This is supremely untrue: a huge part of Uber and Lyft's value proposition is not cost related at all. (Also, cab drivers generally aren't employees most places.)
They are more faster in most places. Other than some urban cores and transit hubs, it is much faster to get a pickup by Uber/Lyft than it ever was a taxi.
They are more reliable in most places. When you call a taxi, it may or may not show up, and you won't be told whether they're going to no-show after you call them.
They are more convenient. Ordering an Uber/Lyft is really easy. Most places, if you want to call a taxi, you have to use the telephone or use an inferior smartphone app. When they started growing, it was almost always the former.
They are a more pleasant experience. My worst experience in an Uber/Lyft ride is day-to-day in a taxi. I've had truly terrifying experiences with taxis.
Many of these factors are actually irrelevant to their labor practices. Some of them do relate (for instance, drivers are very vulnerable to rider low-ratings, in part since firing them is easier than firing employees), to be sure.
* You can predict when it will show. In a lot of cities you had to call a cab 10-15 min in advance
* You don’t need to pay. This says 2-3 min at the end
* It’s all above board. This varies by location but taxis always wanted cash, to hide earnings, and they would create incredible fuss over giving receipts for business expenses
* Not only is it above board, it’s automatic: business receipts from uber go straight to my accountant. Expensing is much easier.
In Europe traditional taxi companies caught up pretty quickly, you can now order taxi ride via app that has UX similar or even nicer than Uber, and you get licensed taxi driver, car with taxi signs, so that you no longer need to stare weirdly at all black Priuses approaching you, and the driver can speak your language, and knows his way around the city. To recap: traditional taxi service is of much better quality than Uber, and only slightly more expensive, therefore much preferred.
The only time I used Uber was in the US, once I came back I don't miss it at all. I don't know what exactly is wrong with US taxi market, but Uber and Lyft aren't the only solution.
I’m in Canada, and taxi UX really hasn’t caught up to Uber. But when I was in Brazil there was a taxi app that was basically equivalent to Uber. Except maybe you paid in cash. It’s possible for the taxi industry to improve parts of their model. The north american taxi system may lack the incentives?
Edit: reword to be easier to read.
That left me with the impression that cabbies rented the money to buy access to the market, and were paid enough to afford it.
That and the financing for medallion often came from the seller. Not a lot of banks would touch these assets so the interest rates were horrendous on these.
https://en.wikipedia.org/wiki/Taxicabs_of_New_York_City says "most medallions (and most cabs) are owned by investment companies and are leased to drivers"
If you want another one in retail compare and contrast with Costco. Which limits its number of SKUs (and actually has a reputation for paying workers relatively well by retail standards).
When figuring in all the costs, like car depreciation and maintenance, they actually earn less than they spend.
I think it's fair to critique the ridesharing companies for using a business model that requires their workers to do far more complicated calculations than most workers in order to ensure that they are working in a financially beneficial way.
[1] https://orfe.princeton.edu/~alaink/SmartDrivingCars/PDFs/Zoe...
[2] https://www.vox.com/2018/3/3/17074782/uber-mit-study-less-th...
1. https://www.npr.org/sections/thetwo-way/2018/03/07/591430857...