As African economies make efforts to compete with the rest of the world's economies, technological innovations are critical towards attaining inclusive development. Platforms remain one of the innovations that are shaping the growth trajectory of many African countries, and while they seem to offer diverse benefits and opportunities to leapfrog development, there are also attendant challenges that need to be addressed if African economies seek to maximize the opportunities of the platform and shared economy. This chapter provides insight into some of the benefits of the platform and shared economy and further argues that to address the challenges of the platform economy, there is need for evidence-based research. The chapter further proposes new research frontiers in the platform and shared economy that require immediate attention as first step to providing the required evidence for building a market enabling environment for Africa's platform and shared economy.
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The growth and adoption of the Internet as a communication and knowledge-sharing platform has resulted in complementary technological and transformational developments not limited to cloud computing, social media, mobile technology, big data, artificial intelligence, and machine learning. These digital transformation concepts have created new business principles such as on-demand and a new sharing economy. While several economies have primarily grown out of industrialized economies, especially North America, platform activities in other regions have been on the rise even in Sub-Saharan Africa. Evans and Gawer (2016) opine that although the emergence of platforms is still at its infancy, platforms have the potential to be equally disruptive to traditional approaches to banking, healthcare and energy services and other aspects of the economy, both local and at the international scope. The platform and sharing economy have been described with different names such as creative, collaborative, on-demand, gig, network or the sharing economy as has been adopted by this chapter. Whatever the name is, the underlying concept is based on mobilizing human and other economic resources for 1) co-creating value, 2) capturing value, and 3) economic development.
Since 2014, a series of survey-based research outputs have emanated from the Centre for Global Enterprises (CGE) project on the emerging platform economy, acquiring regional data on platform development from China, North America, Europe, India and Sub-Saharan Africa (Evans & Gawer, 2016). While information and communication technologies (ICTs) are fostering new businesses with disruptive business models, Africa has just been awakened to this new reality. The population growth, economic activities and consumer demands for better and efficient ways of service delivery unravel diverse economic models of value creation, delivery and value capture. These emerging business models continue to power digital business transformations which have and still beckoning on investors—locally and internationally to invest in digital startups across Africa. Many of the largest and most successful businesses now operate as platforms given the role of technology in today’s digital world. While African tech start-ups may not yet measure with these global super-platform companies, platforms continue to disintermediate Africa’s business landscape with the promise of putting Africa in a global competitive spotlight.
As African economies make efforts to compete with the rest of the world’s economies, technological innovations will remain paramount to this development sojourn. This is where information and communications for development (ICT4D) play a crucial role in inclusiveness and growth across all sectors. Until the late ’90s, traditional pipe businesses have been the dominant drivers of African economies but now face stiff competition and cannibalization from this new class of business model that now disrupt the incumbent. This disruption is both digitally innovative and transformational, leading to the creation of new business principles such as the on-demand economy and a new sharing economy. Although sharing has been a key component of the African society, the evolution of the platform economy continues to formalize sharing mechanisms in a coordinated manner that is mutually benefitting to all stakeholders. Considering this, Perren and Kozinets (2018) submit that the sharing economy is defined by a reliance on platforms through which providers and users are appropriately identified and matched for the facilitation of exchange of resources. Evans and Gawer (2016) note that the relevance of platforms to growing any economy continues to prove more significant as they have become the drivers of productivity in multiple ways through the digitalization of products, services and businesses processes, and provide support for efficient utilization of assets, thus, reshaping the global landscape. The platform economy is thus a driver of the sharing economy, just as the sharing economy is a value driver for the platform economy (see Figure 1).
Figure 1. A relational flow between ‘platform’ and ‘sharing’ economy concepts