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Uber Reveals One of Its Big Vulnerabilities (slate.com)
One-quarter of its business happens in just five cities; 15 percent of bookings happen on airport trips. From a report: About 24 percent of Uber's bookings -- all the money that customers pay through the app and in cash, including driver earnings -- occur in just five cities: New York, Los Angeles, San Francisco, London, and Sao Paulo. For a company that operates in more than 700 cities, including quite a few giants -- Mexico City, Tokyo, Paris, Lagos, Hong Kong, Seoul, and Mumbai, to name a few -- that concentration gives Uber a surprising vulnerability at the local level. And they know it.
This vulnerability casts a new light on, for example, Uber's 2015 humiliation of New York City Mayor Bill de Blasio, when the company fought off the City Council's proposed vehicle cap. That was a warning to other politicians, and a show of power, but it was also a vital business move. The company's filing also mentions, as a cautionary tale, what happened afterward: Just three years later, the City Council approved minimum rates for drivers and a cap on the number of new ride-hail vehicles. The company also mentions its regulatory challenges in London and San Francisco.
This vulnerability casts a new light on, for example, Uber's 2015 humiliation of New York City Mayor Bill de Blasio, when the company fought off the City Council's proposed vehicle cap. That was a warning to other politicians, and a show of power, but it was also a vital business move. The company's filing also mentions, as a cautionary tale, what happened afterward: Just three years later, the City Council approved minimum rates for drivers and a cap on the number of new ride-hail vehicles. The company also mentions its regulatory challenges in London and San Francisco.
I really expected Washington DC to be on that list of top cities too. The District is such a pain to drive around, most people seem to just navigate it the way I do when I'm out there; take the Metro to the nearest station and walk the rest of the way. If you need to carry around any large items/boxes though? Uber is your friend.
I see a whole lot of Uber hailing going on in DC though, thanks to all the bars and nightclubs, with people who had too much to drink, plus all the "important people" who need to get around from point A to B while not breaking a sweat or getting their nice suit dirty.
Personally, I do everything I can to avoid taking Uber and to date, I've never used Lyft (though their app is still on my phone, just in case). I think the service itself is a great idea, and I love how it disrupted the old-school and stale cab business. I just don't like paying that much to be taken relatively short distances. I spend all the money involved in owning my own vehicle and I'd prefer to use it in most situations.
You've basically got five cities that can now make whatever demands they want. Losing any one of those top five would be a huge problem, and now they all know it.
Uber is gonna wish they hadn't been so pugnacious, I suspect.
If only companies would be penalized enough to affect the stock value so that investors were forced to think about the practices of the companies they give money to in a way that they would understand.
Laws are rules for the court, but merely a bottom bar to hit for life. Think beyond laws in your actions always.
There's nothing illegal about compensating someone else for sharing a ride
What sharing? The people driving aren't going to the same place the people contacting them. The driver is going out of their way to explicitly pick up someone. Further, that driver wasn't going anywhere in the first place. They were waiting somewhere for someone to contact them. You know what that's called? A taxi.
or renting out a spare room in your house
Yes, there is. It is guaranteed the homeowner's insurance does not cover running a business out of their home, especially one involving the housing of other people. Also, people doing the "renting" aren't following the same rules that real landlords have to do when renting.
Don't tell anyone about garage sales those might be illegal to.
Selling your odds and ends one day a year is in no way comparable to running a business out of your car or home.
We will bankrupt ourselves in the vain search for absolute security. -- Dwight D. Eisenhower
A Knock-Down is where the driver takes a passenger for cash without logging it into their metering device (their phone, for Uber/Lyft) thus cutting out their employer completely.
This happens very often with repeat customers, as drivers will give out cards with their personal cell number on it to call when they need service so they can just go "off duty" and take the whole fare.
It's little wonder they're struggling in the measured profit department, and drivers' recorded earnings are so low, statistically.
Any driver with a decent stable of regulars can make a killing without sharing the wealth with Uber/Lyft. There's also very little that they can do about it, either. Even if they let those drivers go, they turn into Gypsy Cabs that simply run the signs, and work for cash only. Lots of them out there.