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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?
If uber is too expensive, just call a taxi?
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?
This complaint just doesn't make any sense. We are moving to this pricing model all over the place, even in traffic control situations. Tolls on bridges and tunnels and express lanes are often "surge priced" these days. The express lanes into Miami on I-95 are only a quarter most of the time. But during rush hour and other heavy traffic times the lanes bump up towards $10.
And those are fixed resources - so there is no way to get more cars through the tunnel or over the bridge. With Uber the raised prices will theoretically get extra drivers on the street - limiting the surge in prices and getting service to more people.
And as others have mentioned - if you don't like the policy, you have alternatives.
"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
You want to regulate pricing, so that you have a corrupt cartel which keeps competition limited and prices high?
Because that's what we had before Uber came around.
We don't need regulated pricing, we need competition. And that's what we have with Uber and Lyft (who compete against each other). What we need is a few more services like those, and then several apps which do for them what PadMapper does for the rental market, and aggregates them and lets you quickly find out which service will give you the best combination of fare price and convenience (e.g., a cheaper fare probably isn't worth it if you have to wait an hour to get picked up).
All this whining about surge pricing is silly. The pricing is not a surprise: Uber's app tells you before you ride how much it's going to cost. If the price is too high, don't buy it. Most of the time, Uber rides are far cheaper than regular cabs, and you get to ride in a much nicer vehicle. Without surge pricing, drivers wouldn't bother driving during certain times.
I've only used Uber a few times, but every time I used it, I was given an estimate of the cost beforehand. The pricing isn't a surprise.
Now of course, if you're in a bind and need a ride NOW, and surge pricing is in effect, you may have little alternative, but that's what you get for making yourself dependent on a for-profit company: when they have you locked in, they screw you over. We see this in the software world all the time, where the term "lock-in" is common. I don't think I need to elaborate on it in this forum. The same principle applies with Uber: if you don't want to get screwed, don't make yourself dependent on a for-profit company. It's very simple. Either get your own car, use public transit, or move to someplace where you aren't dependent on them.
This regulation that sets pricing has the effect of normalizing prices across market volatility. Surge pricing indicates what happens when that normalizing is gone and one is literally playing the market to buy one's ride.
Do not look into laser with remaining eye.