1) It was VASTLY cheaper due to VC cash subsidy attempting to become the single monopoly. That's not an "efficient market"--that's predatory--and eventually the cities will have to deal with the aftermath in the cab system when Uber/Lyft collapse.
2) My feedback could hit the driver directly--so the failure modes of cabs were prevented (not picking people up, taking too long to pick people up, not driving them where they want to go, taking stupid paths, etc.).
Not really. Most taxi drivers are 1099 contractors as well. They pay the dispatcher a cut of the fair for connecting them with the ride. They either own their cab and medallion, or rent them from the dispatch company.
It will be interesting to see if Cali prosecutors go after the dispatch companies the way they are going after uber and lyft.