Uber Drivers “Strike” and Switch to Lyft Over Fares and Conditions

http://www.buzzfeed.com/johanabhuiyan/uber-drivers-are-protesting?s=mobile

by smacktoward • 12 years ago

287 187 12 years ago

jonifico• 12 years ago

So they were fine and dandy until a better competition came around. When Lyft has its rival, same thing will happen.

deadfall• 12 years ago

What about Sidecar? Isn't that Lyft's rival? I think SideCar and Lyft are about the same service since they don't offer black town cars/luxury SUVs.

viscanti4• 12 years ago

http://fortune.com/2014/09/11/uber-vs-lyft-the-credit-cards-... It doesn't look like a lot of competition honestly. That probably paints Lyft in the best possible light too because it just takes into account US only trips (100% of Lyft's business and only a fraction of Uber's). But even then, that's only competition for the uberx market. These drivers are black car drivers, where uber has no competition at all.

SEJeff2• 12 years ago

This is how capitalism works, survival of the fittest. If someone comes along that allows the drivers to make more money, prudent drivers will likely switch to that service.

It is a no brainer.

philip1209• 12 years ago

It's amusing because fewer drivers online will trigger multiplier, thus increasing their pay.

aetherson7• 12 years ago

Yeah, but that pisses off passengers and drives them to try Uber competitors.

tdicola• 12 years ago

And the irony is this is exactly what Uber is doing to the traditional taxi industry.

SEJeff2• 12 years ago

But the best part of this is that as a consumer of taxi services and digital ones like Uber (I've not used Lyft but love Uber), we get cheaper and ultimately better service by them competing. I say bring on the competition!

mkal_tsr2• 12 years ago

This is how capitalism works, survival of the fittest*

* Unless you have enough money to change regulations in your favor, skirt regulations, and so on, in which case it's survival of the financially-backed.

aeturnum• 12 years ago

Access to capital and the political world are part of "fitness" in this environment. Generally, the companies that are seen as most likely to survive have easier access to funding than companies that are seen as riskier. The same can be said of companies that are likely to succeed v.s. simply survive.

innguest5• 12 years ago

Statists, take notice of how improvements in work conditions come from competition and not from regulation. They're better off now than through the monopoly of taxi medallions.

dragonwriter2• 12 years ago

And anti-statists should take notice of how many improvements in working condition did require regulation, and how the Uber/Lyft market has special features (particularly, the fact that the primary service being provided to the end customer is provided entirely by one worker using their own capital and that the fact that what Uber/Lyft provide is essentially a matchmaking service where there is very low friction for a driver to switch services and for the other service to absorb new drivers -- which is not true in many other industries regardless of how competitive they may be on the consumer end.

Even in a competitive market for autos, the capital dependence of the industry -- and potentially geographical separation between plants -- means that if the workers in Alan's factory are upset with their working conditions, they very likely can't just walk over to Bob's factory en-masse and sign up to work there. The ability to do that with certain services that are 1:1 and where the middleman is just providing matchmaking gives the individual service providers more power to set working conditions with the middleman in a market where there are competing middlemen then would be the case in many industries.

innguest5• 12 years ago

What's happening right now to Uber and Lyft is a metaphor for how the free market works. You've touched on a few interesting points yourself:

"provided entirely by one worker" : this is like admitting that the problem comes from injecting hierarchy into the system, which in a free market can only happen voluntarily if both parties benefit from it, but in a statist society is imposed or restricted by the economy planners through regulation.

"essentially a matchmaking service where there is very low [switching] friction" : every market is a matchmaking service between the seller and the buyer, and the way to sustain low friction is to have as little regulation as possible (you will see the Uber/Lyft_fuelled prosperity (e.g. happy workers) disappear if the government steps in, and it will decrease wages to the point that it will be equal to the taxi market which is heavily regulated)

"which is not true in many other industries" : how can we know? "many other industries" are mostly regulated, and heavily so.You're saying deregulation doesn't work in other industries because they're already regulated.

The problem of workers and factories, as far as I know, is solved by unions. However, historically governments have regulated unions as well. Cf. Bangladeshi garment workers, their poor working conditions and their torturing of labor organizers.

innguest5• 12 years ago

Why am I being modded down?

praxulus• 12 years ago

"Statist" is usually a derogatory term among libertarians/ancaps, so that's not a great way to open up a productive discussion.

orblivion• 12 years ago

Because you're making a brazen libertarian point in a thread on a tech discussion board where it's not all that warranted. If this were a discussion of public policy it could be different. I chimed in with that stuff when Net Neutrality came up, for instance. Otherwise it just gets overbearing. That said, I also got voted down there, I think libertarians are losing ground on HN.

bmcfeeley2• 12 years ago

I don't yet have down vote privilege, but I have to imagine The GP (your original comment) got nuked because it is both needlessly inflammatory and also lacks a substantive argument. As for your response to dragonwriter, you appear to be talking past one another; of course markets are matchmaking services for buyers and sellers by definition, but what you've done here is mistake this specific case of relatively frictionless movement between employers increasing the surplus of the employees for an indictment of regulation in general.

This particular case seems to realize said friction (and consequently, the surplus/benefit for the drivers) precisely because the service itself being offered by Lyft/Uber is market like, and the end-consumer product is in fact offered by the drivers themselves. It is not clear to me (or the others disagreeing with you here evidently) that regulation has any bearing on this conversation -- in a world where both Lyft and Uber's respective operations are regulated by the state, the power is still in the drivers' hands because Lyft and Uber are competing to offer the drivers' services.

This is not exactly the common formula for most employee-employer relationships, although it may become more common as this business model takes off. What dragonwriter seems to be saying IMO is that there are certainly cases that don't fit this mold that are good arguments for state intervention; among them are cases where there is greater friction for the employees themselves due to the nature of the business; lack of information about compensation, working hours, or other metrics to evaluate the given positions; or, as dragonwriter said, physical proximity to the workplace itself.

If you would be so kind, please elucidate how you feel this particular seemingly unique scenario is generalizable to regulation in general.

PS: Apologies if this is wordy and difficult to follow, I have a hard time writing coherently into this tiny box.

Karunamon• 12 years ago

That's an argument against that particular kind of regulation, not regulation in general.

digikata• 12 years ago

There are a couple of market preconditions that are glossed over here. For this competition to have actually worked in an effective way, switching costs for both the labor as well as the customer have to be low. Transactions also need to be fairly short and repeated to complete to keep feedback loops responsive.

There were also missteps with insurance that companies like Uber and Airbnb made, which were corrected, but, I suspect, wouldn't have been addressed as quickly without a legal/regulatory framework for liability. They're essentially hidden risks/costs to the consumer and employees.

So aspects of this market need more than a simplistic "Yay competition, boo regulation..." And, I think in general we need to move public & political discussion beyond that point an get a better understanding of where competitive markets work, and where they fail.

Pxtl2• 12 years ago

Wake me when they drive on privately owned roads instead of capitalizing on a taxpayer-funded asset.

ForHackernews3• 12 years ago

What would it take for somebody to just build a free, open-source matchmaking service for drivers and riders? It doesn't seem like what Lyft or Uber offer is very technically demanding (perhaps doing it at scale is), and presumably you could attract a lot more drivers by offering them the chance to keep ~99% of the fare.

The existence of Lyft demonstrates that Uber's first-mover advantage isn't insurmountable, so who's to say the third-mover shouldn't be a free utility that provides matchmaking at cost?

spydertennis• 12 years ago

Interesting consequence of the lower cost of technical resources. I'm guessing the higher cost would be in marketing the service to get initial critical mass.

eli2• 12 years ago

I think Sidecar lets each driver set their own rate. It would take a whole lot more than 1% of the fare to keep the system running though.

grogenaut2• 12 years ago

Why would you say that?

seanmccann3• 12 years ago

The value is in the network of riders and drivers not in the software. The big value for the drivers comes when you can minimize the time gaps between rides, and for riders to be able to get pickups down.

Lyft was actually the first mover on the the UberX product category, Uber was only doing premium service when Lyft started growing.

Ultimately this market is a race to the smallest commissions possible. There are costs involved like credit card processing, insurance, operations, etc. I could see commissions going down to 5%.

natrius• 12 years ago

There's no incentive to build and run a free Uber/Lyft competitor the traditional way.

If someone were to build a Stellar-like decentralized market that matched drivers with riders who pay with the market's internal currency, the incentive to build and improve upon the service would be the appreciation of the currency. People who thought it could succeed would buy some of the currency cheaply, build applications that make the market easy to use, and profit from the gains their improvements cause.

It could happen.

calpaterson• 12 years ago

Who would provide customer service, sales, marketing, user research and the other non-technical elements of the business? It's true of many companies that what they do is not very technically demanding (Amazon, Facebook, eBay, etc) but that very often means that you _can't_ replicate them by just replicating the technology - these successful companies are much more than just their software.

And anyway, I bet there is a surprising level of sophistication to eg: Uber's software

ForHackernews3• 12 years ago

Who would provide customer service, sales, marketing, user research and the other non-technical elements of the business?

Do you need any of those things? How much does Craigslist spend on marketing and sales?

Operate as a non-profit, compete only on price, and let drivers spread the word themselves. Imagine if at the end of the ride, your Uber driver told you, "Hey, next time call me with the CheapRides app and it'll cost you 20% less, and I'll make more."

wcummings• 12 years ago

Taxi rides are basically futures contracts. Not exactly fungible due to location but you might be able to price that in, somehow. Bring on a generic taxi ride commodities exchange.

drivingmenuts• 12 years ago

I thought the whole point of Uber and Lyft was that didn't have to be full-time occupations.

seanmccann3• 12 years ago

Many folks do it full-time because it pays more than the their other job. There are also incentives if they driver full-time hours.

eipipuz• 12 years ago

That's what I thought, but now it's rare when I see a driver that isn't a full-timer.

I'm sure the system works better with stability so the incentives push towards full-timers.

pkfrank• 12 years ago

I almost hope that Lyft is orchestrating all of this behind the scenes.

It would be such an Uber-move.

canvia• 12 years ago

BuzzFeed is almost entirely "sponsored" content so it wouldn't be too surprising if this article was a PR move.

untog3• 12 years ago

All sponsored content is indicated as such.

jefflinwood• 12 years ago

The really interesting story here is that if drivers are so willing to switch networks for better opportunities, there isn't a compelling reason for Uber to have the valuation that they do.

The value of Uber isn't really in the tech or the app - it's in the networks of riders and drivers in each city. If each of those can be aggregated into some other kind of service, where Uber, Lyft, etc. are just providers of payment processing, and possibly some operations expertise, that middleman network will capture all of the value.

smacktoward3• 12 years ago

I'm not sure a middleman service is even really necessary. There's plenty of drivers right now driving for multiple services. The more services there are, the more competition there is for drivers' time, which means drivers have more leverage.

One could read Uber's insistence on canning drivers who turn down too many rides as an attempt to reduce this leverage, since the only way drivers can exercise it is to turn down Uber rides in order to drive for somebody else. Requiring them to accept a certain volume of Uber rides effectively ties them to Uber.

jkestner• 12 years ago

There's plenty of drivers right now driving for multiple services. The more services there are, the more competition there is for drivers' time, which means drivers have more leverage.

We're gonna need an Uber for Ubers. But of course a middleman is necessary - who's going to match customers and available drivers? But if drivers have the leverage, it could resemble more of an agent relationship.

Why haven't Uber/Lyft demanded exclusivity with drivers?

sheetjs• 12 years ago

if drivers are so willing to switch networks for better opportunities, there isn't a compelling reason for Uber to have the valuation that they do.

There are two sides to the story: If customers are so enamored with Uber that they wouldn't consider Lyft or the other services, Uber will still be in control.

EDIT TO CLARIFY: Did not mean to suggest that customers are indeed enamored with Uber. Only wanted to point out that driver promiscuity does not necessarily threaten Uber so long as customers flock to them.

aetherson7• 12 years ago

There is absolutely a large chunk of the rides-for-hire passenger population that is entirely mercenary in its affections. Some people are loyal Uber passengers or loyal Lyft passengers or whatever, but a lot of people are happy to go where the bargains are.

yumraj• 12 years ago

This.

Basically while there are network effects in the sense that any provider (Uber, Lyft etc.) will need to have some critical mass before there are enough drivers and enough riders, both can subscribe to multiple providers and there is no long-term stickiness at the moment.

In other words, this is not a winner take all market with FB/LinkedIn/Twitter type network stickiness and the overall market is still fair game. The driver's rating is the only sticky data, and it is unclear in this context as to how valuable that is as riders are not going to wait an extra 30mins to get a 5-star driver vs. a 4-star driver.

This should not come as a surprise to anyone since right now most metros have multiple competing taxi service providers, so it makes sense that that may be replaced by a similar multiple mobile-app taxi providers.

Also, it is difficult to re-paint your taxi when you move from one traditional provider to another, in the Uber/Lyft/etc. world, that is no longer required, so provider switching or aligning with multiple providers is trivial which will imply that in future the providers' margins will be squeezed out and riders and drivers will keep the most benefit.

toomuchtodo13• 12 years ago

How would you say self-driving vehicles fit into this? Supposedly they're rolling out in ~3-5 years, and with self-driving vehicles, you no longer need the middle man managing a fleet of contractors.

EDIT: I'm willing to me a Long Bet [1] with anyone regarding fully autonomous self driving vehicles in regular use in 6 years.

[1] http://longbets.org/ ; http://longbets.org/rules/

samstave2• 12 years ago

You know what would be interesting is that municipalities should see this as an opportunity. What if the city were to start their own modern municipal taxi services, and compete directly with Lyft/Uber....

Then they get revenues.

panarky• 12 years ago

Consequently, the cost of a ride will approach the level of direct costs like fuel and maintenance. There won't be much left for driver compensation or vehicle depreciation, much less a durable surplus for the network operator.

Paradoxically for the disruptors, the way out of this trap is for Uber and Lyft to lobby for greater regulation, stringent requirements for insurance and liability, background checks, safety inspections and government licenses. They need higher barriers to entry.

They need to carve out a space safe from competition, or it will rapidly devolve into a lowest-common-denominator market.

Not that there's anything wrong with that.

tootie• 12 years ago

I don't see how there's any network effect to be had. Consider food delivery. I use both seamless and delivery.com. Seamless is a little better and has a wider network of restaurants. But I have 0 lockin and will frequently switch to delivery.com for any exclusive restaurants they have. I have an account on grubhub too although I use it rarely. There's nothing tying to me to any of them. No friend list, no thousands of photos. Just my recent orders which are of limited value. Taxi service is the same. The second that Lyft has lower rates or a close car, everyone will switch in a second. Or flock to option 3 the second it has any advantage.

100timesthis• 12 years ago

This.

ThomPete2• 12 years ago

Uber is going to be a logistics company. But I agree they are grossly overvalued.

viscanti4• 12 years ago

http://fortune.com/2014/09/11/uber-vs-lyft-the-credit-cards-... I don't know. The numbers appear to disagree. That just shows a sample of their growth in the US, but according to reports the bulk of their growth is internationally. They are likely orders of magnitude larger than their closest competition and growing rapidly. Real money is going through that system. If they can find a way to leverage that user base and become a full-on logistics company they're probably undervalued.

potatolicious2• 12 years ago

This is an oft-repeated meme but I don't see it ever substantiated.

Disregarding the fact that the "driver in a car" model is never going to be the most efficient means of transporting things (as opposed to people), we're ignoring the fact that the "Uber for X" formula already has many players.

Instacart, Seamless, GrubHub, Google Shopping Express, Postmates, every product category already has an "Uber". In fact every product category already has several "Ubers".

Uber won't have a first-mover advantage in any of them, and a lot of them thrive on having logistics options that aren't "dude in a sedan/SUV", and have built substantial hard-to-clone infrastructure on that front.

Uber has a lot of momentum, and a lot of hard-to-clone systems built around freelancer drivers, but IMO others are ahead in applying logistics to other things. This is like saying "Toyota can leverage their engineering expertise and totally own aerospace!" ... without acknowledging the existence of Boeing and Airbus.

supercanuck• 12 years ago

If these taxi cab drivers are "contractors" they should be able to just take on whatever business they want.

Carry one phone for Uber and one phone for Lyft, and swap out the branding when representing one or the other.

prawn2• 12 years ago

There was a photo going around Twitter recently of a driver with five or so dash-mounted phones/devices doing more or less what you suggest.

pinkyand2• 12 years ago

Maybe the networks now are quite weak.

But in a future where a large percent of rides are shared by 3 passengers on average, or maybe even more via SUV(for cost savings of course), being the dominant provider is tied directly achieving optimal routes and average share ratios.

In such a future , the network effects over riders is much stronger , and it's probably a "winner takes most" market.

aetherson7• 12 years ago

That's true, IF passengers are interested in sharing a ride with two other passengers (and if they're interested in trading cost savings for the delays involved in that).

I kind of doubt that there will ever be a day when rides have an average of 3 passengers. Figure that if your base fare is $20, the first person you share with saves you $10 (or maybe $9 or something if you have to shore up the profits of the hailing app). Second person you share with saves you... $3. Third person saves you $2.

The returns to the passengers for additional passengers falls off fast, and the costs to the passengers (in terms of time, of discomfort, etc.) are linear or even more than linear. So probably not three passengers.

But two passengers is possible and would make for a real network effect... if ultimately there's enough demand for shared rides at all. There might be! Hard to say.

nchuhoai• 12 years ago

I think Uber realizes this, thus their strategy is to eliminate Lyft and any future competitors from entering the market as soon as possible. AFAIK, Lyft currently makes no money on its operations while Uber does (by virtue of their greater scale).

I'm afraid of a world in which Lyft is forced to quite (as you only so long sustain on VC money), and Uber then abusing it's monopoly power.

The difference to the existing cab market is the extraordinary scale and growth Uber posses. They can simply afford to undercut everyone's prices for the short term with their billion of dollars in VC money.

anigbrowl• 12 years ago

Probably so. Reading up on Homejoy for another thread, and wondering about their valuation, I noticed that after getting $38m in series A funding 8 months ago they have used some of it to buy out a competitor: http://getmaid.com/

cordite• 12 years ago

This reminds me of the concept of cities renting out internet infrastructure to providers.

mayneack• 12 years ago

I recently was in a Lyft where the driver was also an Uber driver. I don't know how rapidly he switched contexts (ride to ride, day to day, or something like surges). Does either company do anything to prevent this?

dpiers• 12 years ago

No, if they did, they would not be able to claim that drivers are contractors. People driving on Lyft/Uber are allowed to perform trips at will, and can go on/offline as they please.

Something that would cause problems is if a driver was simultaneously accepting requests on one service while performing trips on another. I've had this happen as a user, and you just see the driver going the opposite direction for ten minutes while claiming to be 'on the way'.

Another problem might be cancellation rates; if a driver were online in multiple apps and got simultaneous requests, they would have to accept one and cancel the other. Acceptance rates are part of a driver's performance records on Lyft/Uber/etc. and declining lots of rides could get a driver's account deactivated.

wpietri• 12 years ago

Yes. I think a good comparison is airlines. They generate enormous value, but because there's a lot of competition, they don't generate much in the way of profits. Another useful analogy is real estate: because it's so easy to become a real estate agent (you need business cards, people skills, and modest arithmetic skills), it's a relatively hard business to me in. I wouldn't buy into Uber right now.

stcredzero• 12 years ago

The value of Uber isn't really in the tech or the app - it's in the networks of riders and drivers in each city.

One thing to keep in mind, is that a "spontaneous pick-up of a new rider" workflow is very similar to a "switch rider to a new network" workflow. If the apps are designed to be rapidly downloaded over cellular/LTE then this could often be accomplished in the space of a single ride, facilitated by coinciding GPS information.

Spooky232• 12 years ago

IMO, it's a great example of what happens when you dress up fundamental disrespect for the law and society at large as creative disruption.

stackcollision• 12 years ago

Thank you for saying this, it's exactly what I've been thinking since the start.

smacktoward3• 12 years ago

Update -- Uber reverses policy: http://www.slate.com/blogs/moneybox/2014/09/12/uber_drivers_...

ivraatiems• 12 years ago

I'm genuinely surprised. I imagine this is just a policy of minimum appeasement, but it's very interesting how rapid the change was.

Edit: Also, the strike is going forward - not all of their demands were met. Maybe this is just so Uber can say "hey, we tried to do what they asked?"

viscanti4• 12 years ago

Or maybe the strike is closer to what happened last year in SF, where a bunch of drivers who were banned from the uber system because of low quality scores protested for other reasons. Something doesn't add up with the strike anyway (the threat to leave Uber because some trips might be on uberx, but to go to lyft where all their trips would be at that level and they'd make less doesn't make sense). The fact that the strike is still going forward makes it pretty clear it's not about having to make more money per hour by doing uberx trips.

Shivetya• 12 years ago

Its bound to happen as long as there is a viable competitor within the market. Until then Uber really doesn't have a choice, they cannot lock in drivers.

seanmccann3• 12 years ago

It's great to see how easy it is for drivers to switch networks if they are unhappy, but drivers have to understand that prices are going down and they'll likely earn less money over time on all networks.

When articles are posted about Uber drivers earning $90k/yr, I'm sure many folks quit their $40k office job and hit the road. The thing is, driving taxi is pretty low skilled so the growing supply of drivers will really push down their income. There's an efficiency problem when an Uber driver "can earn" more than 75% of Americans, and existing drivers have been reaping the benefits of those inefficiencies.

potatolicious2• 12 years ago

Even if $90K a year is sustainable, driving a taxi is a very high-expense business. You'll drive your car into the ground far quicker than you did before, insurance is going to be insanely expensive (an UberX driver I talked to once told me his insurance is $7K a year), and gasoline isn't free (and getting less and less free every day).

The take-home from $90K driving taxis is very different than the take-home from $90K sitting at a desk.

Pxtl2• 12 years ago

I'm going to go ahead and assume there's an app that aggregates Uber/Lyft/whatever and just gets you the closest driver regardless of network. Uber's service goes from being a premium product to a replaceable commodity in a blink.

aetherson7• 12 years ago

Well, Uber, Lyft, and whoever will fight such an aggregator for obvious reasons, and attempt to prevent them from accessing their APIs.

zorpner• 12 years ago

Already happened at least once: http://techcrunch.com/2013/06/02/corral-lyft/

mbesto2• 12 years ago

And someone just as smart will circumvent their APIs.

josephjrobison• 12 years ago

Not sure about an app, but there's a cool site that does it - http://www.whatsthefare.com/

jbigelow762• 12 years ago

The drivers, who are mostly comprised of SUV and black car drivers, have planned a protest outside of the Long Island City Uber Office

I wonder how much good the office protest will do versus just emailing Uber saying "Adios Uber! I'm headed to Lyft because of..."

The on site picketing made sense for blue collar industrial and government workers because the switching cost of quitting your job and (hoping) to get hired at another plant would have been very high. For hire drivers working for Uber and Lyft essentially have close to zero switching costs. A demonstration of that would seem more effective than picketing.

peatmoss• 12 years ago

The media attention that drivers get through this action help signal to consumers that they are moving to a competitor. This might make me (a rider) more likely to fire up the Lyft app instead of Uber next time I need a ride.

jbigelow762• 12 years ago

True, media attention is important but I wonder if the protest will make it onto more mainstream channels and not just the tech news/blogosphere.

Local papers in Dallas have been doing quite a bit of coverage as Uber and Lyft taken on the politically connected taxi industry here. I don't know if intra-service fighting would get as much attention.

Maybe some HNers in the Long Island area will chime in.

whitej125• 12 years ago

Wait, strike? First off...IANAUD. If you become an Uber Driver are you under any sort of contract? Are you now an employee (W-2) of Uber or free agent contractor (1099). If drivers think they can get better fares elsewhere... go nuts and do it. Yay economics!

I feel like I am missing something here.

viscanti4• 12 years ago

This. Although I don't understand the argument from the driver's side. They're upset about sometimes getting trips from uberx (and apparently making more doing so), so they're going to a place that pays less per trip and per hour? Something doesn't add up there.

If there was a factual claim here, I have to believe that they'd be sharing their numbers. It would be trivial for them to show a decrease in earnings (they can easily calculate gas and wear-and-tear) in the before-and-after earnings. The fact that that isn't happening makes me believe this is similar to the protests last year in SF. From the reports back then, it ended up being mostly drivers who had been banned from the uber platform who were trying to be reinstated (although that's not what they claimed).

bitJericho• 12 years ago

May I ask what you make per hour?

vertex-four• 12 years ago

They're upset about sometimes getting trips from uberx (and apparently making more doing so), so they're going to a place that pays less per trip and per hour?

They're trying to convince Uber to stop doing what they don't want (according to them, they do not make more by accepting UberX fares, no matter what the company says) by denying them labour. In the meantime, they're doing work elsewhere, although are hoping not to permanently work there; they're hoping that Uber will cave in.

Denial of labour ("striking") is a tried-and-tested approach to persuading companies to do what the labourers want. They can't operate without labour, so labourers organise to deny them that until they get better working conditions/better pay/etc.

Assuming enough labourers agree to deny labour, this will work unless (a) what the labourers want, the company literally cannot provide without going bust, or (b) there are enough people looking for jobs and willing to put up with the bad terms that the company can hire them to replace the striking labourers.

This is a relatively simple idea, and has been a thing since the Industrial Revolution; I'm not really sure what you're not getting.

avalaunch4• 12 years ago

What is IANAUD? I tried googling but nothing came up.

Spoom• 12 years ago

IANAwhatever usually means "I Am Not A whatever", in this case, "I am not an Uber driver", I assume.

ed• 12 years ago

I can think of two possible sources of driver lock-in: insurance (on the clock but between rides) and car financing. Anyone heard of uber or lyft working on this?

philiphodgen• 12 years ago

There is another reason: employment status and the resulting side-effects.

If you lock in a driver, you start to look like an employer with employees. This creates enormous payroll tax responsibility, workers comp insurance and other headaches for Uber/Lyft.

I would bet that Uber/Lyft have burned a metric crapton of lawyer and accountant brains in an effort to be on the "safe" side of the independent contractor vs employee fight. They're not going to screw that up.

loceng• 12 years ago

This is how free market capitalism is supposed to work - where mobility (switching services) is low to non-existent and so then users can migrate en mass to the ecosystem that is governed better or more in their favour.

pptr1• 12 years ago

Why not have a social network for professional drivers. Let that network destroy any type of information withholding that companies like uber do.

Leverage the power of scale. Unions 2.0

stefan_kendall3• 12 years ago

Sounds like the market is demanding UberX, and Uber is responding.

I'll keep using UberX in cars that don't need $80/day in gas.

spiritplumber• 12 years ago

Excellent, this shifts the balance of power a little. Looks like the whole "everyone is a free agent" thing has some benefit for the little guys too.

sprkyco• 12 years ago

That's awesome I cancelled my account last month due to the issue of "we are lowering prices for summer" me thinking naively that this meant eventually prices would go up after a month or two. However after receiving not only notification that the prices would not go up further (Houston drivers at a minimum) but also I would now be required to pay 10 dollars a week to maintain service. Prior to Uber I was thinking the sharing ecnonomy was an embodiment of a change in corporate attitudes. F me right?

omnivore• 12 years ago

My ugly questions on this are: What about liability for when an Uber or Lyft driver kills someone in an accident driving unsafely? Or just murders someone because they're having a bad day? Or get carjacked? I mean, I guess it's just one spree away from people doing dangerous things?

robbyking• 12 years ago

The only reason to phrase your question the way you did is to increase the FUD surrounding car services like Uber and Lyft. The same question could be asked of any person in any profession.

Regardless, the answer to your question is the first result when you search Google for "Uber liability coverage":

Uber holds a commercial insurance policy with $1 million of coverage per incident. Drivers’ liability to third parties is covered from the moment a driver accepts a trip to its conclusion. This policy is expressly primary to any personal auto coverage (However it will not take precedence over any commercial auto insurance for the vehicle). We have provided a $1 million liability policy since commencing ridesharing in early 2013.

http://blog.uber.com/ridesharinginsurance

ColinCera• 12 years ago

It's a legitimate question because Uber and Lyft are a "new thing" and they're international brand names, something that's not true of regular cab services.

If a cab driver in New York City rapes and kills a passenger, it wouldn't make people distrust all cabs in NYC, much less cabs in other cities; there's no brand name to be damaged by news coverage, and as a news story it probably wouldn't even be covered by media outside of the NYC area.

But if an Uber driver rapes and kills a passenger, it will be covered by media everywhere, because Uber is a newsworthy company and because Uber has a global presence, and the Uber brand will be damaged worldwide, not just locally. Because Uber is a "new thing" there will be lots of people/media asking questions about the safety of Uber (in many cases stupid questions, but still).

oceanstone• 12 years ago

Lyft drivers are creeped out by Uber. "Operation: Shave the Stache" [1] is one of the most manipulative business practices I've heard of. Lyft chooses to invest its money on improving the experience inside the car, and hiring socially intelligent people, who they then treat like human beings. Uber could learn a lot from them.

[1] http://www.theverge.com/2014/8/26/6067663/this-is-ubers-play...

abalone• 12 years ago

This is a much more specific issue than most of the comments here are making it. People are talking about capitalism, competition, etc...

The problem is simply that a couple weeks ago Uber started sending UberX fares to Uber black car drivers. Which was a dumb move, because they are unprofitable and undercut the value of the premium car service. They've now reversed that dumb move.

anateus• 12 years ago

Exactly. This was a protest over a very specific issue, and Uber ended up listening.

The article surprisingly doesn't really spin this into generalized pontificating and really talks about this specific grievance at length. HN commenters however are responding as if this was a general piece on Uber's failings as a whole... Strange.

gaikokujin• 12 years ago

The bottom line is: If you're easily replaceable, you will feel the squeeze sooner or later.

Been in those kind of jobs myself and the only way out is to upskill until your value as a worker is high enough that ruthless managers that couldn't care less about the impact of their decisions on individuals won't get away with it.

igl• 12 years ago

Followed this Uber thing for a little, Read a few articles from the neo liberal tech press, specially interesting when Uber was banned in germany. Initial Reaction to this: haha

tjbt• 12 years ago

The current incarnation of ride shating is fatally flawed. I imagine a superior model in which there is no direct reward for picking somebody up, rather a network of normal people, who can submit and receive requests to pick up. The only compensation would be that in a splitting of gas, which could potentially be done automatically.

The main difficulty in getting a network like this to succeed is the fact that there is no incentive for new drivers to join.

Until then, they are just a taxi company with lax employment protocol.

11Blade• 12 years ago

Clearly the cracks are starting to show.

If the drivers create the value/provide the service and Uber is facilitating that by taking a share, it has to make sense for the value-creator/service provider to continue the relationship. If Uber erodes that margin, the drivers will leave.

Eventually Uber has to change to benefit their service providers and act a little more ethically. The drivers know of their underhanded ways with dealing with Lyft and eventually the public will.

I am an immigrant, I drove a black car in NYC(many years ago), my cousin drives one now. He is none too happy with the UberX situation right now.

Uber should consider the plight of the drivers and not their 100X VC overlords. Nobody ever got rich driving a cab, why victimize the drivers?

"Because we can?"

"We are making the market more efficient"

"Frictionless"

It is just at the expense of the drivers. That's your friction point.

Hard working people just want a fair shot, not to be exploited.

Instead of a billion-dollar pay day, why not just a little human decency.

zobzu2• 12 years ago

Heh they get banned if they accept/deny or plain deny more than 50% of the requests it says in the article.. that seems legit to me as a customer ;) dont really want drivers (of uber or any similar company) to accept/refuse my rides.

Uber Drivers “Strike” and Switch to Lyft Over Fares and Conditions

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