Riders set the rates with demand based pricing and drivers choose which one gives them the best opportunity at each trip request. That's a unique situation, so a comparison to "every other independent contractor" misses the point here.
Also, Uber actively discourages this by penalizing drivers who skip to many fares, which suggests they really don't want you to do this.
When Uber caught on, they added the penalty.
But in this case, when a driver takes a Lyft passenger instead of an Uber passenger, they are actively taking business from Uber. This is more like an employee working at a call center, and answering calls for another call center on their cell phone instead of taking the ones that are ringing at their desk.
Ebay for instance, the suppliers set the prices. Amazon Marketplace: the seller sets the prices (not Amazon).
Uber sets the prices, NOT the free market.
Uber is a price setting monopoly, the "sole authority" of the price within the Uber "marketplace". Consumers do NOT have any ability to change the price. Nor do any of the Uber drivers.
Taxis never were a free market either. But at least they didn't pretend to be one like Uber does.
> Uber is a price setting monopoly, the "sole authority" of the price within the Uber "marketplace".
Within the Uber marketplace dilutes the definition of "monopoly" into meaninglessness. Uber competes for drivers with Lyft, SideCar, taxi companies, limo companies, and, well, every other company hiring (relatively) unskilled labor. Uber competes for passengers with, uh, again, Lyft, SideCar, and taxi companies.
A free market does not require that consumers have the freedom to choose exactly what price they will pay for a particular product or service. What defines the free market is the ability to choose between competing products and services.
Can the Uber drivers, within the Uber marketplace, compete with each other? If yes, then they are acting like independent agents. If not, they are acting like employees.
So, is Uber acting like a market, or like an employer?
Uber has one job. Connect riders with drivers.
The "libertarian" solution is to provide a marketplace where drivers can sell their services to riders. Drivers can compete against each other by raising or lowering prices, while riders can compete against each other by similarly increasing or decreasing the bid.
Uber pretends to do this, but with a distinct difference. Uber sets all the prices. Therefore, Uber is anything BUT a free market.
Maybe you don't get it because you haven't been paying attention to Uber marketing. But I'm not claiming that Uber has no competitors. What I'm saying is within Uber's "marketplace" of "independent contractors", the drivers and riders are in fact helpless to Uber's pricing whims.
Uber is NOT a free market. But they are trying to market themselves as one. This is a distinct reason why Uber drivers have been declared to be employees.
> The "libertarian" solution is to provide a marketplace where drivers can sell their services to riders.
States create solutions. The libertarian "solution" is to do nothing and let the interactions happen organically. This could mean a marketplace, it could mean other things. It really depends on what people want, the locality, technology available, etc. And sometimes people actually want a monopoly and are happy with that. Facebook is practically a monopoly and I don't think people want 2 main social networks.
> Uber pretends to do this, but with a distinct difference. Uber sets all the prices. Therefore, Uber is anything BUT a free market.
I agree that Uber by itself is definitely not a free market place. I'll take your word that their marketing paints a different picture--seems likely.
Upvoted.
You are confusing anti-trust law ( or something else ) with labor law.
A misnomer. Uber sets the prices, not the market. Uber can market the concept as much as it wants, but it doesn't change the fact that Uber sets the prices and therefore, no free market really exists.
Riders don't set the rates, no... but I'm not sure what that has to do with a free market.
[0] - http://www.forbes.com/sites/andrewbender/2015/04/10/ubers-as...
> Uber is arguably the #1 regulatory power in the U.S. personal transportation sector.
I would reserve the phrase "regulatory power" to government. I think you're using it here for the hyperbolic value.
I am being snarky, but the libertarian poster-child is shielding 46% of the national market from competition (drivers can't compete with eachother) and that's pretty ironic.
> A free market is a market system in which the prices for goods and services are set freely by consent between vendors and consumers, in which the laws and forces of supply and demand are free from any intervention by a government, price-setting monopoly, or other authority.
Uber is a price-setting monopoly within the Uber market. Uber is the sole authority in the prices that consumers pay and that drivers receive.
The Uber marketplace is NOT a free market. QED. Its rent-seeking behavior on behalf of the owners.
Consider a counterexample - eBay is clearly a market. Independent buyers and sellers agree to transactions, on their own terms. eBay competes for the attention of both buyers and sellers, in terms of service and fees, not on the prices of the actual goods in the market.
If the competition that's happening in the transportation market is between Uber and Lyft, and that competition is on the price of rides and quality of rides, then Uber isn't a market, it's a vendor in a market - and thus the drivers aren't vendors within Uber's market, they're just employees of Uber.
As an employer Uber can set shifts for its employees and ban them from taking jobs from anywhere else while on shift.
I wonder what Uber's new privileges with respect to its workers will cost. What benefits are California employers required to pay? Paid vacation? Pay in lieu of notice for termination without cause? Employment insurance contributions? Social security contributions?
It's all going to be a moot point in the end. Transport automation is coming.
Uber's biggest asset is the installed customer base. Uber's drivers are technically their biggest liability... as this ruling well demonstrates!
I'll also speculate this this is a pretty big competitive advantage. Collecting that much ride data is not trivial.
Actually it pretty much is, if you're willing to snoop on handshaking data from peoples' cell phones.
When I want to get from point A to point B, it doesn't really matter what my friends or other people are using, I just personally want good service at a good price - and I don't think I'd be particularly loyal to any one provider.
I expect that smaller regional providers of self-driving taxis would be able to compete on even footing with larger companies, once self-driving vehicles are purchasable commodities without heavy R&D costs.
If Uber can operate 100,000 robo-cars in San Fran you can walk up to the sidewalk and press Hail and presto you have your ride. They can dynamically balance load between nearby cities on a day-by-day even hourly basis dispatching streams of robo-cars from their garages when the surges hit. Large events which drive demand are pre-scheduled and automatically reflected in both car distribution and the number of gasoline futures they trade on the options board for the upcoming week, etc. etc.
You can bet these robo-cars will be getting robo-tire-rotations and any other effeciencies they can squeeze out. (Imagine a line of them going through Uber's robo-washers)
5? 10? 15 years out? Doesn't really matter but I'm convinced it will eventually happen. It will be awesome and terrible all at once.
Incidentally, this is why car manufacturers like Daimler and VW are running carsharing systems
Companies like Uber face problems most of us can't even imagine, such as regulatory capture by the incumbent taxi industry. Yes, Uber plays dirty, but to some extent I think they have to, because it's a dirty game.
No, it really isn't. There isn't anything special about them, unless you're one of those people that believes a patent should be granted for an existing process simply because now it says, "on a computer".
In the model where contractors are dispatched to handle some task by phone the contractor is able to make counter offers to the company. Eliminating that through automation affects the legal test. The point I was replying to about the ability to choose jobs from different clients (Uber vs Lyft vs all the other edelivery services) also makes this different.
This is a complex area of law, which I'm guessing you haven't personally litigated, so you incorrectly compare it to the software patent issue.
I knew someone who worked at a grocery store that was 24/7. Except they did close on Christmas, New Years, and Thanksgiving. The store's insurance was for a 24/7 operation - which meant that someone had to be in the store even those 3 times a year it was closed. So my friend's job 3 times a year was just to sit in an empty store by himself. Just to comply with the insurance policy.
I knew someone who was a master control operator for a TV station for the overnight shift. He told me his job was "make sure the TV doesn't go off the air" which ended up being that he was on the internet and watching TV his whole shift since the TV broadcast very rarely malfunctions. (I don't know if this is usual or not for a master control operator)
No, it isn't. There isn't anything special or unique about Uber that says they should be exempt from existing law.
"Riders set the rates with demand based pricing"
No, they really don't. I have no ability as a user to state how much I'm willing to pay for a trip.