As car service app Uber grows, D.C. council pushes to regulate

I absolutely love the smartphone app Uber, which allows you to order car service on demand, instead of trying to hail or call a cab or order a black car. It became an essential tool during my radiation treatment for cancer in LA, when treatment made me too weak to drive, public transportation didn't serve the route I needed to get to the hospital, and I was just too flaked out to arrange rides in other ways. When my friends Tara Brown and Sean Bonner "gifted" me some Uber credits, I tried it once and was hooked. Uber wasn't a luxury for me, but a truly practical service.

It is also the very definition of a disruptive technology: as Napster was to the recording industry, Uber is to taxi unions. And, not coincidentally, the guy behind it is Travis Kalanick, who was once sued for $250 billion by the MPAA, RIAA, and NMPA over his now-defunct P2P search engine Scour.

In his latest round of pissing off legacy industries by building great internet-based services, Kalanick has managed to upset the forces that represent Washington, DC area cab drivers. And the DC city council is now considering regulation that would mandate much more government oversight over Uber's operations, and severely cramp its style. Snip from WaPo:

The regulations, among other things, would require drivers and companies to obtain licenses to be renewed annually; require companies to operate at least 20 vehicles, with at least 10 percent of them wheelchair-accessible; and require the vehicles to be painted black and meet age and model standards.

Also in the proposed rules is a ban on “demand pricing” — a direct shot at a key part of the Uber business model, which hikes prices during periods of high demand to guarantee a supply of cars.

“I would ask the D.C. Council to figure out what problem it is trying to solve,” Kalanick quipped this week. “Sedans didn’t all of a sudden grow horns and get a pitchfork.”

Read more: D.C. Council weighs limo regulations (Washington Post, thanks, Miles O'Brien).


  1. Having pulled my back out this weekend, I watched the hearing online.  Some of Uber’s concerns have already been resolved, and the chair of the committee (Mary Cheh) seemed responsive and had a common-sense approach to things.  However, Councilman Jim Graham (Google his name for association w/ taxis) was outright biased in his attempts to retrict sedan service.  The taxi commissioner (Ron Linton) also came out looking clueless in many respects.

    One revelation came when Cheh inquired about many sedans not being registered in DC, but rather neighboring MD and VA.  Linton admitted that DC currenly does not issue any new licenses to sedan/limo drivers.  His excuse?  DC’s taxi commission is just too darn busy to deal with allowing people to apply for licenses. In fact, I took Uber today to a meeting in DC, and the guy was registered in VA. He said that he tried in vain to get a DC license, but that DC told him that they were not allowing anyone to apply.

    Another recurring theme: riders complained that Uber is non-discriminatiory, yet taxis commonly refuse to haul passengers due to race or location, even though that’s prohibited by law. I can confirm that taxis generally treat my neighborhood like crap, and it’s sometimes tough to catch a cab. Friday night, two in-service cabs wouldn’t take me, so I called Uber- the driver was there in 5 minutes.

    The hearing ended with most people thinking that DC will probably increase regulation a bit (perhaps enforce license regulations), but also needs to allow those who want to comply with the law to do so.

    Another note: Uber’s Kalanick came off looking like a petulant, disrespectful child. He may be in the right (and I agree with most of what he’s said), but his behavior yesterday didn’t do him any favor.

    1. I’m in a licensed profession with licenses in MD, VA and DC.  To get an application sent to me in MD and VA it was a phone call.  For DC, the phone rang, was never picked up, and then their was a message telling you to leave a message, which then told you it couldn’t as it the voicebox was full.  Called a half dozen times at least.  Sent a letter, registered, requesting one.  They sent me an application.  Filled it out, sent it back. A week or so before the exam, they called to tell me I’d filled out the application for the wrong profession.  Was not labelled as such on the form.  They sent me a different form, this one different, but clearly for the wrong profession.  I sent another letter, got the correct form as well as the information on what the test was  on.  When I came to take the exam, was told it was actually not going to be on that material at all.  I passed, but didn’t appreciate the misdirection.  The process is supposedly better now, but it was still remarkable, and I’m told that it was not atypical for DC.  It may be partly running a “state wide” level bureaucracy on a city wide level tax base, but I still found it crazy.

  2. I’ve only read your quote from the original article, but some of those requirements (licensing, wheel-chair accessibility, age and model standards) seem like reasonable accommodations to expect from a business providing a service to the public in a modern, liberal city (US political sense, not as in libertarian). I don’t doubt threatened business interests are flexing their muscles here, but people are allowed to be motivated by more than one thing at the same time (business interests AND public interests). Maybe there’s room for a compromise. 

    1.  “wheel-chair accessibility, age and model standards” are not reasonable requirements. If you need a wheelchair accessible vehicle, you could ask for it. And the rest of the world can stop subsidising your special situation. Making every taxi wheelchair accessible rules out smaller vehicles being taxis. Smaller vehicles use less fuel damage less environment etc…
      Unless accessible includes manhandling the person into a seat and plonking the chair into the boot. In which case, there are virtually no vehicles that can’t pass. Except motor bikes, which have been used as taxi like transport in some cities.

      Insisting that a vehicle be a certain age or model is also bad. I just need a vehicle to take me from A to B. Why does the age or model of the vehicle transporting me matter.
      If you want to take a large item (that needs a larger vehicle) from A to B then once again, you should ask for it. And the rest of the world should stop subsidising your one off convenience on every single journey.
      For example, insisting that a vehicle be able to carry 4 passengers might rule out a Smart car. Which uses practically no fuel compared to a massive 4×4.
      Insisting that cars are new is only providing the automotive manufacturers with more business. If manufacturers had to provide spares for say 20years there would be a lot less environmental impact from disposing of old vehicles. Sure they use a bit more fuel than a new car but not that much. But that’s a completely different argument about disposable society and manufacturers forcing old cars off the roads by overpricing spares to promote new sales.

      1. Making every taxi wheelchair accessible rules out smaller vehicles being taxis. Smaller vehicles use less fuel damage less environment etc…

        That’s not what the suggestion was, and building this kind of straw-man is nonsense. The standard was 10% of vehicles be accessible, not 100%.

        Age of the vehicle matters because older vehicles were built under older emissions and safty standards.

        1. The standard was 10% of vehicles be accessible, not 100%.
          I have not read TFA, so perhaps this was addressed – but how is that supposed to apply to a small operator with one or two cars?

    1. I don’t think you’re the only one. And some of the people who are imagining that work for Google, I’d wager.

  3. I’m a bit confused here.  Aside from Uber’s not calling itself a limo company, what is different about its service that makes it not a limo company?  Obviously the iPhone app but that isn’t a significant difference.  Car, driver, by-phone request, all of this seems identical to convential car services or limo company offerings.  Why shouldn’t they be regulated like their competition?

    1. Because much of that regulation was put in place by their competition as a barrier to entry to keep out newcomers and keep prices high.  Uber figured out some loopholes, good for them.

    2. Uber isn’t a limo company, but a dispatch company. They don’t own or operate any vehicles directly, but act as a middleman between passengers and a large number of small sedan service companies (which can be often just a single person operating a single vehicle).

    3. In the same way is not a sales force, and Ticketmaster is not a theatre company or concert venue owner.

      They don’t own any limos or hire any drivers; they offer a short-turnaround booking service to limo companies.  The limo companies have to provide the limos and drivers.

  4. The problem the D.C. Council is trying to solve: USA is starting to develop a market economy for taxi rides.

    Wonder if protecting developing markets to some day get out of the financial crisis will make it into the presidential campaign?

  5. I’m not sure really what to make of Uber, but as a New Yorker my gut reaction is to actually side against it. Yeah, yellow cabs like to pull tricks on tourists, but nominally they are regulated in such a way to protect the consumer. Limos and car services are ripoffs 100% of the time. You only use them if you are crazily desperate, have too much money to care, or are too ignorant to know better. Why is Uber a good thing? Why in the world would I want a ripoff limo to show up at my door?

    1. In LA, prices were about the same as a cab. Maybe $10-15 more on a $40-50 ride (distances make any form of private ride service, taxi or otherwise, costly in LA). For me, the extra $10 was worth it during cancer treatment, because of many factors, one of which being compromised immune system. Clean cars made a difference, during treatment. As do short wait times, and the ability to order a car at the exact time you need it.

    2. As a native former New Yorker myself, let me tell you that you have no idea how good you’ve got it with yellow cabs. There are many major cities where the only place you can realistically pick up a cab without calling ahead and waiting anywhere between 5-infinity minutes is the airport or a hotel.

      And what’s the problem with car services? Sure, they’re more expensive, but they’re not meant for randomly bouncing around town, they’re meant as a service where you can make a reservation ahead of time and there’ll be a car waiting for you in the morning when you need to catch a flight, or after your late shift when all the yellows are refusing to go to Brooklyn because they’re “on their way back to the garage.” (Illegal, but they still do it.)  Plus you can set up an account with a car service company, which has some advantages.

      I’ll save the SF taxi rant for another time.

      1. Car services are not more expensive than a yellow cab! Yellow cab from my house (in southcentral BK) to the airport is about $30-$35, car service is $25. I’ve personally never encountered a situation where it would have been cheaper to take a cab instead of a car service (the only reason I take yellow cabs is if I’ve forgotten to call ahead).

        I’m wondering if we’re having some difference in how we define “car service” here. When people say “car service” in the outer boroughs, where they’re the only game in town, they mean a car that you call ahead, maybe not necessarily be a nice car (it usually isn’t) but they’ll get you there for a pre-arranged, somewhat reasonable price and they know the neighborhoods pretty well. Maybe you guys are thinking of black cars, which are a car service, true, but they’re high end, with nicer cars and higher prices. I’ve taken black cars because my company had an account.

        Uber’s business model uses mostly “idle” black cars, but they’ve been expanding into lower-end cars and yellow cabs.

    3. Actually I have been ripped off by cabs or just refused service I would say 60% of the time with yellow cabs. I usually need to go after 2-3 taxis before I get one that will take me into Brooklyn. It’s of course illegal and I’ve filed complaints but nothing ever seems to come out of it. Also a car service has almost always been cheaper than a cab unless you get into one not through the proper channels.  There’s one bar I go to regularly. It costs 8 bucks from car service, before tip or usually around 12 bucks yellow cab, before tip. 

      Uber is a little more expensive than car service most of the time, but hey i don’t mind a 10-15% premium if it means I can actually get a cab to take me to Brooklyn.

    4. In comparison to a cab ride in DC, Uber costs about 25-40% more, and it’s worth every penny.  DC cabs are a truly horrible affair – most of the cabs are ancient, ill-maintained, filthy, and the drivers will use every trick imaginable to cheat their fares.  One of the major strikes against the former mayor was that he replaced the ancient and bizarre zoning system that basically let cabbies confuse their passengers into paying almost anything with actual meters.  

      1. I travel to DC a lot, and generally have had reasonably good experiences with taxis.  I still remember how happy I was the time I arrived and the zoning system was abolished in favor of meters. 

        I’ve been there enough to know when a cabbie is trying to pad the meter; but now tourists with smart phones have the tools they need to be able to figure out if they’re getting ripped off–beyond the ordinarily high prices that is…

      2. Maybe DC cabs are okay on the inside, but they’re a menace if you’re a cyclist. Maybe it’s OT, but the disregard they have for the safety of others has always made me think I would never trust them with my money.

  6. Here in Ontario the government granted US bus company monopoly is protected by making car pooling illegal.  If any money changes hand you’re running a “rogue bus company” and the cops will shut you down. So if one guy doesn’t drive and kicks in for the gas or you set up a website with a membership fee to co-ordinate rides you’re a criminal.

    Another Canadian First in transportation: along with being the Toronto Transit commission being the only metropolitan transit company on the face of the Earth with no operating funding from upper levels of government and being the only country in the world which prioritises freight ahead of people on the train lines.

    1. On the cross-Canda train route, prioritizing freight is apparently a physical necessity in many cases – the freight trains now running are longer than the sidings.  Where a passenger train or a freight train must yield, the passenger train is often the only one physically able to do so.

      1. Why not restrict the length of freight trains? Besides convenience to passenger service, anyone who’s ever seen a runaway train movie can see it’s a safety hazard to have a train too long for a siding.

    2.  Freight is prioritized on railways in the Southeastern US, too — because the freight companies own the track. That’s why taking Amtrak isn’t a reasonable option until you get north of DC — the train will be delayed for hours pulling off and waiting for freight trains.

      (I did a little checking, and apparently Amtrak is technically supposed to take priority — but that rule only applies during the window of time when the train is actually scheduled to be on that stretch of track. So if the train is delayed at all early in the route, then it loses priority for the rest of the route and therefore gets more and more delayed.)

  7. I use Uber weekly. I live in Paris. The cost is not too much more. The difference is amazing. The drivers are very professional and uber friendly. The app itself let’s you see where the car is and allows for feedback and rating, and those actually get read by the community manager. When your ride is over you get an email with a map and route along with the price breakdown. Paris has an amazing public transit system but after midnight or depending on the urgency I will grab an uber. It’s a life changer. I absolutely love this service.

    Taxi drivers in Paris are for the most part dicks. They refuse rides, which is illegal, and they always try and add a charge if the ride is below 6 euros. They also talk on the phone, well yell into the phone. It’s not fun.

    I wish I owned stock. Anyway, I was discussing this with the drivers and the general opinion is that the cab drivers here don’t care. Uber can’t pick people up on the street, it’s not the same as a taxi.

    The underlying issue seems to be that Uber was planning on starting a new service called UberX that was less luxury and more value. Small electric cars for hire via iPhone app at cheaper rates. I think that scared the shit out of the cab companies…

    The bottom line is that uber is a better service and the cab companies are right to be scared. 

  8. The vehicle age restrictions seem like an obvious effort to keep out competition. The companies don’t care, because they force the drivers to lease the car from them. I have no problem with a decently maintained 20 year old car, and might even prefer if a company used much older classic cars. Requiring companies to have at least 20 cars is an obvious attempt to prevent owner-operated cabs and prevent competing business from starting up. I don’t mind requiring companies with more than 20 cars to have a percentage of their fleet be wheelchair accessable, as it would be useful if those vehicles can also be used to transport able bodied passengers with cargo. If cab companies win any concessions against Uber, I would hope that the government starts enforcing the existing regulations that they seem to be so openly flouting against them as well.

    1. I absolutely agree the ’20 car minimum’ is obviously anti-competitive. I have less of a problem with age and car model limitations because limiting the options should make it easier for the government to regulate safety, environmental impact, and accessibility, which are things that I think the government should regulate.

  9. It is worth mentioning that the DC Council has been hit by numerous corruption scandals recently, including a nice “everybody but the Mayor” scandal involving payoffs to a Democratic primary candidate to attack the previous Mayor. If Uber is smart, they can play this for maximum advantage.

  10. Isn’t there a volunteer driving service in your area?  There’s something like “Driving Miss Daisy” service for seniors except instead of a private company it’s done by volunteers.  Although their focus is on getting seniors to the medical facility they need, I’m sure they’ll drive anyone that’s too frail to make it to their treatments.

  11. Here’s a good local account of the issue –

    Xeni’s mixed up her good personal experience with what’s happening in another city.  I’ve used Uber, and am generally a fan of transportation competition, but the argument in favor of Uber here is pretty lame.  There are lots of good (and some bad) reasons for the regulation of services like Uber.  

    Finally, Travis?  Came off like a giant dick.  And I’m mostly on his side.

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