The debate over technology and disruption is a red herring, writes Glenn Fleishman. The trouble with Uber is that it’s a middleman that can control both ends of the market.Read the rest
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.”