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Not All Uber Drivers Like Surge Pricing, Either
CNET reports that Uber's practice of surge pricing, which sometimes raises the ire of passengers, isn't universally acclaimed by the company's drivers, either. "[M]ost Uber riders," according the the linked article, "despise surge pricing," though it's not clear quite how that "most" is arrived at. From the piece: They've complained about running up bills totaling hundreds of dollars, and have criticized the company for using surge pricing during emergencies, like Hurricane Sandy and the Sydney hostage crisis. The San Francisco Better Business Bureau gave Uber the grade of an F because of complaints related to surge pricing. And New York lawmakers have even proposed legislation to put limits on how high fares can go. Now some drivers, like [San Francisco Uber driver Peter] Ashlock, are also having second thoughts on surge pricing."
On the other hand, what system would you propose to better reward drivers for working at high-demand times?
I don't get the hate for surge pricing; it feels, to me, like a cry for education.
For example, an Uber where I live costs around half or less that of a regulated taxi. *Some* of my friends complain like crazy when the surge modifier is like 140% - not realising that it's STILL cheaper to have Uber around than use the old system. Then they suggest a "remedy" for surge pricing, that is basically moving back to something closely resembling the old system. Essentially, their proposals would result in a "constant 100% surge pricing" just to have predictable prices.
Surge pricing achieves two things:
1] Encourages drivers to work peak times in peak areas, increasing service.
2] Prices a scarce resource accordingly, meaning that people can choose an alternative (wait, don't go, use a different transport system) appropriately instead of just having a fucking LOTTERY of who gets the only cab available.
Surge pricing is good for everyone, and just about everyone I have ever explained it to has gone "Oh yeah I see what you mean". We just need to educate people.
That said, I am curious to hear of any legitimate arguments against surge pricing - anyone got any?
"On the other hand, what system would you propose to better reward drivers for working at high-demand times?"
If we want to stick with Uber's claims about simply being an app that enables a market, there's an easy solution. But first we have to be honest about one of Uber's core claims: Uber is not engaging in any form of free market capitalism. Uber sets the rates consumers pay and drivers receive. Their is no market driven supply and demand in Uber's model. Sure, they can say "but... algorithms" and confuse people into thinking this is a pure form of free market capitalism. In reality, it's just an authoritarian scheme controlled by a few people at the top. Hell, they use their massive VC warchest to rewrite regulations in their favor - you know, manipulate the market.
For Uber to really to do market driven ride-sharing, they would simply provide a bid/ask platform for riders and drivers. Riders could post what they're currently willing to pay per mile/minute/what-ever-metric-makes-sense, drivers could post what they're currently willing to work for. Transparency on both sides as to price and other factors (e.g., location, number in party, etc) would allow each to adjust their rates according to current market conditions. That's how a free market for ride-sharing would actually work and provide a natural (invisible?) method to reward/incentivize drivers during surge times.
-Chris