Techdirt. Stories about "sidecar" Easily digestible tech news... http://www.techdirt.com/ en-us Techdirt. Stories about "sidecar"http://www.techdirt.com/images/td-88x31.gifhttp://www.techdirt.com/ Thu, 28 Mar 2013 13:03:00 PDT Taxi, Limo Trade Group Hates Innovative Upstarts, Labels Them 'Rogue Applications' Mike Masnick http://www.techdirt.com/blog/innovation/articles/20130327/02594322476/taxi-limo-trade-group-hates-innovative-upstarts-labels-them-rogue-applications.shtml http://www.techdirt.com/blog/innovation/articles/20130327/02594322476/taxi-limo-trade-group-hates-innovative-upstarts-labels-them-rogue-applications.shtml
Not surprisingly, the more well known apps -- Uber, SideCar, Lyft and Tickengo -- all have received the coveted "red light." While according to the TLPA this means they're dangerous "rogue apps," to me it suggests that they're all doing something right. They're providing services that people want that are more convenient or better priced than the old guard, which is why the old guard has to attack them.

The key point they make is that these are all "unregulated" taxi services, which allows them to go into full out moral panic mode about how, without regulations, these services will likely take advantage of consumers. The paper talks about threats of "criminal" drivers and the potential for meter rigging. Of course, as we've seen in other industries, this seems like a clear case of businesses using regulations to keep out innovation and competitors, rather than for a legitimate purpose. Yes, many of those regulations were put in place for a good reason originally, yet many of those reasons really don't apply to these new services.

In the past, you needed regulations to protect you from drivers taking extra long paths to where you wanted to go, driving poorly or charging too much -- because drivers could do that and there was little recourse. But the thing about these new services, which rely heavily on online reputation systems, is that these reputation systems make the need for such regulations much less necessary. The services, like Uber, set the price and poor drivers get booted from the system based on user reviews. And, since most people who have a mobile phone these days to use one of these apps will also have GPS on those phones, people can self-monitor if the driver is taking a reasonable route. Basically, the original safety reasons (which, again, may have made sense at the time) for many of those regulations simply may not really apply to these new services. But rather than deal with that, the legacy players are doing what legacy players do: using those regulations to try to stomp out innovation and stifle competition.

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]]> can't-beat-'em-in-the-market,-so... http://www.techdirt.com/comment_rss.php?sid=20130327/02594322476 Mon, 19 Nov 2012 03:35:45 PST California PUC Cracks Down On Innovative Ride Sharing Operations As Another Batch Of Taxi Drivers Sue Uber Mike Masnick http://www.techdirt.com/blog/innovation/articles/20121115/16194521069/california-puc-cracks-down-innovative-ride-sharing-operations-as-another-batch-taxi-drivers-sue-uber.shtml http://www.techdirt.com/blog/innovation/articles/20121115/16194521069/california-puc-cracks-down-innovative-ride-sharing-operations-as-another-batch-taxi-drivers-sue-uber.shtml regulatory and legal fights that Uber has been dealing with lately. The company, which basically has set up a super convenient way for people to book a ride (and, in some cases, taxis), keeps running up against a combination of local regulatory agencies who tend to feel that they get to lord over anyone who attempts to do anything involving driving people around for money, as well as existing limo and taxi providers who fear a more efficient system (especially when they profit off of inefficiencies). Of course, some politicians and taxi/limo drivers recognize that greater efficiency is actually good for everyone, allowing a more convenient and useful system, and filling in gaps when regulated supply strains the system.

However, too many are just focused on the status quo. And this isn't to say that there isn't a place for regulatory bodies to ensure that cabs and limos are safe and that they don't take advantage of passengers. But the line between protecting passengers and protecting legacy players from competition sure does become a blurry line very, very quickly. And this week a bunch of these companies have run into legal problems on their home turf. Uber, specifically, has has been sued in San Francisco by some cabbies demanding that the company be shut down. They claim that Uber's car hailing service is really an unregulated taxi service, and thus, unfairly competing with them.

Perhaps the bigger issue, however, is that the California Public Utilities Commission (PUC) has fined Uber and two other companies, Lyft and SideCar (who offer ridesharing). As that Wired link notes, this seems to be a clash between two core concepts that seem to thrive in San Francisco: on the one hand, freedom to innovate and disrupt and, on the other hand, support in government intervention for the public good. I'd argue that the two concepts aren't in quite as much conflict as the article suggests, if the intervention actually is for the public good. The problem is that's not really clear here, and it's not hard to see how it's really for the sake of limiting competition.

SideCar points out that this is a case of regulators not knowing how to classify an innovation:
asserting that we are operating a transportation carrier... is like saying Airbnb is a hotel chain, that Travelocity is an airline, or that eBay is a store
Lyft, similarly, suggests that there's a problem in regulators taking a square peg and trying to shove it into a round hole, because they've never seen a square before:
Transportation has historically been a highly regulated industry, and the existing regulations weren’t designed to imagine a world where two neighbors who have never met are able to connect within a matter of minutes to share a ride across town.
Uber's CEO, Travis Kalanick, told Wired that the PUC fine is particularly ridiculous in its case, since it only works with drivers who are already regulated by the PUC. It's just offering them another channel for finding customers. But under the PUC's ruling, it appears that they want those people to be doubly regulated, which seems completely wasteful:
Our contention is that if you read the regulations, such a notion doesn’t make sense. Are we supposed to give drivers a second drug and alcohol test? Are we supposed to have cars inspected by the DMV a second time after they’ve already inspected (our) partners’ vehicles?
In the end, you have to wonder if the role that regulators have still makes sense for these kinds of innovators. Yes, there are issues about safety and avoiding scams, but the various companies have built in systems to deal with that -- such as driver ratings and public reviews. Those types of things weren't really possible in the past, which is why you needed a PUC to make sure taxidrivers weren't ripping people off. But now the "PUC" can be the public itself. But... that only works if you believe the regulations are supposed to help the public, rather than the legacy players.

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