Cab Drivers Angry About Having To Compete With Free As Well

from the it's-called-competition dept

There's just something about having to compete with "free" that gets people really, really angry. It's silly of course. In traditional competition, if someone lowers their price and it's lower than your own costs, you simply have to figure out other ways to compete (such as by adding more benefits and value). It's the same thing when you compete with free -- but for some reason, people see that big $0 and they stop thinking, not realizing it's no different if someone is charging $0 or if they're just charging less than you. You need to figure out some way to compete. EEJ points us to a story from a couple months back, noting that in Tampa, Florida, some entrepreneurially minded folks have started up free transportation services using electric vehicles. The operators of these vehicles make their money by wrapping the cars in ads and accepting tips. Other than that, the ride is free.

But... wouldn't you know it? Local cabbies are pissed off and demanding regulations to stop this sort of competition. Rather than coming up with better ways to compete, they feel the need to run to the government and get protectionist help. Doesn't this sound familiar? Amusingly, it's actually taxi regulations that have created some of this problem in the first place. At least one of the electric car owners notes that he approached the city about getting a license, but he was denied, because of the artificial scarcity the city places on cabs via such regulations (which help keep the cost of a cab ride artificially high). But... the loophole is that the regulations only apply to hired transportation. If the transportation itself is "free" then there are no regulations.

Filed Under: business models, cab drivers, competition, free, licensing, tampa

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  1. identicon
    No, 26 Jun 2009 @ 10:36am

    F the cab drivers

    If driving a cab wasn't profitable no one would do it.
    They need to do this in NYC. They should put monitors that play commercials - CAPTIVE AUDIENCE!
    In many elevators they have monitors that show news items surrounded by advertising (and sometimes full commercials) and they make money.
    NYC gov makes money by charging a lot for taxi medallions (hundreds of thousands) because they know cabs make a lot of money. I know someone who quit an office job to drive a cab because he made so much.
    FREE transportation should be an option.

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