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Uber….taxi or technology company ?

Uber says it’s a technology company. Technology is defined as a better way of doing things. Uber built technology to efficiently dispatch vehicles on demand. The technology is embodied in the Uber mobile app; it represents a better way to hail transportation.

Taxi companies are not technology companies; they are transportation companies. For one, these companies own and rent taxi cabs to taxi drivers at a weekly rate. For at least this reason, the companies are generally required to commercially insure the cars they themselves rent to others. This makes sense.

The question thus becomes whether technology companies such as Uber should endure the same regulations as transportation companies. Put differently, should a technology company that develops airline-booking software (e.g., Priceline) be required to insure and manage all the airplanes using that software?

Indeed, applying the same regulations to technology and transportation companies makes no sense. Uber does not rent cars to Uber drivers. As, Jarrod noted, Uber drivers use their own personal or commercial vehicles to fulfill ride requests received via the Uber app. Again, Uber is simply a piece of technology –a digital dispatcher. Nothing more ( but a 20% finders fee)

But wait, what specific regulations are we even talking about here? Require drivers to have insurance ( more then your standard coverage)? Driver background checks? Car inspections(?)? Non-discriminatory practices. Uber says it already performs these “regulations.”

Can Taxicabs and Uber happily coexist? With at least 15 federal lawsuits, and this week, the California State Senate’s insurance committee passed bill AB 2293, a measure to require “transportation network companies” such as Uber to insure drivers as soon as they turn on their ridesharing app of choice. Currently, Uber and similar startups offer drivers commercial insurance when their app is on and someone has accepted a ride — the coverage then generally lasts until the rider exits the car at their destination.

If AB 2293 passes through the state’s Appropriations Committee and becomes law, taxi industry leaders will flood newswires with victory cheers. To them, startups like Uber should be required to provide full-time, primary commercial auto liability insurance coverage, just like traditional taxis.

Or maybe the taxi industry should be deregulated?

So I guess time will……and we all know how swiftly the U.S. justice system works.

4 Comments on Uber….taxi or technology company ?

  1. If Uber was just a booking agent or just a dispatch service this would be a different issue. Booking agents don’t look to employ people to house vacationers or business travelers in their homes. Or people that may have a plane that is not licensed to take people to their destinations. Or people that want to rent their cars out to other people to drive.
    Uber is not looking to connect people who need transportation with an existing, licensed and screened company that does this under the scrutiny of a governing agency. Yes. Governing agency. Anyone that has a problem with local government and municipality and regulations are either hypocritical because they are the first ones to run to the authorities for help or they are just outright criminals that want to skirt around the law.

  2. I’ve used the service several times until a driver over charged me over $100. I showed Uber proof of the fraud but they didn’t even read my emails at first, until I threaten them with a chargeback. My bank called them but they don’t man the phone. They never ever answer!

    Long story short they helped a driver rob me. Was it done intentionally, who knows?

    Do not use a service like Uber that doesn’t allow you to authorize the amount billed after the fare ends. Customer service sucks.. never again!

  3. UBER is now offering financing for vehicles that they put on the road for them to work for UBER with. So, I don’t see any difference between them and any other taxi company. Just more smoke and mirrors..until they are regulated just like a cab.. In mean time, they will make their billions and cheat customers..

  4. Uber cannot compare itself to apps like Priceline. Those “apps” are only connecting customers to the best pricing, not actually providing the airline travel service. Uber is connecting customers directly to and providing the contracted vehicle for hire drivers. There is a big difference and what Uber is doing is illegal.

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