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I generally away from regulation, but let me articulate the pro-regulation argument. Markets that are important (like transportation) and have network effects

I generally away from regulation, but let me articulate the pro-regulation argument. Markets that are important (like transportation) and have network effects need to be regulated. A monopoly with Uber and/or Lyft dominating local transportation is not good for consumers or cities in the long-term. Cities should take control of their transportation and ensure competition by managing allocation of capacity. I think the best parallel is managing of spectrum in telecom to ensure competition.

austenallred 8y ago
San Francisco just granted two companies a monopoly when previously there were multiple companies fighting for the same business. That’s the exact opposite of what you’re advocating.
- WisNorCan 8y ago
  VCs would not be giving billion $ valuations if they thought this will be a highly competitive market with many players. Everyone is betting on a winner takes most market.
  - repsilat 8y ago
    Scooters are cheap enough and slow enough that the benefits to scale - aren't hard to reach for anyone with funding, and - can be maintained over relatively small geographic areas (neighbourhoods/cities, not states/countries/globally). If some new company invents a scooter with better tires or a better battery or a disco ball and a stereo it's not hard for them to enter the market. And, in fact, this regulation is happening because the city thinks it's too easy for upstarts to get a toe-hold and cause negative externalities like sidewalk crowding. (Besides these points: Has anyone made the argument that "overwhelming, unapproachable network-effect leads" are kinda great outcomes for consumers? Like, assume there were 10 facebooks instead of one -- kinda terrible. Or if there were a hundred Ubers and Lyfts, and you didn't know which one had cars close to you... awful.)
  - twblalock 8y ago
    I’ve noticed that a lot of “natural” monopolies are regulated under the assumption they will become monopolies but before they actually do. I suspect a lot of that regulation has been wrong, monopolies would not have emerged, and we would be better off regulating only the monopolies that actually exist. I’d rather see the scooter companies fight it out than have the city government pick winners and losers when the industry is only a few months old and multiple viable competitors already exist.
  - jonathankoren 8y ago
    That's certainly the conventional wisdom, but there's very little in the way of evidence that this is anything other than a cheap commodity.
- eridius 8y ago
  This is a time-limited pilot program that also caps the number of scooters. It's far from a market monopoly. In addition, there's no network effect with scooters. Car sharing has the chicken-and-egg problem where you need enough drivers to meet demand, and you need enough passengers to give drivers a reason to drive for you. But scooters are cheap and easy to dump a whole bunch on a city, so there's no reason why a new company can't move in on an existing scooter market. For the most part the only important pieces are the brand recognition of the company and how easy their app is to use. If Uber is serious about scooters, I fully expect them to just move back in when the pilot program is over and immediately pick up a sizeable chunk of the market.
  - tomglynch 8y ago
    I disagree. There is a network effect here, people will use the brand that already is installed on their phone PLUS the one that has the most scooters. This is what can occur here.
    - JSDave 8y ago
      If someone wanted to sell a new app, they have to get people to recognize their brand and install their app no matter what. Ride sharing companies then also have to reach a critical mass where drivers and riders can match in a reasonable time. I think overcoming that is the network effect.
      - ccvannorman 8y ago
        "Overcoming entering into a new market" is categorically different from "Overcoming a mandatory 6 month freeze on your ability to compete while your competitor gets first dibs."
    - eridius 8y ago
      Using the app already on your phone isn't a network effect. A network effect is when the more users there are, the more valuable the network is to each new user. For ridesharing, the more drivers there are, the more useful the service is to passengers, and the more passengers there are the more attractive the service is to drivers. But for scooters? Whether a given scooter brand is popular or is unknown has no bearing whatsoever on its utility to a new user, all that really matters is whether the scooters are available when and where the user wants them, and whether the app is easy to use.
- fipple 8y ago
  Well maybe those companies shouldn’t have been huge assholes the way that Uber was. The city is once bitten and twice shy with Uber.
  - austenallred 8y ago
    What did Bird or Lime do?
    - fipple 8y ago
      They created conditions for a massive degradation of the public sidewalk especially for wheelchair users. They did nothing to fix it. Regulators act slowly and rarely, but when they do they always overreact. Entirely predictable.
seehafer 8y ago
>A monopoly with Uber and/or Lyft dominating local transportation is not good for consumers or cities in the long-term. As opposed to a city ineffectively delivering transportation to such an extent that people have to drive their personally-owned cars everywhere? Anyone in SF who was here before Uber will tell you that Uber and Lyft were and remain a godsend. Cabs were few and far between (there's an Eddie Izzard bit about this actually) and Muni is slow and unreliable.
- WisNorCan 8y ago
  You are attacking a position that I am not advocating. I am not suggesting government run transportation. I am suggesting that government ensure that the private market remains competitive with multiple players by allocating capacity. In any case, the only thing worse than government running services is a company with a monopoly running services. The first tends to be inefficient. The second tends to be inefficient with a profit motive (see Comcast).
  - ams6110 8y ago
    No, government services are worse. I can opt out of Comcast.
    - NegativeLatency 8y ago
      Sure if you want DSL. Choices in my market are: dialup, dsl, and Comcast.
      - baddox 8y ago
        Does your state or local government have a deal with Comcast effectively awarding it a monopoly? There’s a fairly good chance the answer is yes.
        NegativeLatency 8y ago
        I live in Portland, OR. I don't think there's a granted monopoly to Comcast here. There is actually a small independent WISP here I would love to use, but they don't serve my particular location currently.
xtqctz 8y ago
If you consider the short term rental of inexpensive scooters an important market needing laws to regulate their capacity (..by the wise and benevolent leaders of this sparkling city..), it's hard to imagine any market that would fall short of your importance threshold. The notion that the only way to ensure competition is to forbid it is convoluted.
- eropple 8y ago
  When corporate entities happily take money in exchange for their clients littering the streets with eyesores, it is a rather important problem. Boston hasn't been overrun yet, and I am hopeful that we stay that way.
  - NegativeLatency 8y ago
    Have you tried one? They’re actually quite handy.
    - eropple 8y ago
      I have no need for one and I don't need to throw somebody else's brightly colored garbage onto the property of or into the streets I share with my neighbors.
      - olalonde 8y ago
        Have you heard of the expression "live and let live"? The level of entitlement displayed in your comments is astounding. You feel it's reasonable to prevent everyone else from using a very cheap and convenient transportation service just because the vehicles aren't esthetically pleasing to you?
        eropple 8y ago
        Who is doing the "let live" when a bunch of rental bicycles or a bunch of rental scooters are getting thrown across sidewalks or into a community pond, exactly? In your world, it's incumbent upon me to let them shit up my town, but not incument upon them--either the users or the companies that supply them--to not shit up our town. That's a pretty nasty world.
djrogers 8y ago
Wait, so a monopoly with Skip and Scoot is somehow better? Literally the only thing creating any sort of scarcity or monopoly here is regulation, so claiming it's necessary to prevent a monopoly is a bit ludicrous. I don't think many people are in favor of zero regulation, but politicians literally picking winners and losers instead of the market is even worse.
- adrr 8y ago
  Politicians shouldn't be picking winners or losers as this can lead to corruption and regulatory capture.
- greglindahl 8y ago
  The city held a bidding process to pick two initial winners, which is ... a market. I guess you prefer a different organization to the market, but...
bradleybuda 8y ago
How do "transportation" companies (dockless scooters in this case) have network effects? The automobile industry, which is about as mature as markets get, has seven companies in the US with at least 5% market share and the leader (GM) has merely 17%, and is largely bereft of command-and-control economic policies.
- greglindahl 8y ago
  For a scooter, I have to walk until I find a scooter for a company that I'm enrolled with. Do I even have company X's app on my phone to show their scooter nearby? If I run across company Y's scooter, how much effort is it for me to enroll to use it? And is company Z offering me a bulk discount? All of these are totally different from buying a car.
  - superchink 8y ago
    Dumb question: are you arguing that renting a scooter is harder than buying a car? Or easier?
    - greglindahl 8y ago
      Neither. I'm saying they're completely different things with respect to network effects, in response to someone who thought they were similar in some fashion.
pjscott 8y ago
There aren't a lot of barriers to entry in the ride-hailing market. Want to ride with another service? It's just another app. Want to drive for one more service in addition to the rest? Again, just another app that sends notifications. If Uber and/or Lyft get a monopoly and then jack up prices, they won't have a monopoly for long.

austenallred 8y ago

San Francisco just granted two companies a monopoly when previously there were multiple companies fighting for the same business. That’s the exact opposite of what you’re advocating.

WisNorCan 8y ago
VCs would not be giving billion $ valuations if they thought this will be a highly competitive market with many players. Everyone is betting on a winner takes most market.
- repsilat 8y ago
  Scooters are cheap enough and slow enough that the benefits to scale - aren't hard to reach for anyone with funding, and - can be maintained over relatively small geographic areas (neighbourhoods/cities, not states/countries/globally). If some new company invents a scooter with better tires or a better battery or a disco ball and a stereo it's not hard for them to enter the market. And, in fact, this regulation is happening because the city thinks it's too easy for upstarts to get a toe-hold and cause negative externalities like sidewalk crowding. (Besides these points: Has anyone made the argument that "overwhelming, unapproachable network-effect leads" are kinda great outcomes for consumers? Like, assume there were 10 facebooks instead of one -- kinda terrible. Or if there were a hundred Ubers and Lyfts, and you didn't know which one had cars close to you... awful.)
- twblalock 8y ago
  I’ve noticed that a lot of “natural” monopolies are regulated under the assumption they will become monopolies but before they actually do. I suspect a lot of that regulation has been wrong, monopolies would not have emerged, and we would be better off regulating only the monopolies that actually exist. I’d rather see the scooter companies fight it out than have the city government pick winners and losers when the industry is only a few months old and multiple viable competitors already exist.
- jonathankoren 8y ago
  That's certainly the conventional wisdom, but there's very little in the way of evidence that this is anything other than a cheap commodity.
eridius 8y ago
This is a time-limited pilot program that also caps the number of scooters. It's far from a market monopoly. In addition, there's no network effect with scooters. Car sharing has the chicken-and-egg problem where you need enough drivers to meet demand, and you need enough passengers to give drivers a reason to drive for you. But scooters are cheap and easy to dump a whole bunch on a city, so there's no reason why a new company can't move in on an existing scooter market. For the most part the only important pieces are the brand recognition of the company and how easy their app is to use. If Uber is serious about scooters, I fully expect them to just move back in when the pilot program is over and immediately pick up a sizeable chunk of the market.
- tomglynch 8y ago
  I disagree. There is a network effect here, people will use the brand that already is installed on their phone PLUS the one that has the most scooters. This is what can occur here.
  - JSDave 8y ago
    If someone wanted to sell a new app, they have to get people to recognize their brand and install their app no matter what. Ride sharing companies then also have to reach a critical mass where drivers and riders can match in a reasonable time. I think overcoming that is the network effect.
    - ccvannorman 8y ago
      "Overcoming entering into a new market" is categorically different from "Overcoming a mandatory 6 month freeze on your ability to compete while your competitor gets first dibs."
  - eridius 8y ago
    Using the app already on your phone isn't a network effect. A network effect is when the more users there are, the more valuable the network is to each new user. For ridesharing, the more drivers there are, the more useful the service is to passengers, and the more passengers there are the more attractive the service is to drivers. But for scooters? Whether a given scooter brand is popular or is unknown has no bearing whatsoever on its utility to a new user, all that really matters is whether the scooters are available when and where the user wants them, and whether the app is easy to use.
fipple 8y ago
Well maybe those companies shouldn’t have been huge assholes the way that Uber was. The city is once bitten and twice shy with Uber.
- austenallred 8y ago
  What did Bird or Lime do?
  - fipple 8y ago
    They created conditions for a massive degradation of the public sidewalk especially for wheelchair users. They did nothing to fix it. Regulators act slowly and rarely, but when they do they always overreact. Entirely predictable.

seehafer 8y ago

>A monopoly with Uber and/or Lyft dominating local transportation is not good for consumers or cities in the long-term. As opposed to a city ineffectively delivering transportation to such an extent that people have to drive their personally-owned cars everywhere? Anyone in SF who was here before Uber will tell you that Uber and Lyft were and remain a godsend. Cabs were few and far between (there's an Eddie Izzard bit about this actually) and Muni is slow and unreliable.

WisNorCan 8y ago
You are attacking a position that I am not advocating. I am not suggesting government run transportation. I am suggesting that government ensure that the private market remains competitive with multiple players by allocating capacity. In any case, the only thing worse than government running services is a company with a monopoly running services. The first tends to be inefficient. The second tends to be inefficient with a profit motive (see Comcast).
- ams6110 8y ago
  No, government services are worse. I can opt out of Comcast.
  - NegativeLatency 8y ago
    Sure if you want DSL. Choices in my market are: dialup, dsl, and Comcast.
    - baddox 8y ago
      Does your state or local government have a deal with Comcast effectively awarding it a monopoly? There’s a fairly good chance the answer is yes.
      - NegativeLatency 8y ago
        I live in Portland, OR. I don't think there's a granted monopoly to Comcast here. There is actually a small independent WISP here I would love to use, but they don't serve my particular location currently.

xtqctz 8y ago

If you consider the short term rental of inexpensive scooters an important market needing laws to regulate their capacity (..by the wise and benevolent leaders of this sparkling city..), it's hard to imagine any market that would fall short of your importance threshold. The notion that the only way to ensure competition is to forbid it is convoluted.

eropple 8y ago
When corporate entities happily take money in exchange for their clients littering the streets with eyesores, it is a rather important problem. Boston hasn't been overrun yet, and I am hopeful that we stay that way.
- NegativeLatency 8y ago
  Have you tried one? They’re actually quite handy.
  - eropple 8y ago
    I have no need for one and I don't need to throw somebody else's brightly colored garbage onto the property of or into the streets I share with my neighbors.
    - olalonde 8y ago
      Have you heard of the expression "live and let live"? The level of entitlement displayed in your comments is astounding. You feel it's reasonable to prevent everyone else from using a very cheap and convenient transportation service just because the vehicles aren't esthetically pleasing to you?
      - eropple 8y ago
        Who is doing the "let live" when a bunch of rental bicycles or a bunch of rental scooters are getting thrown across sidewalks or into a community pond, exactly? In your world, it's incumbent upon me to let them shit up my town, but not incument upon them--either the users or the companies that supply them--to not shit up our town. That's a pretty nasty world.

djrogers 8y ago

Wait, so a monopoly with Skip and Scoot is somehow better? Literally the only thing creating any sort of scarcity or monopoly here is regulation, so claiming it's necessary to prevent a monopoly is a bit ludicrous. I don't think many people are in favor of zero regulation, but politicians literally picking winners and losers instead of the market is even worse.

adrr 8y ago
Politicians shouldn't be picking winners or losers as this can lead to corruption and regulatory capture.
greglindahl 8y ago
The city held a bidding process to pick two initial winners, which is ... a market. I guess you prefer a different organization to the market, but...

bradleybuda 8y ago

How do "transportation" companies (dockless scooters in this case) have network effects? The automobile industry, which is about as mature as markets get, has seven companies in the US with at least 5% market share and the leader (GM) has merely 17%, and is largely bereft of command-and-control economic policies.

greglindahl 8y ago
For a scooter, I have to walk until I find a scooter for a company that I'm enrolled with. Do I even have company X's app on my phone to show their scooter nearby? If I run across company Y's scooter, how much effort is it for me to enroll to use it? And is company Z offering me a bulk discount? All of these are totally different from buying a car.
- superchink 8y ago
  Dumb question: are you arguing that renting a scooter is harder than buying a car? Or easier?
  - greglindahl 8y ago
    Neither. I'm saying they're completely different things with respect to network effects, in response to someone who thought they were similar in some fashion.

pjscott 8y ago

There aren't a lot of barriers to entry in the ride-hailing market. Want to ride with another service? It's just another app. Want to drive for one more service in addition to the rest? Again, just another app that sends notifications. If Uber and/or Lyft get a monopoly and then jack up prices, they won't have a monopoly for long.