California Becomes First State In Nation To Regulate Ride-Sharing

Virtucon writes "Ride Sharing Services such as Uber, Lyft and Sidecar received a big boost today when the California Public Utilities Commission approved rules that would allow them to continue to operate as long as they followed a few rules. This makes California the first state to adopt such rules and is expected to preempt local governments who are trying to clamp down on these services and regulate them like local taxi companies."

Comments

Why is it called ride sharing?

[immaterial]

I must be missing something about this concept. If you're getting paid (with a net profit) to drive people around, why is it called ride sharing? How is it not a taxi service?

Re:Why is it called ride sharing?

[erice]

I must be missing something about this concept. If you're getting paid (with a net profit) to drive people around, why is it called ride sharing? How is it not a taxi service?

A taxi takes you where you want to go. A ride share takes you where you want to go providing it isn't too far out of the way from where the driver was going anyway. Think of it more like paid hitch hiking. That's the idea as Lyft presented to New Tech Meetup a few months ago.

It gets less clear when drivers use the service to make trips they would not otherwise have done, just to collect the fare. As I understand it, "professionals" doing just that for trips to and from SFO.

Re:Why is it called ride sharing?

[Nerdfest]

I tell people that unless they're covered with mud, they're just a poorly designed minivan.

Re:Why is it called ride sharing?

[MrEricSir]

How is it not a taxi service?

Legally the difference is that taxi cabs can be hailed on the street. No other type of private transportation (limos, airport shuttles, ridesharing, etc.) can be hired this way -- they require a separate, prior arrangement.

Re:Why is it called ride sharing?

[TheRealDevTrash]

Hipsters don't take taxis.

Re:Why is it called ride sharing?

[tlambert]

It's like how an SUV is called a "light truck" to get around more stringent CAFE regulations.

Actually, no.

According to 49 USCS 32901 [Title 49. Transportation; Subtitle VI. Motor Vehicle and Driver Programs; Part C. Information, Standards, and Requirements; Chapter 329. Automobile Fuel Economy], the term "work truck" means "a vehicle that--
(A) is rated at between 8,500 and 10,000 pounds gross vehicle weight; and
(B) is not a medium-duty passenger vehicle."

So it's by weight. The Cadillac Escalade was intentionally redesigned to add 200 pounds to it to make it legally a "truck". And yes, it was to get around CAFE regulations, but it also reduces property taxes in most jurisdictions, since trucks are considered work vehicles. In addition, as a work vehicle, you can get a license plate as a commercial vehicle, which permits stopping/parking in loading zones.

Re:Why is it called ride sharing?

[Anonymous Coward]

I must be missing something about this concept. If you're getting paid (with a net profit) to drive people around, why is it called ride sharing? How is it not a taxi service?

...A ride share takes you where you want to go providing it isn't too far out of the way from where the driver was going anyway...

.

No. I've used Lyft on multiple occasions, and every single time it was exactly like a taxi--"Take me to location X". There was no waiting around for someone travelling a similar route or anything along those lines.

What I actually really like about it is the rating system. Lyft provides a "suggested donation" for the traveler. The traveler can pay as much as they want (with a minimum of $5, IIRC), but Lyft tracks the value as a % of the suggested donation (which is *always* less than the cost of a taxi). Lyft drivers, then, have the ability to look up passengers that average, say, minimum 80% of the suggested donation. So if you're continually paying very little, you're going to quickly find yourself out of a ride. And on the flip side, travelers get to rate the driver--how friendly were they, how clean was their car, etc. And living in Chicago, I can tell you that I have taken far more filthy taxi rides with complete asshole drivers (who refuse to take the route I tell them) than I care to count. So while I haven't used the other services, I have nothing but good things to say about Lyft.

Re:Why is it called ride sharing?

[joocemann]

So what you're saying is that they are using a loophole by relying on their drivers to lie about what they were doing. A lawyer might even argue that, of course, the driver was going in that direction because money was waiting for them when they arrive! How keen!

Pffft. Why not just deregulate taxi driving and be honest about it. I know Lyft drivers. They are *not* picking people up randomly. They treat it as a job and appreciate the income.

Re:Why is it called ride sharing?

[Anonymous Coward]

It's like how an SUV is called a "light truck" to get around more stringent CAFE regulations.

Well duh.

Complex regulations are ALWAYS worked around by everyone.

Imagine that.

It's just another example of how people fight an overweening government's attempts to control behavoir

Re:Why is it called ride sharing?

[WWJohnBrowningDo]

My source says the Escalade is 7,100 pounds gross. Perhaps you have a better source that puts it above 8500 pounds?

Meanwhile this link backs up everything GP said.

The basic definition of a light truck--any truck or truck derivative with a gross vehicle weight rating of 8,500 pounds or less--allows plenty of room for family vehicles. Because light trucks is considered a separate category from passenger automobiles, vehicle manufacturers have been able to build and market SUVs and other large vehicles with a less stringent CAFE standard, currently 20.7 miles per gallon (mpg). Furthermore, most SUVs and pickups, and all vans, are currently permitted to emit 29% to 47% more carbon monoxide and 75% to 175% more nitrogen oxides than passenger cars.

Re:Why is it called ride sharing?

[icebike]

A separate prior agreement that you can make via a phone call while chatting with the driver.

If Taxi's want to compete, let them build a rating system like Lyft or Uber.
Put a QR code on their doors people can find out about the surly bastard driving and the condition they keep the vehicle in.

There are apps for this in the taxi world, mytaxi is a common one. TaxiMagic is another.
mytaxi-Driver skips the cab company and goes direct to the cabbie, and its the equivalent of a street hail.
With some of these apps you can pay the fare through the app.
But they are still way more expensive than lyft or uber.
Oddly, many cities forbid these apps.

The only advantage taxi's have, is that, at least in some jurisdictions, the driver passed a background check, if not the sniff test.

Re:Why is it called ride sharing?

[mjwx]

I must be missing something about this concept. If you're getting paid (with a net profit) to drive people around, why is it called ride sharing? How is it not a taxi service?

Because they haven't paid the Californian govt for a license.

There may also be liability issues. Certainly in Oz if you paid for a "private" car insurance policy the policy may be declared null and void if you're using the car for commercial purposes.

Re:Why is it called ride sharing?

[Anonymous Coward]

Every time I see a Hummer I start shooting my AK-47 at it, throwing bombs, and yelling "Allahu Akhbar!"

Re:Why is it called ride sharing?

[I'm New Around Here]

You too? I thought I was the only one. Yeah, Go Akhbar, whoever you are!

Re:Why is it called ride sharing?

[Mr. Freeman]

The difference is that a ride sharing program has a driver who is not licensed to drive taxis or limos, is not properly insured, and is not required to maintain their car. You're entirely correct that these ride sharing programs are nothing but an end-run around the regulations for taxis and limos. We need to regulate them for the exact same reasons we need to regulate taxis.

Re:Why is it called ride sharing?

[Anonymous Coward]

Taxis also don't get to pick and choose their fares...if they stop to pick someone up, they have to take them wherever they're going. These sharing services allow drivers to screen based on destination, so people heading to bad neighborhoods could be SOL.

Re:Why is it called ride sharing?

[fnj]

A taxi takes you where you want to go. A ride share takes you where you want to go providing it isn't too far out of the way from where the driver was going anyway. Think of it more like paid hitch hiking. That's the idea as Lyft presented to New Tech Meetup a few months ago.

So in other words:

(1) a taxi takes you where you want to go for money within limits (i.e., no taxi is likely to take you from Maine to Tierra del Fuego, and you can't always rely on them picking up and discharging in certain neighborhoods).

(2) a ride share takes you where you want to go for money within limits.

Yet you evidently somehow see a difference between the two fundamental enough to justify classifying (and regulating or not) them differently [shakes head in bafflement and wonder]. What I see is some people attempting to work around onerous over-regulation of taxis and financial burdens on same which they must pass on to customers. I can't imagine why anyone would object to the opportunity they are attempting to provide to both drivers and riders, but the method seems foredoomed because of existing taxi regulations. I do understand that it is difficult to attack those regulations because they arise locally in thousands of separate jurisdictions. It's like a lot of manifestations of runaway government. I don't see how to effectively control it without what ... overthrowing the entire system ... in favor of what?

Oh, and a vanishingly small percentage of drivers demand money to give a lift to a hitchhiker. That one is just a pure red herring.

Re:Why is it called ride sharing?

[Chris Mattern]

It is a taxi service. They're calling it something else so it doesn't get strangled by the cartel-based rigid regulation of taxis.

Re:Why is it called ride sharing?

[Talderas]

It might be a trap for Akhbar.

Re:Why is it called ride sharing?

[Kielistic]

Hey, it's very important that my vehicle look more impressive by being taller, even though it raises the center of gravity and greatly increases the risk of rolling over.

You may never have driven a high vehicle but if you have you would immediately notice that being high gains you a better view (at least I do when I get in a high vehicle from my sedan). This is actually pretty nice when turning left at intersections, merging lanes etc. Being as most people drive these vehicles in urban environments and not in environments that would stress their centre of gravity I would posit that they've more concerned about the better view than "looking impressive" or worrying about their centre of gravity.

Re:Why is it called ride sharing?

[intermodal]

And this, in a nutshell, is what separates the ride-sharing services from taxis.

What it really does, in my opinon, is provide a much-needed reset for regulations upon ride-for-hire services that were once monopolized by cabs. As with any longstanding sets of regulations, taxicab regulations have long been past due for the whole system to be stripped down and rewritten from the ground up.

Re:The Third World was first

[MrEricSir]

So if the US does something that a third world nation does, that makes us a third world nation? By that logic, Americans who breathe have turned the US into a third world nation.

Re:Taxi Medalion

[Anonymous Coward]

"This is a pure case of individuals rather than corporations in California finding a way to make a profit and the state can't allow that."

FTFY.

Re:The Third World was first

[EzInKy]

"Hey Ez, where you headed?"
"Going to the store to get some beer."
"Mind if I go? I need a few things too."
"Sure, no problem."

I'm sure I'm not the only one in shares rides either.

the taxi services have a right to be pissed

[hguorbray]

considering that a medallion in San Francisco can cost upwards of $200k

http://www.sfexaminer.com/sanfrancisco/flag-might-drop-on-more-taxi-medallions/Content?oid=2193759

-I'm just sayin'

Re:the taxi services have a right to be pissed

[ThatsMyNick]

The taxi services were enjoying the monopoly and have a share of the blame too. It is not as if they were trying to fight the medallion system. I personally cant wait for the medallion system to collapse, or prices to plummet.

Re:the taxi services have a right to be pissed

[tlambert]

considering that a medallion in San Francisco can cost upwards of $200k

http://www.sfexaminer.com/sanfrancisco/flag-might-drop-on-more-taxi-medallions/Content?oid=2193759

-I'm just sayin'

Only if they damn well show up when I call them, rather than taking nearby, more lucrative fares when they get flagged down on their way to me. If their dispatcher agrees on their behalf that they will show up, they need to damn well show up.

If they don't show I, I really don't give a flying what they paid for their medallion (and most Taxi drivers in SF are contract workers, with the medallion being owned by the taxi company; the driver is just an employee with no benefits who has to follow radio orders).

Re:the taxi services have a right to be pissed

[flimflammer]

Indeed. The worst situation was when I called in a pickup, and the Taxi driver outright lies to dispatch saying I wasn't there so they can avoid actually picking me up. I was at a large stadium in the middle of the night, standing at the entrance to the parking lot. There was one way into the parking lot. I was the only person there. He then told dispatch that I wasn't there. Cabbies deserve to be fired over this crap.

Re:the taxi services have a right to be pissed

[Anonymous Coward]

The SFMTA reports that there are only twenty-nine taxi companies that legally operate in San Francisco. Those 29 taxi companies operate a total of 1,707 cabs. (One medallion allows one cab to be operated.)
I can tell you from hard, long experience that this is far too few cabs for the city.

Data source, straight from the horse's mouth: http://www.sfmta.com/services/taxi-industry/medallions/medallion-holders

There are currently 1,430 people waiting to acquire a taxi medallion. http://www.sfmta.com/services/taxi-industry/medallions/waiting-list

It is said that one is often on the waiting list for ten years. In order to acquire a medallion, you have to meet a boatload of somewhat reasonable requirements, then be able to pony up $300k. From that $300k, the city takes $100k, and the remainder is given to the previous medallion holder.

As of this moment, the city does *not* create new taxi medallions. This is the very definition of "lucrative, performance insensitive monopoly".

Re:the taxi services have a right to be pissed

[Thomasje]

Don't hold your breath waiting for prices to plummet when taxis are deregulated. This has already been tried in the Netherlands, and the result was that prices went up, not down, and service got worse, not better, capitalist dogma notwithstanding.
The problem is that taxi drivers need to make a certain amount of money to pay their cost of living, and if the number of cabs goes up while the number of passengers doesn't, they end up spending more time waiting for fares, and less time actually driving. And they can't just hop off to a second job while they are waiting. So, they have to *increase* their rates in order to make up for their reduced number of trips, so taking a cab becomes more expensive, and they will tend to refuse short trips, trying to hold out for the more profitable longer ones, so taxi availability gets worse.

Re:the taxi services have a right to be pissed

[Truth_Quark]

On the other hand, it worked quite well in Wellington, New Zealand.

Re:the taxi services have a right to be pissed

[Zenin]

In San Francisco "taxi services" do not own medallions generally, individual drivers do. This is a distinction that matters a lot.

It means that a customer can call a taxi service and request a cab...and the service will put the call out on the air...and no cabs will care to pick it up (bad neighborhood, too out of the way, whatever). The service can't hold the drivers accountable (the drivers own the medallions) and the customer just gets to stand on the corner forever at times...completely unable to get a cab from any of the "5 pages" of taxi services (since they're all asking largely the same pool of medallion-carrying drivers). -The "services" get kick backs from the drivers for routing them calls, that's how they make money: The drivers are their customers, not the passengers.

And...Most drivers however, aren't even medallion holders. I know, I just said they were, but they're not. Drivers with medallions rent their medallions out to other drivers (thus ensuring the expensive medallion is making money 24/7 for the owner). Those sub-sub-contracted drivers are most of the actual drivers in the city.

The actual owner is required to "drive" some number of hours each week to maintain the medallion. But they're lazy...they own a medallion (read: free money), so why should they actually work? So they do their hours by sitting in the taxi waiting line at the airports, watching YouTube on their phones.

DOZENS of them...all in a line for ages at the airports...transporting no one...for hours at a time. Meanwhile the actual CITY of San Francisco suffers a severe lack of taxi service.

-----

And no one is accountable. Not the "taxi services" (they can't fire or refuse to "hire" a given cab). Not the medallion holders (who largely see their medallion as a free-ride and so long as the sub-contracted driver pays their rent who cares). And definitely not the consumers (who have no ability to select or rate drivers...and it wouldn't matter if they could because again, most drivers aren't medallion owners and the owners don't give a damn).

And it's been this completely fucked up for at least half a century, probably longer.

The medallion system is completely indefensible.

Re:the taxi services have a right to be pissed

[AK Marc]

In Anchorage, the only way to create new medallions is to have the current holders vote to create them. The city started issuing some, and they were sued for illegal seizure by diminishing the value of the existing ones without compensation. The courts ordered that the city must buy-back existing medallions at market prrices (About $100,000) before they could issue new ones. So no new taxis. Most are owned by out-of-state investors, and the original idea of owner-operator is the rare exception (and the few of those also rent out the medallion when they aren't driving, often making more renting it than driving it).

Re:the taxi services have a right to be pissed

[Zenin]

If they were anywhere else they'd get hailed (almost instantly) and have to drive. And they can't just turn the service light off and not take riders, they wouldn't be "working".

Re:the taxi services have a right to be pissed

[Zenin]

If they don't show I, I really don't give a flying what they paid for their medallion (and most Taxi drivers in SF are contract workers, with the medallion being owned by the taxi company; the driver is just an employee with no benefits who has to follow radio orders).

That's just it, in SF the medallions are not owned by the taxi company. They're privately owned. Sure, most of the drivers are contracted...but they are contracted to the medallion owners (individually), not the taxi companies. Or more correctly, the drivers rent the medallions and so aside from paying that rent not even the medallion owners care what the driver does.

The taxi companies have no leverage over the drivers, they can't fire them or otherwise demand they actually do what they're told.

The sad fact is they don't have to follow radio orders, ever, from anyone.

Re:The Third World was first

[Anonymous Coward]

Do you know who else also breathed? Hitler. You should be ashamed of yourselves.

Re:Taxi Medalion

[FooAtWFU]

"This is a pure case of upstarts rather than entrenched interests with political connections in California finding a way to make a profit and the state can't allow that."

Adjusted that FTFY of yours for you. (Because there are a few notable non-corporate examples from time to time.)

Re:The Third World was first

[rmdashrf]

Not directly, but at least my expectation of a first world country would include excellent public transport. In the US public transport has been killed by privatisation and corporate lobbying.

Poor public services are an indication of a third world country however, the way things seems to be going in the US is that the only thing that's going to be 'first world' quality is the military.

Not only happening in the US though in Europe the neo-liberalist governments are killing affordable public transport, housing, healthcare and education as well. That does seem to happen due to influences from the US government; EU politicians trying to be more like the US.

Is any regulation necessary?

[mendax]

A very conservative friend seems to think I'm rather liberal when I think regulation is a good idea sometimes. Regulation *is* quite often a good idea when history has amply demonstrated that a business model cannot operate in a legitimate or non-abusive manner without it. Classic examples of this are banks and the the Wall Street financial market as well as the taxi business in places like San Francisco and New York, automobile manufacturing, trucking companies, and the labor markets. Great evils of various kinds have occurred when these things were not regulated. But sometimes overregulation creates problems. A great example is the airline industry. At one time, the airlines were highly regulated. Regardless of who you flew with, the fare would be the same for the same route and they were high. Airline travel in those days was quite expensive. Since airlines couldn't attract customers using fares, they differentiated themselves by offering great service (even in "cattle" class), better planes, etc. For example, when was the last time that any of you flew a Boeing 747 on a domestic flight that wasn't a leg of an international flight? In the 1970's, wide-bodied planes were common on the higher trafficked domestic flights. These days, airline service is awful but relatively inexpensive.

So I ask the question: Does ride-sharing really need to be regulated beyond a requirement that the vehicles and drivers have proper insurance? Is it anything like the wild west of unregulated taxi services in places like New York and San Francisco that created chaos?

Re:The Third World was first

[dan the person]

No it's when the US does something the third (and second) world pioneered. Third world didn't pioneer breathing. (though you could argue they pioneered human breathing if you believe we first evolved there. Of course back then it would have been the most highly developed and thus a first world continent).

This ride-sharing is very common in the former soviet bloc too, though it's of the rather more basic wave-your-arm up and down at all the passing cars type technology rather than using phones.

Re:The Third World was first

[rsilvergun]

No, but just because we can lampoon his analogy with hyperbole doesn't make him any less right. These services got popular not because hipsters care about the environment but because there's lots of people that need to get places and can't afford cars and regular taxis anymore. It points to a general decline in income and standard of living.

You do realize that was a fantasy article...

[moosehooey]

...about the future. Google isn't selling any driverless cars.

Re:You do realize that was a fantasy article...

[gottabeme]

Wow. Let me draw your attention to a few things from the article:

July 25, 2023 — As part of its second-quarter earnings announcement today, local transportation and delivery giant Uber announced its biggest bet on autonomous vehicles yet, saying it would purchase 2,500 driverless cars from Google....

Uber has committed to invest up to $375 million for a fleet of Google’s GX3200 vehicles, which are the company’s third generation of autonomous driving cars, but the first to be approved for commercial use in the U.S. The deal marks the largest single capital investment that Uber has made to date, and is also the first enterprise deal that Google has struck for its new line of driverless vehicles.

It’s been just five years since Google announced it would begin manufacturing its own driverless cars, and just two-and-a-half years since those vehicles have hit the streets.

It's explicitly a "dispatch from the future."

Re:The Third World was first

[FishOuttaWater]

Yes, but he stopped, so it's ok now.

A Few Rules

[jimbrooking]

The rules in the article are as follows:

"Regulators would require drivers to undergo criminal background checks, receive driver training, follow a zero-tolerance policy on drugs and alcohol and carry insurance policies with a minimum of $1 million in liability coverage."

That seems like some pretty heavy lifting that will probably dissuade lots of otherwise good-natured and willing drivers, no?

Re:Which Nation?

[PPH]

Thank goodness we've got this little tiff out of the way. And I thank my good fortune that I live, unambiguously, in Washington.

This is not "Rideshare". It's wrong to say it is.

[eepok]

Rideshare is a federally recognized term that encompasses carpool, vanpool, train, bus, and even bike/walk transportation. The creator of Lyft (John Zimmer) knows this very well as he created a fairly-well-adopted ride-matching website called "Zimride".

Zimride doesn't make too much money, though, so he sold it to Enterprise (the car rental company who also is in the carshare and vanpool markets) and created Lyft. Along with other similar decentralized taxi services, he is trying to brand their business models as "rideshare" to equate them with more sustainable practices and receive subsequent leniency in various markets and even public funding.

If you want to see what genuine real-time rideshare is, check out Carma (formerly "Avego"). This is a carpool-facilitating program that makes sure that the driver doesn't make a profit off the shared ride (per State Department mileage reimbursement rates).