Not "JerkTech" -- Just Business as Usual

July 11, 2014

A recent outcry against companies like MonkeyParking in SanFrancisco, which creates a private market for public parking spots, or ReservationHop, which sells reservations at hard-to-reserve restaurants, raises some important questions.


On one hand, Josh Constine at TechCrunch has branded all of these kinds of businesses that take advantage of existing public, often free, infrastructure and make it more costly (and therefore less accessible) “JerkTech.” And he’s not wrong -- especially in a place like San Francisco, where there is a growing socio-economic divide that is being driven by the tech industry, accompanied by a growing resentment for those same companies. These companies make it harder for any individual to have access to typically cheap or free public goods, and can make it impossible for people who can’t afford to pay more to access these resources.


Business is ultimately about making money, preferably without disenfranchising whole demographic groups, but that’s often a secondary consideration. There is a Silicon Valley trope of “changing the world” and “making the world a better place.” But most of these words come from young people making incredible salaries, which feels somewhat disingenuous. Aren’t all Silicon Valley tech companies engaging in similar behavior to MonkeyParking, if less directly? The affordable housing crisis in the Bay Area has major effects on people making lower wages, and while the cause is debated, the inflated salaries and the growing tech industry have definitely played a role.


Right now the city is fighting MonkeyParking, which is a good first step. But maybe the city should implement MonkeyParking, or some similar market.


MonkeyParking is JerkTech. It does not own those parking spaces, and by selling them at a premium it undermines a public service that taxpayer dollars are subsidizing -- the opportunity for anyone to find parking, not just the wealthy or upper-middle-class. But it is also a great example of using a market to solve a problem, parking access in San Francisco. In fact, the city already tried to put in place something similar on its own. Unlike MonkeyParking, the city is not a “jerk” in the same way, since it maintains and owns the spots. But it does have other considerations that it must weigh --


For example, which is more important, parking spot occupancy or availability? When the city tested increasing parking rates, it never affected parking space availability in the long term.


It’s also often considered government’s role to make sure that public resources are distributed equally -- whether that means subsidized housing for poorer people, or unreasonably cheap parking, available to anyone willing to cruise for a space long enough. But is it better to keep prices low, to give everyone a tiny shot at these parking spaces regardless of income? Or should the city increase prices until they either break even or make enough money to divert elsewhere, then provide or subsidize some other service targeted at the people who are now priced out of parking? These people would have had a hard time finding parking anyway under the old system -- but no harder than anyone else.


This kind of policy requires a little bit of number crunching and some value judgments about how best the government can serve two very different populations in one city. By acting more like a business, cities and governments can drive higher revenues that can provide other public benefits.


Politically, this kind of solution can be tricky to enact. But this is the kind of intelligent policy that will make our cities better places, by increasing the number of public benefits and policy options out there.


MonkeyParking and ReservationHop have been criticized widely, but ultimately the flaw in both ideas is that they capitalize on “free” services that are not actually free. MonkeyParking’s parking spaces are maintained by the city, and ReservationHop’s reservations can be thought of as a bundled service offered by a restaurant to a paying customer. Neither of these businesses has a right to capitalize on these particular opportunities. Both the restaurant industry and the city, however, should take advantage of the research and customer validation these companies have already done for them and change their own practices.


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