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Uber is facing the biggest crisis in its history
- CamperBob2 10y agoHonestly, how many other companies, government agencies, or other organizations would hold up under the kind of coordinated, orchestrated drubbing that the media has dished out to Uber over the last couple of months?
- 67726e 10y agoI'm not at all a fan of Uber, but at this point it seems like a coordinated smear campaign.
- hhw 10y agoI think a lot of people have always had a negative view of Travis Kalanick and Uber's business practices, but they enjoyed the convenience of the service just enough to look the other way. Between the soaring valuation and recent events, that balance has shifted to the point where some people now refuse to use the service. At the same time, there is a lot of schadenfreude by people who disagree either with the valuation, or Travis Kalanick and the company's ethos. The media is just tapping into this interest with their coverage, as is their nature to do. So if anything, I'd say it's more like karmic retribution than a coordinated smear campaign.
- sillysaurus3 10y agoHow quickly history is rewritten. This is the same company that presented at Startup School several years ago to significant applause.
- amazingman 10y ago>How quickly history is rewritten. This is the same company that presented at Startup School several years ago to significant applause. This is completely unrelated to Uber's cultural and ethical problems.
- sillysaurus3 10y agoThe comment was "I think a lot of people have always had a negative view of Travis Kalanick and Uber's business practices, but they enjoyed the convenience of the service just enough to look the other way." My comment was "Actually, that's not true."
- hhw 10y agoI think there may be a disconnect between the "a lot of people" I'm referring to, and who you may have in mind. I'm referring to people at large who are aware enough of technology to follow who Uber is, and observed their business practices and Kalanick's predilection for libertarianism. You would seem to be referring to a much more select demographic, such as those who would have been in attendance at Startup School.
- sillysaurus3 10y agoGood point!
- Apocryphon 10y agoIt's not a smear campaign; it's a feeding frenzy. When public perception shifts one way or another, the stories follow to cover it in that angle (though you'd expect at some point there'd be some contrarian hot takes that take an apologist stance towards Uber, maybe something like "Don't blame Uber. Blame the tech industry/gig economy/etc."). There's something rotten at the company, so journalists will naturally shift to cover it and dig up every juice piece of mud they can rake. Same thing happened to RIM a few years back. None of this is personal. It's just a domino effect.
- 67726e 10y agoHadn't even considered that. Suppose the results are the same either way.
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- decker 10y agoDoubt that, Uber became a company that's popular to hate, and any negative news on the company is going to get a lot of eyeballs.
- amazingman 10y agoOr, you know, their culture really is that toxic, their ethics really are that terrible, and Kalanick really is a hyper-libertarian jerk. The first claim is what catalyzed the latest spate of bad press, but there have been many, many examples of the latter 2 claims over the past few years. All you have to do is browse to your favorite search engine and use it.
- angry-hacker 10y agoAnd you can find hundreds of CEO's with the same characteristics. I hate uber for breaking the laws and calling it disruption, but obviously media smells the blood and this attack gets s lot of attention and pageviews so they keep pouring the oil to fire.
- amazingman 10y agoGood. I'm tired of there being so many positive feedback loops for individuals and companies practicing bad/malicious ethics, and/or failing at even the most basic compassion/egalitarianism.
- therpe1 10y agoYou seriously think government operatives and journalists are coordinating with each other to destroy Uber?
- Gracana 10y agoWhat do you mean by "hold up"? Continue to receive investment money? Maintain a customer base? In what way would other companies fail?
- endorphone 10y agoThe media giveth and the media taketh away. Uber is a glorified cab dispatch organization, desperately fishing around to try to convert some of the insane valuation they enjoy into something more valuable. For years the media has made Uber their darling -- the oft restated misnomer about a "sharing economy" -- giving it what would likely calculate to billions in free press. Retelling the tales about the grand new world for drivers, with endless riches. The new standards of excellence for passengers. So now the bad parts are the narrative. To dredge up another trite saying, live by the sword die by the sword.
- valuearb 10y agoinsane valuation? probably. Glorified cab dispatcher? Hardly. The potential of Uber is a worldwide brand with super efficient dispatch. Do you really think it costs them more than a few cents to dispatch rides? There isn't any cab dispatcher in the world with remotely their economies of scale.
- endorphone 10y agoThe economy of scale is a ruse that doesn't actually exist in the business, and this is very well tread ground so I'm not going to repeat it. For Uber's amazing efficiency, despite not owning the cars, paying for the fuel or normal labor costs, or even the insurance in most cases, and then taking 20% of the fare....they're losing insane amounts of money. The calculation doesn't seem to work out. But in the end you've literally said that Uber isn't a cab dispatcher, but they're a super efficient cab dispatcher. Aside from that not being remotely true (their economics are absolutely abysmal), being a worldwide brand is close to meaningless. The overwhelming majority of rides happen locally. Uber's primary beachhead has been a complete disregard for regulations. This may be justified in many cases, but it led to the corporate culture that is now eating it from the inside.
- trome 10y agoHow has it been coordinated? Most of these things, like worker harassment which was reported on twice, once perpetrated by a childish CEO who is still in charge, is self inflicted. Travis didn't have to join Trump's Tech Advisory Committee either, that was a choice he made.
- CamperBob2 10y agoAround twenty people signed on to Trump's advisory committee, many of them very well-known figures in the tech and manufacturing industries. How many others, besides Kalanick, can you name off the top of your head? Thought so.
- dragonwriter 10y ago> Around twenty people signed on to Trump's advisory committee, many of them very well-known figures in the tech and manufacturing industries. How many others, besides Kalanick, can you name off the top of your head? Given the volume of comments mentioning their role in the committee I've seen on HN, I'd say that HN users are probably at least as likely to know about Elon Musk being on the committee (and unlike Kalanick, staying on it.) And Musk and Kalanick are the two that have been high profile media figures as part of startup media strategy; most of the rest are big blue-chip finance and manufacturing CEO, who despite leading more powerful firms, normally have lower media profiles.
- CamperBob2 10y agoYeah, Elon Musk is the only one I could personally recall besides Travis Kalanick, without looking at an article listing the other members. Not a lot of people seem upset about Musk's presence on the committee, or about anyone else's for that matter. Funny. I'm sure it's all just a coincidence, or karma, or a spontaneous self-organizing feeding frenzy, or something.
- dragonwriter 10y agoMusk has gotten quite a bit of flack (in general and on HN specifically) about it; now, unlike Kalanick, he defended the decision and stick with it rather than resigning on the eve of the first meeting. Now, Kalanick actually managed to draw more attention by creating additional news by his dramatic resignation, but as far as criticism of the initial decision, I don't see any evidence he was treated differently than Musk; often, the two were mentioned together in both news articles and criticism.
- ganfortran 10y agoWell, it all starts with the work harassment blog, which is entirely personal and nothing to do with media. The Waymo lawsuit too. Uber did those shitty stuff itself. Media did exactly what it supposed to do, to spread the information to a wider audience here.
- rconti 10y agoI haven't used Uber since about the third crisis of their own making. Even if it IS a coordinated attack, they launched it themselves, and plenty of folks turned away from the service before the media had a chance to finish their conspiracy plans.
- untog 10y agoSigh. There is no "coordinated, orchestrated" campaign against Uber by the media. The media will pretty much pounce on any story they are given, provided it checks out. This pattern of stories about Uber is very familiar and very predictable. It starts with a single, note-worthy story. Based on the reception of that story, other employees (former or current) are emboldened to leak information of their own to the media/write their own blog post/etc. That story feeds another leak, and so on, and so forth. At this point I don't doubt for a second that numerous people inside Uber want Travis gone, and consider the short term bad press to be worth it in order to achieve that goal. There's no conspiracy here. Just the media reporting things they are told by people in the know. If there were other ways to get rid of Travis (more diverse stock ownership, or, dare I say the word: unions) people would probably go for that route. But when you shut all that off your employees will use the press as a last-resort pressure release valve.
- __jal 10y agoCan you point to the coordination and orchestration? Who is the conductor? Extraordinary claims and all that. We've had enough of this hand wave-whispering of dark plots for one year. If you are not going to name the bad actor you think is pulling the strings, don't make the claim.
- st3v3r 10y agoYou say that as if Uber didn't have it coming, or that it's not Uber's fault. Every single thing that has come up is a direct result of Uber's actions and culture, things that the CEO is ultimately responsible for.
- twblalock 10y agoHere's the money quote: > If Mr Gurley and the rest of the board cannot find an experienced candidate willing to work with Mr Kalanick, calls for him to step down may grow louder. But that is his decision to take. Uber is a prominent example of founders’ power at fast-growing tech firms. On its own, Uber’s board does not have the clout to change the CEO, because of his super-voting shares and those of his co-founder, Garrett Camp: together they control a majority of the voting stock. Well, that's a pretty bad corporate governance problem. The CEO's behavior, and the culture he created at the company, have badly damaged the company's image and driven away senior executives and probably a lot of engineers too -- and yet the board can't get rid of him. I would certainly think twice about investing in a company whose board is powerless to do anything about such a terrible self-inflicted wound.
- shostack 10y agoWhile I'm not sure I disagree with you, devil's advocate here...do you think you'd feel the same way as a founder who could prevent yourself from ever being fired from your own company? I can think of several situations where retaining that kind of control would be hugely beneficial and important (in the right hands of course, which is the whole issue here).
- twblalock 10y agoI suspect that most CEOs would like that level of control, but they shouldn't get it.
- smallgovt 10y agoCare to elaborate on why? The initial condition here is founders having full voting rights. In a free marketplace, they're free to sell shares without (or with little) voting rights as they wish. If investors aren't happy with it (which doesn't seem to be the case), they're free to not invest. You seem to be stating that there's a moral imperative that founders voluntarily give away voting rights to investors.
- aianus 10y agoAs a part-time Uber driver in Toronto I haven't noticed any drop-off in ride requests whatsoever. Uber will survive, at least unless someone else beats them to market with an autonomous alternative. I don't get any incentives or bonuses either, just ~75% of the gross receipts from the customer.
- robbyking 10y agoI think it's important to remember that Uber users aren't loyal: if a ride isn't immediately available through Uber, they use Lyft; if Lyft isn't available, they go to the next app. While I agree that the service is here to stay, the individual players are likely to shift.
- foota 10y agoAre uber rides ever not available?
- bluetidepro 10y agoYes, "available" isn't probably the correct term, but what the author of that comment probably meant was stuff like "surging prices", "wait time", etc.
- Taylor_OD 10y agoBased on what? I'm pretty loyal to Uber and use it because I know what I'm going to pay when I order the ride and because I'm not pressured to tip in the app. I guess if another app had both those features, the same ride availability, and cost the same I'd download and try it but currently none of them, that I've tried, do.
- frgtpsswrdlame 10y agoYes but Uber will have to raise prices at some point. Will you be loyal then?
- aceinaday 10y agoIMHO as a part-time Uber driver, Uber could fix a lot of their current problems by putting tipping into the app. The self-driving car is not here yet, and Uber does not do enough for its drivers. If they would just add tipping I think that better drivers in better cars would start driving again. Without the tips, it's just not worth it.
- twblalock 10y agoI don't think a lack of drivers is really a problem for Uber, at least not in major cities. Plenty of people are willing to drive for Uber currently, despite the bad publicity.
- rconti 10y agoOr they could just raise the driver's share slightly, which would have the same impact on drivers, riders, and the company alike... without adding the unnecessary friction/confusion of tipping amounts and customs.
- vaishaksuresh 10y agoNo thanks! If drivers need to be compensated better, I would suggest increasing the fare or Uber taking a smaller cut. A lot of people prefer Uber just so they don't have to deal with tipping like in traditional cabs.
- sillysaurus3 10y agoTipping is often the only way for people to make end's meet. It lets people with excess money help out someone who really needs the help. I think most people's view would change if they were in a situation where tipping makes the difference between being able to pay your heating bill.
- Taylor_OD 10y agoIf I wanted to help someone out I would give them money. However I'm not getting into a car hoping to hear the story of why this person needs money beyond what I'm already paying for their service.
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- paulpauper 10y agoI suspect management quitting has to do more with options being deep in the money and no longer having a financial incentive to stay with the company, more than Uber actually being in much trouble. Sounds like more alarmism. Uber has gotten a lot of bad press over the past few months but the business itself is doing fine.
- valuearb 10y agoQuitting means forfeiting options.
- sandworm101 10y agoUber is too young for the phrase "biggest crisis in its history". It has no history. It has none of the institutional depth to warrant such comparisons. That comes only after decades, after a company has survived multiple boom and bust cycles spanning multiple administrations. This is an upstart company run by upstart kids. That isn't bad per se, but we should expect unpredictability. Talk about company history when the CEO is in his 70s, is the child of a former board member, and the head office has become a listed building. Those companies won't grow massively every quarter, but they do know how to weather a storm.
- losteverything 10y agoI totally agree. Seems like the Economist would know better. To me, a crisis would be if software stopped working as intended.
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- imh 10y ago>Two questions face the company. One is whether Uber will continue prospering under Mr Kalanick’s leadership. Silicon Valley and its denizens may celebrate his type, but ... Well fuck you too, Economist. That seems like an unnecessary and ignorant jab.
- teach 10y ago"Though the most successful founders are usually good people, they tend to have a piratical gleam in their eye. They're not Goody Two-Shoes type good. Morally, they care about getting the big questions right, but not about observing proprieties. That's why I'd use the word naughty rather than evil. They delight in breaking rules, but not rules that matter." -Paul Graham in "What We Look for in Founders" http://www.paulgraham.com/founders.html http://www.paulgraham.com/founders.html There's definitely a sense in which Kalanick's "boundary pushing" is the sort of thing Silicon Valley encourages.
- imh 10y agoYeah there's a sense, but a bunch of the negative stories about Uber/Kalanick have originated in our community too. Would Susan Fowler's story have gone viral had it not been for the outrage within Silicon Valley? Including "Silicon Valley and its denizens" includes a giant group of people who have been crying out against this behavior. I suppose I just don't like the insinuation that I (or my part of the Silicon Valley community) support that behavior.
- jefe_ 10y agoThe consummate leader cultivates the moral law, and strictly adheres to method and discipline; thus it is in his power to control success. -Sun Tzu
- nilanjonB 10y agoyet another case of our boss went bonkers, wth should we do about it before we get wrecked.
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- hackuser 10y agoI make a habit of talking to taxi drivers about Uber. Consistently they say they drive taxis because there is no money in driving for Uber (which of course that tells us less than it seems, because they are self-selected to be people who prefer driving taxis). One told me something new: I asked, as I often do, if they don't make money then why are there so many Uber drivers? This man said that some Uber drivers are trapped by car loans: They are working-class people who took out loans to buy their Uber cars. All cars lose value the moment they are driven off the lot and these cars are driven hard and for high mileage, so their resale value is low. He said these drivers keep working for Uber because they have to try to pay off the loans. (I know nothing else about that story other than what one random driver told me; I'm hoping others can contribute some better knowledge about it.) It struck me: Not only does Uber treat their workers like contractors and give them no benefits or other employee protections, but they ask (often) working class people to provide Uber's capital. Arguably, it's like General Motors calling factory workers 'independent contractors' and asking them to bring their own machinery. In contrast, taxi drivers lease the cab for a shift, AFAIK; they have no long-term capital investment or debt trap. It's almost as if Uber's main business proposition is a loophole in labor rules that allows them to shift almost all costs onto their own workers. That said, I hesitate to pile on, even for a company I don't like personally (which is why I take cabs). Let's not let the hype exceed the reality. EDIT: A few clarifying edits
- nebabyte 10y ago> AFAIK; they have no long-term capital investment or debt trap Medallions?
- hackuser 10y ago> Medallions? The medallion owners make a long-term capital investment. The drivers lease the car per shift or per 24 hours, and have no such investment. (As I understand it.)
- lokedhs 10y agoMy understanding is that very few places have a medallion system. It's apparently quite common in the US, but I can't say I've heard about it anywhere else. Does anyone have statistics on this?