Albeit the taxi companies created the unfair terms. Obviously it is not necessary to have a medallion to drive someone around. HN is generally anti-lobbying to protect corporate interest, but now that Uber is big there is some regret...
> I would love for the taxi industry to be liberalised but just not for the benefit of a few Silicon Valley billionaires
>Albeit the taxi companies created the unfair terms. Obviously it is not necessary to have a medallion to drive someone around. HN is generally anti-lobbying to protect corporate interest, but now that Uber is big there is some regret...
This myth of the taxi companies lobbying to avoid competition doesn't seem based in reality. Taxis didn't seek out regulation to protect themselves. Cities began regulating fares, service areas, and the business model. Cities put rules on them for the public good. The medallion is there is to balance out the price regulations placed on taxi companies and to ensure that the rules didn't make the taxi business unprofitable.
I've never seen any indication they sought out these regulations.
Really it smells like a smear campaign to make a bunch of immigrants driving cars 12 hours a day the bad guys and to make the 60 billion dollar corporate titan the underdog.
In New York the medallion system was introduced when the supply of taxis exceeded demand. Medallions were a way to control supply and artificially inflate fares, which were also regulated. Unfortunately the supply of medallions has not kept pace with demand which caused medallion prices to skyrocket from ~$3000 ($50k in 2017 money) at their introduction to over one million dollars in the mid 2000s.
Market forces clearly aren't dictating the number of medallions, it's political. Given that fares are still regulated, there's no benefit to creating a shortage of taxis other than inflating the price of medallions. Who benefits from the inflated cost of medallions and who rents them out to taxi drivers?
Like I said, Medallions are there to control supply to ensure profitability of taxi drivers. Sounds like bribery? Well not if the government is dictating your price and business model.
The government says "you can't charge 10 bucks a mile when it is raining during rush hour." And note, that is exactly what Uber does when it is raining.
Limiting competition is the compromise for limiting their profitability. The government is ensuring they'll profit, but not too much. It was a common method of regulation in the past.
The problem you're ignoring is that demand vastly outpaces supply which is why the cost of medallions is so inflated. Additional medallions could be sold by the city to increase supply without affecting existing cab utilization or profits but that doesn't happen. Why? Well because the medallion owners rent their medallions out and if the supply of medallions increases then the demand and thus rent paid for medallions go down.
> In New York the medallion system was introduced when the supply of taxis exceeded demand. Medallions were a way to control supply ...
Regulating supply is about more than fares. Traffic is an externality for the taxi/rideshare company, a 'tragedy of the commons'. I've been in cities where traffic has become much worse due to the large, unregulated influx of rideshare drivers; the cities should auction off slots - which is what medallions are (AFAIK).
Medallions can be used in a number of ways. My comment was pointing out that why they were introduced initially was not to create a commodities market.
>Really it smells like a smear campaign to make a bunch of immigrants driving cars 12 hours a day the bad guys and to make the 60 billion dollar corporate titan the underdog.
The taxi industry has been running its own smear campaign for the last 50 years by offering completely terrible service in the majority of the US.
From the consumer perspective, Uber/Lyft are the only real options for reliable taxi service outside of a few really dense urban areas. The status quo before was calling a number, hoping they didn't hang up or scoff at the route, waiting 20-120 minutes, getting scammed by taking an inefficient route, and then getting lied to about the credit card machine not working. Oh, and then your only recourse being a report to a local taxi authority which is completely unreasonable if you are traveling due to the time effort involved.
That status quo was the thing that made Lyft/Uber an instant winner in the USA. It often gets lost amid the noise of Uber breaking the law.
The pre-rideshare world was awful and full of ripoffs. Disrupting that is the win for all.
I remember the last time I had to use a taxi. It was in Saint Louis - there was no Uber/Lyft at that time at that location. They had no website. So I had to call somewhere - cell service was nearly non-existent for some reason. My flight left in 3 hours. The taxi dispatcher sent someone, but, well, I called the dispatcher after 30 minutes. He's on his way. Great. An hour and 45 minutes before my flight, the guy pulls up. Of course he got lost or something, I don't care. We make our way to the airport. Happily, this time the credit card worked.
A few years before that, I was in Boston. Taxi had a TV playing in the headrest in front of me. Of course it was charging me, but it didn't say that. The driver didn't have a credit card reader - until I told him that I had no cash, so he had to figure it out. Then the reader came out. I asked for a receipt (business trip), and he scribbled something on literally the back of an envelope.
Immigrants driving cars 12 hours a day werent the ones making money off medallions. Rich investors bought medallions as very lucrative investments, until Uber came along.
In pre-Uber San Francisco, many of the drivers who had medallions made a decent living renting them out to the likes of Yellow Cab instead of driving themselves. This alone shows the wrongness of that system, at least as it was done in SF. (Not sure what the system is now, but probably similar.)
I never blamed the drivers (nor the non-drivers) as it wasn't them who rigged the system. And most were pretty cool, even in the days when getting one to show up was a real challenge. (For SF folks: I would regularly wait 45 minutes for a cab to 5th and Howard in 2000, and knew better than to call Yellow which would just not show up half the time. Veteran's at least showed up eventually.)
Now that we have Uber and Lift clogging the city I would have expected the taxis to push things like customer service and professionalism... but last time I was there a taxi driver in front of my business hotel refused to take me to my doctor's office because: "You can walk that."
So I guess I'm prioritizing Lyft next time out. </anecdotal>
It's the same in NYC and Boston. If you can afford a medallion you have enough money to not be a taxi driver.
Honestly, I'm not convinced Uber's fast-and-loose approach is a bad thing. We view disruption as a good thing when it ousts an exploitative private entity -- why is it any different for the government?
> private entity
> why is it any different for the government?
For the record, I don't think the medallion system is good or right or fair - it's not. Just pointing out that there are distinctions here and willfully ignoring them would be foolish.
I'm not sure I understand your post -- I'm asking why people view Uber as evil for trying to disrupt industries that are protected by the government but not when a company tries to disrupt private industry.
> I'm asking why people view Uber as evil for trying to disrupt industries that are protected by the government
That's not why people see Uber as evil. It's because they see Uber as brazenly disregarding the laws of their communities, treating their employees badly (including drivers), exploiting people who need rides in bad weather, and competing unfairly.
It is because of the idea that the government is here for public good, because they're not self-interested, whereas private industries are there because of their greed and self-interest, and they harm their customers whenever they can. In reality, nobody would eat at a government-run restaurant when they have an option to eat at private ones, and nobody would buy a government-designed cell phone when they can buy Android/iPhone. Yet government regulation of transportation, healthcare, and education is the right thing, because they are so much less important than our dinners and phones, and we can afford bureaucratic inefficiencies in these industries, right?
> Cities began regulating fares, service areas, and the business model. Cities put rules on them for the public good.
The popularity of Uber, Lyft and similar show those two statements are in contradiction. I'm sure they weren't aware at the time, but that's what happens when you regulate business models. The status quo is locked in, and things are worse than they could be with perfect invisibility.
It wasn't the need for people to take taxis where the regulation stemmed from. It was because cities didn't want their streets to be overly congested by private vehicles (where at least in manhattan, uber has made far worse).
Taxi regulations date to a time when governments thought it was a good idea for the government to regulate rates. The government decided how much you could charge and your pricing policies, and in return, it limited competition.
Some history of the Haas Act here: https://www.politico.com/states/new-york/albany/story/2013/0.... One thing to note is that this didn't happen in a vacuum. This was happening at a time when the government regulated things in ways it wouldn't dream of doing today. If you wanted to build a new telephone line, operate a new freight trucking or airline route, or build a new railway, you'd have to ask a government agency for permission, and also get approval for the prices you wanted to charge. The agency would decide "oh, there is no need for a route from here to there" and could deny permission on that basis, or decide "oh, this price is too high, you can't charge that much."
The government back then generally viewed competition as a pernicious thing. So they imposed entry requirements to limit competition. That necessitated also bringing prices under government control, to curb monopoly abuses. The Haas Act followed the same basic logic. Limit pernicious competition by limiting licenses, but curb potential abuses by controlling rates.
And who can blame them, really. When it costs thousands of dollars to get a medallion, you want to protect your investment and do whatever you can to maximize your profits.
> And who can blame them, really. When it costs thousands of dollars to get a medallion, you want to protect your investment and do whatever you can to maximize your profits.
AFAIK, in most places in Europe a taxi license costs tens or hundreds of dollars, not thousands. (There are exceptions, of course, most famously London where the cost is more in time than in direct money, and Paris where licenses are sold second-hand for hundreds of thousands.)
It’s not just the cost of the license. In the US, and presumably in Europe, taxi rates are set by the government. Taxis can’t use things like surge pricing to maximize revenues.
Sorry, but as a consumer I welcome this. I will gladly pay a few bucks more or wait five minutes more for a taxi than having every industry taken over by the absentee landlord class that is the tech industry. In the case of Uber spying on their employees, having no obligations any other employer has, paying no taxes and misusing the data of their customers and drivers.
From time to time people would do well do understand that everybody is not just consumer but also a worker, or in the end you'll end up in a bad spot yourself.
One just needs to look at the fact that these businesses have customers and drivers rate each other, which is nothing but undignified and gamified surveillance. Don't give up essential freedoms for the sake of convenience.
I've got an entire city of people (Vancouver, BC) who are desperately waiting for Uber to come and save us from the ridiculous taxi situation in this city. Five more minutes? You're lucky. If you can get an Taxi in 2 hours downtown this month, you're lucky. If you can get a cab to drive you to a suburb, good luck. And we have plenty of people interested in driving for Uber when it comes here.
I welcome as much regulation as necessary to ensure that Uber is safe for consumers but beyond that I say let the tech industry come.
We have a medallion system and those medallions cost a lot of money. The taxi lobby keeps the number of medallions issued low to protect their investment. In addition, there are a number of stupid regulations and artificial boundaries that make the situation worse for everyone.
Unfortunately the government has created a situation where they've made owning a taxi medallion a huge investment and simply allowing Uber would destroy that investment overnight. The taxi industry, knowing now that they're at the mercy of the government, have started "donating" much more aggressively. At this point, the government is just trying to avoid dealing with the issue for as long as possible.
The taxi companies here in Vancouver did that themselves (ostensibly to show they weren't behind technologically in contrast with Uber). However, that in itself doesn't solve any problems. If you can't get a cab by calling dispatch, you can't get a cab using an app.
I feel the same. If only I could hail a taxi with an app instead of having to stand in the street and wave like an idiot at drivers that have riders but who have neglected to turn off their light (as they all do in my city.) And if only when I have to call for a cab I could give them my GPS location so they don't get lost and never show up and if I could provide my destination so they don't take the long way, either on purpose or accidentally. And if only there was a way to see that the cab was actually en route to my location and see an ETA.
If the cab industry could develop an app that works like Uber/Lyft I think they'd be competitive again. I use cabs when they're right there and I know the city, otherwise I reluctantly use Lyft or whatever's available.
Not sure what city you live in, but the ad on the top of the cab is not "the light". I can't imagine a fare system that is not hooked directly to the actual "driver is available for a fare" light, i.e., once the fare is underway, the light switches off. Also, there are apps now in several cities to hail cabs, and some cab companies have their own apps (kind of like Uber, i.e., you can't hail a Lyft or Via via Uber, so why should there be a universal app to hail any cab -- but that would depend on your city and how cabs operate).
Yes, I've tried the one app that I've seen available here (Boston) but it didn't work. It's been a few months, I'll try it again. Cab drivers here don't use their available light so that they can't be ticketed for not picking up minorities.
The incumbent taxi industry is way worse than you describe. Prices aren’t five bucks more, they’re often 2X, with worse drivers due to the lack of a passenger feedback loop. Not to mention that a substantial portion of those profits getting sucked up by the medallion holders, who are much more absentee landlords than Uber or Lyft.
I talked once to someone who honestly thought medallion fees went to pay for driver health insurance and benefits. The status quo was just as exploitive.
In pre-Uber/Lyft San Francisco, it was literally impossible to get a cab home on a weekend night. I would call a dispatcher an hour ahead of time, and stand about a 25% chance of a taxi actually showing up. They would expect you to be waiting at the location the entire time - the drivers would not call to let you know they'd arrived.
The Netherlands tried the experiment to, from one day to another, just remove almost all requirements to operate a taxi. Basically, the only requirements were that you had to have a vehicle that passes inspection, a valid drivers license, and register with the city government that you operate a taxi.
In Amsterdam, the result was absolute chaos. Ignoring for the moment the unhappy existing taxi drivers and companies (that was complete mess, way beyond what the police were able to control), many new entrants behaved less than professional. I.e., competing aggressively for the lucrative rides, being poorly equipped to actually deliver a taxi services.
The situation got so bad, that the old taxi company that everybody hated, was now suddenly was the most reliable taxi service.
The question then becomes how you view the taxi market. Is it a market where anything goes. Where sometimes, in the middle of the night, there is just no taxi that wants to take you (home) for a price you can afford. Where taxi drivers claim that tourists agreed to pay an insane amount of money per person for a short ride from the airport to a nearby hotel.
Or do you want something that is mostly predictable. Maybe not very efficient, certainly not nice. But with reasonable expectation that if you order a taxi, one will show up and take you where you need to go?
So what was the problem? No price transparency for the customers at the airport, no vetting of the drivers, and no reputation market for the drivers.
All of these are/could be/would have been solved by mandating the use of an app. The City of Amsterdam should have made an app, drivers register, that keeps track of their fares and manages supply-demand surges.
Economically it's a race to the bottom unless there's a constrained supply. Especially when [not if] self driving cars start operating as taxis.
If Amsterdam wants to treat taxis as a public good (to get reliable night transport for example), then it can regulate it as such, pay some money for drivers (or otherwise compensate them) to be available at night if natural demand is (or would be) too low.
Just out of curiosity, what were the requirements that got lifted?
The problem is that the Dutch government bought the whole 'free market will solves every problem' ideology. So obviously, a city government was not allowed to mandate anything in this context.
Public transport is the public good that the government pays (in part) for. I doubt that you can randomly pay taxis to be available at night. Then you have to figure out a scheme who gets paid and who doesn't. Otherwise, you may find lots of people who want to get paid for doing nothing at night.
I don't know the details of the old taxi system. There were a limited number of licenses. There was a limit on how much a taxi could charge. But probably there were lots of other requirements as well.
Economically no problem with that race, of course it eventually means cutting out the human driver and usually people who can only drive are not really ready to get a different job. They have no other skills that are "in demand".
Would you describe the present environment as chaotic? Rideshare companies have solved the problems you describe.
You can debate whether it’s fair that they’ve profited by breaking the rules. But they’ve made a very compelling case that the rules aren’t needed anymore.
I was in San Francisco, the birthplace of Uber, in 2009/2010. If you wanted a taxi pickup, you generally had to call two or three taxi companies and wait 30-45 minutes for a two in three chance of a taxi showing.
It is backed up by evidence, though[0]. I think it was meant to validate that the model of ride sharing isn't morally bankrupt merely because it is owned by venture capitalists.
Probably. It is a very interesting case study in corporate culture and corporate viability. Unless the culture changes, it seems difficult to believe that they can stay operational. it is also interesting to watch something with that much inertia slowing down by inches.
I don't think it matters that the justification is after the fact. I think you could actually predict a decrease in drunk driving with better access to transportation that Uber provides before the fact.
> capture even more of the economic pie
I think Uber expands the economic pie more than it takes a share of it. And once there are self-driving cars, services like Uber will become a commodity because there are no network effects on the driver side. Any company with a billion dollars will be able to create a sufficient scale of self-driving cars in a city to compete with the rest of the self-driving car services. The rich people capturing the value will be the ones who own the technology to navigate the car.
Why shouldn't people who develop a new product that solves a real problem and is in high demand not capture more of the economic pie? Seems to me they should be rewarded.
I don't want Uber to disappear, but they brought this ruling upon themselves. A lot of taxi regulations are stupid. However, Uber chose to ignore the reasonable ones as well with the "we aren't a taxi company excuse." If they weren't as blatant with subverting the law, I would have more sympathy towards them.
This attitude that it's terrible that some people get rich is silly at the very least -- destructive at its very worst. And in particular as to ride-sharing services. The net benefit to the consumer has been unbelievably good, and it points to a future where there are fewer personal vehicles and more vehicles for hire, which in turn will have (I think) significant benefits for traffic, city planning, etc. For example, as the number of private cars in NYC goes down, it might be possible to ban parking on more streets, thus increasing their traffic carrying capacity and alleviating traffic problems.
But no, some people got rich doing this. And monopolists got hurt (we're really going to feel sorry for them?!). What a crock. Imagine missing out on all this dynamism and sticking to a measly 13,000 taxis in Manhattan (none in the boroughs, not really) because those millionaires who own taxi fleets and multi-million dollar medallions might suffer while some people in SV make billions. The story is the same around the world.
No, I won't feel sorry for the taxi medallion owners, nor the banks that lent to them that lost money when medallion prices crashed.
> Obviously it is not necessary to have a medallion to drive someone around.
It is when that's the law..
The fact that these people have been able to profit with high visibility and applause when basically the source of their advantage is breaking the law is mind boggling.
Are taxi regulations ridiculous? yes. But that doesn't mean that rampant illegal behaviour is the answer.
Albeit the taxi companies created the unfair terms. Obviously it is not necessary to have a medallion to drive someone around. HN is generally anti-lobbying to protect corporate interest, but now that Uber is big there is some regret...
> I would love for the taxi industry to be liberalised but just not for the benefit of a few Silicon Valley billionaires
And the consumer...