Lyft, SideCar, and Uber all slapped with $20K fines from CA regulator

Most vacation rental agencies I've dealt with wish they were taxed as opposed to being de jure illegal but de facto tolerated. That uncertainty has made acquiring new properties and investing capital in the business quite risky.

That's not to say that the deck isn't somewhat stacked against vacation rentals. There is a hotel lobbie that's dead-set to kill the industry. Unlike the agencies, the hotel people are quite organized (although that's changing in my experience).

And there's an even greater threat from the fact that most vacation-rental properties are owned by foreigners who are seen as driving the price up of longer-term rentals because of the new emphasis on the short-term market. I do think that rising rental prices in many urban centers is the biggest short-term danger -- PR and real.

At the same time, vacation rentals are becoming more and more necessary to tourism in big cities. E.g., Paris has more than 75+k apartments rented by the week, with occupation rates above 50%. If you made it illegal, there wouldn't be nearly enough hotels to cover those millions of travelers. And enforcing a ban on a per-property basis would be extremely expensive in terms of man-power.

My prognosis is that the market matures, the cities find a way to benefit through taxation, vacation rentals become a bit less price-competitive versus hotels because of that taxation, and it grows from an $80b a year market to a $200b a year market [see http://software.homeaway.com/Media/Files/pdf/RezFest2012-Bre...].

I know next to nothing about Uber and that business, and I am sure the taxi lobby will do its best to kill it, but in the end one should never underestimate gov't ability to be clever when it comes to finding new revenue through taxation, especially during these times.

[I have invested in a couple of companies in Europe in the vacation rental market]

It's pretty clear to me that the folks that are suffering from über are the taxi dispatch companies. These companies lease out the cars for a daily fee, like 150 bucks per day. The driver can do whatever he wants as long as he pays that daily fee. The cab company pays insurance because they own the cabs. Cab drivers are essentially independent contractors. They start making money after they've covered the cab cost for the day.

So why should the cab companies care if a driver is using über? From what I've heard, when a dispatcher has a good order, like for a trip across town on a slow day, they'll ask for a cut. In other words the cab companies are supplementing their taxi rental service with a cut of the fares they dispatch. And as a cab driver, if you want to get good orders you have to stay on the dispatchers good side.

Über changes the balance of power. As more people use über, the drivers have to rely on the dispatchers less, and the tit-for-tat system is deflated. I think this class action suit is an attempt to retain the status quo by cab companies. Über shouldn't be responsible for insurance until they start owning their own cabs. If the cab companies have their way, both the drivers and passengers will suffer.