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Most people are looking at this cynically, and I agree that it's a stall for time, he's trying to justify paying people the minimum because otherwise all the ot

Most people are looking at this cynically, and I agree that it's a stall for time, he's trying to justify paying people the minimum because otherwise all the other greedy pigs would undercut him, etc etc. However, my cynicism goes a level deeper. It is in Uber's best interests for laws to change and make the scene more complicated, so that all operators in this space - including Uber - have to pay more to their workers and have more encumbrances. Why? Well, Uber is an established operator. They have made their bucketloads of money off the back of underpaying their workers, got themselves out of startup status in a way that - if they play their cards right - no other gig operator will be able to replicate. Less competition, less disruption. I think there is an argument that says that "gig economy" should be enveloped in laws that protect the gig worker rights and ensure fair pay and a safety net, without introducing laws that enforce restrictions on the workers. Governments should work to simplify the burdens on individuals, without creating new loopholes for the wealthy. "It's hard" is a valid statement, but not a reason to reject the concept. But I would continue to be fully cynical of any solution that has the top gig economy CEO's seal of approval.

starfallg 6y ago
That's the problem with 'disruption' as the MO for tech startups - they end up creating new business models that may not be any more efficient or better overall for society, and escapes scrutiny during the time that society adjusts. By the time everybody catches on, the damage is done. We need a better way to internalise social and environmental costs. Just because human society has been able to adapt to past technological and social upheavals is not an indication that it will be able to continue to do so.
- treis 6y ago
  Taxi companies have always been crap places to work. The job is (relatively) dangerous, pay is bad, flexibility is bad, and probably no benefits. Didn't help that most cities had a medallion system that enabled a group of rent seekers. And outside of NYC, Chicago, and maybe a couple other cities taxis sucked. I think Uber is much more efficient and better overall for society than what it is replacing. Not a great job by any means, but far better than a taxi company. And when I look back 10 years ago Uber/Lyft are probably top 3 things that have made the world better. It opened up an enormous amount of flexibility when going out at night and eliminated concerns around drunk driving.
  - starfallg 6y ago
    Uber doesn't just compete with taxis. It also competes with public transport. Also, there is a chance that sole riders would actually be increasing their carbon footprint compared to driving, as the Uber driver is also involved in your trip. Unless Uber is proven to cut car ownership and vehicular use, it is very possible that it is worse for society and the environment than the previous status quo.
    - kyawzazaw 6y ago
      that competition is fairly small. in the US, there is very few cities with good public transport
      - starfallg 6y ago
        Yes, I can accept that it's region specific. It's the case in London, for example. Uber has made central London traffic worse. And that would be the case for many places outside of NA.
    - asdff 6y ago
      In NYC Ubers have contributed to increased car traffic, so definitely a net negative for congested urban life and global warming at the same time.
      - treis 6y ago
        "contributed to increased car traffic" = "lots of people use it"
        asdff 6y ago
        Yeah that was part of it, but the same study found a lot of it was due to circling blocks around already high traffic areas without passengers waiting for fares. In that case, that added traffic would be from people not using the service, but the service requiring a physical footprint in the city in the name of an empty uber vehicle anyway for it to function, if people were to use it. You can argue buses and trains also need space, but you can fit way more people into a bus or a train before you need to make square footage available for a second bus or a train.
- altacc 6y ago
  Indeed. 'Disruption' often translates to inserting an expensive middleman into an existing relationship. E.g. passengers used to order taxis directly and takeaways would deliver food themselves. There are certainly improvements for some of the parties involved (Uber is a lot easier to use than local taxi companies used to be), but that doesn't mean there's magically a lot more money available to pay both the existing and new members of the model.
athenot 6y ago
That's usually referred to as "building a regulatory moat".
- thathndude 6y ago
  Or pulling up the ladder. Either way, it’s a very common tactic, and undoubtedly part of the motivation.
  - Spooky23 6y ago
    It’s also a defensive play. If Trump loses, companies like Uber will be facing a regulatory reckoning for things like unemployment insurance. (Some states are paying gig workers UI or pandemic relief) Better to control the narrative than just wait.
    - toyg 6y ago
      > If Trump loses, companies like Uber will be facing a regulatory reckoning for things like unemployment insurance. That's... wishful thinking. Such a reckoning will certainly not come under Trump, I agree; but it's not a given that it will happen under Biden. In fact, I'd be willing to bet that it will not, at least for the first 4 years.
    - LunaSea 6y ago
      Right, because there was no Democrat president before.
      - Spooky23 6y ago
        Inform yourself before engaging in snark. It's not a democratic/republican issue. It's a current POTUS vs. responsible leader issue. The problem that we're facing are novel. To my knowledge, the US has never used unemployment to provide benefits to non-employees. UI is an insurance based program and always has been -- the business model is to loan money to the state programs during an uptick, which then gets recovered through UI premiums. Chances are, changes are coming that will erode the free ride that "employers" of Uber have been enjoying. The states are broke and facing big increases of UI premiums. Once the door opens, it's hard to close. People will start looking at things and asking awkward questions about things like Medicaid and SNAP expenses associated with gig workers, etc.
mtrycz2 6y ago
I wasn't following recently, but has Uber finally become profitable?
friendlybus 6y ago
What is the gain in making uber in a taxi company again with all the same corporate math? Uber is turning about to be american arbitrage, giving us the same service but with an app.
tomalpha 6y ago
> They have made their bucketloads of money I agree with your broader point, but Uber lost some 8.5 billion USD last year. They're not (yet, at least) making bucketloads of money, despite paying their workers badly.
- rvense 6y ago
  Doesn't that just mean that Uber's investors are doing badly? I'm assuming most of their (regular) employees are being handsomely compensated.
  - Miraste 6y ago
    Hilariously, years of multibillion dollar losses with no path to sustainability have yet to translate to a lower stock price.
- roenxi 6y ago
  Indeed, the ultra-cynical view is that they are now desperate for government regulation to ossify the market because without a lock in (similar to what taxi companies used to enjoy pre-Uber) profits drop to 0 and stay there. Raw capitalism should drive companies like Uber out of business as a billion-dollar company. They can always be undercut by a group of drivers in a locality starting a new app and stealing the local regulars (identical service, lower cost because no Uber premium) leaving Uber with only non-local traffic. Apps are not expensive.
- shusson 6y ago
  To be clear, they have made bucketloads of revenue, they lost profit. The OPs point was that now that they have practical market dominance, regulations will most likely favor them compared to small start-ups.
  - mumblemumble 6y ago
    Focusing on revenue and revenue growth makes sense for some companies, especially ones where you can expect economies of scale to eventually become a major factor. When the company's business model is this transparently an elaborate scheme to sell dollar bills for $0.75, though, focusing on revenue starts to seem like either committing or being taken in by a very elaborate version of lying by omission.
one_electron 6y ago
i suspect the same. we saw the same exact behavior last year from amazon around minimum wages (https://techcrunch.com/2019/04/11/amazon-ceo-jeff-bezos-challenges-rival-retailers-to-raise-their-minimum-wages-too/ https://techcrunch.com/2019/04/11/amazon-ceo-jeff-bezos-chal...)
cwhiz 6y ago
Uber has never made a profit in any quarter or year. In fact I believe the best they’ve ever done is lose a billion in a quarter. This past quarter they lost $2 billion.
akavel 6y ago
Ouch, right - basically, "dumping": https://en.wikipedia.org/wiki/Dumping_(pricing_policy) https://en.wikipedia.org/wiki/Dumping_(pricing_policy)
trentnix 6y ago
Your deeper cynicism is justified. Regulations always benefit the well-entrenched in a marketplace. In many cases, they are the ones who actually write the regulations. Politicians do victory laps, big business get their position in the marketplace protected by law, and everyone else loses.
StreamBright 6y ago
When Uber started they predicted (falsely) that autonomous driving is going to be ready in few short years. For Uber drivers are a minor annoyance.
mathattack 6y ago
Regulation helps the large incumbents, who have more capacity to bear the fixed costs. The capitalist solution to the 2008 financial meltdown would be to let new banks bump the old banks. Despite all the Fintech innovation, the old banks are more entrenched than ever. With Dodd-Frank, Barney Frank gave them one more gift on the way out of office.
asn0 6y ago
Didn't Uber disrupt an industry that was already very well protected by government regulation, and seems much more exploitative? It costs around $100,000[1] to be allowed (by the city) to drive a taxi in New York ($1.3MM in 2014), for a job that pays on average $43,000[2] per year - which involves driving an average of 70,000 miles per year - which at an average speed of 4.7mph[3] works out to $3/hr (not counting waiting time). It's still not a living wage, but making $9/hr[4] just by owning a decent car seems like progress. [1] https://citylimits.org/2019/11/30/need-to-know-taxi-medallions-in-new-york/ https://citylimits.org/2019/11/30/need-to-know-taxi-medallio... [2] https://www.salary.com/research/salary/benchmark/taxi-driver-salary/new-york-ny https://www.salary.com/research/salary/benchmark/taxi-driver... [3] https://www.latimes.com/nation/la-na-new-york-traffic-manhattan-20180124-story.html https://www.latimes.com/nation/la-na-new-york-traffic-manhat... [4] https://www.thestreet.com/personal-finance/education/how-much-do-uber-lyft-drivers-make-14804869 https://www.thestreet.com/personal-finance/education/how-muc...
- yepthatsreality 6y ago
  I don't think Uber disrupted anything. Private car services or gypsy cabs already existed, they just had a brand name and an app. The result of which is that the same problems remain for workers. Unless that's how disruption in an industry is defined these days. Update for clarity: I guess my bigger question is: what really changed? Customers became more comfortable and the business side became more reasonable, but competition and workers still get the shaft.
  - leoedin 6y ago
    My experience in London was that Uber radically disrupted things. Yes, private hire cars existed, but the experience was pretty bad. You'd phone a number or go to an office, they'd say "20 minutes" and then, hopefully, a car would turn up. It involved a lot of waiting on streets (especially at night) and sometimes no car would turn up. There was no recourse or way to contact the driver. Maybe app based hire cars were an inevitable product of smart phones. If not Uber, then someone else. But certainly Uber's business model was incredibly disruptive of that industry. From my perspective it had a really strong effect on how my generation lived in the city.
Justsignedup 6y ago
To add. Uber has bled billions while paying people less than minimum wage. By now they may be established enough. But anyone attempting to compete will be screwed. The solution is protections and to break up uber.
madeofpalk 6y ago
That's 100% it. By Uber advocating for additional regulation, they get to (hope to) design the regulatory capture that entrenches them and makes it harder for upstarts. It's the same reason Facebook advocates for data protection laws in the US - they're going to happen either way, Facebook wants them to suit them and makes it harder for competition.
MaysonL 6y ago
>bucketloads of money Uber has yet to make a profit. Some shareholders have made profits by selling stock, but the business is losing money hand over fist.

starfallg 6y ago

That's the problem with 'disruption' as the MO for tech startups - they end up creating new business models that may not be any more efficient or better overall for society, and escapes scrutiny during the time that society adjusts. By the time everybody catches on, the damage is done. We need a better way to internalise social and environmental costs. Just because human society has been able to adapt to past technological and social upheavals is not an indication that it will be able to continue to do so.

treis 6y ago
Taxi companies have always been crap places to work. The job is (relatively) dangerous, pay is bad, flexibility is bad, and probably no benefits. Didn't help that most cities had a medallion system that enabled a group of rent seekers. And outside of NYC, Chicago, and maybe a couple other cities taxis sucked. I think Uber is much more efficient and better overall for society than what it is replacing. Not a great job by any means, but far better than a taxi company. And when I look back 10 years ago Uber/Lyft are probably top 3 things that have made the world better. It opened up an enormous amount of flexibility when going out at night and eliminated concerns around drunk driving.
- starfallg 6y ago
  Uber doesn't just compete with taxis. It also competes with public transport. Also, there is a chance that sole riders would actually be increasing their carbon footprint compared to driving, as the Uber driver is also involved in your trip. Unless Uber is proven to cut car ownership and vehicular use, it is very possible that it is worse for society and the environment than the previous status quo.
  - kyawzazaw 6y ago
    that competition is fairly small. in the US, there is very few cities with good public transport
    - starfallg 6y ago
      Yes, I can accept that it's region specific. It's the case in London, for example. Uber has made central London traffic worse. And that would be the case for many places outside of NA.
  - asdff 6y ago
    In NYC Ubers have contributed to increased car traffic, so definitely a net negative for congested urban life and global warming at the same time.
    - treis 6y ago
      "contributed to increased car traffic" = "lots of people use it"
      - asdff 6y ago
        Yeah that was part of it, but the same study found a lot of it was due to circling blocks around already high traffic areas without passengers waiting for fares. In that case, that added traffic would be from people not using the service, but the service requiring a physical footprint in the city in the name of an empty uber vehicle anyway for it to function, if people were to use it. You can argue buses and trains also need space, but you can fit way more people into a bus or a train before you need to make square footage available for a second bus or a train.
altacc 6y ago
Indeed. 'Disruption' often translates to inserting an expensive middleman into an existing relationship. E.g. passengers used to order taxis directly and takeaways would deliver food themselves. There are certainly improvements for some of the parties involved (Uber is a lot easier to use than local taxi companies used to be), but that doesn't mean there's magically a lot more money available to pay both the existing and new members of the model.

athenot 6y ago

That's usually referred to as "building a regulatory moat".

thathndude 6y ago
Or pulling up the ladder. Either way, it’s a very common tactic, and undoubtedly part of the motivation.
- Spooky23 6y ago
  It’s also a defensive play. If Trump loses, companies like Uber will be facing a regulatory reckoning for things like unemployment insurance. (Some states are paying gig workers UI or pandemic relief) Better to control the narrative than just wait.
  - toyg 6y ago
    > If Trump loses, companies like Uber will be facing a regulatory reckoning for things like unemployment insurance. That's... wishful thinking. Such a reckoning will certainly not come under Trump, I agree; but it's not a given that it will happen under Biden. In fact, I'd be willing to bet that it will not, at least for the first 4 years.
  - LunaSea 6y ago
    Right, because there was no Democrat president before.
    - Spooky23 6y ago
      Inform yourself before engaging in snark. It's not a democratic/republican issue. It's a current POTUS vs. responsible leader issue. The problem that we're facing are novel. To my knowledge, the US has never used unemployment to provide benefits to non-employees. UI is an insurance based program and always has been -- the business model is to loan money to the state programs during an uptick, which then gets recovered through UI premiums. Chances are, changes are coming that will erode the free ride that "employers" of Uber have been enjoying. The states are broke and facing big increases of UI premiums. Once the door opens, it's hard to close. People will start looking at things and asking awkward questions about things like Medicaid and SNAP expenses associated with gig workers, etc.

mtrycz2 6y ago

I wasn't following recently, but has Uber finally become profitable?

friendlybus 6y ago

What is the gain in making uber in a taxi company again with all the same corporate math? Uber is turning about to be american arbitrage, giving us the same service but with an app.

tomalpha 6y ago

> They have made their bucketloads of money I agree with your broader point, but Uber lost some 8.5 billion USD last year. They're not (yet, at least) making bucketloads of money, despite paying their workers badly.

rvense 6y ago
Doesn't that just mean that Uber's investors are doing badly? I'm assuming most of their (regular) employees are being handsomely compensated.
- Miraste 6y ago
  Hilariously, years of multibillion dollar losses with no path to sustainability have yet to translate to a lower stock price.
roenxi 6y ago
Indeed, the ultra-cynical view is that they are now desperate for government regulation to ossify the market because without a lock in (similar to what taxi companies used to enjoy pre-Uber) profits drop to 0 and stay there. Raw capitalism should drive companies like Uber out of business as a billion-dollar company. They can always be undercut by a group of drivers in a locality starting a new app and stealing the local regulars (identical service, lower cost because no Uber premium) leaving Uber with only non-local traffic. Apps are not expensive.
shusson 6y ago
To be clear, they have made bucketloads of revenue, they lost profit. The OPs point was that now that they have practical market dominance, regulations will most likely favor them compared to small start-ups.
- mumblemumble 6y ago
  Focusing on revenue and revenue growth makes sense for some companies, especially ones where you can expect economies of scale to eventually become a major factor. When the company's business model is this transparently an elaborate scheme to sell dollar bills for $0.75, though, focusing on revenue starts to seem like either committing or being taken in by a very elaborate version of lying by omission.

one_electron 6y ago

i suspect the same. we saw the same exact behavior last year from amazon around minimum wages (https://techcrunch.com/2019/04/11/amazon-ceo-jeff-bezos-challenges-rival-retailers-to-raise-their-minimum-wages-too/ https://techcrunch.com/2019/04/11/amazon-ceo-jeff-bezos-chal...)

cwhiz 6y ago

Uber has never made a profit in any quarter or year. In fact I believe the best they’ve ever done is lose a billion in a quarter. This past quarter they lost $2 billion.

akavel 6y ago

Ouch, right - basically, "dumping": https://en.wikipedia.org/wiki/Dumping_(pricing_policy) https://en.wikipedia.org/wiki/Dumping_(pricing_policy)

trentnix 6y ago

Your deeper cynicism is justified. Regulations always benefit the well-entrenched in a marketplace. In many cases, they are the ones who actually write the regulations. Politicians do victory laps, big business get their position in the marketplace protected by law, and everyone else loses.

StreamBright 6y ago

When Uber started they predicted (falsely) that autonomous driving is going to be ready in few short years. For Uber drivers are a minor annoyance.

mathattack 6y ago

Regulation helps the large incumbents, who have more capacity to bear the fixed costs. The capitalist solution to the 2008 financial meltdown would be to let new banks bump the old banks. Despite all the Fintech innovation, the old banks are more entrenched than ever. With Dodd-Frank, Barney Frank gave them one more gift on the way out of office.

asn0 6y ago

Didn't Uber disrupt an industry that was already very well protected by government regulation, and seems much more exploitative? It costs around $100,000[1] to be allowed (by the city) to drive a taxi in New York ($1.3MM in 2014), for a job that pays on average $43,000[2] per year - which involves driving an average of 70,000 miles per year - which at an average speed of 4.7mph[3] works out to $3/hr (not counting waiting time). It's still not a living wage, but making $9/hr[4] just by owning a decent car seems like progress. [1] https://citylimits.org/2019/11/30/need-to-know-taxi-medallions-in-new-york/ https://citylimits.org/2019/11/30/need-to-know-taxi-medallio... [2] https://www.salary.com/research/salary/benchmark/taxi-driver-salary/new-york-ny https://www.salary.com/research/salary/benchmark/taxi-driver... [3] https://www.latimes.com/nation/la-na-new-york-traffic-manhattan-20180124-story.html https://www.latimes.com/nation/la-na-new-york-traffic-manhat... [4] https://www.thestreet.com/personal-finance/education/how-much-do-uber-lyft-drivers-make-14804869 https://www.thestreet.com/personal-finance/education/how-muc...

yepthatsreality 6y ago
I don't think Uber disrupted anything. Private car services or gypsy cabs already existed, they just had a brand name and an app. The result of which is that the same problems remain for workers. Unless that's how disruption in an industry is defined these days. Update for clarity: I guess my bigger question is: what really changed? Customers became more comfortable and the business side became more reasonable, but competition and workers still get the shaft.
- leoedin 6y ago
  My experience in London was that Uber radically disrupted things. Yes, private hire cars existed, but the experience was pretty bad. You'd phone a number or go to an office, they'd say "20 minutes" and then, hopefully, a car would turn up. It involved a lot of waiting on streets (especially at night) and sometimes no car would turn up. There was no recourse or way to contact the driver. Maybe app based hire cars were an inevitable product of smart phones. If not Uber, then someone else. But certainly Uber's business model was incredibly disruptive of that industry. From my perspective it had a really strong effect on how my generation lived in the city.

Justsignedup 6y ago

To add. Uber has bled billions while paying people less than minimum wage. By now they may be established enough. But anyone attempting to compete will be screwed. The solution is protections and to break up uber.

madeofpalk 6y ago

That's 100% it. By Uber advocating for additional regulation, they get to (hope to) design the regulatory capture that entrenches them and makes it harder for upstarts. It's the same reason Facebook advocates for data protection laws in the US - they're going to happen either way, Facebook wants them to suit them and makes it harder for competition.

MaysonL 6y ago

>bucketloads of money Uber has yet to make a profit. Some shareholders have made profits by selling stock, but the business is losing money hand over fist.