The Morality of Uber

[Fragile Bird]

FB,

Who are the "fat-cats" who own and run "Uber"?

The main fat cat is the CEO, and he's surrounded himself, as all CEOs do, with like-minded people.  Travis Kalanick is your classic dropout-from-UCLA who founded a company with friends to essentially steal other people's work, a file-sharing company called Scour, which they put into bankruptcy when sued by the owners of the stuff they stole.  He then founded another file sharing company called Red Swoosh, which created  file sharing software for large files so people could organize their stuff  (ie music and movies other people stole from the internet, so Red Swoosh would not get sued) which was sold for $19 Million in 2007.  He then founded Uber with a Canadian named Garrett Camp in 2009.  Six years later his shares of Uber are worth $6 Billion.  The company is worth around $50 Billion and Forbes says he owns at least 12%.

I'm not sure where you got the idea that I love technology or the CEO of Uber. I struggle with a typewriter and, I repeat, I've never used Uber and probably never will. But technology does render jobs redundant. I know this because it made mine redundant earlier this month. Attempting to reverse this has never worked out. 

I assumed your list of causes you support was sarcasm, no?  Since the support you'll give the taxi drivers is the same as you'll give to MWWiFoHCwaRF.      You don't have to use Uber to admire the CEO...  My apologies for misunderstanding you.

The other thread I've been meaning to open was on disruptive technology.  I have no doubts at all that driverless cars will cause incredible turmoil throughout the economy and society.

[Fragile Bird]

There are two separate issues that conflated because people want a simple, overarching "x is good/bad" answer.

<snipped for space>

Conclusion: Fuck taxis and fuck Uber. I've never taken an Uber and I hope I'll never have to. Unfortunately that isn't an option for everyone everywhere.

Well put.

[Sir Thursday]

The way I see it, Uber is an agent of reform in what was previously a very poorly run and exploitative sector. While I don't particularly like the ethics of their business model, I am hopeful that the effect of their attempts to 'disrupt' the marketplace will lead to better outcomes for the consumer and the taxi driver, even if that's not initially the case. The ideal outcome would be that the traditional services modernise and this results in improved service.

Currently Uber has an unfair advantage over its competitors in that it doesn't need to price in workers' benefits to its fares. I don't really agree with this part of things. Nevertheless, I still use Uber. I rationalise this on the basis that I don't use Uber because of its price but rather because of its convenience. If there was an equivalent service that provided the same convenience factor, I would be very willing to switch to it if it was more ethical but also more expensive.

In fact, I believe traditional taxi services did launch such a service in London - it's called Hail-O (much better name!). That's an ideal outcome, as far as I'm concerned! Sadly it does not have a version of its app available for Windows Phone at the moment, so I guess until that changes they aren't really an option for me, but it does show that the service is improving as a result of Uber's presence.

Also, I'd be interested to know if many people have talked to Uber drivers about their situations. We're all up in arms about the fact that Uber isn't really providing any benefits to their workforce, but what do their workforce actually think about that? I know when I've chatted to them in the past several have told me that they are using Uber as a flexible way to earn some extra cash - they don't have to go through the faff of signing up with a traditional taxi company, installing dispatch equipment, etc. Now, there's an element of 'desperate circumstances' around most of their stories, but nevertheless it is facilitating them to earn some money they may not otherwise have been able to, so...

ST

[Iskaral Pust]

I think Ini phrased it well.

As a downtown dweller, I view taxis as part of the transit infrastructure of the city and necessary to my lifestyle. So I make a point to tip drivers generously because I know they are exploited by the medallion owners.

I don't use Uber unless I'm somewhere I can't hail a cab.

[TerraPrime]

Not every country runs Taxi service the same way as the U.S., though perhaps similar enough to make them all near-identical.

I've not used Uber before, but I have used other on-demand services (Lyft and Flywheel). I don't know how they differ from Uber, to be honest, because those were cases where we needed a service and the host/hostess at the restaurant/bar called the service for us, so no time to research and compare.

From what I know of Uber, I think it's a terrible business model. Personally, I favor Taxi over Uber or other forms like it, mostly because I've had good experience with Taxi services outside of the U.S. In Hong Kong and Taiwan, Taxi is an indispensable part of your transportation needs, and the service quality is excellent - clean cars, monitored routing to prevent price gouging, display of licenses for complaints, etc. There still some predatory drivers, especially when they deal with foreigners and travelers, but they are by far the rare minority, in my experience. Taxi services in the U.S., however, is a much more dicey affair. I've taken taxi cabs in D.C., Philadelphia, Boston, San Francisco, Atlanta, Madison, Chicago, and several smaller cities. The quality of service really varies a lot, even within the same city. In SF, for instance, I once took a cab from the airport to my hotel that costs 40% more than the return trip, clearly showing that the first driver took a longer-than-needed route. But, even with all that, I much prefer Taxi services, because while the licensing process creates a monopoly, it does, imo, eliminate a lot of the problems of security and safety.

So, I'd like to see a reform to the taxi system, maybe a 10-year-limit per license, or other types of changes, rather than abandoning it and choosing services like Uber, which I think it actually worse than Taxi.

[S John]

 driverless cars will cause incredible turmoil throughout the economy and society.

No doubt about that, but I personally can't wait for driverless cars (and long-haul trucks) to be the norm.  No more fatigued drivers, no more drunk drivers, no more reckless drivers... well, at least fewer of those things.  Would also likely greatly improve traffic flow in all of our gridlocked cities if every human was just a passenger.  You sit down and let beautiful technology cart you around like the precious cargo that you are.  I am a decent driver, not perfect by any means, but pretty good - but all around me each and every day I encounter incompetent fools on the road who shouldn't be allowed to operate a toaster yet are operating a rolling 2-ton death machine.  

The other day I saw on the news that Texas has had at least one vehicle related fatality every single day since the year 2000!  That is absolutely incredible.  There's gonna be growing pains, for sure, but the improvement will be worth it.  For now Uber should develop a better model for taking care of their human drivers, and taxi companies should adapt to be less shitty so that they can actually compete with Uber in places where the Taxi services are awful like where I live.  Taxi's are so unreliable as to be useless unless you are going to the airport at 5am or leaving from the airport.  Uber filled a void and that is why it has been wildly successful in many places.  But the endgame is definitely going to be a fleet of driver-less cars hauling goods and people, and the more of them we have on the road vs. human drivers, the better off we are gonna be.

[Spring Bass]

Six years later his shares of Uber are worth $6 Billion.  The company is worth around $50 Billion and Forbes says he owns at least 12%.

Uber isn't worth $50 billion - the company has never filed for an IPO. That's just a figure given based off the fact that they raised $1-2 billion in venture capital from a collection of companies. It means absolutely nothing until they file for an IPO and go public, and in Uber's case is especially deceptive because the company is running deep in the red.

The other thread I've been meaning to open was on disruptive technology.  I have no doubts at all that driverless cars will cause incredible turmoil throughout the economy and society.

I think it will be hugely beneficial for society, as accident rates plummet and delivery services become much better. As for the drivers, stuff like this usually doesn't get implemented over night, and they represent a pretty small percentage of overall US employment as is (less than one-tenth of one percent of the US labor force is employed in the "taxi driver and chaffeur" sector).

None of which is to defend Uber's business model, which deserves to be challenged in court because they're blatantly stepping over the line in the "independent contractor vs employee" situation IMHO. Uber drivers can be disconnected from the app for having too low of a rating, and for accepting too few rides within a time period.

[Fez]

The way I see it, Uber has a built in corrective in place. If there aren't enough drivers willing to accept fares, surging price kicks in. So long as there's enough drivers okay with the too-low wages, there's no incentive for Uber to change. The only way to change that is either through regulation, which won't work because too many people are sympathetic to Uber because of how shitty taxis have been, or through Uber drivers unionizing. 

I'd fully support a unionization drive, but until that happens, I'll continue to use Uber almost exclusively. Outside of rush hour, I can take an Uber to pretty much anywhere I want in the DC area for $10-$12 and get there within 10-20 minutes, that same ride would cost around $20 in a taxi. I could use the metro system, but because of where I live that means using the bus and then transferring to at least one subway; which means its around $5 and takes around an hour. To me, the choice is clear. I'd probably also user Uber most of the time after a hypothetical unionization, unless prices went up too much and I had to start using the metro a bit more.

[litechick]

If I was going to play fortune teller, I would predict that they will meet in the middle.  Taxi companies will change their dispatch and price structure to compete, Uber will have to increase costs in order to satisfy the need for some regulations.

How does Uber control the mechanical integrity of vehicles in their fleet?  Do Uber drivers have to carry commercial insurance?  If not, how might the insurance companies respond to claims from Uber-related accidents?

I don't consider it an issue for deep moral analysis.  It will all sort itself out.

[Shryke]

Why do some people support Uber?

In my experience talking with people about it, it's because they are from areas where taxi service sucks. And that's basically it. That's what it comes down to. When you come from someplace where taxis just don't work, it's nice to have someone come in and give you the service you expect from a cab company. Coming from a city where taking a taxi has never run into anything like the issues people sometimes talk about, I assume quality of service is highly regional.

[zelticgar]

Litechick,

I'm not sure of the safety controls or insurance requirements in place for Uber drivers but I have used Uber extensively in San Fran and Boston.  I have never been picked up by any vehicles that had any outward signs of issues. For the most part the rides I get are clean, newer Camry's, Prius, SUV's or Minivans.

Compared to the complete shitboxes I used to ride in when taking taxis it is a huge change. As others have stated, taxi service is a joke so until such time as there are other alternatives I will ride Uber exclusively when I need rides.

 

[Shryke]

The "sharing economy" is just a (stupid and dishonest) euphemism for big companies hijacking decentralized networks of service-providers and service-seekers and turning people who would otherwise be employees or owner-operators into independent contractors, allowing them to offload significant cost of operations onto their workers for minimal returns.

This. It's a classic old school business practice simply made easier by communications networks. Offload costs, risks and responsibility onto contractors. Convince them that this is good for them because it's freedom and choice. Walk away with fat stacks. You see this all the time in other industries.

 

The reality is that Uber is revolutionary and its model is in some ways inevitable. It's obviously disruptive to the current taxi cab industry, and I'm not sure that this, in and of itself, is a bad thing. Taxi cab "medallions" in big cities are already scarce resources, valued at hundreds of thousand of dollars hoarded by the wealthy to rent out to their workers. These taxi cartels DESERVE to be broken up. But if Uber is what ultimately replaces them, then we're looking at the total destruction of the ability of your average worker to earn a decent living as a taxi driver. 

Uber is only inevitable imo in areas where the taxi service is shit enough for them to get a major toe hold and gain political backing and the political will to crack down on this kind of business practice doesn't exist. They have been kicked out of several places via enforcement of regulation.

[Shryke]

I'm not sure where you got the idea that I love technology or the CEO of Uber. I struggle with a typewriter and, I repeat, I've never used Uber and probably never will. But technology does render jobs redundant. I know this because it made mine redundant earlier this month. Attempting to reverse this has never worked out. 

Uber isn't new technology though. No jobs have been rendered redundant. Uber drivers are just unregulated, unlicensed independent contractor taxi drivers. It's just a new business model

[Aemon Stark]

 

Many of the Walmart haters talk about how they refuse to put another dollar of profit in the pockets of the Walton family, yet by using Uber, a company with almost no capital costs (since the workers put up all the capital) that takes a ridiculous 25% of the worker's earnings before any capital expense is factored in, these same people have made the CEO of Uber a multi-billionaire in the blink of an eye.  In fact, if you factor in the capital expenses associated with the car, the company probably takes 75% to 90% of the worker's earnings.

[...]

What do you think about the morality of the Uber and the Uber business model.  Why is using Uber different than shopping at Walmart?  This topic has been at the back of my mind for months now, and posting was triggered by a millennial friend who won't shop at Walmart but just loooooovves Uber.  In fact, she just posted that Facebook picture making the rounds, the one of the fellow holding a sign that's a veiled attack on Walmart, "Nothing says I love you like cheap crap made in China made by slave labor.  Sold by a company owned by billionaires benefitting from corporate welfare etc etc."

Well, unlike Walmart, which is just a big retailer - a more successful Sears, if you will - Uber is nothing more than a rent-seeking operation. It's parasitic. I didn't really understand Uber's business model until, well, this post, but you've convinced in about 30 seconds that it ought to be prohibited (along with the likes of payday loans). I did have the app on my phone at one point, but since I use TTC when I'm in Toronto never did use it (and we don't have it in St John's). Got rid of it for space a few weeks ago.

It will stay gone when I get my new phone in a few days. 

[Tears of Lys]

I'm ashamed to admit that I never gave this issue a thought until you started this thread, Fraggie.

I used Uber during a recent trip to Chicago and loved the experience.  My (admittedly limited) experience with taxis has been dismal.  I did talk with the Uber drivers to see if they've run into any problems and what THEIR experience has been with Uber, and all of them I rode with (four) were positive - but here's the thing:  It was a positivity that seemed a bit forced.  To a man they all said Uber was a great way to make some extra cash, they could work when they wanted, no taxi cab company was raising a stink about Uber cutting into their business, etc., etc.  In fact, they all said there was enough business for EVERYONE.  Yippee! 

Every SUV was a late model and were leases.  I haven't checked into the monthly lease payment on a late model SUV, so I don't know what amount they have to meet every month to make any money.  Maybe $300/month?  Then they have fuel costs to absorb and maintenance. 

In a big touristy city, I guess people could make a little money doing this - but no driver's going to get rich off of this, that's for sure.   As for smaller cities, fuggediboudit.  

I detest the growing trend of companies making everyone either part-timers or contractors, so I'm not sure why I didn't relate this to Uber.

/hangs head in shame

 

 

 

[Altherion]

I say "go out of business" because Uber's business model is unsustainable - they're losing nearly $300 million/year, burning through the $1-2 billion in capital they've raised, and that's after dropping rates and increasing their cut of the fares to try and get more customers and revenue.

What are their costs? From a cursory glance, it appears that the drivers pay for everything so it's not clear to me how they could be losing so much money. Does the company actually do anything beyond maintaining the app?

[Fragile Bird]

What are their costs? From a cursory glance, it appears that the drivers pay for everything so it's not clear to me how they could be losing so much money. Does the company actually do anything beyond maintaining the app?

They have a headquarters to run, they have software to keep up, they have legal costs around the world as communities and countries try to run them out of town, they have lawsuits to defend or pay out as drivers have accidents or rape female passengers or rob passengers.  They have millions to pay their executives, who are running a $50 B company.  They have recruitment costs.  They send out recruiters to communities to sign up drivers.  A month or two ago here in Toronto you'd pass by a gas station with a big sign saying "Free Fill-up!" and it was the Uber recruiters offering a fill-up if you would sign up as a driver (no problem, just sign up, you don't have to accept passengers, just sign up!).

ETA:  And of course running businesses in 58 countries, incorporating everywhere they go, costs money.

[Theda Baratheon]

Why do some people support Uber?

In my experience talking with people about it, it's because they are from areas where taxi service sucks. And that's basically it. That's what it comes down to. When you come from someplace where taxis just don't work, it's nice to have someone come in and give you the service you expect from a cab company. Coming from a city where taking a taxi has never run into anything like the issues people sometimes talk about, I assume quality of service is highly regional.

Yeah, I'm surprised to hear how bad taxis are in some places. Have never had a problem with taxis before, especially in Cardiff with one particular company being consistently reliable and excellent. 

[zelticgar]

Outside of Bermuda and Orlando I've never had a good experience in a Taxi. NY, Los Angeles, SF, Boston, Philly, DC, Atlanta... In all cases the drivers are late, drive like maniacs, and the cars are dirty. Contrast that to Uber - they show up on time, clean cars, provide water and often times engage in nice conversations. Its night and day.

The city taxi service is bad but in my view the worst taxi services are the ones outside the cities that work in the lower income secondary cities and more concentrated suburbs in my state. These services are generally serving elderly and very low income clients that have limited access to public transit. I see them in older minivans driving like maniacs. A lot of times they are smoking in the vans and seem like really rough people.  I've noticed lately that Uber has been creeping into these areas and have been serving some of the younger folks that are going out around towns on weekend evenings. There is a demand for this outside the city and it could be that their biggest growth opportunity will be in the secondary markets.

 

 

[DanteGabriel]

They have a headquarters to run, they have software to keep up, they have legal costs around the world as communities and countries try to run them out of town, they have lawsuits to defend or pay out as drivers have accidents or rape female passengers or rob passengers.  They have millions to pay their executives, who are running a $50 B company.  They have recruitment costs.  They send out recruiters to communities to sign up drivers.  A month or two ago here in Toronto you'd pass by a gas station with a big sign saying "Free Fill-up!" and it was the Uber recruiters offering a fill-up if you would sign up as a driver (no problem, just sign up, you don't have to accept passengers, just sign up!).

ETA:  And of course running businesses in 58 countries, incorporating everywhere they go, costs money.

Don't forget running a data mining and investigation operation to intimidate journalists critical of their business practices.