Uber CEO: I Think I’ve Got 20,000 Years Of Jail Time In Front Of Me
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And next time you can't find a cab, keep this in mind -- SF didn't add any (transferable) cab licenses for 33 years, until 2010. http://www.ktvu.com/news/24519083/detail.html
It's pretty clear who is writing the rules for taxis in SF, and it's not someone with the consumer in mind.
"Thanks for the free ride!" - At least in Chicago, it's a part of the passenger "bill of rights" that you are able to pay by credit card. They've pulled the same thing on me a few times and, assuming I'm not in a rush, I've offered to ride with the meter turned off to the closest ATM...then the machine suddenly works.
Not to continue an old argument, but to continue an old argument, these are the good medallioned guys who are regulated by the state so that they can't scam you. This is supposed to provide an advantage over e.g. Ubercab, where the perils of unregulated capitalism would allow a driver to cheat you. But they still try to scam you and their medallion is not going to get yanked for it. Meanwhile, Uber solves this technologically: they can't run payment scams because the system doesn't trust drivers with any part of the payment flow aside from hitting "The Ride Is Over."
* Regulations need to catch up to Uber, fast. Uber is good.
* Cabs should be regulated, for public safety and consumer protection. They're a unique intersection of low-barrier-to-entry, vulnerable-consumer, and serious externalities.
* Cabs are not well regulated now.
* I am ambivalent about business plans premised on "everyone recognizes that reg X is broken, so we'll force the issue by ignoring the reg and going right to market". If Uber gets to, maybe so do investment banks.
Perhaps smartphone-dispatching, sticky reputations, and non-cash payments solve all the safety and 'consumer protection' issues better than the corrupt, captured, regulatory-commission system. That regulatory system, despite decades (or centuries!) of head-start, has resulted in a situation where "cabs are not well regulated now".
Until there's evidence of abuse, why do "regulations need to catch up to Uber, fast"?
The Ubercab situation is a strong signal to regulators that the landscape is changing and they should be considering changes.
This is a good idea in the case of low probability, high impact events. For example, counterparty contagion in the financial system or oil spills.
But in the case of low impact events, it's pointless. Take a few obvious precautions (e.g., track all the drivers) but otherwise just wait for problems to arise before fixing them.
The risk of an unregulated system is very low - a few consumers get scammed out of $12. The risk of regulation is very high - many consumers may be deprived of a considerable consumer surplus (i.e., they may not get a ride at all, or may be forced to overpay for a regulated cab).
But lets suppose this really were an issue. There is a simple solution: charge each taxi a flat $10k/year license fee (with no cap on the number of licenses issued). Use the proceeds to hire full time undercover taxi inspectors.
That gets you about 1 inspector for every 10 cabs. Assuming each inspector rides 10x/day (i.e. 5 hours/day riding, 30 min/ride), each taxi will be inspected every single day on average.
That said: your suggested regulation seems eminently reasonable to me.
Hmmm, no.
http://articles.nydailynews.com/2010-08-19/news/29439015_1_l...
What you've pointed to is a risk of allowing people to interact, and really has very little (if any) to do with cab regulation. Being murdered is a risk anytime you're around other people; its just so remote that usually it is appropriately ignored.
Further, if there were an epidemic of cab-murders, which of course a single anecdote doesn't show, such that it made sense to worry about the risk of homicide, then the people calling cabs would be aware of this, and there would be market demand for a cab company that does full background checks, offers life-insurance policies, sends a second person to guard against malfeasance, etc. Of course, murder is illegal, so police would be looking for the perpetrators as well.
Even if for some reason a that didn't happen (say, people enjoy being murdered during their cab ride) and we wanted to prevent it anyway, the type of regulations that'd make sense would be things like background checks before issuing a license (which would need renewing routinely), which would apply to all cab operators, both new and renewing.
Keep in mind that the regulations that people actually object to are mostly of the form "we allow X cabs total in the city".
democracy is highly inefficient for this purpose. no one is going to elect obama to change EPA regulation 1.2.093 or whatever. so the only way to sunset a bad rule in practice is to incentivize flagrant public nullification.
I don't see what your point is in comparing a taxi driver's income with that of a tech CEO. I'm not wealthy either, and now take cabs only in emergencies because the cost has become prohibitive. Maybe you should compare drivers' incomes with those of medallion holders and taxi company CEOs. In general I'm a pro-regulation, pro-governance kinda guy, but not when it comes to price controls. the taxi industry is the way it is because of a corrupt arrangement between incumbents and administrators.
About the only time I've found myself in a cab in a timely manner is with the taxi zones at SFO. That happens to be pretty much the only time I ever get a non-Uber ride too.
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> before costs of living gets out of hand
http://techcrunch.com/2008/11/12/ill-never-let-canada-live-t...
Yeah, so do I.
http://search.municode.com/html/14143/level2/DIVII_ART1100RE...
The horrific notion of criminalizing a consensual economic intercourse between two adults -- with prison penalties, at that -- isn't an issue of democratic politics, but of basic rights.
Addressing a problem by going to the opposite extreme is just foolish. There's a reason that most people wouldn't feel safe accepting a ride from a random stranger, and why children are taught not to do it from an early age. Hint: it's not fear of capitalism.
But that is not the idea of taxi "licensing" as it exists. It doesn't merely regulate taxi driving; it prohibits it altogether, outside of a protected group. It's not licensing, but cartel enforcement. Its aim isn't protecting the safety of the public, but protecting the business monopoly of the taxi industry.
Uber isn't prohibited from operating taxis because they're unsafe, uninsured, or unwilling to subject themselves to registration, inspection, insurance, background checks, or whatever "public safety" requires. They're banned simply because they are competition. And this has nothing to do with public safety!
Let's use another regulated field as an analogy: medicine. You have to receive extensive training and receive government certification in order to become a doctor. This is to protect your future patients against someone who knows nothing about medicine, which we can all agree is fair. Here's the difference between being a cab driver and a doctor: if you are qualified to be a doctor, you can be a doctor. But to be a cab driver, you have to buy an arbitrary license from the government of which there are only a finite number of. You could be the safest most wonderful driver in the world, but without that arbitrary piece of metal bolted to your car, it's illegal for you to drive anyone around.
Medallions are not about safety. They are a government subsidy for cab drivers.
But ... the limit is sane. And a retired doctor can come back to work if they see a big shortage (which gives the system time to train more grads).
Was that intended to be a double-entendre?
here's the relevant passage: http://dl.dropbox.com/u/22117/tcp_and_taxicab_distinguished....
(source: http://www.cpuc.ca.gov/NR/rdonlyres/D5E763FD-5706-4F7D-9F95-... )
(limousines which are passenger carriers regulated by CPUC aren't licensed to be hailed from the curb, but can perform prearranged transportation)
SF Definition of a Dispatch Service:
Dispatch Service" shall mean any person, business, firm, partnership, association or corporation that receives communications from the public regarding taxi service for the purpose of forwarding such communications to motor vehicle for hire drivers, and shall include any owner, manager, employee, lessee and any agent of said service. "Dispatch Service" shall not include any service through which the public is able to communicate directly with Drivers, and shall not include any effort on the part of a Driver to market his or her services to the public.
"Taxi" shall mean a vehicle operated pursuant to a Taxi or Ramp Taxi Medallion that is legally authorized to pick up passengers within the City with or without prearrangement, of a distinctive color or colors and which is operated at rates per mile or upon a waiting-time basis, or both, as measured by a Taximeter and which is used for the transportation of passengers for hire over and along the public streets, not over a defined route but, as to the route and destination, in accordance with and under the direction of the passenger or person hiring such vehicle.
"as measured by a Taximeter", "for hire over and along the public streets"
Because TCP's are legal in SF, and Uber can prearrange trips in a legal fashion using them, and there's no special law that applies to Uber only, in theory Uber should be able to operate legally.
Technicalities like whether the trips are fully prearranged (pick-up AND drop-off) might come into play, but these are details they could fix.
IANAL, but from what I've seen, If ordering a TCP via the internet is legal, ordering a TCP via the internet using Uber is also legal.
Or is something preventing them form doing that, because licensing is inherently a way to protect old cartels from new cheaper/better upstarts?
http://www.medallionholders.com/medallions.html (n.b. this is cartel-funded propaganda)
http://www.sfweekly.com/2010-01-27/news/cabbies-cry-foul-ove...
It's exactly what it looks like: they've criminalized competition. You get prison for "stealing" business from union thugs.
One of the abiding virtues of due process is that it's public. In the event that a cartel captures a regulatory agency, and turns it against the people it's supposed to serve, a system of open justice will force them to fight for their odious privilege in full view of the press. The risk - for the cartel - is that the trial will backfire by spotlighting just how corrupt and abusive their underlying legal supports have become. Even if they do win in court, the victory my by Pyrrhic.
In the absence of a clear (and superior) alternative, the arguments that supported the initial regulatory capture may still carry some weight with an otherwise ambivalent public. In these cases, private acts of cartel-busting may be truly foolish. But in cases like Uber or Airbnb - where the public can not only see the alternative clearly, it can download it as a wildly useful app - it becomes exponentially harder to strangle genuine progress. Extreme and widespread dissatisfaction with the norm (which is very much the case with SF Taxi service) makes aggressive legal suppression even riskier - especially when cash-strapped states and municipalities can be convinced that the new market is big enough to substantially augment their tax bases.
None of this means that the overt cartel-busting approach to business development isn't risky as hell. It is. But timed correctly, and supported by the right technological breakthroughs, it can pay off spectacularly. If anyone deserves the entrepreneur-as-hero laurels, it's these guys.
Anyway, I see a simple solution to San Francisco's laws: run the site out of Libya or something. Pretty sure there's nothing San Francisco can do about that, except start cracking down on the users (but oops, who aren't doing anything illegal).
Most of the people on the end of taxi numbers dont even seem to have a map in front of them. If you can't give them a street address, they don't seem to comprehend that you're describing a real place, on the same planet as they are. The drivers naturally know where everything is instantly, the issue is persuading the phone operator to relay your directions to them.
IANAL, but isn't this the kind of offhand comment that frequently comes back to haunt people? I guess its very dependent on which country you're in.
As you can see from the debate at the top of this page, it's disrupting the regulation of the cab industry which is about creating artificial scarcity of the cabs in order to keep the prices of rides inflated. (EDIT: actually the price of rides is regulated and would be the same regardless of how many cabs there were. It is actually to ensure daily revenues for the cabs remains high by ensuring optimum utilization)
From that perspective it is even more disruptive than Netflix because Netflix operates in a free-market environment. You could choose to rent your DVD's from Amazon or Blockbuster. With cabs in cities like SF you have no real direct alternative.
The cab industry could easily add a web-interface for booking cabs.
They could but they won't because they already have more potential customers standing on street corners wanting cabs then they can service (because, as already explained, the number of cabs is artificially restricted).
There is no benefit to the cab industry to innovate in any way (such as build an app) unless regulator steps in. Which is why a private player able to do this is so disruptive.
Sounds to me like you don't really understand the way the cab market works which is why you're not getting the disruptive element.
Perhaps you can also explain how it benefits minority folk who have arrived in SF in the last ~30 years that virtually no new medallions were issued from 1978-2010 despite a ~15% increase in the city's population during that time.