Uber loses licence to operate in London, will still operate while appealing

have you ever wondered what makes services like Uber affordable? 1) underpaid drivers 2) VC money dropped into an otherwise unsustainable business

I'm pretty sure Uber will raise prices the moment it kills the competition

They already have! Repeatedly. And lowered the cut paid to drivers.

That's why I differentiated my like and dislike. As a consumer, it's a service I use. I would use anyone who gave me that service and driver-mass. As a citizen of the net, I dislike them for their practices. But to be perfectly honest I rather call an uber than stand in the rain waiting for a black cab.

i understand that, but we should also understand that black cabs don't have softbank showering billions to subside uber rides and at the same time squeeze any possible costs out of their drivers.

> underpaid drivers

This is and always will be a matter of opinion.

Uber is not putting a gun to anyone's head. If it's not profitable for you to drive, you don't have to.

The affordability is only one thing that draws people to Uber. The convenience of the app and the fact that the fare is prepaid (and therefore there is no incentive for the driver to fuck around to inflate their fare) are imho at least as important. If the fare is known in advance I can make an informed decision about whether I can afford this ride. Taking a normal taxi is just always a gamble: will they try to win me over by taking the short route? Will they try to fuck me over? Will they get far and then say that they only accept cash, thus driving me to an ATM and charging even more? Who knows!

I totally get that. And you know what, If black cabs were nicer, not THAT expensive, and, available(!) I'd be happy to use them. But they are, like all unionised services, stuck in the 70s. I don't mind paying more. I do mind paying a LOT more for less. I am totally aware Uber is subsidised. But what makes uber uber, is their availability and ease of use.

Since drivers can't set their own rates, I've always felt the government should regulate the split. Uber's portion should be capped at something like 5%. The marginal cost for them to connect a driver to a rider is close to 0 so even 5% feels very generous.

Except then you can't eat? It's not that it's not profitable, it's that the earnings drivers make are meager compared to what people need to sustain themselves. You make it sound like anybody who's on minimum wage just doesn't realise that they could go elsewhere for higher wages!

Always fascinated by the idea that paying someone $8/h is a crime, but paying them $0/h is perfectly fine.

Such enormous cognitive dissonance. We humans are so good at that.

That's not the job of the government to regulate margins of businesses. If you go by that way, then you might as well regulate every margin of every app store?

> Except then you can't eat?

In an era of record low unemployment (in the US at least), claiming that it's "Uber at low wages or you don't eat" is kind of a ridiculous hyperbole.

There are a couple of apps you can use to get a black cab. They help to avoid an annoying argument with the driver about cash vs card and you can wait inside until the cab arrives. Uber is still cheaper though (excepting surge pricing) and late at night both have patchy availability to be honest.

A great idea.

At least in the US, they do it all the time. The job of the government is mostly to do what we tell it to do because the government is just people from the community.

In London, for decades there have been competing services to the black cabs: minicabs. They had to be booked in advance (by phone, but that translates easily to booking by app), and the price had to be agreed in advance.

From my understanding, this might be called "limousine service" in the USA, although unless you make a special request it will just be a fairly normal car.

Mobile phones and then apps made the border between the two services fuzzier, but they are still separate things.

No indeed there's no gun, and luckily if you can't afford a car to drive, Uber would love to sell you a subprime auto loan as see on FTC TV: https://www.ftc.gov/news-events/blogs/business-blog/2017/01/...

I wonder if we would all feel the same about some other ponzi scheme.

That is the governments job.

They aren't regulating an app on the store, they would be in this hypothetical scenario regulating the labor practices of a multinational corporation, which is for sure the job of any government.

I doubt that their margin is much higher than that after factoring in discounts.

It's baiting people who don't understand the costs associated, eg change in insurance premium if they were to correctly register & insure themselves.

Uber outsources all the risk and fees that taxi companies would have to cover.

Thats what taxation does anyway

> Uber is not putting a gun to anyone's head.

But their platform has a near-monopoly in many markets, which they use to set prices while simultaneously classifying drivers as independent contractors.

"Limo service" in the US tends to mean a more upscale black car service. (Which is how Uber actually got started.) And, outside of markets like Manhattan, it usually requires booking a day or two in advance--although there's some flexibility, especially for regular customers.

>while simultaneously classifying drivers as independent contractors.

They are independent contractors. There's no time you have to be at work. There's no amount of time you have to work a given day of the week, or during the whole week. If they were forced to turn them into employees, that would all go away.

Drivers can set their own rates, or at least to the success a bidding process would work. If the rate is to low, don't work. If there was a bidding process I wouldn't be surprised if you saw rates actually drop.

I may be wrong, but I don't think the driver keeps 95% of the fare.

Stupid question: did they actually translate minicabs to an easy smartphone UX before Uber got involved?

The idea that minimum wages kills jobs is not as well supported as you might think. People commonly take overly-simplified econ 101 labor market theories as gospel when the empirical evidence about the effects of minimum wage increases is decidedly mixed: https://www.vox.com/future-perfect/2019/11/20/20952151/shoul...

Say we implemented this scenario, can we walk though what would happen next:

- What do you expect would happen to Uber prices?

- How do you expect that change would affect overall demand for the service?

- From there, how do you expect this change of demand (if any) would affect the take-home pay of the drivers?

I can't comment on "easy" (I never used it), but the largest company, Addison Lee, had an app in 2010, five years before Uber launched in London.

https://www.computerweekly.com/news/2240104764/iPhone-app-bo...

3) Undermining the cartels of some of the most vulnerable sectors of society. 4) Shifting ressources from railway to road transit from the 1920s onwards as well as severe cuts to public transit in the 1960s and 1980s. That last point might seem like a long shot but I think it is accurate considering that the externalities of private transit are being paid by society as a whole.

Totally agree. And going further in the bad-intentioned-driver topic: There's also the issue with tourist getting fake curruncy, for expamle here in Buenos Aires a friend visiting from South Africa got fake pesos as change after paying in dollars. After that she only took Ubers.

I understand, but in certain jurisdictions your viewpoint is being challenged. See: AB 5 in California or an announcement from the state of New Jersey that Uber owes $640 million in back taxes and fines for misclassifying employees.

I personally have a moral problem with drivers not being allowed to charge their own rate while simultaneously being labeled independent contractors.

> What do you expect would happen to Uber prices?

That would depend on how much money Softbank has left to invest. Prices might go up.

> How do you expect that change would affect overall demand for the service?

Uber's great advantage is that the quality of service is better than the alternatives. If drivers can make more money, more drivers might sign up and wait times would drop. A better experience means the service will be used even more.

> From there, how do you expect this change of demand (if any) would affect the take-home pay of the drivers?

There are two parts to this. First Uber should have to make sure no driver ever makes less than minimum wage. If a driver starts the app to announce their availability and has the app running for four hours, they are entitled to a minimum of four hours of pay.

The second part is that I think getting 95% of the fare would mean drivers take-home pay is generally higher than it is today. If Uber wants to make more money by raising the rate, then drivers automatically get a pay increase as well and that seems fair.

Unemployment numbers aren't relevant when you're saying that people can ignore an entire class of jobs though. What percentage of those employed people are driving for Uber or equivalent and would love to get another job themselves? That's your employee competition pool.

Paying someone $0 to work for you would be illegal too.

There are many countries where free speech is regularly challenged, that doesn't make it right.

Especially in New Jersey's case trying to retroactively tax them. California at least is just changing a law.

What they're saying is that the worker either gets 8/hour with a job or 0/hour with no job. I'd rather have the job.

Unemployed people have various forms of legal protection in place that "underemployed" people don't. You can claim unemployment because you were fired, but not because your hours were cut.

The government should (and does) regulate the margins of natural monopolies like utilities where a free market can't operate effectively.

I'm not talking about that.

I just find it crazy that in the scenario where Uber pays someone poor $8/h while I pay them 0$/h, Uber is the bad guy, while I am completely blameless.

The only actor actually paying the poor person is somehow the problem!

It's hard for me to come up with a logical framework that supports that conclusion. So I think it's not actually a matter of logic.

And before it was illegal, people preferred for their five year olds to have the job too.

There are competing services. In Nottingham I use DG Cars, which is a taxi company but has an app that looks like Uber (you can see the drivers, fixed price, paid in advance by app). They just need to be more popular and maybe make it so that I don't have to have an account for all of them.

Keep in mind that Uber's revenue was $3.6 billion in the last quarter, but they lost $1.2 billion. I wouldn't be surprised if their margin was negative.

Really the problem is not that Uber gets paid too much, but that drivers are underpaid. I think a minimum wage for drivers is a better solution. In California such a law is currently underway.

I mentioned minimum wage in another comment. If a driver has the app open for four hours, they need to be paid a minimum of four hours of minimum wage.