The rise of so-called "disruptive" businesses such as Uber and Airbnb is receiving fresh support from the state government amid new estimates that they contributed more than half a billion dollars to the NSW economy in the past year.
Innovation minister Victor Dominello will on Tuesday announce the government is embracing what is known as the "collaborative economy" and developing a framework for its potential regulation.
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Sharing economy worth $500m to NSW
The NSW sharing economy has contributed more than half a billion dollars to the NSW economy in the past year, according to new research from Deloitte Access Economics.
The announcement comes a month after the NSW government legalised ride-sharing services such as UberX and said it would deliver $250 million in compensation to the taxi industry.
It signals the government's willingness to further intervene in the market to support emerging startups while ensuring principles such as consumer protection and fairness to all businesses are adhered to.
A position paper to be released by Mr Dominello states the government "welcomes the positive impact of the collaborative economy for consumer choice, employment and productivity".
It quotes research commissioned from Deloitte Access Economics, which estimates 45,000 people earned income through the collaborative economy in the past year in NSW.
The areas of transport such as Uber, accommodation such as Airbnb, financial services such as Kickstarter, online marketplaces such as Ebay and Gumtree, and services and labour hire businesses such as Airtasker "value added" about $504 million, it found.
The position paper outlines five guiding principles for how the government will approach the collaborative economy, which it stresses will be supported as long as "all businesses" are treated fairly and "appropriate levels of consumer protection and public safety are in place".
They are: supporting a culture of innovation; fit-for-purpose regulation in the digital age; customer protection and safety; promoting competition; and agile government procurement.
It says the government will work with industry and experts to "make it easier for start-ups to do business in NSW".
Its attitude towards regulation "will be flexible and proportionate to identified risks" and consider a "digital-first approach".
However, businesses must ensure customer protection is paramount and that their goods and services meet "community safety and amenity standards".
It states competition within markets "leads to greater efficiency and innovation" and that the government will consider buying collaborative economy goods and services using the "value for money test".
Research from 2014 quoted in the Deloitte report states 53 per cent of Australian consumers had "participated in some form of collaborative economy in the past year". It said 63 per cent planned to in the near future.
Mr Dominello said digital innovation is "transforming the way people do business in every city and every country around the world. The reality is the collaborative economy is here to stay."
"We are living in the information age and it is vital that government policies embrace new technologies and enable businesses to operate with certainty," he said.
Chris Riedy, associate professor with the Institute for Sustainable Futures at the University of Technology Sydney who has been researching the collaborative economy for the past five years, said the announcement was "quite a positive step".
"The devil's in the detail of how they're going to put some of this into practice in the different sectors," he said. "But as far as a first step it seems fair and balanced and recognising the benefits and the challenges at the same time and, I guess, quite forward thinking."
Dr Riedy said many jurisdictions have been actively impeding businesses like Airbnb and Uber.
"So it's pleasing to see they're coming at it from an innovation angle. They're letting these digital platforms innovate but recognising there needs to be a balance and they can't all be cowboys doing what they want out there".