Rough patch for Uber service's challenge to taxis | Hacker News Reader

Rough patch for Uber service's challenge to taxis

cnbc.com

18 pointscodegeek22 comments

It's interesting watching this, because it seems inevitable that Uber will become exactly like the service it was meant to compete with: the Taxi industry.

The whole saga has good, bad, and meh elements to all of it.

It's good that the question of auto insurance is coming up. I imagine that many of these drivers are painfully unaware that they are in serious insurance limbo. If someone's a de facto Uber employee, then yeah, Uber should pay for damages that the driver causes. It's definitely an exaggeration to say that Uber will "leave a trail of bodies in the street", but it's also unfair that the victim gets screwed here (because there's no chance in hell the driver's personal insurance will cover this).

It sucks that the odds are so stacked against them for providing (what at least used to be, I rarely use them nowadays) a good service. I remember being in SF a couple years back and trying to hail a cab for 30 minutes before getting an Uber in ~5 minutes. It was really shitty, and Uber really came through in the end. I was glad to pay the price difference.

Regardless of what happens, there's a lot of interesting ideas here that hopefully get noticed. Surge pricing's an interesting idea. Whereas taxis sacrifice reliability for relatively stable pricing, I'm glad there's a competing service that sacrifices stable pricing for reliability. It lets you make the decision about which is more important, and I'm sure we've all been in situations where getting somewhere quickly was worth the extra money.

Since most taxi drivers are technically independent contractors, do the taxi companies insure them or does each driver have their own insurance?

The independent contractor status screws them on all sorts of other things (e.g. health insurance), but I'm pretty sure auto insurance is the responsibility of the taxi company.

> It's interesting watching this, because it seems inevitable that Uber will become exactly like the service it was meant to compete with: the Taxi industry.

It's almost as if http://www.joelonsoftware.com/articles/fog0000000069.html _also_ applies outside of software.

> The idea that new code is better than old is patently absurd. Old code has been used. It has been tested. Lots of bugs have been found, and they've been fixed. There's nothing wrong with it. It doesn't acquire bugs just by sitting around on your hard drive. Au contraire, baby!

Now re-apply that to things like taxi and hotel regulations.

I'm not suggesting things are perfect, but in many cases, these laws exist for a reason.

when you change things slightly sometimes a shift in the regulations might be bigger than you expect. A lot of the taxi regulations have to do with the taximeter - as a passenger, you're have to have trust that the taximeter isn't shafting you (FWIW I don't think that lyft or uber necessarily completely solve this problem because you don't pick your route at the outset, unlike other livery services). Other parts of the taxi regulation to do with congestion caused by taxis that are cruising, which certainly seems like less of an issue for these "alt-taxis".

It's interesting how Uber's messaging has evolved to coincide with argument that they simply facilitate the connection between drivers and people who need a ride. Where they used to say "Everyone's private driver," [1] now they say "The Uber app connects you with a driver at the tap of a button." [2]

[1] Uber.com, January 2013: http://cl.ly/image/261W1r3J1r00 [2] Uber.com, today: http://cl.ly/image/302s342N2r3l

Their lawyers probably told them to make the change since it will help them defend against possible lawsuits arising from accidents the independent drivers who use their platform get into while driving and/or waiting for a fare.

Depends on which service you use. Initially, it was just a means of getting a car (and then, SUV) from a car service. Which is a licensed category of transportation performed by a professional driver.

Now, with the peer-to-peer UberX option (a la Lyft or Relay Ride), it's expanded into a different world, and your driver can be anyone at all.

The experience with these older business, like cabs and hotels, seems highlight the role of legal and regulatory frameworks in encouraging or retarding innovation. Uber and Airbnb seem to be simple and elegant businesses that in part increase supply by freeing up unused resources while competing on price and service with established industries such as taxis and hotels. Now that they have made some headway people are specifically buying apartments and cars to participate.

This issue seems like Airbnb's in NYC where room/apartment renters are being required to play by the same rules as the hotel folks with respect to insurance and safety.

One thing that recently impressed me and that I would like to see happen more generally is the Attorney General's response to the challenge of banking with respect to marijuana businesses in Colorado and Washington. Banks were turning away pot shops that are legal at the state level but illegal at the Federal level. Within a few weeks of the advent of legal marijuana sales the AG's office has stepped in to say that they want to find a solution to enable marijuana merchants and banks to do business. I am impressed by the responsiveness of "the law" in this case. Such "innovation" around regulation would be welcome in other cases where innovation mediated by technology is happening at a faster rate than regulation is used to adapting.

You might also want to look at Uber's DDOS attack on rival Gett[1] ; Seems like Uber is not the good guys they seemed earlier (at least to myself). This is mentioned in the last paragraph of the linked article, but is worthy of its own discussion.

[1] http://techcrunch.com/2014/01/24/black-car-competitor-accuse...

Uber's entire advantage is attempting to evade regulations. They'll be ahead of the game precisely as long as that holds, and have until then to destroy the competition. Hence the culture of dirty tricks.

Every time I get into an uberx the driver starts driving away while fumbling with the gps on their phone keying in my destination. I think Uber should take the "distraction" problem much more seriously.

Regardless, we all know Uber is not going anywhere. Uber is pulling $20 MM a week. However, if they don't address the potential safety liabilities more aggressively, lawsuits might end up eating a big chunk of their revenue.

One thing I've been wondering about with respect to Uber;

When they were taking all that flak for surge pricing during the storm, their defense was "Raising the price increases the supply of drivers."

That's all well and good, simple supply and demand matching.

But then a week or so later, they came out with a substantial price reduction on the UberX service. So if raising the price increases the supply of drivers, what happens to the supply when lowering the price? Isn't this the cause of the constant surge pricing on UberX since the price decrease?

It depends on whether you are in a situation where demand outstrips supply (surge pricing) or supply outstrips demand (UberX).

By lowering the price, they are trying to get more people to opt for UberX vs. taxi/Lyft/etc which theoretically brings the supply/demand into equilibrium. There is potentially the effect of lowering prices so much that drivers don't find it worthwhile to pick up fares in which case you once again help get into equilibrium since now supply is closer to demand levels. If Uber wants to counter that secondary effect, they can lower the prices by reducing their own margin w/o impacting the driver's cut.

Yes, but this causes price opacity which is beneficial to them.

> 'And the only people getting rich are the investors and the executives.'

Wat. Did he expect to get rich driving people around? I don't understand this statement at all.

Its supposed to remove the taxi company cut from the equation. But Uber's confusion about tips seems to have eroded that to nothing?

It's unfortunate that there are so many legal issues with a seemingly very simple service. Having to worry about insurance policies and driver damages has got to be a pain. But, that's all part of the business I guess...

it's not simple at all, because unlike a web service, you are actually responsible for bodily harm that could happen to people.

I know, let's sue the dispatcher for the irresponsibility of the driver. That ought to work.

It's about informing Uber's de facto employees that they have liability and must carry appropriate insurance. Should the employee decline to take this responsibility or should Uber fail to appropriately inform their employees, those who have been hurt or killed are left with nothing.

To ensure that drivers are insured, Uber has responsibility.

Uber mistreats its customers, suppliers, and competitors. How can one do anything, but hope they fail?

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