There are a lot of things to enjoy in London during winter. You can go ice skating at Somerset House, walk around on the beautiful Christmas markets or you might even have tickets to Hyde Park Winter Wonderland. However, there is one thing you might not be able to enjoy this winter in London, Uber.
As of September 30th, 2017 Uber is set to lose its private hire operator license in London (Sundararajan, 2017). Transport for London (TfL) states that this is not an attack on innovative businesses like Uber, but rather on Uber itself. According to TfL, Uber does not pay enough attention to things like managing safety affairs and conducting criminal background checks. Furthermore, TfL condemns Uber’s Greyball technology. This technology was developed to avoid sting operations (Wong, 2017). By using data points like geolocation, credit card information and social media accounts, Uber was able to single out individuals who carried out these sting operations. Uber opposes that this technique was used in London.
People in London are less than thrilled about the Uber ban. There are an estimated 3.5 million users in London and over 40,000 drivers use Uber as a source for (part of) their income (Sundararajan, 2017). On September 22nd, the day of the announcement of the ban, a petition was started to cancel the approaching ban and by the end of this day it already had 400,000 signatures.
Sadiq Khan, the mayor of London, supports the ban, but there are many other government officials who do not. For example, union leader James Ferrar, who has been trying to make Uber drivers be classified as employees opposes the ban and he gets support from trade minister Greg Hands. This shows that even the government officials are not on the same page in this matter. See what Sadiq Khan had to say in the video here.
Uber’s history with laws and regulations does not strengthen her case. There have been many conflicts with governments making Uber illegal in Denmark and suspended in Bulgaria, Hungary, France, Germany and Spain (Sundararajan, 2017). However, the new CEO of Uber, Dara Khosrowshahi, asks TfL a chance to make a new start. He asks for a second chance to show that Uber can handle her responsibilities and make things right.
Whatever the plan at Uber may be, they better act fast. As of today, the ban has not been revoked and Uber’s arch rival Lyft is already moving in on the London market (Titcomb, 2017). If the ban stays, Uber will lose about 3.5 million users. If it does not, I expect that Uber has to make significant changes to her business model in London.
What do you think? Was this a rightful ban? Or should it be revoked? Let me know in the comments!
Rik Helsloot
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Sources:
Sundararajan, A. (2017, September 23). London’s Uber ban is a message to a reckless tech ethos. Retrieved September 25, 2017, from https://www.theguardian.com/commentisfree/2017/sep/23/london-uber-ban-message-to-reckless-tech-ethos
Titcomb, J. (2017, September 23). Uber arch-rival Lyft holds talks with Transport for London as it plots global expansion. Retrieved September 25, 2017, from http://www.telegraph.co.uk/technology/2017/09/23/uber-arch-rival-lyft-holds-talks-transport-london-plots-global/
Wong, J. C. (2017, March 03). Greyball: how Uber used secret software to dodge the law. Retrieved September 25, 2017, from https://www.theguardian.com/technology/2017/mar/03/uber-secret-program-greyball-resignation-ed-baker
Other interesting articles about the Uber ban:
https://www.theguardian.com/technology/2017/sep/23/uber-london-ban-austin
http://www.telegraph.co.uk/technology/2017/09/22/uber-denied-london-licence-huge-setback-app/
http://www.telegraph.co.uk/news/2017/09/23/uber-petition-reverse-ban-london-hits-500000-signatures-backlash/
Interesting post Rik. By banning Uber, London is limiting the choice of consumers, and thereby taking away the principle of free markets, whereby consumers gets to choose which products they consume. One could argue that consumers should be able to decide themselves if they want to support a company by making use of its services. Other consumer-led company-boycott initiatives have been carried out previously after integrity missteps. The decision to ban Uber seems politically motivated for Khan, as the decision helps out the struggling black-cab industry, which helps his favorability in the city (for protecting local business). Uber is appealing the decision based on these grounds, which will be an interesting case to follow over the coming year.
I would agree with you in arguing that this decision was politically motivated. Uber in my opinion has been one of the real threats to a vital part of our labour market. For many it is just a first symptom of the ‘Third Industrial Revolution’. For all non-Dutch student out there we have had a fair share of this clash between this ‘new’ vs. ‘traditional’ workforce in the Netherlands. Since the launch of Uber in a few large cities here, there have been continuous reports of harassment and violence against Uber drivers by licensed taxi drivers that do not work with the app. As a business student I feel tempted to condone any action that discourages technological progress, like banning apps like Uber. However, in this discussion (that this would be my main point) we often forget that in Europe alone around 10 million people work in the Transportation and they account for roughly 5% of the European total GDP (https://ec.europa.eu/jrc/en/research-topic/transport-sector-economic-analysis). With rapid developments in this technology we have to start thinking about those numbers right away. However, simply banning these apps without discussion the true underlying motivation is not correct.