh the other day, about, uh, the decentralized, uh, the decentralized way of doing business, uh, rather than, you know, I feel this is connected to what we were talking about earlier with, with Google and Amazon providing simple tools, you know, so how, how is basically this, this idea of decentralization of organizations, which is, you know, a big topic in technology right now, DAOs and so on, you know, how does that connect to the peer to peer-to-peer or sharing economy or collaborative economy? And again, you know, could you make this more clear actually this difference between these collaborative and sharing and, uh, you know, uh, still feeling a little bit shaky about what, what

Somil Gupta:

Yeah, I will. Okay. I will try my best to do that. So first of all, I think, uh, back 30, 40 years ago, uh, there was a big discussion about centralization versus decentralization. A lot of research papers that we have read and all of case studies that were done, whether one model is better or the other model. Fortunately, I think we are past that. So we know that there is no absolute centralization and there's no absolute decentralization, right? It's, you need a way of orchestration. So I think my favorite, um, operating model is where the, some of the topics like governance, security, some of these things are centralized. versus the actual execution is more decentralized. So it's more about how we structure ourselves. We need both. Depending upon the context why it works, uh, how it connects to the P2P or collaborative economy. Is that the degree to which you can, you can focus on smaller, let's say niche segment or niche problems? Depends upon the degree of centralization, uh, sorry. The degree of decentralization. So more decentralized, the decision making of an organization is the more autonomy they will have to do something in a specific local niche segment. Now, if a, if an organization is completely centralized right, then you typically try to solve the big problems of the world. right? And then you say, okay, for example, I wanna build a global platform to do X. That's the word centralized way of framing a problem. What's a decentralized way of framing a problem is, okay, we want to enable, uh, innovation or local innovation in these communities or in this areas, right? So the, so the framing changes now, depending upon how the organizations are set, uh, that the degree of decentralization, they have so much power to enable others to work in a decentralized way. Now a company like Uber cannot be centralized and offer a peer-to-peer kind of a network based, uh, services. It's, it's, it's very, very difficult. Your, the services that you provide ha will be a reflection of how you're structured,

Johannes Castner:

could

Somil Gupta:

So this is why Google

Johannes Castner:

bit more that's really interesting The

Somil Gupta:

So there. There is a reason why Google is structured into independent teams. There's a reason why, uh, the, uh, Amazon is structured into, into tribes in each tribe owning a product or a service. There's a reason why a company like Uber always, you know, is, is, is, is so decentralized because if you are offering a decentralized service, , right? Then you have to make decision because you're, you're, you're interfacing with the environment at a local level. That means you, if you want to have a short feedback loop between, uh, let's say, uh, an event and a response to that event, the, the, the decision making has to be delegated to that node, which is experiencing it. So by the nature of your inter interaction with the environment, it is, it, it makes it impossible for these companies to have a centralized structure. Right, so a peer-to-peer a com, any company who wants to facilitate peer-to-peer has to be decentralized in one way or another to be effective.

Johannes Castner:

we make a distinction also between, you know, there is this idea of hierarchical because it can still be so, it could still be, uh, a hierarchical structure, but it, it is decentralized in the sense that there are some semi-independent Nodes right as you, as you call them. So for example, London will have, uh, London will have someone from Uber here. There will be, uh, uh, how to say there, there, there is, you know, a, a big office here, not a headquarters, but a large office of, of Google, uh, of, of, of Google here, of Uber, here of all kinds of, uh, organizations. And they also have to be in France and they have to have something in Germany and they have to have something. So, so that's what you're talking about, right? And, but

Somil Gupta:

Yeah, so the degree, that's why I talk about the degree, what the degree means is what is the fine, I mean, and I mean, if I don't talk about decisions as a more kind of topic, but I say, okay, what is a degree of investment relative to their p and l that a, that an entity can make locally versus global?, I think that is how I would say I would look at this degree, because the degree to which you can take decisions, uh, locally or make financial commitments locally to that degree, you'll be incentivized to kind of solve the problem of the region where, where you're located and to enable solving the problems, right? So if, if you are highly decentralized, let's say if I'm completely decentralized in decision making, a hundred percent of my decisions are decentralized. Okay, that's not possible, but let's assume it for, for so then, That unit in London is committed to London, right. That means all the, everything that they will do will be in that boundary

Johannes Castner:

Mm-hmm.

Somil Gupta:

and that's how they will try to optimize themselves. Cause that is their market, that's, that's their e economy, right? So it is in their interest also to enable those peer-to-peer. Networks that can help them solve the problem. So there is so much a peer-to-peer network can do, but you see the peer-to-peer network is good at make coming up with ideas or coming up with solutions. But when you want to implement those solutions, if you want to have an effect that is larger or that is much bigger, you need the, you need additional levers. To push that or make or make that happen. And that's where the collaboration comes into picture. The collaboration is basically the how we are making decisions, uh, in what kind of forums versus what kind of power we have to effect a change. I think at a P2P level, we are very, we, we could be very good. We, I mean, let's say we are like-minded and we want to do this and we could come of great ideas, but until we have enough fire power or enough muscle power to do effect a change. There's nothing we can do, we can do about it. But let's say tomorrow, Google London or Uber London, or Amazon, London decides to team up with us because they think this is a great idea. The amount of impact that they can create in the society because of the muscle power that they have, that could be great. know, compared to if, if you, if you and I try to do that. So the peer-to-peer network is great for coming up with ideas, new solutions, stuff like that. But to implement them, you do need, uh, engines. They are also who are also empowered, and that's where the collaborative part comes into picture. And you also need some resources and assets that are available to you. And that's where I think the shared economy plays, uh, important. So these are really three kind of, uh, legs of a chair. Uh, you know, uh, in a sense you can't have one without the other. You can't have a collaborative engine without having some form of peer. Peer-to-peer peop a people engagement. You can't have without having the shared, uh, assets, resources to work with. So together, I think they form what we talk, talk about this, we call it the, the prosumeristic culture or a P2P culture

Johannes Castner:

theoretically you could work, you know? Peer-to-peer, sort of on, on peer-to-peer problems using Google infrastructure. Like you see, this is why I would come back to that again, you know, because Google, Google again, is, is not, you know, peer-to-peer and it's, it's quite a big player, right? So does it have to be this way? Does it have to be this way? Because there's this, this problem that I see is, have all of the computing power, right? So it, it, it, will it have to be this way or can we share computing power as well? Can we share the data? Right? So can the data, well, it's complicated because of privacy issues and so on, but can we, can we have a, a structure, um, that is decentralized in a way where we own our data, each individual owns the data, right? It's, it's part of decentralization. Essentially, you need to, so for example, in order to decentralize ai, you would need to decentralize the compute, right? The compute power, meaning you'd have to. Have different people owning parts of the compute, right? So be because you can already do a lot of things in parallel, right? And even in the Google data Center, right, there are tons and tons of different computers and it's already parallelized and distributed to all of these machines, you know, separate entities. So why can't we just own a piece of that, right? So if, if, if a, if, if a whole city like London, Each person has a little box at their house you know you can rent the compute power power just as you would from Google, you know, then, then you could, you could rent it from the people as well, right? So that is kind of related to this, but then there's ownership there then because.

Somil Gupta:

Yeah, but also the question of, uh, efficiency. See, because again, see decentralized, even the most decentralized business models need efficiency. they would have some centralized components to do it, right? So the degree to which we are able to use the cloud and compute and memory is the degree to which Google is able to centralize their investments and make it available

Johannes Castner:

So you don't see any problem with Google then in that sense? Because I, I see the problem of this, you know, huge. Mono, uh, you know, so sort of monopoly on, on augmented intelligence, you know, ai, uh, a monog, uh, monopoly on data, right? It's these, these are monopolies in some sense. And, and I think this is contrary to what you are saying, also, the power of the people, right?

Somil Gupta:

So see, I, because I don't think there is a, I mean, I don't think there is a pure, purest solution. I, I am more pragmatic in that view and I look at, okay, what's available to me right now and what's the best I can do right now with that? Because of course we could paint a picture of like utopia as you say in your, uh, thing. But the question is, uh, have we ever, have we ever in our history of mankind ever had that u.

Johannes Castner:

no, no. Of course not.

Somil Gupta:

I don't recollect that. Right. So it's usually based on everything. I mean, if, even if you look at the railroad, uh, revolution that happened, the, the trains themselves were decentralized, that run, but the, the lines were still centralized and owned by, uh, you know, monopolized. So we could have an argument.

Johannes Castner:

economists will call this a natural economy, a natural monopoly, which means that because the cost is so large, the initial cost, the forefront cost that you have to expent to build a railroad network. That then it's argued by economists that is, this is best owned by the state. And actually, in fact, most, most mainstream you know, argue for that

Somil Gupta:

I think that has happened. Uh, if, if you look at the Amazon Supply Chain network or if you look at the Google's data center, or if you look at the Uber's uh, backbone, that that's exactly what happened because they had the, the vision and the courage to invest in that, you know, and then see, because they also understand that they can only go to some extent if if only they own it, well, I mean, I am, if, if you are paying, uh, like a tax every month for privacy or for storage, uh, I mean it's, it is the same model essentially. If, if, if you look at it,

Johannes Castner:

The difference is we have So we we, we we pride ourselves in this democratic, uh, ethos. But then,

Somil Gupta:

there is a market economics that will come into play because we cannot have like a pure monopoly, uh, in that sense because antitrust laws, so of course there will be competition bylaw. So I don't think Amazon if, yeah, if Amazon was the only cloud provider in the market and then I was forced to use that, then there was this question, you know, I think we have some kind of oligo poly,

Johannes Castner:

exactly.

Somil Gupta:

uh, but even within that oligo poly, it is not that I could just, if I go with Amazon, then I have to only use Amazon.

Johannes Castner:

no, no. But it can be

Somil Gupta:

The beauty of architecture.

Johannes Castner:

can be a cartel

Somil Gupta:

No, think that is a little bit more, uh, I mean, unlikely because see, we are not, we, I, I'm not tied to any specific platform right now, right? My architectures are distributed, so I could buy something from Google and something from Amazon and something from Uber, and then it, it still works.

Johannes Castner:

Absolutely.

Somil Gupta:

people are under control. Uh, in sense of what they consume. And, uh, I think there is, see the only way you can influence, even if you look at democracy, the only way you can influence if people can come together in communities and discuss and share and then align. I think if I look at a technical community, that's happening quite a lot. So there is a democracy in a sense that because these, all these companies, they have big developer networks, communities who they serve in a way.

Johannes Castner:

they don't serve so they, they affect, okay, I agree with you. The, the, but, but the developer community that they serve is much smaller than the, than the community that they affect, right?

Somil Gupta:

So that's the, that's the P2P problem because now we have a very few people who are actually interfacing with these technology. I mean, if I. Someone on the road. Okay. What do you think about Google Cloud? I don't think I'm gonna get a, uh, any, any, uh, good response, right? So now the question is if, and that, that we come back to where we started. Now, if we could have those tools accessible to a lot more people the knowledge and means available to a lot more people, then a lot more people will become the developer, thereby the stakeholders.

Johannes Castner:

Sure.

Somil Gupta:

To this, therefore, they're customers of these companies and hence they, I mean, then the demo democratic process will just become broader.

Johannes Castner:

Yeah. No,

Somil Gupta:

see, the thing is, the good thing is that right now, the cost of starting something, so forget, I mean, if you go beyond that, this if, if I look at the layered architecture of a cloud, right? If I go beyond the basic infrastructure,. If I look at all these services up, I don't have to use, uh, I mean, look at Kubernetes for example. I mean, I don't have to use Google, Kubernetes Automat, Amazon Kubernetes. I could set up my own and I can run it if I, if I so please. Or I could, or I could create a, a, a, a a, a private cloud if I,

Johannes Castner:

yeah Sure

Somil Gupta:

so, so that's

Johannes Castner:

but the barriers to entry are still pretty high in this case. Right. So it would take learn

Somil Gupta:

the infrastructure.

Johannes Castner:

and, you know, so, so like, just to get this going and up and running, just to make sure that, you know, my listeners understand, I mean, this would cost, you know, what we're talking about. If we were to set up like a, a Kubernetes at, at your house, how, how much do, do you have to, how much would it cost?

Somil Gupta:

No, but the thing is, why would you do that, uh, if you have easy tools available? Right. So think it's, uh, I think the, what the good thing that we have right now is that the infrastructure is so, um, layered and, uh, flaked that if I want, I could pick up a problem and I could build a solution for that using what is available, but not depending upon.

Johannes Castner:

No, you're

Somil Gupta:

think this is most important part, right? We're not dependent upon any specific platform or service. I could create my own service if I so choose.

Johannes Castner:

a few things that are hard to kind of, like, for example, Google BigQuery know BigQuery is not available anywhere else

Somil Gupta:

yes, but it is like this, right? I have to be dependent upon the roads. If I want to do a trade, I mean,

Johannes Castner:

true.

Somil Gupta:

or airports if I want to do my, uh, aerial commerce in some way. So there are always some dependency on, on infra.

Johannes Castner:

interesting, right? Because we, we, we, to be clear here, because we're te we entering the territory of what usually governments or countries provide now, now Google and Amazon provides them, right? And this should, I think we should become conscious of this change.

Somil Gupta:

No, but if I think, see this has been more like a public-private partnerships. Uh, I think most of the infrastructure is kind of, uh, created in, i, how, how's in in Europe.

Johannes Castner:

you see, like Mariana Mazzucato, are you familiar with, uh, with, with

Somil Gupta:

no, no,

Johannes Castner:

So she, she has this book called, um, uh, the Entrepreneurial State and, and I'll put a link under, under this as well, to and where, where she describes this public par, uh, uh, private part, uh, public. Partnership, which is very interesting because there again, RA, you know, some questions are raised there. Um, namely, so Apple, you know, everything that's in the iPhone, almost everything that's in the iPhone is, is actually, uh, been produced by government money, right? So, uh, research and universities, that's funded by taxpayers money. And then the profits, though the profits of the iPhone are not made by the taxpayer, right? They have directly, and, and then, then there's this issue that they don't pay taxes very, very much, right? So they pay less taxes than, you know, than, than they should. I guess a lot of people argue, uh, I would argue. Uh, and, and so, Then, uh, you know, at, at the same time. So how do we benefit from this money that we put in, right? So we, we basically, everybody, you know, whether you're a technologist or not, you're, you're putting money into this pot and you don't even know it. In fact, the discourse in America is, you know, the self-made man, the big corporation that pulled itself out of the its own bootstraps. And, you know, Elon Musk is this guy, this hero who, you know, did it all on his own, but he didn't. got a lot of tax money, payer payer money to, to do it. Right. So how do you feel about that? So this is public private partnership, and I agree that we need that. So we wouldn't have any nano nano, so, so be sure I'm not, I'm not against this. I'm, I'm in fact for it. Right. And, and so is this book the entrepreneureal state? Right. But we should be upfront with it, right? So we shouldn't pretend

Somil Gupta:

No, I mean, see, I don't have an opinion. I mean, that, that, that's not my area, that's not my area of expertise. So I don't think I have the ability or, or basically the, uh, you know, capability to comment on this. Uh, and, uh, again, see my focus, uh, is always not on how it should be, but I just try to look at what is available to me because I think I don't, I mean, I don't think, uh, ever, at least what I'm aware of or even in my lifetime ever has been so much knowledge, resources, tools, opportunities available to each and every one of us ever, for Abso for practically free of cost.

Johannes Castner:

yes. That's true.

Somil Gupta:

I, I have never seen that happen, ever, and I think. If we want to argue about how it should be, I don't think we are gonna go far. But if we start looking at, I mean, see for me, I mean, I just look at myself.

Johannes Castner:

mentioned the costs that they have. They're not, they're, they're free of costs, like in the sense that you don't have to pay for them right now. But you mentioned, I mean, you, you yourself were making this, you know, this argument earlier that there are these costs that we don't account for. Right. And actually

Somil Gupta:

No. So. See there are there, but I'm talking about the cost that exists basically from the cost of setting up. So let, okay, let me, so if I have to set up a factory,

Johannes Castner:

yeah.

Somil Gupta:

I would have to look at a lot of different costs, not just financial costs, and that's one way of working, but let's say if I want to solve a problem, uh, in my village, that is to do something with, let's say, soil erosion, ocean or climate change, right? For that, if I want to, let's say, do use a basic tools to solve a problem, I don't need, I don't need hundreds of thousands of dollars. I can guess most of the tools I need for free. I could get, I could still do a lot more. And I like to, I like to look at a opportunity that is available right now rather than think about what could be or how things should be, because things are seldom how they should be. They're not right. So we live in, we live in Im imperfect world and I think the best we can do as I think we have. What, what my point is, we have more than enough right now, and I

Johannes Castner:

yeah I can't argue with that. That's true.

Somil Gupta:

before we, we, before we start, you know, before we start, uh, kind of pointing fingers at others. You know, I think it's, it, it, it's, it's worth a reflection within ourself and see, um, are we utilizing these, uh, to the best extent possible?

Johannes Castner:

Mm-hmm.

Somil Gupta:

I think that is the most important, uh, kind of takeaway for me. So, and if I, if, if I could just, if you could just work on that aspect.

Johannes Castner:

Mm-hmm.

Somil Gupta:

The, again, I come back to awareness skills and, uh, you know, to competence development. If you could just have that, I was reading a book, uh, which the, and, and, and their main, uh, kind of argument was that the world is not how most people perceive it to be, and our momentum model of the world is 20, 30 years old.

Johannes Castner:

Mm-hmm.

Somil Gupta:

right? So, so a lot of things that we believe about the world are not really true. So the question is, how many of us are really willing to go ahead and look at the new world, the new reality that we live in, get more facts about it, look at the problems, think what problems we can solve, and then actually do go do something about solving it. Because I don't think if we can't solve the problem, No one else can. No, no one else will. And if you look at any of the great innovations or the companies, they started with one person trying to solve a problem. And that's why I meant by building organization around a person rather than trying to put people in the organizations.

Johannes Castner:

Yeah. Yeah. Yeah. I agree that that's

Somil Gupta:

So, so I think that's, that's, that's where I think the p2p, the, uh, the peer-to-peer is. I think peer-to-peer is a mindset. Is a mindset that I, and I basically, if I say for myself, I, uh, I don't want to be just a consumer of stuff, but I want to be a presumer. So I want to create something. I want to do something more than, Just what I need to do to just, uh, you know, kind of, uh, get my expenses or pay my bills. I want to do more. we have this mindset, then I start looking at problems. I say, okay, what, what can I do? And then I see there are hundred thousand million different problems. And then I have to see what is it that, that I can solve the same feasibility, disability viability. But when I look at the tool ecosystem and the knowledge ecosystem, I think that's tremendous. is, um, see, most important there's a community of people. Yeah. Community of people who are willing to help you and they're not asking for any money in return.

Johannes Castner:

true. Yeah. Yeah.

Somil Gupta:

I think this is amazing and this is something that we should cherish and people should understand that. So we are in the p2p.

Johannes Castner:

We should celebrate what has I agree with you a hundred percent. I do also think, though, that sometimes we have to push the envelope a little bit to think about what could be, you know, in the sense that, you know, how it could be a little bit better. Uh, not you know, how it would be perfect because that's, um, that's obviously a, a futile question for sure. There is no such

Somil Gupta:

No, but I think the utilization rate right now for most technology is, is below 10%. So I think once they go to a, to, once they start using what we already have, I think that's when I wanna think about what, how can I be improved right now? Like no one is using anything. So we could, we can solve a lot of problems Right now.

Johannes Castner:

That's

Somil Gupta:

needing any support from the government or from the companies or anyone, we can just do it on our own. It's enough.

Johannes Castner:

I hope that, uh, the, that our, uh, my listeners will be inspired by what you're saying there and, you know, pick up those tools and, you know, there lot of talk about these tools on, on this show. You know, and I think this is what, you know, what you're saying about, you know, the, having the courage to look at what there is and, and you know, what can be built there, there, that's part of what the show is about. The other one being, you know, what should be avoided and I guess, you know, what can be built that's really gonna have a likely high impact. That's positive. You know, that's what we, I think we should really, I, I agree. I agree with that. You know, so this is part of what, what this show is about, is basically about, um, up, you know, looking at possibilities and not just avoiding, you know, that we've been talking about in ethics. You know, ethics has

Somil Gupta:

Yes.

Johannes Castner:

There has just become this focus of, you know, not creating bad things, but I think that we have to really be focused on building really good things.

Somil Gupta:

Absolutely. And I think, uh, I think, see, I mean there is, uh, I mean lot of times people kind of paint a lot of these entities and investors and companies, organizations in like a more negative light, but I have seen a lot of people who genuinely want to do something good. met investors who are saying, okay, give, show me a good initiative. And we are, we, we want to invest. It has to be good. It has to be good enough., it has to be something. Don't worry about the scalability. We know how to scale. We will scale it.

Johannes Castner:

Yes. Yes. Absolutely.

Somil Gupta:

Just show me that it works. So I think there are a lot of people out there who want to help. And you will. I mean, I, I can say myself when I came to this country, you know, I didn't know anyone. And now I think I'm so blessed, grateful to have this ecosystem, people supporting and it's like I

Johannes Castner:

you're saying this country just so, so we know

Somil Gupta:

Sweden. Okay. So I'm, I'm basically, I live in Sweden and I originally from India. I came here like five years ago. And, uh, I think the, the support that I have got here, the, it it is been amazing. I mean, a lot of things I work on right now, I actually, uh, kind of learned it here in the last five years. So it's, it's, it's been amazing.

Johannes Castner:

Yeah. Uh, so Fantastic. That's, uh, that's really inspiring. Well, what's been, it's been really fantastic and, and, uh, thought provoking to speak with you. Hopefully we can keep the discussion going, you know, with the comment section, but also there will be related shows that will sort of nicely inter. Interconnect with what we were just talking about and uh, we can, we can hopefully keep this a lively discussion that's ongoing and it will be also a very global discussion. So we have people, people, uh, guests here, you know, like you are from Sweden. I spoke with someone from the US yesterday as well as someone from Dubai. So it's quite distributed,

Somil Gupta:

Yeah. And, and I want to also kind of appreciate this, this initiative. I think it's a great initiative because, uh, I think a lot of these things, they don't get discussed. That's always there. So I think it's also good that I'm, I'm, I'm really kind of very, uh, happy and, uh, you know, want to congratulate you because putting it, this, this platform together and this initiative, I think it's, it's a great, uh, and we might have a lot of opinions, but at least.

Johannes Castner:

Yeah

Somil Gupta:

As long as we have a forum to share it, you know, I think we will. We are making progress.

Johannes Castner:

And if, if I say anything wrong or whatever, I encourage anyone who listens or watches to, to tell me that, Hey, I don't like what you were saying there because of X, Y, Z, or so on as long as things are respectful and uh, and, and towards, you know, so, so the other thing is we argue, we, we should argue toward progress and not toward being Right.

Somil Gupta:

Yeah. I, I mean, of course we are all, I mean, we are all learning and, uh, because this was my disclaimer, right? I'm only sh sharing you what, how I think of it. It could be smart, it could be stupid. I don't know.

Johannes Castner:

Well, we're all learning together, it's a peer to peer process, actually, as So this, uh, this learning is a peer-to-peer process. And show, and what I'm trying to do here is, is exactly connected with what you're talking about with, uh, with respect to the peer-to-peer economy. thank you very much. It was a pleasure speaking with you

Somil Gupta:

Thanks. Thanks, Johannes. Thank you so much. Thanks for inviting. See you.

Johannes Castner:

This show will be published every Wednesday,

5:

00 AM Eastern Standard Time. We will see you next week when I will be discussing techno womanism with the originator of this concept, Shamika Klassen.

Shamika Klassen:

Techno womanism is applying the womanist ethic to social justice issues that happen in and around the digital space and around technology,

Theme Song
Welcome Message
Introducing Somil Gupta
What is the peer to peer economy, what is the sharing economy and what is the collaborative economy?
Historical Framing
The Peer to Peer Economy
The Sharing Economy
The Collaborative Economy
Incentives for the Collaborative Economy: Democratization
Solving The World's Problems
Building Socially Impactful, but Low Profit Solutions
Using the Tools built by Techno-Feudalists to solve problems in the peer to peer economy: a problem with that?
Economies of Scale
The Peer to Peer Business Model: low Volume, high Diversity
Is the Peer to Peer Economy the Solution to the Problems that arise from Scale
What comes around, goes around?
Decentral and Central Organization
The Leverage of working with the Big Players (Techno-Feudalists)
The Shared, Peer to Peer and Collaborative Economies: three legs of a Chair
Do we have to play with the big Players?
Efficiency
Pragmatism over Purity
Natural Monopolies: Amazon and Google as new States
Are these new quasi States democratic?
What is the relevant Community for Techno Democracy?
The new Roads: Public Private Partnerships
Use the Tools that are available to us now: We are the ones we've been waiting for!
The tremendous Ecosystem to solve today's Problems
Ethics beyond do no harm: let's build a better World together!
Some words about the Show
What comes next on the Show?