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Uber In Retreat Across Europe

HughPickens.com writes: Mark Scott reports at the NY Times that Uber is rapidly expanding its ride-hailing operations across the globe but some of Uber's fiercest opposition has come in Europe, where the culture clash between the remorseless competition of the US tech industry and the locals' respect for tradition and deference to established interests is especially stark. In Frankfort, Uber shut its office after just 18 months of operation spurred in part by drivers like Hasan Kurt, the owner of a local licensed taxi business, who had refused to work with the American service. Uber antagonized local taxi operators by prioritizing its low-cost service, and then could not persuade enough licensed drivers to sign up, even after it offered to pay for licenses and help with other regulatory costs that totaled as much as $400 for new drivers. "It's not part of the German culture to do something like" what Uber did says Kurt. "We don't like it, the government doesn't like it, and our customers don't like it."

Uber also pulled out of Hamburg and Düsseldorf after less than two years of operating in each of those German cities. In Amsterdam, Uber recently stopped offering UberPop, in Paris and Madrid, Uber has been confronted by often violent opposition from existing taxi operators, while in London, local regulators are mulling changes that could significantly hamper Uber's ambitions there. Uber's aggressive tactics have turned off potential customers like Andreas Müller who tried the company's Frankfurt service after first using Uber on a business trip in Chicago. Müller said he liked the convenience of paying through his smartphone, but soon turned against the company after reading that it had continued operating in violation of court orders and did not directly employ its drivers, who are independent contractors. "That might work in the U.S., but that's not how things are done here in Germany," says Müller. "Everyone must respect the rules."

21 of 460 comments (clear)

  1. Respect for the law for everyone, not just the poo by Anonymous Coward · · Score: 2, Insightful

    It's what sets Europe apart from the oligarchies and part of what the city slickers want to get rid of in the UK.

  2. Don't speak for 'all of europe' by Anonymous Coward · · Score: 5, Insightful

    Here in Belgium (Brussels for me) lots of people used Uber, even after the threat to close them down. Its cheaper and more convenient than the expensive and slow taxi service. Most everyone I know has used them at least once and everyone (in my circle) was not happy with them pulling out of Brussels after threat of legal action.

    I think if you talk to anyone who isn't a taxi driver or associated with the police, you'd find they like Uber and are not happy with the monopoly of the taxi service on this industry.

    Of course, Belgium is well known as a 'fuck the rules' sort of country. But we're also the seat of the EU so the irony is not lost on me about this story.

    Still, most people would have been happier if our fucking governments had found a way to work with Uber instead of just bowing over to the taxi unions.

    1. Re:Don't speak for 'all of europe' by nbauman · · Score: 5, Insightful

      Here in America, we see that the winner-take-all economy leaves us with monopolies that are even more inefficient, greedy and unresponsive than the unions and regulated monopolies. https://en.wikipedia.org/wiki/... And you saw what Uber did to their competitors like Lyft.

      Once Uber has driven its competition out of business, they'll be able to raise prices for riders and drive their "contractors" (employees without rights) down to third-world wages by getting them to compete with each other to be the lowest bidder.

    2. Re:Don't speak for 'all of europe' by Anonymous Coward · · Score: 4, Insightful

      That's capitalism 101. Drive out the competition by any means possible (or reach an agreement with the competition), jack prices to whatever you want. Buy politicians to legislate against new competitors. Profit!

    3. Re:Don't speak for 'all of europe' by drinkypoo · · Score: 3, Insightful

      Here in America, [...] Once Uber has driven its competition out of business, they'll be able to raise prices for riders and drive their "contractors" (employees without rights) down to third-world wages by getting them to compete with each other to be the lowest bidder.

      Once Uber has driven its competition out of business, anyone will be able to offer a service like Uber, because the barriers to entry will have been removed — at Uber's considerable legal expense. I fail to see how you fail to see that this is a win for everyone except entrenched taxi businesses enjoying a state-enforced monopoly. Taxi licensing may work in Germany, I can't speak to that, but Here in America, taxi licensing does absolutely none of the things it is supposed to do.

      --
      "You're right," Fisheye says. "I should have set it on 'whip' or 'chop.'"
    4. Re:Don't speak for 'all of europe' by jaa101 · · Score: 4, Insightful

      Once Uber has driven its competition out of business, anyone will be able to offer a service like Uber.

      No, because this type of service is a natural monopoly, especially when operated by a large multi-national. Nobody wants to use a different app for every city. It would be just like trying to compete against eBay in the online auction market.

    5. Re:Don't speak for 'all of europe' by dywolf · · Score: 3, Insightful

      uber isn't trying to shake the tree.
      uber doesn't even want to change the tree.
      uber wants to ignore the tree while everyone else is still forced to pay attention to it.
      that is the entirety of their plan, and the source of their profitability.

      if the tree actually got changed, and ubers advantage disappeared because the field was leveled, uber would be unhappy.

      --
      The guy who said the election was rigged won the presidency with the second-most votes.
    6. Re:Don't speak for 'all of europe' by nbauman · · Score: 4, Insightful

      Yes, the free market is not perfect, but there is probably nothing worse than a capitalist economy which is being prevented from receiving any negative market signals by government action.

      A monopoly in an imperfect free market can be pretty bad and sometimes worse.

      Americans don't realize this because it's been so long since we had a market that was really unregulated by the government. But you can look around the world for examples.

      A year after "communism was destroyed" along with the Soviet Union, we had a handful of oligarchs with as much power and monopoly as the previous Soviet oligarchs and even less accountability.

      Rather than running a cotton processing plant, they could make more profits by closing the plant, firing the workers, and selling the unprocessed cotton on the international market to cotton processors in India or China.

      Or look at the unregulated Chinese pharmaceutical industry, which was the subject of a New York Times series a few years ago.

      The Chinese chemical manufacturers would sell powdered milk for infant formulas, and add a toxic chemical that gave a false reading when the wholesale buyers analyzed it, and made it look like it had higher protein content and therefore commanded a higher price. But infants would get sick and die.

      The Chinese chemical manufacturers sold a syrup for children's cough medicine, but substituted a cheaper toxic product for the more expensive pharmaceutical product. (I think they substituted ethylene glycol for glycerine.) On the order of 100 children died as a result.

      Things like this were common in the U.S. in the 19th century and early 20th century, which is why we created the Food & Drug Administration and why we have government regulations. Once you remove the regulations, the same things happen again.

      In Europe the free market gave us Thalidomide. Then they started regulating again.

  3. Nothing to do with American Tech Industry by houghi · · Score: 5, Insightful

    Biassed much? This has jack shit to do with the "remorseless competition of the US tech industry and the locals' respect for tradition and deference to established interests".

    It has to do by following the rules. They keep saying that they are not a taxi company, while they are. They try to get around all different kinds of laws, especially labour laws and that is not a good thing to do in Europe.

    The thing I see is that when they follow the rules, they are NOT cheaper than the traditonal taxi companies.

    So what "remorseless competition" means is actually "illegal operation of a business". It is like calling Corleones way of selling insurance "remorseless competition of European family businesses".

    Uber is welcome if they play by the rules. They tried and did not make any money.

    Do understand that in many places you can just become a taxi-driver by getting the correct papers. Not everywhere there are fixed limits or medaillions.

    What the taxi companies should take away from this (and other places as well) is that people like the ease of use, especially in payment. People like the cashless society. There are options for taxi-drivers. I pay with my bank card if possible and that is something that is widely accepted.

    The App is also a nice thing and I could see a role for Uber (or others) there. Set up a system where multiple companies can join so you can get a taxi easily. e.g. something like http://www.pizza.be/en/ where people can order from many different places in Belgium.

    Do that on a European or even worldwide manner and you are golden.

    --
    Don't fight for your country, if your country does not fight for you.
    1. Re:Nothing to do with American Tech Industry by monkeyxpress · · Score: 4, Insightful

      People like the cashless society

      Perhaps, though Europeans still use a lot of cash. I think the bigger issue (and what makes Uber appeal to me) is knowing that the driver isn't going to be able to pull any number of tricks on you in an attempt to shake you down for more money. My most recent regular taxi experience was in Italy, where I waited at a taxi stand for 30 mins desperately trying to flag down numerous empty taxis. A local finally told me you had to ring and order one. I got a hotel to do this (they had to wait on hold for 10 mins), figuring all the taxi's I'd seen must have been on order, until I got in the one that arrived five minutes later and realised there was a EUR 7 'radio taxi' charge for ordering one.

      It is these sorts of stupid tricks that really annoy people. I just want to be able to arrive somewhere, get a taxi, and not worry about the driver changing out my 50 note for a 5er, taking me the long way, or simply driving like an idiot and giving me no way to inform subsequent passengers that they are a dick.

      The big value of uber is that it fixes these issues. If they ditched the stupid Ayn Rand techno-liberalism stuff then they could probably replace all the world's taxis just by fixing these endemic problems with getting into a vehicle with a stranger.

    2. Re:Nothing to do with American Tech Industry by stephanruby · · Score: 3, Insightful

      The App is also a nice thing and I could see a role for Uber (or others) there. Set up a system where multiple companies can join so you can get a taxi easily. e.g. something like http://www.pizza.be/en/ [pizza.be] where people can order from many different places in Belgium.

      Do that on a European or even worldwide manner and you are golden.

      This idea has been tried many times in the US (ever since the iPhone became popular)

      In the US, these types of apps simply don't work reliably enough in highly populated areas and during peak hours. You'll order a taxi, but the taxi won't show up. That's because taxis don't have a strong enough incentive to honor their commitment. Since they're taxis, they can commit to picking someone up, but if they see someone else on the road halfway to their pickup, or if they hear of a more lucrative pick up on their radio, they'll go pick up that other person instead.

      Many times, this doesn't even need to be a straight lie, the taxi drivers will just tell themselves, that other person can just wait a little bit more while I take care care of this other customer right now. Or they'll tell themselves, there is enough wiggle room for me to squeeze one more client, especially if I can find someone to pick up who needs to go to the location near where my other pick up will be. All this optimization is great for the taxi drivers, but it's not great for the customers.

      Uber, on the other hand, doesn't work that way (except for UberPool where the customer explicitly chooses that option to be more flexible in exchange for an upfront discount). But with Uber, if you order a normal Uber ride (and not UberPool), the system is first-in and first-out (just like with just-in-time lean manufacturing, if you don't mind me using the analogy). Once a Uber driver accepts the offer of a customer, that driver can no longer see other potential pick ups he can make on the map (the map just won't show him that information). Also, that Uber driver doesn't have competing offers streaming in from a dispatch center over the radio, or via telephone or text, or just via driving (since Uber is not allowed to pick up people who flags down a driver from a sidewalk). In addition to that, the customer is even reassured that the Uber car is on its way (without even asking), since as soon a driver accepts his/her offer, the customer sees the Uber car moving in real-time towards the pick-up location he suggested.

      In other words, Uber is offering a service that taxi services simply can not offer (without the taxi services giving up on some of the advantages they have of having multiples ways of getting customers, which will never happen). Also, the barrier to entry for Uber drivers is much lower. For most of them, they can just use their existing car and just start driving for Uber only for a few hours each month (just to see what it's like). That's a very attractive proposition for potential drivers. Many of those potential drivers may already have full time jobs, part time jobs, or other serious commitments like kids to take care when they're not in day care or in school.

  4. Re:Europe, land of the sheep and chickenshit by nbauman · · Score: 3, Insightful

    A socialist pipedream in which college education is free.*

    Good luck paying off your college loans, and your children's college loans, suckers.
    ____
    *Free because college graduates pay back more in taxes to the government in 6 years than the cost of their education.

  5. I root for Uber in Bucharest by Anonymous Coward · · Score: 2, Insightful

    I think they are not succeeding in countries with well established and (maybe) good quality taxi services. This is not the case for Bucharest. Here the taxi drivers are guys with no education that would not get a job otherwise. They always expect tip and can become violent if this is not provided (especially to women). They smoke even if you ask for a non smoking cab and some of their cars are pitiful (I don't expect leather but I want the heating to work). Uber imposes some rules on cars and you can rate drivers (and the rating is actually used by Uber as opposed to taxi firms). This makes their drivers act nicer, the cars are better and the whole experience is better. And not having to deal with cash money and tip is cool also.

  6. Re:Europe, land of the sheep and chickenshit by Anonymous Coward · · Score: 2, Insightful

    Forcing people into dept so they can get an education. This is just another scheme by the rich to keep the poor down.

  7. Re:Europe, land of the sheep and chickenshit by Rei · · Score: 5, Insightful

    Isn't that how it is supposed to be? Someone invests in something to get the money back due to increased revenue? I don't see the problem. Please elaborate!

    The problem is that not everyone is in equal opportunity to invest. To some families/individuals, the cost of college in the US is trivial. To others, it's hugely prohibitive. This imparts a bias in which it's far easier for a certain segment of the population to pay for college than another (much larger) segment, which discourages the latter from attending college, which discourages a large portion of those who would actually be good at a particular career from getting the background and degree that they need to pursue it - leading to said positions being filled by less qualified individuals who simply came from personal (or more often, family) backgrounds with more money.

    That's not to say that individuals from poor families can't reach success - far from it. But in this regard money is like the difficulty setting on a video game. Sure, someone who's really skilled may still beat it on the hardest setting, while someone who is lousy at the game may still lose on the easiest. But playing the game at a particular difficulty setting is going to skew the percentage of people who succeed at it. The "high scores" - the job market - is based around those who won the game without regard to what sort of difficulty setting they played at, and so naturally it's going to be skewed toward those who played at easier difficulty settings, rather than being an accurate list of who is really best at the game.

    Beyond the base economic issues of wanting your nation's workers to be able to reach their maximum potential rather than having potentially brilliant scientists and engineers working retail, there's also the issue of happiness. Because people tend to work harder at jobs that they enjoy. But if someone gets locked into a particular career path that they don't enjoy or aren't good at, high costs of tuition (as well as a lack of a "safety net", such as universal healthcare) make a career change a hugely, often prohibitively costly endeavour. Where tuition is cheap and a safety net stronger, people who realize that they've headed down the wrong career path are much more likely to switch career paths and find one that they actually do enjoy and are good at, rather than being unhappy and unproductive for decades in the workforce.

    Safety nets and universal tuition do have a cost, don't get me wrong. But having workers in the wrong career and not having people meet their potential has an even bigger cost.

    --
    Shiny New Australia.
  8. Which "interests" are being supported? by Dereck1701 · · Score: 1, Insightful

    I wonder, is their retreat due to a genuine disinterest by the populations of those countries or simply by anti-competitive practices by those countries "established interests"/governments? It almost sounds like at least in UberPops case that the general public was happy to use the service but the taxi companies/drivers "dissatisfaction" resulted in blocking traffic, government lobbying, destroying Uber cars and attacking their drivers. No doubt that Uber is a company that is more than anything interested in profits, but why people are ascribing different motivations to various established taxi companies across the globe is beyond me. Let them all provide their service and allow the public to decide which deserves to survive.

    http://techcrunch.com/2015/06/...

  9. Re: Europe, land of the sheep and chickenshit by Opportunist · · Score: 5, Insightful

    I think after two attempts they noticed that it doesn't work.

    The US are still in the learning phase.

    --
    We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
  10. Re:Respect for the law for everyone, not just the by serviscope_minor · · Score: 1, Insightful

    Then your grandfather was an intellectually lazy bigot.

    --
    SJW n. One who posts facts.
  11. Re:Respect for the law for everyone, not just the by dave420 · · Score: 3, Insightful

    With each post your perplexing signature makes more and more sense. You are so incredibly apt to lump all kinds of disparate people together under one simple label, to judge away and ascribe whatever motive you want to their actions. No wonder you are so confused about nearly every topic you discuss here.

  12. Re:Respect for the law for everyone, not just the by Anonymous Coward · · Score: 2, Insightful

    When I would ask my grandfather what the difference was between the U.S. and Europe, he used to tell me that America was made up of the descendants of the European people who were willing to work hard and take the risk of a better life in the New World. Europe was made up of the descendants of the European people who were too lazy or frightened to leave the Old World.

    Having done a fair amount of genealogy, I'd say one of the biggest factors for coming to the US was having very little to lose.

    Successful people tend not to pick up and leave everything and everyone they know. It's the people who didn't see a future in Europe that came to America - because of the local economy, or because they were raised as farmers but had no land to farm, etc.

  13. Re:Respect for the law for everyone, not just the by Anonymous Coward · · Score: 0, Insightful

    The people who went to the US were largely those of relatively far-from-the-middle minority religious or political beliefs.
    They went to the US in order to be free to prosecute others.