Amazon officially opened its Home Services program today to let folks shop for personal in-home services, from appliance installation to academic tutoring to automotive maintenance. Just drop a service in your cart like you would with any other product on Amazon, schedule a time, and pay when the service is done, says the The Verge.
But instead of contracting out to specialists on its own, Amazon will simply act as the platform for the transactions. In so doing, Amazon will let specialists set their own prices, likely allowing Home Services to survive the legal onslaught that’s currently besieging the gig economy.
For the Home Services launch, Amazon has lined up more than a dozen partner businesses that can supply knowledgeable specialists, from Pep Boys (for auto maintenance) to Dish Network (for audio/video setup) to TaskRabbit (for everything else). Other businesses and independent contractors can apply on Amazon’s Selling Services page, and as long as they pass Home Services’s comprehensive vetting system, they’ll be listed locally for that service.
Home Services is different from last December’s announcement of Local Services program, which is more like a Groupon for local deals and discounts, says Amazon spokesman Erik Fairleigh.
Amazon is getting in on the services game because consumers usually spend four times as much on services as on products, says Fairleigh–and since the Home Services specialists are setting their own prices to stay competitive locally, everybody wins. Amazon gets a cut of consumer-paid fees for hosting specialists on its service, ranging from 10-20 percent, depending on the type of service. Plus, Amazon promises a money-back guarantee to consumers if the service isn’t satisfactory.
By letting businesses and contractors set their own prices, Amazon looks to dodge the bullet that has plagued other gig economy businesses. Uber and TaskRabbit both employ armies of contractors to avoid doling out the perks afforded to full-time employees like benefits and wage minimums. Some of those contractors have sued, claiming that the companies are purposefully misclassifying their work as contract when it could qualify as full employee work.
Perhaps the biggest potential issue facing Amazon is the possibility that the gig economy companies it hosts on Home Services become crippled by litigation before the new platform has a chance to flourish. As Fast Company’s Sarah Kessler writes, a lawsuit against gig economy company Handy for misclassifying two workers as contractors could be applied to all 2,000 Handy contractors, which would force the company to pay out $600 million in damages.
And the unrest is everywhere, from Uber driver protests in San Francisco and New York to a letter-writing campaign from Amazon’s own Mechanical Turks to Amazon CEO Jeff Bezos asking for greater pay and communication. When gig workers are overworked, underpaid, and have few (if any) protections from their contract employers, landmark legal cases with broad implications for the gig industry might be the only way to win contract workers the employee rights they seek.
Amazon says it’s confident about its vetting process, which needs to be strong if Amazon users are to feel confident inviting Home Services contractors into their homes.
If all goes according to plan, Home Services will be another pillar in Amazon’s e-commerce empire, just like its recent forays into grocery delivery and hotel booking. But we’ve already seen Jeff Bezos’s team jump into fields before they’re ready, like when they recalled their diapers after two months and bungled the launch of their Fire smartphone, so Amazon’s got its work cut out, if it’s going to offer as good an experience with Home Services as it does for online shopping.
[via The Verge]