Plenty of Wellingtonians are getting excited about the arrival of the rapidly-growing quasi-taxi service Uber. They offer the convenience of a smartphone app, the potential for better service and flexibility, a promise to disrupt what is often seen as a monopolistic industry, plus fancy cars and All Blacks. For that, they’ve been rewarded with billions of dollars of venture capital, making them darlings of the startup scene.
One Wellingonista signed up to see what they’re offering during their “secret test mode” period. Signing up requires your credit card details up front, but they’re offering free rides through to 21st September. At the moment, they appear to have four cars in Wellington, but expect that to grow. Once they start charging, they’re currently talking about a minimum fare of $5, with ongoing charges of $0.50 per minute and $1.85 per km. I say “currently charging”, since one aspect of their dynamic new model is surge pricing, which raises the fares according to the laws of supply and demand, sometimes hitting users hard.
That’s not the only potential fish hook in this shiny new service. As well as the praise from some parts of the business and tech world, there have been many serious criticisms.
For a start, there’s the matter of passenger safety with a business model that sidesteps the regulations of the taxi industry. New Zealand’s already lightly regulated taxi industry has problems with shady drivers to start with, but there have been horror stories coming out of the US. Worse, the company tried to alleviate those concerns by offering a “$1 Safe Ride Fee”: yes, passengers had to actually pay extra not to get assaulted.
On top of that, Uber have fought against insurance and safety legislation, been accused by their drivers of exploitation, and used what seem to be extremely underhand anti-competitive measures. While we wouldn’t suggest boycotting a company because of its CEO’s politics, it would seem that Travis Kalanick makes Cameron Slater look like Laila Harré, and his libertarianism manifests itself in the company’s anti-unionism and contempt for public safety legislation. As anyone who remembers the Green Cabs Wars on the Wellingtonista will know, the Wellington taxi industry isn’t exactly a host of angels. But in a city that is already overrun with cabs, is there much need for an even less regulated alternative?
We do hope that Uber will spur the local companies into making better use of technology to improve their customers’ experience, and there are advantages in having electronic records of every fare. It may be that in New Zealand, Uber won’t make the same questionable business moves that it has done in the US, and the innovative aspects of their service could actually benefit Wellingtonians. We will watch with interest.