Platform Coops, but for whom?

This blog is part of Human Stories of Digital Transformation. With this project, our goal is to direct attention to the lack of public and civic spaces online and the effect of extractive business practices on people’s daily lives. At the same time, we offer pathways to an alternative digital infrastructure and point to alternative practices that can serve as models and inspiration.

We look at the impact of the current dominant digital business models on five domains: local economy and communities, care, workers’ rights, education, public debate, and climate. As the awareness of the impacts of extractive practices on all these different spheres of our lives grows, more and more people, organisations, governments, and other actors want to be part of the change. With this project, we aim to boost those efforts and offer concrete ideas for public value-based digital infrastructures and business models.

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Where, when, and how work is done is changing. Currently, Big Tech companies are only getting bigger and more dominant. In this blog series, our colleague Carolyn Beer introduces an alternative possible future of online societal organizing by way of platform cooperatives. In this second blog, she writes about the movement of cooperatives and how platform coops offer a chance for other movements.

Platform Cooperatives are often advocated with stories of better labor practices coming from worker control which, while true, may lead others to think that this is not “about them” too. Cooperatives, generally, are more likely to keep wealth within a given community, benefiting customers too. In the digital context, platform cooperatives provide for attentive, caring data stewardship.

Cooperatives have a significant presence in the world’s economy today. According to the International Organisation of Industrial and Service Cooperatives (CICOPA), employment in and within the scope of cooperatives includes 279.4 million jobs, accounting for 9.46% of the world’s total employment. Beyond bringing employment, cooperatives provide decent work as they, by definition, value the principles of employee protection, fair profit-sharing, and community building.

They play a major role in developing local areas. Whereas private investors tend to be attracted to areas with cheap labor and relocate income and profits in urban centers or abroad, cooperatives are established by the community where they are located and grow to serve that community. The innovative offshoot of the cooperative model is the “platform cooperative,” a term referring to the cooperative model applied in the digital economy and introduced in our last blog post.

1. Existing cooperatives

In line with an essential principle of cooperation — that coops should support other co-ops — guidance and expertise of traditional cooperatives are needed to progress this movement. Because so many platform co-ops offer innovative business models, these models offer a huge opportunity for financial, social, and political disruption and success. Additionally, existing cooperatives may benefit by creating digital services and tools.

2. Freelance workers

Platform co-ops emerge as a key strategy for changing the exploitative workplace dynamics of freelance work. By organizing workers through labor platforms that they own and operate together, freelancers can continue to pick up gigs as they see fit while meeting administrative, legal, and healthcare needs.

3. Business owners

Faced with rising income inequality and possible recession, converting to the cooperative model could be important for businesses to succeed. Sharing ownership with workers ensures that a broad base of stakeholders is engaged and invested in the business. People take more responsibility for what they own and operate. Recent research has documented the increased efficiency and improved performance and productivity of worker-coops.

4. Technologists, developers, and engineers

Running a platform cooperative means that the members of the co-ops are on the platform, which gives them sovereignty over the code. Members, therefore, have more control over the privacy of the users and transparency over what happens to data on that platform.

By organizing as a worker cooperative, tech workers can create democratic businesses that they own and operate. The co-op is free to determine how it wants to define its membership: it can be comprised of workers, including consumers or producers, community members, or other stakeholders. Each owner has a share and a vote in the co-op — which means that they can jointly decide which projects they want to take on.

5. Researchers

Research can make a difference by guiding policy and practice. The study of the cooperative digital economy is a new field that offers the opportunity to create applicable knowledge and help real people and communities in the short term. The cooperative digital economy is a new field of study that draws on interdisciplinary thinking and brings into conversation the fields of anthropology, political science, sociology, history, economics, labor studies, and cooperative studies.

6. Policymakers

Platform co-ops are a powerful new way to address growing concerns about data privacy. Advancements in artificial intelligence are shown to scale up discriminatory practices based on gender and race. We must think about how data is collected, analyzed, and to whom it is sold. Policymakers should look towards platform cooperatives as a viable political path in addressing problems with data privacy and labor inequity.

Governments can play a supportive role by creating legislation to facilitate the making of cooperatives and public investment in cooperative business development. Any business endeavor requires energy and capital to begin, and cooperatives by name require more since they are cooperation among different people necessitating conversation to discern the structure and governance of the business. Despite the heavy lifting, in the beginning, cooperatives are set up to benefit all stakeholders more in the long term and can be just as generative and innovative as any other business mode (if not more)l.

7. Civil society advocates & activists

This movement needs the support of non-profits and activists working across a range of political issues. Because platform co-ops address a range of social and political problems — including the lack of privacy rights, racial and gender discrimination, and many other issues — they can help build alliances across movements and tackle multiple issues at once. Through this alternative economic model, we have an opportunity to create solidarity across a spectrum of political movements.

8. Philanthropists and Funders

Grant-making foundations have an essential role to play in counteracting this decline in labor power. Funds can meet a broad range of goals by investing in anchor institutions and directly funding platform co-ops and related research. Platform co-ops improve wages, boost workers’ agency, democratize business decisions, and incorporate community needs into their business plans.

9. Union leaders & organizers

Organized labor needs a powerful new vehicle to organize workers into more fair on-demand work situations while also accelerating union growth. To counter alienation and other negative effects of the digital economy in new and imaginative ways, unions depend on an ecosystem of other kinds of worker movements such as the platform co-op movement. Traditional union models are struggling to organize workers that are increasingly reliant on gigs, platforms, and short-term work. This is especially true for distributed workers who are not working in the same place. Platform co-ops offer a new way of uniting workers online, with clear rights and privileges as owner-members.

10. Consumers, or anyone who uses internet platforms

‘Data is the new oil,’ refers to the immense market value that internet users’ data holds. As someone whose personal data is being highly capitalized on, platform users have strong grounds to feel concerned about where information about them is being sold, at what price, and how it is used. Platform cooperatives offer models where stakeholders may have agency regarding their personal data flows and more ownership of technology used in their day-to-day life.

In het third blog, next week, Carolyn will zoom in on the governance, ethics and technology of platform coops.