Portsmouth regulators vote to eliminate taxi regulations in response to Uber
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Portsmouth regulators vote to eliminate taxi regulations in response to Uber
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Re: Portsmouth regulators vote to eliminate taxi regulations in response to Uber
#2Good for them! I'm glad at least one city is living in the future with the rest of us
Re: Portsmouth regulators vote to eliminate taxi regulations in response to Uber
#3The title is very misleading, as the taxi commission voted to eliminate itself. It isn't on the chopping block for any other factor than by its own volition; an incredibly rare example of public watchdogs intentionally giving way as the best way to pursue the public interest they were made to help.
Re: Portsmouth regulators vote to eliminate taxi regulations in response to Uber
#4A few key things: It seems like the cab companies are not happy about this move by the commission.
Second, this portion of the proposal:
> Replace the current taxi medallion system with a registration process that would require all drivers to register with the city clerk's office and provide proof of commercial insurance.
This article does not make it clear if the insurance Uber provides by default for UberX drivers would count here, or if drivers would need their own commercial insurance policy.
If UberX's insurance does not count, then this move would not introduce significant ridesharing, and the only benefit to the policy change would be the elimination of the medallion system.
Do not read me wrong, that is a wonderfully good thing, as regulated limits to supply legally enforce monopoly pricing. I read the primary benefit of UberX and similar services in the massive increase in marginal transactions facilitated, rather than the relatively simple task of acting as a modern taxi dispatcher.
Again, this is all conditional on the proposal passing, and the commercial insurance requirement excluding UberX insurance for casual ride-sharers.
Re: Portsmouth regulators vote to eliminate taxi regulations in response to Uber
#5> Cataldo said if drivers are smoking, or offering rides in unkempt vehicles, consumers will decide if they want to hire them.
Remember this only works if there's an "arbitrarily large" number of other drivers competing for the same fare. As always, deregulation only works if the markets being deregulated can become healthy and stay that way long term.
Re: Portsmouth regulators vote to eliminate taxi regulations in response to Uber
#6New Hampshire. Live free or die!
Re: Portsmouth regulators vote to eliminate taxi regulations in response to Uber
#7> Cataldo said if drivers are smoking, or offering rides in unkempt vehicles, consumers will decide if they want to hire them. Remember this only works if there's an "arbitrarily large" number of other drivers competing for the same fare. As always, deregulation only works if the markets being deregulated can become healthy and stay that way long term.
Uber has a pretty good track record of bringing in more and new drivers.
Given that personal automobiles are a large sunk cost that many people have incurred, being able to generate marginal income through ride-sharing seems like it needs a lot of active barriers to entry (like restrictive regulations favoring incumbent taxi services) to really limit the supply of drivers.
Re: Portsmouth regulators vote to eliminate taxi regulations in response to Uber
#8> Cataldo said if drivers are smoking, or offering rides in unkempt vehicles, consumers will decide if they want to hire them. Remember this only works if there's an "arbitrarily large" number of other drivers competing for the same fare. As always, deregulation only works if the markets being deregulated can become healthy and stay that way long term.
Uber has a pretty good track record of bringing in more and new drivers. Given that personal automobiles are a large sunk cost that many people have incurred, being able to generate marginal income through ride-sharing seems like it needs a lot of active barriers to entry (like restrictive regulations favoring incumbent taxi services) to really limit the supply of drivers.
Personal automobiles are NOT a sunk cost. You can sell your car, the portion of the cost that is "sunk" is small.
It's really expensive to drive for a living, especially in a nice car. Obviously you can make a ton of money if your parents bought your car and pay for your repairs, if you're not paying for commercial insurance, and if your main competition faces strict regulations that you've cleverly sidestepped.
To this day Uber releases numbers that don't account for wear and tear on your car, anybody who's ever delivered pizzas will tell you that changes the economics of it drastically.[2]
There are also reasons not leave a public good like transportation in the hands of people looking to "generate marginal income".
But the real joke is Uber's brought in about $5 billion in funding in the past five years, their recent valuation came in at over $41 billion[0] and there's still this narrative of Uber being the little guy out there fighting big government. It's a real underdog story!
They're simultaneously taking on "6,300 companies operating 171,000 taxicabs. More than 80% of these companies operate less than 50 vehicles"[1] in America alone. Think about that, they're poised to put about 3,000 small business under in the coming years, but they're out there for the little guy. They're taking the market over and if they have their way it'll go from regulated oligopoly to unregulated oligopoly with them at the top. It's an absolutely huge power play, and like every rational business they're fighting for whatever monopoly power they can get:
> There’s not a lot of earth-shattering IP in the ride-sharing space, but Uber seems to be making a play to own it, having submitted 11 patents that cover every major aspect of its business model. If granted, it could find itself with a technical monopoly not only in ride-sharing but other businesses based on its processes, like general delivery (again, more reason for those rich investors to be excited, right?)[0]
Forgive my rant, Uber's marketing pisses me off. They're not some benign force trying to help people get luxury rides to the airport, they're a rational business making rational business decisions.
[0] - http://www.forbes.com/sites/jonathansalembaskin/2014/12/05/t... [1] - http://www.tlpa.org/about/taxicab.cfm [2] - http://www.washingtonpost.com/blogs/the-switch/wp/2015/01/22... bonus link: http://www.quora.com/How-much-does-an-Uber-driver-make-1
Re: Portsmouth regulators vote to eliminate taxi regulations in response to Uber
#9Earlier quoted context omitted.
Uber has a pretty good track record of bringing in more and new drivers. Given that personal automobiles are a large sunk cost that many people have incurred, being able to generate marginal income through ride-sharing seems like it needs a lot of active barriers to entry (like restrictive regulations favoring incumbent taxi services) to really limit the supply of drivers.
Personal automobiles are NOT a sunk cost. You can sell your car, the portion of the cost that is "sunk" is small. It's really expensive to drive for a living, especially in a nice car. Obviously you can make a ton of money if your parents bought your car and pay for your repairs, if you're not paying for commercial insurance, and if your main competition faces strict regulations that you've cleverly sidestepped. To t…
Regarding sunk costs: in a strictly technical sense, you are correct, but in a practical evaluation a personal vehicle represents a large sunk cost for an individual. How do I justify this? People only sell their car to finance buying a new one. Individual car owners always have a large amount of their capital tied up in a vehicle, even though the specific vehicle will change over the course of years. For those (vast majority) of car owners who do not choose to eschew personal vehicle ownership, it is entirely accurate to consider a vehicle a sunk cost.
That being said, I don't really disagree with most of what you have to say, though I do disagree with your negativity.
It is expensive to drive for a living - so expensive, in fact, that it was not a living until monopoly pricing was forced by government regulation.
The excess capacity of vehicles owned for personal transportation is huge. I don't want to repeat myself, so I'll link to another thread discussing Uber (and friends) where I participated that makes my position very clear[0].
I do not view Uber as an underdog. I agree with you that they are a rational business pursuing their profit. I also believe that in pursuit of their profit they will provide a great amount of value to consumers, and to ride-sharers who can defray some portion of their cost of ownership of a personal vehicle. The point is not to make a living, but to defray costs. The historic trend of jitney services (a combination of ride-sharing and public transit in widespread practice before regulation - history in linked thread) was of a high turnover driver base, with many performing relatively few trips, and some few working "full time" for a short time frame. This is the model that Uber (along with its friends) improves upon.
While I do not debate the narrative you have presented as common about Uber (and friends), I have not made arguments that follow it. It is a valid point that does not apply to the discussion I have engaged in. I view as a net positive the dissolution of all 3000 firms you have referenced if Uber (and friends) can provide an analogous service more desirable to consumers and at a lower cost (I do not deny the transitional pain - note I said net positive, not absolute). We can certainly disagree on this point and have a discussion about the merits of industries being displaced and altered with technological and regulatory change, if that is what you'd like.
Even if Uber manages to acquire patent protection over every aspect of its business model and on the terms they have applied for those patents, this is still a superior situation to the stagnant monopoly pricing that has been enforced by medallion systems for nigh on a century. Patents will expire before another century has passed.
That being said, the fact that there are already multiple players in the market for ride-sharing apps indicates that the ideas are, while novel also rather obvious. I would be surprised if they managed to acquire patents that remove their competitors from the market completely.
I agree that Uber is not a benign force trying to help people get luxury rides to the airport. I also agree that they are a rational business making rational business decisions. The way I read the situation, though, is that they are eliminating significant deadweight loss that is a direct result of the status quo they are challenging. They are providing significant competition in an industry which has seen consumer-harming regulation for a century. Forgive me for not being upset that a company pursuing its own self interest is also doing good as a side-effect.
Re: Portsmouth regulators vote to eliminate taxi regulations in response to Uber
#10Earlier quoted context omitted.
Personal automobiles are NOT a sunk cost. You can sell your car, the portion of the cost that is "sunk" is small. It's really expensive to drive for a living, especially in a nice car. Obviously you can make a ton of money if your parents bought your car and pay for your repairs, if you're not paying for commercial insurance, and if your main competition faces strict regulations that you've cleverly sidestepped. To t…
Regarding sunk costs: in a strictly technical sense, you are correct, but in a practical evaluation a personal vehicle represents a large sunk cost for an individual. How do I justify this? People only sell their car to finance buying a new one. Individual car owners always have a large amount of their capital tied up in a vehicle, even though the specific vehicle will change over the course of years. For those (vast…
> It is expensive to drive for a living - so expensive, in fact, that it was not a living until monopoly pricing was forced by government regulation.
This was done in exchange for stability in price, stability of service and other benefits i.e. we're getting something for our money.
> The excess capacity of vehicles owned for personal transportation is huge. I don't want to repeat myself, so I'll link to another thread discussing Uber (and friends) where I participated that makes my position very clear[0].
I glanced through it, I don't find the argument convincing.
> They are providing significant competition in an industry which has seen consumer-harming regulation for a century.
#1 Is it consumer-harming? #2 if it is, does it harm consumers more than it benefits society at large?
The medallion system has limited the number of cabs on the road which minimizes the pollution and congestion they cause, it also makes sure they pay their fair share for things like road repairs since they're using a public good for commercial use. Because the cars are generally awful shades of yellow or orange pedestrians, cyclists and other cars are safer as well. These are things that benefit society as a whole.
Believe it or not, many people like to know ahead of time how much a cab ride is going to cost so they can plan accordingly.
At the end of the day Uber is going to regulate the market using their market power to whatever extent they can. They simply aren't going to bring an efficient, competitive market place where everybody wins. You don't get valued at $40 billion when all you have are easily substituted assets (it's an app, a brand, and some logistic management software) unless you have a long term angle of somehow making massive profits which according to basic economics are assumed to be impossible in healthy markets.