Embrace innovation with Uber

Limo (Flickr / rlimousinephoto)

(Flickr / rlimousinephoto)

Everyone likes to talk about innovation and entrepreneurship. But actually embracing these values (and the short-term pain they may bring) is a commitment that many are not willing to make.

Consider Uber, a new car-service company that has changed the way people get around in big cities. Uber uses an iPhone app that lets you request a driver to your location. The app updates in real-time with a GPS indicator of how far away your car is. It also includes the name, picture, and phone number of the driver as well as the make, model, and license plate of the car.

When you arrive at your destination, the app automatically charges your credit card (tip is included in the fare, which is already lower than what a taxi would charge). This mechanism is safer for both drivers and consumers, as it reduces the risk of both robbery and nebulous pricing.

One of Uber’s most innovative safety features is the two-way rating system. After your ride, you must give your driver a 1-5 “star” rating. If a driver drops below an average of 4.7 stars, Uber steps in to give customer service training before the driver can pick up rides again. This ensures the highest quality of service. Many drivers offer a newspaper and cold bottle of water to keep their ratings up.

Drivers can also rate passengers. This ensures that passengers who are rude, excessively intoxicated, or threatening are not allowed to use the system.

It seems like a win-win for everyone, but some don’t think so. It’s common to hear complaints about Uber’s “unfairness.” But here’s the real question we should be asking – unfair to who?

Uber is certainly not unfair to consumers. As evidenced above, consumers get a better ride for a cheaper price.

It’s not unfair to drivers either. Drivers (who drive their own vehicles) can be “on the clock” whenever is most convenient for them. All they need to do is “switch on” the app.

One of my favorite drivers in DC, Musawar, could not stop talking about how much he loved driving for Uber. He said working 9-10 hours a day, 6 days a week, he makes about $60,000 a year, about twice the average annual salary of a taxi driver. Of my 19 rides so far, I still have yet to meet an Uber driver who is not excited to tell me about why he or she has the best job ever.

So who’s left to complain about the perceived “unfairness”? Taxi drivers.

In June, taxi drivers protested in London by causing a major traffic jam, gridlocking streets for an hour. This summer, taxi drivers in DC also protested Uber by blocking major intersections downtown and blaring their horns incessantly for half an hour.

First, some helpful advice to the taxi drivers. If you’re trying to endear customers to your business, causing public frustration is generally not the best strategy.

The taxi drivers’ fear really comes down to this – they perform a service more inefficiently than the new players in the game and are now in danger of fading out of existence. But rather than trying to reform their own industry to compete, they would prefer the government ban Uber.  It makes sense – but only if you are a taxi driver.

How about we move toward a system where the government doesn’t prop up failing industries by making new ideas illegal? If taxis want to charge more for a less pleasant experience, they are more than welcome to. All the government should do is give people the chance to choose between an Uber or a taxi – whichever they prefer. If we’re going to talk about fairness, that’s the clear choice.

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2 responses to “Embrace innovation with Uber

  1. Pingback: Values & Capitalism » Embrace Innovation with Uber - Values & Capitalism·

  2. I agree completely, Danny. I feel badly for the taxi drivers…I suppose their business was caught unawares and the typical taxi driver isn’t generally responsible for the inefficiencies of their business model, it’s been the only model around for a long time. And most taxi drivers are probably just as nice and committed to their job as Uber drivers (I’ve only used a taxi a few times and they’ve always been fine).
    Having used Uber often on a Washington DC trip, including getting a SUV with my elderly parents and relatives after fireworks on the Fourth of July (when trying to hail a taxi was out of the question), it was clear to me that Uber has a much better business model for the future. I really hope that the taxi companies do not fade out of existence, but instead reinvent themselves to be healthy and viable competitors to Uber, since I truly believe that fair competition is good for all. I’m sure if that happens, the taxi drivers will suddenly decide that banning this new business model is not a good idea after all.

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