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Uber's Rise In China May Be Counterfeit

Posted by timothy on from the uber-has-a-reputation-for-gaming-too dept.

retroworks writes: Josh Horwitz' story in Quartz reports both the apparent rapid success of Uber adaptation in China, and a queasy footnote for shareholders applauding the rapid growth. While China is a natural ride-sharing haven, it also has a tradition of gaming the western system. From the story: "Accomplices can sit in their apartments, disable location settings, and specify a pickup not far from the actual location of driver's vehicle, the report said. The driver then accepts the hail, and goes on a trip without a passenger. After the accomplice approves payment, the driver will – hopefully – pay back the fee and share a cut of the bonus. It's not the most clever get-rich scheme on the planet. But for drivers, it's better than waiting for a hail in a parking lot." Uber's spokeswoman told the Quartz writer that the company has an on-the-ground team who investigate into these various type of fraud, then uses "deep analytics, and new tools developed by our Chinese engineers in our dedicated fraud team to combat against such fraud." The Uber spokeswoman declined to elaborate on the nature of these tools.

86 comments

  1. Trying to figure out how this works... by TWX · · Score: 5, Insightful

    How is money made, if the fake passenger pays X to Uber, the driver earns X-% from Uber, and the driver pays X-% back to the fake passenger?

    --
    Do not look into laser with remaining eye.
    1. Re:Trying to figure out how this works... by jaseuk · · Score: 2, Informative

      Free rides and bonuses, that are funded from the service charges.

    2. Re:Trying to figure out how this works... by Senior+Frac · · Score: 1

      Even this statement doesn't make money appear out of thin air. It still doesn't explain how Uber loses money after they take their cut of the transaction.

    3. Re:Trying to figure out how this works... by towermac · · Score: 2

      Okay, but at some point Uber has to make money, and at that point, it is then a net loss for the driver and his co-conspirator.

      If that's not the case, then that is what is wrong with Uber's business model, and a problem that is easily fixed.

    4. Re:Trying to figure out how this works... by Nukenbar · · Score: 1

      Stolen credit cards?

    5. Re:Trying to figure out how this works... by NotDrWho · · Score: 0

      Basically, it works like this:

      They Chinese. They play joke. They pee pee in Uber's coke.

      --
      SJW's don't eliminate discrimination. They just expropriate it for themselves.
    6. Re:Trying to figure out how this works... by Anonymous Coward · · Score: 0

      Who's getting "free rides and bonuses" and why do they deserve it?

    7. Re:Trying to figure out how this works... by rhazz · · Score: 5, Informative
      You aren't trying very hard then, since TFA clearly states that Uber is adding special bonuses and subsidies to attract drivers. They are weathering smaller profits and some losses to gain market share because there were existing players in the market.

      By one account, Uber was handing drivers 300 yuan (about US$50) for every 30 trips and 400 yuan for every 40.

      Seems like they need to add other metrics into their bonus system, like a minimum fare required to count towards the bonus.

    8. Re:Trying to figure out how this works... by amicusNYCL · · Score: 1

      What bonuses and service charges? If I take a ride and it costs me $10, I know that my driver gets $7.20 and Uber takes $2.80. I'm already out $10, how are we both going to earn a profit by splitting $7.20?

      --
      "Our two-party system is like a bowl of shit looking at itself in a mirror." - Lewis Black
    9. Re:Trying to figure out how this works... by Anonymous Coward · · Score: 0

      Communism

    10. Re:Trying to figure out how this works... by ShanghaiBill · · Score: 4, Interesting

      Okay, but at some point Uber has to make money, and at that point, it is then a net loss for the driver and his co-conspirator.

      At some point Uber has to make money, but that point may be off in the future somewhere. WARNING: I READ TFA. Uber is paying "new driver" bonuses. So the driver signs up for an account, does enough fake rides to earn the bonus, then still has enough to make a profit even after paying both Uber and the accomplice. Then they create another Uber account with another name, and do it again.

    11. Re:Trying to figure out how this works... by Anonymous Coward · · Score: 0

      The real answer is that Uber offers a kickback system at a monetary loss.

      jaseuk's post is very cryptic as it gives unimportant details about the kickback system and omits the crucial fact that it is a monetary loss to Uber. I'm not sure why it's moderated so high.

    12. Re:Trying to figure out how this works... by cdrudge · · Score: 1

      Using made up numbers, You pay Uber $10. Uber takes $2.80, but gives back a $5 bonus incentive for being a new driver. The driver returns the $10 to the customer/accomplice plus 1/2 of what's left. The accomplice makes $1.60 and the driver makes $1.60 and Uber is out $3.20 (or more if you account for other overhead)

    13. Re:Trying to figure out how this works... by Lobachevsky · · Score: 4, Insightful

      I received a $30 credit from Uber when I installed the app. That's free money. However, Uber only lets me spend it on my first Uber ride. So I can't just put that $30 into my bank account. In my case, it was raining one day, and I didn't have an umbrella, so I called an uber and got a short ride home. It came to $8, which used up my $30 credit. I didn't cleverly hatch a scheme with the driver.

      If I were in China, I could say, hey, dude, bill me $30, it's coming off my new user credit anyways. Then give me $10. The driver makes $20 instead of $8, and I make $10 instead of $0. The loser would be Uber. Now, if I were to make a criminal enterprise out of it, I could say, hey, why even get a $8 ride? Let's have NO rides, and just keep billing $30 to get that juicy new user credit! We'll get keyboard farms to keep creating new uber accounts and riding and get that sweet $30 snatch!

      Now, in the U.S., Uber stops me from creating new accounts on my own to take that $30 repeatedly because it requires a credit card. Now, if I were savvy, I'd use a new credit card with a cousin's billing address on a wiped phone and create a new uber account. If I have 12 credit cards and 12 cousins, I could register 12 new accounts. The only overlap would be my name, but Uber has zero way of telling if two John Smiths with different credit card numbers and different billing addresses could possibly be the same person. They rely on the fact that no one cares so much about $30 to bother with wiping their phone, swapping in a new sim card, using a new card and a cousin's address. And, they're right, in the U.S. In China, people will go through a lot more hardship for less. Clickfarms in China pay something like 10 cents per hour.

    14. Re:Trying to figure out how this works... by gnupun · · Score: 1

      Uber effectively pays this much:
      $5 - 2.80 = $2.20.
      So driver and accomplice make $2.20/2 = $1.40 each.

    15. Re:Trying to figure out how this works... by TsuruchiBrian · · Score: 1

      Uber is giving out free money to get people to use the service, like an uber crack dealer giving out discounted crack to new chinese users to get them addicted. But rather than using the crack and becoming addicted, the chinese customers are simply reselling the crack for a profit (at the cost of uber).

    16. Re:Trying to figure out how this works... by Flavianoep · · Score: 1

      Uber effectively pays this much:
      $5 - 2.80 = $2.20.
      So driver and accomplice make $2.20/2 = $1.10 each.

      FTFY

      --
      Linux is for people who don't mind RTFM.
    17. Re:Trying to figure out how this works... by ShanghaiBill · · Score: 5, Interesting

      Uber is giving out free money to get people to use the service

      I have lived and worked in China. If there is any way to game a market, the Chinese will figure out how to do it. When BAT (British American Tobacco) first entered the Chinese market, they were surprised to see sales higher than expected. Sales continued to grow for several months, and they ramped up production. Then, after six months, sales plummeted to zero, and never recovered. They took huge losses on infrastructure and unsold merchandise.

      It took them a long time to figure out what happened. Their sales were high because their products were being purchased by their competitors, and stored in damp warehouses, where they grew stale and moldy. Then after six months, all the accumulated rotten cigarettes were dumped onto the wholesale market, crashing the price, and destroying BAT's reputation for quality.

    18. Re:Trying to figure out how this works... by Minwee · · Score: 2

      Uber effectively pays this much: $5 - 2.80 = $2.20. So driver and accomplice make $2.20/2 = $1.10 each.

      FTFY

      Math is hard. Let's drive cars!

    19. Re:Trying to figure out how this works... by Minwee · · Score: 1

      It took them a long time to figure out what happened. Their sales were high because their products were being purchased by their competitors, and stored in damp warehouses, where they grew stale and moldy. Then after six months, all the accumulated rotten cigarettes were dumped onto the wholesale market --

      Along with a free copy of the runaway best-seller, Who's Got The Monkey.

    20. Re:Trying to figure out how this works... by gstoddart · · Score: 1

      Well, don't forget they've given themselves permission to access your data, spam you and your contacts, and track your location constantly.

      I'm sure that was always part of the end-game for profits.

      Because tracking, analytics, and ads are always part of the end-game.

      --
      Lost at C:>. Found at C.
    21. Re:Trying to figure out how this works... by tomhath · · Score: 1

      There are roughly 93 million people in China named Wang. Imagine how many credit cards you could get with that many Wangs...

    22. Re:Trying to figure out how this works... by tomhath · · Score: 1

      at some point Uber has to make money

      They'll make it up in volume.

    23. Re:Trying to figure out how this works... by TsuruchiBrian · · Score: 1

      It's pretty hard to feel sorry for a tobacco company. It is pretty funny to see a company from an industry considered to be dirty by western standards to be schooled in how to really play dirty by Chinese standards.

    24. Re:Trying to figure out how this works... by Charliemopps · · Score: 1

      I received a $30 credit from Uber when I installed the app. That's free money. However, Uber only lets me spend it on my first Uber ride. So I can't just put that $30 into my bank account. In my case, it was raining one day, and I didn't have an umbrella, so I called an uber and got a short ride home. It came to $8, which used up my $30 credit. I didn't cleverly hatch a scheme with the driver.

      If I were in China, I could say, hey, dude, bill me $30, it's coming off my new user credit anyways. Then give me $10. The driver makes $20 instead of $8, and I make $10 instead of $0. The loser would be Uber. Now, if I were to make a criminal enterprise out of it, I could say, hey, why even get a $8 ride? Let's have NO rides, and just keep billing $30 to get that juicy new user credit! We'll get keyboard farms to keep creating new uber accounts and riding and get that sweet $30 snatch!

      Now, in the U.S., Uber stops me from creating new accounts on my own to take that $30 repeatedly because it requires a credit card. Now, if I were savvy, I'd use a new credit card with a cousin's billing address on a wiped phone and create a new uber account. If I have 12 credit cards and 12 cousins, I could register 12 new accounts. The only overlap would be my name, but Uber has zero way of telling if two John Smiths with different credit card numbers and different billing addresses could possibly be the same person. They rely on the fact that no one cares so much about $30 to bother with wiping their phone, swapping in a new sim card, using a new card and a cousin's address. And, they're right, in the U.S. In China, people will go through a lot more hardship for less. Clickfarms in China pay something like 10 cents per hour.

      Yea, and then the most hilarious part is:

      Uber's spokeswoman told the Quartz writer that the company has an on-the-ground team who investigate into these various type of fraud, then uses "deep analytics, and new tools developed by our Chinese engineers in our dedicated fraud team to combat against such fraud." The Uber spokeswoman declined to elaborate on the nature of these tools.

      So they are bragging about how smart they are for thwarting the scammers with "Deep analytics" whatever the hell that means. If you were smart enough to do "Deep analytics" should you also have been smart enough to design a system that wasn't so easily scammed? I dunno... like you don't get your payout for 3 months or something? or your payout's in the form of an Amazon Gift card that you can only use from your Uber account? There's about 100 different trivial ways to completely subvert the scam from the start, it's mind boggling that they allow it to continue.

    25. Re:Trying to figure out how this works... by Anonymous Coward · · Score: 0

      Don't they ask for photo ID ? oh wait....

    26. Re:Trying to figure out how this works... by Dr.Saeuerlich · · Score: 1

      yup. whatever can be exploited will be exploited; and not even extremely "not worth it" gains will stop them from doing so. In a country like China there's always some sucker who'll do whatever shit job for next to no pay.

    27. Re:Trying to figure out how this works... by dave420 · · Score: 1

      Lazy, childish stereotypes? That's how it works?

    28. Re:Trying to figure out how this works... by Anonymous Coward · · Score: 0

      Reminds me of what happened to this German missionary: karl Gützlaff

      In response to the Chinese government's unwillingness to allow foreigners into the interior, he founded a school for "native missionaries" in 1844 and trained nearly fifty Chinese during its first four years. Unfortunately, Gutzlaff's ideas outran his administrative ability. He wound up being victimized by his own native missionaries. They reported back to him glowing accounts of conversions and New Testaments sold. While some of Gutzlaff's native missionaries were genuine converts, others were opium addicts who never traveled to the places they claimed. Eager for easy money, they simply made up conversion reports and took the New Testaments which Gutzlaff provided and sold them back to the printer who resold them to Gutzlaff.

      Shattered by the exposure of this fraud, Gutzlaff died in Hong Kong in 1851.

  2. So, it's credit card fraud by Anonymous Coward · · Score: 2, Insightful

    What else is new?

    1. Re:So, it's credit card fraud by Anonymous Coward · · Score: 0

      You should always deal in cash. That way you never are screwed, and if anyone tries, you blast them.

    2. Re:So, it's credit card fraud by orasio · · Score: 2

      Fraud is not the main thing here.
      Uber is paying cab riders bonuses that make riding without passengers profitable. So, they ride without passengers and collect bonuses. Their using fake ids or other illegal is just incidental. Uber itself is probably operating illegally, and nobody cares about that.

  3. Say it ain't so! by Anonymous Coward · · Score: 0

    Not in China! Not that bastion of moral superiority known throughout the web! Oh, what have we become!

  4. China, the yellow scourge by TiggertheMad · · Score: 2, Interesting

    While there might be a problem with fraud in Uber use in China, is it any worse than in any other country? There is an implicit racism in all these stories that hit the media decrying 'Chinese Fraud and Duplicity'. I am sure there is plenty, as totalitarian governments have been shown to increase dishonesty in their populations, but is it really worse than any other developing country or country lacking a government?

    Granted, the story will 'sell more papers' than a similar story about Uber being defrauded by teenage stoners from Kansas. China is a competing economic power with the US and EU, and as a result it seems to being demonized because Chinese people didn't have the common sense to be born with white skin. This constant barrage of stories about 'Chinese' dishonesty paints an image of them as being inscrutable and untrustworthy as a race.

    --

    HA! I just wasted some of your bandwidth with a frivolous sig!
    1. Re:China, the yellow scourge by gnasher719 · · Score: 5, Insightful

      There is an implicit racism in all these stories that hit the media decrying 'Chinese Fraud and Duplicity'.

      That's you looking for racism. If Uber is so desperate for growth that a driver can make money by driving his wife around the block all day, especially if he doesn't actually drive her but has a coffee with her or something that slashdot users wouldn't comprehend, then people will take advantage of that. In every country. And Uber fully deserves it.

      Because in the end these drivers make a few Yuan, while Uber fraudulently makes billions of dollars by pretending to investors that they have genuine growth, when this is only due to losing money on every trip made.

    2. Re:China, the yellow scourge by Anonymous Coward · · Score: 0

      I don't think the word you are looking for is "racism" -- maybe "xenophobic?" If you say that there is implicit racism in all of these stories, then there is implicit racism in your acknowledgement that you are "sure there is plenty [of fraud in China]." Instead of just decrying possible "racism" -- maybe you could go out and find the stats to support your assertion.
       

    3. Re:China, the yellow scourge by dj245 · · Score: 1

      While there might be a problem with fraud in Uber use in China, is it any worse than in any other country? There is an implicit racism in all these stories that hit the media decrying 'Chinese Fraud and Duplicity'. I am sure there is plenty, as totalitarian governments have been shown to increase dishonesty in their populations, but is it really worse than any other developing country or country lacking a government? Granted, the story will 'sell more papers' than a similar story about Uber being defrauded by teenage stoners from Kansas. China is a competing economic power with the US and EU, and as a result it seems to being demonized because Chinese people didn't have the common sense to be born with white skin. This constant barrage of stories about 'Chinese' dishonesty paints an image of them as being inscrutable and untrustworthy as a race.

      Chinese people may not be universally unscrupulous, but it is definitely a lot more common than in other countries. When is the last time a German or Australian was at a trade show and wasted a competitor's time, asking questions that are obviously related to copying their business, taking detailed notes, and photos of everything? I have never seen it happen or witness such a thing. But without fail, at every trade show I go to, there are several Chinese delegations who go around doing this to every booth in the show. It's a cultural etiquette mismatch. Chinese people (despite, or because of, their totalitarian government?) also seem to have a difficult time following any kind of rule.

      --
      Even those who arrange and design shrubberies are under considerable economic stress at this period in history.
    4. Re:China, the yellow scourge by Ionized · · Score: 1

      but china is not a developing country, nor is it lacking a government.

    5. Re:China, the yellow scourge by eepok · · Score: 1

      "Worse" is a relative term. Bribery and what the West considers fraudulent or corrupt don't have the same weight or value in China. Talk to anyone who does business in China. Bribery is expected. It's part of business. The West's influence is trying to make Chinese business more like the West's (and thus more predictable) and thus we're seeing Chinese business practices through the Western lens. India's not that different. Nor many Latin American countries. Come to think of it, bribes are a part of business life for the majority of the population of the world. So there's that.

    6. Re:China, the yellow scourge by Anonymous Coward · · Score: 0

      Chinese people (despite, or because of, their totalitarian government?) also seem to have a difficult time following any kind of rule.

      That's because they understand that if a rule is not enforced strictly enough that you can get away with breaking it, then that rule is meaningless.

    7. Re: China, the yellow scourge by Anonymous Coward · · Score: 0

      I don't have the necessary data to say if the Chinese are or aren't more unscruplous(or, as an intermediate possibility, have a different distribution of unscruplousness, so westerners are surprised to be shivved in the back by manufacturing managers rather than financial services assholes, say).

      However, China is the place where companies go chasing dreams of either growth or ultra-cheap production, or both; often with a lot of naÃveté, few or no on-site people(much less ones fluent enough to do their own digging without depending on the people they are supposed to be overseeing); and a myopic focus on the immediate term that blinds them to the fact that the Chinese government is looking to aquire new industries, not be your toxic waste dump and source of expendable coolies forever.

      This tends to lead to a lot of foreign companies getting burned. Now, given that this is so well known that a random slashdot commenter could tell you it, there's a fair bit of room to ask whether it has gotten to the point where(just as it's easier to con a man willing to believe something too good to be true, or to agree to assist in a dishonest transaction and split the proceeds) the companies still being taken in are victims, or either reckless, arrogant, or utterly heedless of everything beyond the next couple of quarters.

    8. Re: China, the yellow scourge by Anonymous Coward · · Score: 0

      Racism? So then why does hardly anybody complain about Taiwanese sneakiness and dishonesty then? I suggest you go live in mainland China for a while and see if you don't change your tune.

    9. Re: China, the yellow scourge by Anonymous Coward · · Score: 0

      s/China/Black and see if you would still be prepareerde to use your real name.

      For extra points, get a large mortgage first.

    10. Re: China, the yellow scourge by guruevi · · Score: 2, Interesting

      It is a cultural thing. Chinese are educated by copying others and have done so for centuries. They are awesome at testing with high scores in any schooling system and field (math, physics etc) because testing is simply copying the answer. But having them apply what they've learned is (generally) not feasible.

      It is culturally engrained and encouraged from birth, to them it is not immoral to do so which is reflected in their legal system (lack of copyright and patents enforcement).

      Copyright and patenting is really a westerner construct and inherently unnatural, even immoral.

      --
      Custom electronics and digital signage for your business: www.evcircuits.com
    11. Re:China, the yellow scourge by Anonymous Coward · · Score: 0

      It's called appletrage.

    12. Re:China, the yellow scourge by grahamsz · · Score: 2

      I also strongly suspect they'd have exactly the same problem if they offered the same bonus structure in the US. Except the headline would be something about hacker ingenuity.

    13. Re: China, the yellow scourge by Noah+Haders · · Score: 1

      I don't have the necessary data to say if the Chinese are or aren't more unscruplous(or, as an intermediate possibility, have a different distribution of unscruplousness, so westerners are surprised to be shivved in the back by manufacturing managers rather than financial services assholes, say)

      I think this is the key point - many throughout the world and throughout history would be shocked at the Gordon gecko-like avariciousness of demolishing a company to sell the bricks in the wall, or bankrupting an entire country in order to profit off the spread, or other acts that we consider not just "just" but also "necessary for a functioning economy."

      if another culture is applying the same maxims in different areas of business where we are used to a more collaborative or respectful approach, then maybe we should cut back on the moral outrage.

    14. Re:China, the yellow scourge by Minwee · · Score: 2

      I also strongly suspect they'd have exactly the same problem if they offered the same bonus structure in the US. Except the headline would be something about hacker ingenuity.

      Or whatever you want to call it.

    15. Re:China, the yellow scourge by quantaman · · Score: 1

      While there might be a problem with fraud in Uber use in China, is it any worse than in any other country? There is an implicit racism in all these stories that hit the media decrying 'Chinese Fraud and Duplicity'. I am sure there is plenty, as totalitarian governments have been shown to increase dishonesty in their populations, but is it really worse than any other developing country or country lacking a government?

      Granted, the story will 'sell more papers' than a similar story about Uber being defrauded by teenage stoners from Kansas. China is a competing economic power with the US and EU, and as a result it seems to being demonized because Chinese people didn't have the common sense to be born with white skin. This constant barrage of stories about 'Chinese' dishonesty paints an image of them as being inscrutable and untrustworthy as a race.

      Think of it as a Prisoners Dilemma applied to a market economy. The Prisoners Dilemma generally means people cooperate within their group (optimal with repeated interactions) but defect with outsiders (optimal for 1-off interactions).

      The West has had market economies for a very long time, we've figured that cooperating even with strangers is the best strategy at a cultural level so as a culture we've put in a lot of effort into telling people they should conduct business honestly even with strangers and not defect.

      In China this kind of economy is a lot newer so people are following the default rule, cooperate in your group and defect outside. They'll change over eventually but I think it is a true phenomena that the Chinese won't feel the same pressure to cooperate with strangers.

      --
      I stole this Sig
    16. Re:China, the yellow scourge by Anonymous Coward · · Score: 0

      "The tradesman and the shopkeeper take advantage of you wherever they can, and to the smallest imaginable amount rather than not take advantage of you at all. This knavery is universal."
      —Sir Arthur Brooke Faulkner describing Germans in 1833.

      "My impression as to your cheap labour was soon disillusioned when I saw your people at work. No doubt they are lowly paid, but the return is equally so; to see your men at work made me feel that you are a very satisfied easy-going race who reckon time is no object. When I spoke to some managers they informed me that it was impossible to change the habits of national heritage."
      —an Australian management consultant in Japan in 1915.

      It's amazing what a few decades of industrialization can do to a culture. Next up, India! :)

    17. Re:China, the yellow scourge by MoaDweeb · · Score: 1

      Transparency International (transperancy.org) ranks countries as the following for perceived levels of corruption:

      1 Denmark
      2 New Zealand
      3 Finland
      7 Singapore
      10 Canada
      11 Australia
      15 Japan
      17 USA
      55 Saudi Arabia
      85 India
      100 China

      Perhaps racism is not the driver; perhaps the driver is a culture that facilitates corruption.

      --
      New Zealanders are well balanced with a chip on each shoulder. One represents Australia, the other the rest of the world
    18. Re:China, the yellow scourge by Anonymous Coward · · Score: 0

      "When is the last time a German or Australian was at a trade show and wasted a competitor's time, asking questions that are obviously related to copying their business, taking detailed notes, and photos of everything? I have never seen it happen or witness such a thing."

      Grnted it was long ago, but how about this?

      http://www.bloombergview.com/articles/2013-02-01/piracy-and-fraud-propelled-the-u-s-industrial-revolution

      Read the part about "HAMILTON’S MANIFESTO"

    19. Re:China, the yellow scourge by Anonymous Coward · · Score: 0

      When is the last time a German or Australian was at a trade show and wasted a competitor's time, asking questions that are obviously related to copying their business, taking detailed notes, and photos of everything?

      I don't have the reference, but I remember reading somewhere that's how Microsoft copied Lotus 1-2-3.

    20. Re: China, the yellow scourge by mjwx · · Score: 1

      It is a cultural thing. Chinese are educated by copying others and have done so for centuries. They are awesome at testing with high scores in any schooling system and field (math, physics etc) because testing is simply copying the answer. But having them apply what they've learned is (generally) not feasible.

      Chinese R&D (Remember and Duplicate).

      Jokes aside, whilst a lot of Chinese educational institutions are set up for rote memorisation (this is the same across most of Asia) China still manages to produce quite a few people capable of creative and independent thought. Typically these people try to get into western universities where degrees have a good value. The sad thing is, a lot of the rote memorisation crowd are trying to do the same thing for the same reason.

      You get geniuses and idiots in all cultures, I've worked with some absolutely brilliant Chinese engineers and some who are thick as two bricks.

      --
      Calling someone a "hater" only means you can not rationally rebut their argument.
    21. Re:China, the yellow scourge by NicBenjamin · · Score: 1

      Keep in mind that Singapore has the exact same racial majority as China, and they don't get these kind of stories.

      What's happening is you've got a uniquely Chinese cultural and social systems that is adapting to (and in many case outright adopting) the Western business models that are the only way you can successfully run an economy. Historically the country has had huge problems because historically Han culture has emphasized getting the best one can out of the system with virtually no regard as to the health of the system, which is a fancy-ass way of saying that they like to milk the system, and their opinion of your argument that "if everyone did this that would suck" is that you're an idiot for not realizing that it already sucks.

      I suspect that in the next few decades these stories will start to go away, as they get used to the ways you can milk a system based on Western business.

    22. Re:China, the yellow scourge by donscarletti · · Score: 1

      Uber has virtually no presence in China, it is being eaten alive by local competitor "Didi" who uses almost the exact same business model, but is actually able to find customers and drivers.

      Uber is like "China is a big market, we must go there", but in reality, they have no idea of the realities of doing business here. They will drop huge amounts of money on advertising which will be seen by no one because they don't know how to get the word out here. Nobody in China knows Uber, nobody talks about Uber, but because they're getting scammed so hard, it looks like they are getting lots of leads.

      Why are they getting gamed so hard? Because they are naive suburban whites like you who are not expecting any of this. China is not Kansas. In Kansas, Chinese restaurants all have a buffet with reasonable food for a reasonable price, but go to China and the few buffets you see are expensive and poor quality, why? Because many if not most Chinese won't eat for a day before going to the buffet and will gorge themselves silly on whatever looks expensive (crab etc.) whether or not it tastes any good. In China, if you release anything, an online services platform, an MMO, anything and you have to watch out how you are being gamed every day. You think you can give something for free online and you will find people creating thousands of accounts to harvest it. You even have to watch out for this giving virtual goods in MMOs, when giving real rides for real money you have to watch out.

      The world is full of different people. The Chinese just do this because it is normal to them, they think if there is a service that you don't take advantage of fully that you are being ripped off. Didi understands it, Uber doesn't.

      --
      When Argumentum ad Hominem falls short, try Argumentum ad Matrem
    23. Re:China, the yellow scourge by Anonymous Coward · · Score: 0

      You mean, racist against Americans? The story was shared to my by someone living in China who thought the moral was that Uber was the camera-weilding, Hawaiian shirted bumbling Yankee in the story. Anyway, everyone I know who shared the story is pretty anti racism incl the original poster. That's somewhere below "implicit", or "covert" and "knee-jerk-suspected"

  5. Desperate for growth? by gnasher719 · · Score: 4, Insightful

    Do I get this right: Uber is so desperate for growth in China that they pay the driver more money than a genuine customer pays for the drive, and as a result the drivers give fake rides to fake customers, and after returning the ride fee plus some bonus to the fake customer, there is still money left over?

    This reminds of a story from the former German Democratic Republic, where the prices for apples (the fruit, not the fruity computers) were so much subsidised that farmers delivered their apple harvest to the state, then bought up as many apples as they could in the stores at subsidised prices, and sold them again to the state as freshly harvested?

    1. Re:Desperate for growth? by Anonymous Coward · · Score: 0

      Replied to wrong comment (above).

      It's called appletrage.

  6. Wow... by fuzzyfuzzyfungus · · Score: 3, Funny

    And here I used to think that Uber was dead-set on being as aggressively disrespectful to local cultural practices as possible in every market except its native valley 'disruption' fetishists. I guess I was wrong, if they have in fact embraced counterfeiting in the Chinese market.

    1. Re:Wow... by tehcyder · · Score: 1

      Uber and China - when they met it was moider!

      --
      To have a right to do a thing is not at all the same as to be right in doing it
  7. run this one by me again? by nimbius · · Score: 1, Informative

    so the purveyors of unlicensed, unregulated public transportation services by potentially non directly employed third party contractors not required to submit to drug or background checks is complaining their service, which has been banned in spain, thailand, india and briefly germany, is being bilked for incentive payments in a country with markets for such exotiques as recycled cooking oil rendered from waste food. I guess the best solution could be to stop running an unregulated, unlicensed transit network thats been charged of raping and assaulting passengers in the past...or i guess just try another country and see if the idea of ayn rand on wheels works any better.

    --
    Good people go to bed earlier.
    1. Re:run this one by me again? by thedonger · · Score: 2

      so the purveyors of unlicensed, unregulated public transportation services by potentially non directly employed third party contractors not required to submit to drug or background checks is complaining their service, which has been banned in spain, thailand, india and briefly germany, is being bilked for incentive payments in a country with markets for such exotiques as recycled cooking oil rendered from waste food. I guess the best solution could be to stop running an unregulated, unlicensed transit network thats been charged of raping and assaulting passengers in the past...or i guess just try another country and see if the idea of ayn rand on wheels works any better.

      Regardless of your obvious bias against Uber, if said non directly employed third parties and/or passengers enter into agreements (e.g., TOS, etc.) and then purposefully violate said agreements, Uber is justified in trying to combat said violations.

      --
      Help fight poverty: Punch a poor person.
    2. Re:run this one by me again? by Noah+Haders · · Score: 1

      Regardless of your obvious bias against Uber, if said non directly employed third parties and/or passengers enter into agreements (e.g., TOS, etc.) and then purposefully violate said agreements, Uber is justified in trying to combat said violations.

      the gp isn't arguing against uber trying to combat the fraud. s/he's only suggesting that we all tamp down on the moral outrage, especially considering that uber itself has been known for its rapacious practices/"disruption".

    3. Re:run this one by me again? by drinkypoo · · Score: 1

      I guess the best solution could be to stop running an unregulated, unlicensed transit network thats been charged of raping and assaulting passengers in the past..

      ...as opposed to the regulated, licensed transit network that's been charge of raping and assaulting passengers in the past and present.

      --
      "You're right," Fisheye says. "I should have set it on 'whip' or 'chop.'"
    4. Re:run this one by me again? by dave420 · · Score: 1

      Not all taxis are like those where you are from...

    5. Re:run this one by me again? by drinkypoo · · Score: 1

      Not all taxis are like those where you are from...

      A goodly percentage of them are, and anyway, look at the top of your browser window right now to see what we're talking about. HTH, HAND.

      --
      "You're right," Fisheye says. "I should have set it on 'whip' or 'chop.'"
  8. About Those Tools by Toad-san · · Score: 1

    "The Uber spokeswoman declined to elaborate on the nature of these tools."

    Does it include a call to my cousin Vinny in Joisey?

    1. Re:About Those Tools by Minwee · · Score: 1

      Is he a yoot?

  9. Deep Analytics? A waste. by plopez · · Score: 1

    Just use a fare meter...... duh..... they are taking a simple problem and making it more complicated.

    --
    putting the 'B' in LGBTQ+
    1. Re:Deep Analytics? A waste. by Firethorn · · Score: 1

      I can't say about China, but:
      1. The fare meter wouldn't help if the 'problem' is that the driver is taking 'fake' fairs and still driving in order to 'satisfy' the fare. Remember, the GPS system tracks the drivers much more closely than a meter would.
      2. Can't say about Chinese law(ergo, there's probably nothing against it, they're actually less regulated than the USA is), but I know that in the USA and England that in many spots having a taximeter is actually illegal unless you're a taxi, and they don't want to be a taxi because that implies you have to follow taxi rules.
      3. Simplest fix would be to make the bonus conditional on having more in fare income to Uber than the bonus is worth. IE it would cost these types money. Done.

      --
      I don't read AC A human right
    2. Re:Deep Analytics? A waste. by plopez · · Score: 1

      1) The bonus must be less than the actual cost of driving.
      2) They are a taxi service on a global scale with centralized control and dictated fares. They are discovering the risks of trying to skirt the law. Believe it or not, being a registered taxi service and running it as one could actually benefit Uber.

      --
      putting the 'B' in LGBTQ+
    3. Re:Deep Analytics? A waste. by Firethorn · · Score: 1

      Believe it or not, being a registered taxi service and running it as one could actually benefit Uber.

      That depends on the market. While being a registered taxi service might benefit them in some areas(and they actually are in some areas), in others being so merely runs them up against existing taxi companies that have twisted the markets to protect themselves - medallions, work requirements, method of operation, what they're allowed to charge*, etc... Some of the requirements are good, others are just to help insure that a new business doesn't come along and put the old taxi companies out of theirs.

      Basically, Uber investigates each market and makes the decision on what form their service will take, and to be honest, what regulations they're going to follow. In NYC, for example, they don't follow taxi rules, but they do follow for-hire car rules, which means no taximeter, no responding to street hails, and a few other things, but relieves them of a large amount of other rules. Their cars are still insured, and the drivers have the proper endorsements to be a for hire driver in NYC.

      *Some people get upset with the Uber's demand charge system that raises prices when demand is high enough to exceed supply. I think it's only fair in most cases.

      --
      I don't read AC A human right
  10. Chinese Joke by Anonymous Coward · · Score: 1

    Me play ancient Chinese joke, me use Uber without a bloke.

  11. Same here in India by vivkkrishnan2005 · · Score: 1

    Actually, this happens in India as well but in a different way. I am yet to see it, but have heard people describing similar tactics. Here is how they apparently do it : They make two cab booking at the same time, for the same cab, but with different internet cab companies like Uber/Ola/etc. And no one is the wiser.

    1. Re:Same here in India by Anonymous Coward · · Score: 0

      Makes sense. They aren't going to be sharing data.

    2. Re:Same here in India by sexconker · · Score: 2

      Amazingly simple and effective.
      The investors for these companies are fucking retarded. The companies need to be taking a cut of each fare, not giving a bonus that puts them in the red for each ride, thus making this type of scam possible.

    3. Re:Same here in India by Anonymous Coward · · Score: 0

      You don't get it. They take a loss on each fare, but make up for it in volume.

  12. Deep Analytics by sexconker · · Score: 2

    Bullshit: "deep analytics, and new tools developed by our Chinese engineers in our dedicated fraud team to combat against such fraud."

    Truth: "We just found out about this and have no idea what we can do to stop it because our entire business model is based on customers claiming they need a ride then claiming they got a ride, and drivers claiming they received payment. We're a middleman that does nothing other than point customers to an unregulated fleet of drivers so we have no idea what is actually going on. If we were taking a cut of each ride payment this scam wouldn't exist, but we have to bleed money by incentivizing drivers with bonuses in order to maintain a public image and keep our name in the news. This allows scammers to fake the ride and fee and share the bonus. We might be able to catch a few of the worst and dumbest offenders by looking at the top bonus earners and their passengers, but that money is long gone and we won't switch to a sustainable model until the last investors left holding the bag demand it."

  13. Not a very smart fraud if true by msobkow · · Score: 1

    This isn't a very smart fraud if it's true. The odds are the wear and tear cost on the vehicle FAR exceeds the value of the bonus.

    --
    I do not fail; I succeed at finding out what does not work.
    1. Re:Not a very smart fraud if true by Anonymous Coward · · Score: 0

      You should tell this to the massive numbers of Uber drivers.

    2. Re:Not a very smart fraud if true by mjwx · · Score: 2

      This isn't a very smart fraud if it's true. The odds are the wear and tear cost on the vehicle FAR exceeds the value of the bonus.

      The thing is, at least in western countries, that there's currently no shortage of starry-eyed suckers who have been enamoured by the Uber propaganda so they can afford to churn and burn. As people slowly figure out that they're not making money after the costs of running the vehicle or find their insurance wont pay out after an accident Uber can afford to dump them because there are still 2 others willing to take their place.

      This wont last forever, eventually enough people will figure it out so all they'll be left with are the worst of the worst. Drivers that even the dodgiest courier company refuses to employ. This of course is assuming that an Uber driver doesn't cause a pileup in a country with sane laws like Australia and the UK and Uber is sued into bankruptcy by the insurance companies and local governments.

      In third world nations where taxi's are already run by gangs and mafias, the Uber problem will be solved by having Uber drivers dragged out of their cars and beaten.

      --
      Calling someone a "hater" only means you can not rationally rebut their argument.
  14. The long con by TsuruchiBrian · · Score: 1

    "deep analytics, and new tools developed by our Chinese engineers in our dedicated fraud team to combat against such fraud."

    The fraud committed by the chinese shill uber customers and drivers is just a decoy. The real con is by the "chinese engineers" being paid by uber to counter the fraud. They are actually a team of hackers working to steal uber's source code and sell it to a startup chinese version of uber.

  15. 'Strayan here by mjwx · · Score: 1

    Is he a yoot?

    Its called a "ute"

    --
    Calling someone a "hater" only means you can not rationally rebut their argument.
  16. Uber is not ride sharing by dave420 · · Score: 1

    Ride sharing is where one person who is going to a place anyway, solicits for people to join them and share the cost. Commissioning someone to drive you somewhere for an amount of money which includes profit is in no way ride sharing, but operating a taxi. It would be a lot easier to discuss Uber if we could clear this fact up.

  17. Uber's Growth and Referrals by Anonymous Coward · · Score: 0

    Uber is hitting it big time across the world.

    Just use this promo code to get your 1st ride for free: UberOpenHouse