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Getting Over Getting Over Uber: Tim O'Reilly Does the Math
Susan Crawford yesterday published at Medium a critique of Uber and similar ride-coordinating services, in the form of a kind of paean to the American taxicab.
Though she didn't start out with negative feelings for Uber, Crawford writes, her sentiment has swung away from objections to taxis (such as that they seek unfair protection from competition) to an extravagant defense, though it comes with a long list of "shoulds": "[Cities] should be focusing on making their taxi services better," she writes. "Taxis should be more accessible to everyone. Taxi fares should be low, predictable, and uniform. Taxi geographies should be wide. Taxis should be clean, fuel-efficient, driven by trustworthy, well-trained drivers, and available for frictionless electronic hailing." Even with the flaws that list implies, Crawford's description of how well taxis work now is more positive than I've found to be true: "Their rates are regulated and set; their pricing is transparent and can be double-checked (just look at the meter, which is itself regularly tested); they look like a uniform fleet; they are subject to very strict licensing and safety requirements. With rare exceptions, they don’t employ surge/congestion pricing schemes."
Tim O'Reilly has written a response, calling Crawford's arguments "puzzling and unconvincing." O'Reilly dissects some of the math behind the business of driving others for money, as it applies to both conventional taxi drivers and "gig economy" drivers, as well as some of the qualitative effects of ride-dispatch services; surely some readers will take issue with his figures and examples, but they provide a plausible case for doubting Crawford's rosy picture of taxis and dark view of modern app-dispatched rides. O'Reilly writes: "Regulation is not a good in itself. It is a means of achieving public goods. And so far, it is pretty clear that Uber and Lyft (and in particular, the competition between them) are improving the transportation options in American cities. Regulators should be using the opportunity to revisit the old way of doing things rather than trying to make the new conform to outdated rules that no longer serve their purpose."
Tim O'Reilly has written a response, calling Crawford's arguments "puzzling and unconvincing." O'Reilly dissects some of the math behind the business of driving others for money, as it applies to both conventional taxi drivers and "gig economy" drivers, as well as some of the qualitative effects of ride-dispatch services; surely some readers will take issue with his figures and examples, but they provide a plausible case for doubting Crawford's rosy picture of taxis and dark view of modern app-dispatched rides. O'Reilly writes: "Regulation is not a good in itself. It is a means of achieving public goods. And so far, it is pretty clear that Uber and Lyft (and in particular, the competition between them) are improving the transportation options in American cities. Regulators should be using the opportunity to revisit the old way of doing things rather than trying to make the new conform to outdated rules that no longer serve their purpose."
...but then a taxi lobbyist dropped a big bag of Benjamins on my desk, and what's a blogger to do?
Taxis should be more accessible to everyone. Taxi fares should be low, predictable, and uniform. Taxi geographies should be wide. Taxis should be clean, fuel-efficient, driven by trustworthy, well-trained drivers, and available for frictionless electronic hailing.
Congratulations, you just described Uber, and now understand why it exists.
The only thing limiting availability of Uber in fact, is governments and taxi cartels you seek to improve... if taxis could be any of those things, why aren't they already since they have had decades longer to do so? If you think the "city" can make the taxis into those things, look around at the barley kept -up infrastructure and crumbling streets and answer the hard question of how they could do that one thing well when so many other things have been done poorly.
If wishes were horses I wouldn't need taxis OR Uber, but they aren't so I do
"There is more worth loving than we have strength to love." - Brian Jay Stanley
Last May when my auto insurance policy renewed there were a few pages enclosed. Adding / detracting language from the previous policy. While not stating Uber or Lyft by name it was clear that the insurance company was writing them completely out of the picture.
say it again. It's not the service, it's how they treat their employees, e.g. by calling them contractors to get out of paying for their Health Care, Unemployment, tax and other benefits (as well as their commercial insurance and proper background checks). Right now Uber is externalizing all those costs. Either onto the driver or eventually society (since we more or less don't just let people die in a gutter in this country, yet...). Their entire business model falls apart as soon as those costs aren't externalized. Look at all the 'Uber for...' companies and how quickly they shut down when their told that they have to treat people who are a core part of their buiness as employees...
Uber is a race to the bottom and a sign capitalism is starting to break down...
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I generally avoided Uber, but last year I needed a taxi to get to the airport. I called two different taxi companies, and neither one had any taxis available to pick me up. Uber came right away, and was cheaper than a taxi.
Generally it's easier to get an Uber than a taxi, unless you're right in the middle of a big city. And it will be a long time before traditional taxi companies get their game together enough to equal that.
"First they came for the slanderers and i said nothing."
then stfu, don't read the article, and go get a life. it's not as if you had a gun pointed to your head making you read this stuff.
"Regulation is not a good in itself."
I wish more people realized that. How many times have you seen people arguing, one side saying, "Regulation is bad!" and the other "Regulation is good!" It's one of the dumbest arguments ever, because both sides are wrong.
Some regulation is good, and some regulation is bad. If you want to know which is which, you need to actually look at the regulation itself.
"First they came for the slanderers and i said nothing."
Why don't we protect _both_ groups of workers? Crazy? I know, right?
Sounds like a complete change from your first post. The reason you don't like Uber (compared to a taxi service) is that Uber doesn't treat its workers well.
Now, you are saying your first post was 100% in error, and that all hire-car services should be regulated to a standard greater than taxis currently face.
Though, I'd question the result when comparing a freelance uber driver who drives 10 hours a week at changing and unpredictable times for extra pocket money. When you require greater regulations to stamp out freelancing, what will the freelancers do for income?
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In western europe for example, taxi are geographically widespread (for example in germany they are forced to take negative value fare in remote area), their price is regulated but uber is not and uber DO surge pricing. So taxi fare is uniform and predictable (low is a question of perspective). Taxi are driven by trustworthy driver , german regulation make sure of insurance (commercial) is there and there is a test in many country. Uber not so much. Taxi are accessible to everyone as over a zone some country imposes a minimum number of accessible handicapped taxi. All of those Uber does not really do. We even have in germany an apps on smartphone to hail taxi (at least in my region). Uber DO LIE on pretending there is driver nearby. Uber bombed with fake request their rival. Both of which would be a fraud in germany for example. take off the pink glasses in many countries in western europe Uber is not so great , it is only a newcomer which want to break laws to its disadvantage, laws mostly protecting consumer NOT taxi.
Now we know that US law are often corporate blowjobs (dealership, taxi medaillion etc..). But Uber is not so great either. What do you think will happen if taxi get deregulated ? Well i will tell you : the most common minimum denominator that's what will happen.
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Uber drivers are on strike right NOW.
Did you know that?
I live in Chiang Mai Thailand. I suggest if you really really like the idea of a 'gig economy' then move here for a few months and see how that idea works out in real life. I don't think you'll care for it much as only a few live a decent lifestyle.
And what stops you from taking a taxi to get home if Uber is too costly?
Learn to love Alaska
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"Their rates are regulated and set; their pricing is transparent and can be double-checked (just look at the meter, which is itself regularly tested)"
Oh how naive. The way taxis rip people off is by taking long routes and adding distance/time. That is specifically the scam that Uber avoids by route planning. If she thinks they are trustworthy just because they have a visible meter, she is an idiot.
I bet she wholeheartedly agrees to see all the recommended specialists every time she goes to the doctor's office, and makes sure to get as many undercarriage coatings as she can from the car dealer because their pricing is transparent too.
while(1) attack(People.Sandy);
Taxi's can't offer guaranteed service at certain locations and times precisely because they do not use the author's dreaded "surge/congestion pricing schemes."
When your professional society conference lets out at the same time that the local sportsball team's game gets over, and everyone is headed downtown to eat, the taxi company runs out of cabs because they're all cheap and everyone takes one. Uber surges the price to match the market demand, more drivers come out, and everyone who wants a ride can get one.
Under the pure cartel taxi system, if you need to get to the hospital because your wife called and she's gone into labor early, too bad! All the cabs are taken because they're so cheap and the demand is so high. Under Uber's system, the price rises to match the demand and you can pay for a ride.
It's no different than when people decry "price gauging" after a natural disaster. Go ahead and keep gas at pre-disaster prices, and 100% of it will sell out. Then, if you MUST have it, say to run your generator to power grandma's oxygen machine, too bad! It was all sold for $2/gal to a bunch of people who panicked and drank it all up even though they really didn't need it. If the gas stations had surged pricing to match demand, they'd be more likely to have some left, and while it would be very expensive, at least it would be available for people who really needed it, instead of being consumed by people who merely panic-purchased because it was still cheap.
Uber's surge pricing system is a virtue of their business model, not a vice.
Uber basically wants to do the same thing as H1Bs except with local people. Basically we have a mass of people who are making a livable salary but as consumers we think they cost too much so we usher in Uber despite what the laws say. Sorry but that is no different then crying foul on Disney for spinning the H1B laws and having their domestic employees training the easier foreign once as they get kicked out the door. So before you say H1Bs are a bad thing again, look in the freaking mirror.
Laws are rules for the court, but merely a bottom bar to hit for life. Think beyond laws in your actions always.
Uber drivers are on strike right NOW.
Then they aren't Uber drivers. And as has been noted before, they aren't really employees of Uber in the first place.
Did you know that?
Nope, and I don't see a reason to care.
Rather than the nonsense of a "strike", the simple solution here is just not to use Uber's service - which would be a boycott. Uber does have competitors and a shift of business from Uber to these other competitors would hurt them. That's more effective than a strike.
Is that each user JOINS a ride sharing service. Every time a conventional cabbie picks up a fare, he rolls the dice: will this ride be the one that leaves his riddled, bloody body in an alley? Giving rides to people who have subscribed to your service is a huge security advantage.
Except that "price gouging" isn't really a thing, and anti-gouging laws cause more harm than good: They Clapped
though it comes with a long list of "shoulds": "[Cities] should be focusing on making their taxi services better," she writes. "Taxis should be more accessible to everyone. Taxi fares should be low, predictable, and uniform. Taxi geographies should be wide. Taxis should be clean, fuel-efficient, driven by trustworthy, well-trained drivers, and available for frictionless electronic hailing."
And competition is the way to achieve those ends. All those "shoulds" have existed for decades with no action taken. Suddenly Uber arrives on the scene and people are talking about how to address them.
and if they turn down too many fairs Uber fires them. Also Uber is dependent on them for their ongoing business needs. Uber doesn't have a business without their labor. That makes them employees. Not contractors.
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In NYC I don't have any of these Uber-fixed problems. The problem I have repeatedly:
- I cannot communicate the destination to the driver.
- I attempt to, but the driver gives me no feedback.
- The driver types the address into a GPS from the 90s, distractely while driving, incorrectly, for example confusing S 4th St with 4th St, or 23rd Pl with 23rd Dr. Handing the driver a printout from Google Maps doesn't solve it. Cutting off the address, so the driver has to read the map and can't just type like a monkey, still doesn't solve it.
- The driver cannot find the destination.
- I name a landmark, "Bronx Zoo," and the driver unreasonably says "where's that?"
- The driver attempts to find his own way to the destination by memory and makes many wrong turns. He even turns off the meter apologetically, so he's not trying to scam me, but I'm still late, and it would be avoided by being forced to use a navigation app.
- The driver makes poor decisions about traffic that Waze or even Google Maps would have avoided.
It means, to take a cab and have it actually work, I have to use maps on my phone and give the driver directions. About half the time I can get where I'm going without doing this, but the other half the time there is a major fuckup like wrong turns or going to the wrong place or not knowing where the place is period until I tell him. This is a pain in the ass to do with your friends, because they take everything personally and get hysterical. Doing it with a stranger who is not in German efficiency-mode but is in insecure face-saving third world asia mode quickly becomes the most stressful part of my day.
I recommend reading the link. It beats my example of hauling generators and gasoline all to heck.
$8/bag for ice might be high. But I'm willing to bet that the yahoos in the story ended up exonerated, might even have ended up forcing the police to pay for arresting them and ruining their 'product' by allowing it to melt.
Why? Simple enough - add their expenses up.
They paid $1.75/bag. They didn't get it for the cents normally charged, they paid retail.
They also didn't produce the ice on site - they rented a refrigerated truck. Add that expense, as well as the gasoline.
They had to chainsaw roads clear - add that expense as well.
Consider themselves, well, as not just register monkeys*, but qualified chainsaw wielding drivers. The hours required to drive to the area.
$8/bag probably seems reasonable after adding all that up, probably with them earning darn near minimum wage.
*Nothing against those that run registers, but somebody with both a CDL and the ability to work a large chainsaw competently is a skillset that demands higher wages.
I don't read AC A human right
Why stop at that? Go to those disaster areas and loot - if the owners are dead you are not hurting anyone. Why travel when you can graverob at home instead? Your "it's OK to exploit people who can't find easy alternatives" may be what you see as "the American way" but only from the most amoral of the bunch in "Deadwood".
So they dont take money from Uber in exchange for providing services as dictated by Uber?
The money comes from the customers they serve, not Uber.
However this is a good demonstration why Uber is a self correcting problem and why you shouldn't get attached to them. Uber is losing money hand over fist WHILST they have lower costs because they're ignoring the rules that other transport providers have to follow. In order for Uber to make money they have to give the employees a smaller cut. As they have to be cheaper than legitimate, insured taxi companies this means that the amount drivers get is already small and making it smaller means that only the most desperate will be willing to work for Uber (and don't even contemplate how badly the vehicle is repaired because that comes out of the drivers diminishing cut).
You rationalize however you want. Even if Uber is as incompetently run as you hope, it's still the end of most taxi oligopolies. Not everyone protects their taxi special interests as well as say, London does.