And… Yet Another Regulator Flips Out About Uber, Tries To Kill It
from the regulation-2.0 dept
Here we go again. Yet another local transportation regulator who either doesn’t understand Uber or (perhaps more likely) understands it all too well has decided to give Uber all the free Streisand Effect publicity it needs to build its reputation in the market by trying to pass legislation to shut it down. This time it’s the Colorado Public Utilities Commission, which is looking to pass some new regulations that effectively make it impossible for Uber to operate its innovative car/taxi service (which is incredibly popular with users) in Denver. Of course, all this has really done is give Uber the perfect opportunity to get tons of attention for its service in Denver as it urges Uber fans to speak out against the regulatory changes.
Uber points out that the proposed changes will basically make its business model illegal in multiple ways — saying that you can’t price based on distance, effectively keeping Uber cars outside of downtown areas that taxis populate, and forbidding Uber’s key relationship set up with drivers (independent partners). As Uber points out, these rules don’t serve any legitimate regulatory purpose other than to prop up the taxi business model and hurt the disruptive upstart:
These rules are not designed to promote safety, nor improve quality of service. They are intended to stop innovation, protect incumbents, hurt independent drivers, and shut down Uber in Denver.
Of course, we’ve seen this before. In a bunch of places where Uber operates, the service faces regulatory crackdown by local regulators who seem to do a lot more to protect incumbent taxi services than they do to figure out what benefits the users the most. This gets back to that concept of corruption laundering that I’ve mentioned a few times. The regulations can be presented as having good intentions: they want to protect riders from getting scammed by unscrupulous drivers, and they want to make sure the market is safe and efficient. But, as with so many regulatory schemes, what can be positioned as having the best of intentions also serves a secondary purpose: to allow incumbents the ability to thrive, while blocking out competition and the impact of disruptive innovation. That seems to be the case here yet again.