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For me, it’s always fun to watch stupid regulatory initiatives blow up in the faces of politicians and ignorant voters. The Texas tech Mecca (irony boner), the city of Austin, claimed that its “enhanced background checks” law, best known for its fingerprint requirements, was aimed at passenger safety. Anyone with a brain knew that it was aimed at protecting the local cab companies whose market share had been decimated by the much more cost effective Uber and Lyft. The city of Atlanta tried the same thing, but luckily it was struck down. The consequences are obvious. Austin had better be ready for an increase in drunk driving, since cab fares will skyrocket due to less competition and increased costs for conforming to the new regulations. Another obvious consequence that has emerged is an increase in black market ride sharing.
From The Federalist:
Tens of thousands of riders and drivers are now connecting through Facebook and Craigslist, sidestepping onerous city regulations passed late last year aimed at traditional ride-sharing companies like Uber and Lyft that required drivers to be fingerprinted, among other things.
What exactly did the city of Austin think was going to happen to Lyft and Uber drivers when the companies had to pull out of the city? Were they going to apply at cab companies? Were they going to sit at home and jerk off in their newfound free time? Of course not. Most uberX and Lyft drivers do ride sharing for a little extra money in their free time. According to the drivers I’ve talked to, they make pretty good money for just driving people around. You get off your regular job, press a button on your phone, work as long as you’d like, press the button again, and go home. Boom, brilliant. Now with the companies gone, former Uber and Lyft drivers have started advertising their services on Facebook, Craigslist, etc. as black market, unregulated ride sharers.
So good job, Austin. At least Uber and Lyft did basic background checks on their drivers. Now you have an unregulated black market where you don’t know who is out there offering people rides. If anything, you created a greater rider safety issue than before. I’m not standing here saying Uber and Lyft are perfect — sometimes creeps and psychos can slip through background checks — but at least it was a basic screening process. On the other side of the coin, I guess drivers can now be less cautious about offering coke and weed to their passengers, for a nominal fee of course, since there is absolutely no oversight. Or, God forbid, something worse.
Congrats, Austin, you goddamn idiots..
Image via BravoKiloVideo / Shutterstock.com
[via The Federalist]
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@5OClockShadow_
Capitalism ftw, government intervention be damned.
Anyway you could get your twin with the old TV show to say this? Maybe then people would actually listen…
(Sorry, it had to be said. “Meh” me into oblivion.)
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Well, Grandex could finally find a use for its interns, rather than shit articles.
With the occasional horror story of an Uber or Lyft driver sexually assaulting their passengers, I really don’t dislike the idea of increasing the scrutiny of background checks. But this is something that you’ve got to work with businesses on, not just unceremoniously pass legislation.
I got a gun pulled on me by an uber driver once so I’m okay with a few more regulations.
Austin has now become a new emerging market for shady dudes who drive windowless utility vans. So basically guys, that’s a joke that subtly hints toward an increase in rapists who use vans as a concealment mechanism to carry out their dirty work in suburban strongholds. I have to start disclaiming these comments now because some of you seemingly aren’t getting it, alright.
I’m not well versed with the new Austin limitations, but what’s to stop a company from just creating a similar app–but following the guidelines now set in place? While the margins may not be as good, and it’s not global–I’d think that money could be made.
It’s not the creating the app that is the hard part, it is having the infrastructure in place to handle tens of thousands of people trying to get rides at the same time.
The problem for a new competitor is the barriers to entry and necessary scale for profitability. Austin is one of very few large markets that Uber and Lyft have left. So pursuing a strategy of entering the markets they exit isn’t enough and those companies could return at any time (See San Antonio). Additionally, entering a market as the 3rd competitor and the new guy is going to be very challenging.
The problem is not one of infrastructure because little is required. A company would create their algorithm for matching potential jobs to drivers, which is mostly based on long established GPS tech. Then the company rents some servers and storage to handle the traffic and they can scale up from 100 drivers to thousands. They don’t need huge capacity initially because the limiting factor is drivers which takes time to build up along with a good rep with customers.
Uber and Lyft left Austin because their strategy is to exit any market that requires finger print background checks. This policy is not due to the market becoming unprofitable, but rather a strong arm tactic to dissuade a mass change in local regulations across the country and force cities like Austin into changing their regulations. This is a key time for both businesses because if they are unable to stop the trend toward stricter regulations, they would lose some of the large competitive edge they currently enjoy over Taxis. Although you can bet your ass Uber and Lyft would find a way to pass most of the higher cost onto customers and drivers. Requiring finger print checks from people who are responsible for other’s safety every time they “clock-in” is not an absurd request or regulation. I’ve had to do finger print checks for jobs going back to my high school days. The cost is not unreasonably higher; finger print checks are much more difficult to trick and provide a more comprehensive report of the employee’s driving history, which is uh…kind of important. Also, just think, a sexual predator who definitly wouldn’t get past a finger print check could slide through whatever cheap ass checks Uber does and then be allowed to pick up drunk girls/guys on a nightly basis. This isn’t a fight over burdensome regulations killing profits and crushing a young industry. Both companies would still have a large competitive advantage over Taxi’s and earn strong profits. Its just greed and laziness. Another possibility is Uber and Lyft cut corners on their in-house checks to save costs and are concerned what could be revealed about their drivers. Either way, don’t let these greedy fucks fool you.
Uber and Lyft are the greedy ones because they don’t want the government taking money they don’t need? Ok dude.
Uber and Lyft’s background check has failed 53 people just in Austin that were already cab drivers. But yeah, this fingerprinting is going to make things safer. If you don’t feel safe riding in an Uber or a Lyft, nothing was stopping you before from taking a cab. The correct answer here is to get rid of all the ridiculous regulations for all of these services, but the cab unions don’t want that because then they would actually have to compete with other companies instead of pricing them out of the market. And the politicians will kiss the unions ass in return for funding.
And sure, the fingerprinting isn’t expensive. But fingerprinting would just be the first step. The city would keep passing regulation after regulation until it broke the camel’s back. And safety would be the last reason they were doing it.
TLDR: Go free market, Fuck Steve Adler.
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No, keep the background checks. I don’t need to be getting into an Uber with someone who has multiple DUI’s on his record.
Uber and Lyft do background checks on all their drivers like most employers.
Hippie.
What? Nobody is forced to use uber or lyft, nor is anyone put in any additional danger over the traditional cab services or public transportation. Everything you mentioned already shows up on a background check on someone’s social security number. This is just an attempt by the taxi unions (oh yeah, and the third parties that have profited millions by lobbying for more and more industries to pick up these sorts of checks/occupational licensing) and the politicians they bought to send voters into a morality crisis. Helps them line their own pockets.
P.S. having someone’s prints will never stop them from murdering or raping
I’ve been having to use something called ride share, twice as expensive as an uber but the same concept. Desperate times here in Austin.