Taxi, Limo Trade Group Hates Innovative Upstarts, Labels Them 'Rogue Applications'

from the can't-beat-'em-in-the-market,-so... dept

There's nothing like a bit of disruptive innovation to make the legacy players start busting out the old moral panics. We've written a few times about the new generation of ride-for-hire and ride-share services, which are really disrupting the old taxi and limo business -- leading to all sorts of highly questionable lawsuits and attempts at regulating these new players into oblivion. In almost every case, it seems quite clear that these attacks are not because the service is bad for consumers... but because it's disrupting traditional players who haven't innovated. So, it came as little surprise this week to receive an email from the "Taxi, Limousine & Paratransit Association" excitedly telling me all about a new paper they've issued with a giant "warning" about what they call "rogue apps." Isn't that great? Rather than innovative and disruptive services that consumers absolutely love, they just rebrand them as "rogue" apps and they can make them seem sssssssssssssscary. The paper grades various new services, giving them a "red light," "yellow light" or "green light."

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.

Filed Under: innovation, limos, protectionism, regulations, taxis, threats
Companies: lyft, sidecar, tickengo, tlpa, uber

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  1. This comment has been flagged by the community. Click here to show it
    Anonymous Coward, 28 Mar 2013 @ 4:09pm

    would you fly on an airline that used the same 'scam' as these guys, and allow them to operate without regulation ?

    you also know these are the very same regulations that the taxi companies have to follow, therefore these "new" players are trying to gain an unfair (trading) advantage by not following the laws.

    these regulations have been put in place for a reason, just like ensuring pilots of jet's are suitability checked and trained, and aircraft meet specific standards. And it's not just about the risk to pasengers but also for the drivers and the company, are they fully insured ?

    Can both the car and driver be easily identified, and is there any mechanism in place to ensure competent and honest drivers, or any method of punishment if these companies fail to meet some minimum standard? Such as security for the driver like armoured driver seat backs or in car video?, or a panic button system ?

    what recourse do you have if one of these 'amateur' services fair to show up ? or if the driver is abusive ? or he smells ? or aggressive, or steals off you ?

    or is not really with the group he says he is, and you never get to ANY destination ?

    Again, these regulations are in place for valid reasons, and things like training, certification, security, professionalism, right down to the requirement to wear uniforms and be easily identifiable are there for a valid reason.

    If an airline started operating, and were really cheap, (after all they don't need to maintain their planes, meet regulations like pilot checking, or training. would you be willing to fly with them. and is it fair that people could be put at risk (and professionals lose their jobs) because someone wants to make profit, but not provide a safe and effective service ?

    this article just shows how shallow Masnicks mind is, and how nothing matters except how much money you can scam off people.

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