A few more thoughts about the push for Uber, Lyft, and similar services upstate

uber app sample screenshots

Sample screenshots from the Uber app.

The ongoing campaign to open the way for taxi-app services such as Uber and Lyft to operate in Upstate New York got another push this week when Uber publicly backed the campaign at the Capitol, framing it in part as a jobs and economic development issue. [NYT]

A bill that addresses insurance and regulatory issues for these sorts of "transportation network" companies has been floating around the state legislature since last session. Lyft has been pushing for legislation like this since at least this past spring. And this past summer Andrew Cuomo made comments that sounded like he supported some sort of statewide regulation. [NYS Senate] [NY Observer]

We touched on the taxi service/Uber/Lyft situation a bunch of times already. So here are a few more bits and thoughts prompted by Uber's actions this week...

The current situation is broken

Stories of odd, confusing, or just plain bad taxi experiences in this area are so common that it seems like everyone has a story of that type. It's a problem for people who count on taxis to fill a portion of their transportation needs. It's a problem for other businesses that rely on taxi services to serve clients/customers/associates. And it's a problem for the the whole area as it tries to build a rep as a hospitality destination alongside projects like the in-construction Albany convention center.

So, the desire to see a new player (or players) shake up the taxi scene is totally understandable.

But why are things broken?

One of the key questions in this whole discussion is: Why is the situation broken?

If it's a straightforward matter of bad management or lack of effort on the part of local taxi companies, then new competition -- whether it's a taxi-app service or some other sort of player -- might be the fix.

But it's also possible the situation is more complicated. Taxi companies have said lack of consistent demand is a problem in this area, and the pie is already being cut into too many slices. And the Capital Region's municipal structure -- many small municipalities all packed together, with many popular trips crossing multiple boundaries -- provides a layer of complication that other metros with one geographically-dominant municipality don't have. [Biz Review]

So, as public officials look at this issue -- which is happening behind closed doors, even though it should be a public conversation -- the focus shouldn't be catering to the desires of Uber and Lyft, but rather trying to solve the problem as a whole. Could that solution include companies such as Uber? Sure. It could also include regionalization and a common set of rules for all companies that offer taxi (and taxi-like) services. [Biz Review]

How much demand is out there?

As mentioned above, local taxi companies have said a lack of consistent demand is a problem. But given how many people have had bad taxi experiences here, there's good reason to wonder how much potential demand is out there if people just felt more confident about the service. Anecdotally, we've encountered multiple instances where people would have taken a taxi in this area, but purposefully avoided doing so because of past bad experiences and instead arranged other transportation. It's not necessarily fair to generalize based on some personal experiences, but given how widespread stories of bad taxi service are here, we suspect many other people have had similar experiences.

The potential demand question is important not only because it touches on the degree to which the current taxi situation is not serving the needs of the Capital Region, but also on the potential for how much the industry can grow here. Which brings us to the next point...

Jobs -- and these jobs aren't necessarily like other jobs

During its event this week at the Capitol, Uber framed its proposed push into Upstate New York partly as a jobs issue. And it released projections -- based on its experience in other markets, it said -- for the number of jobs its service would involve here: 13,000 across upstate and 700 here in the Albany area.

But scratch at those numbers a little bit and it becomes clear these aren't necessarily the sort of jobs that get touted when people talk about economic development. Uber projects $80 million in net fares for upstate during the first year -- that's about $6,100 per job. And it projects $430,000 in combined monthly net fares for the Albany area during "peak season" -- that's a little more than $600 per month per job. And that's before the driver's expenses -- gas, car payment, insurance -- are taken into account. (There was an interesting first-person account in Philadelphia City Paper earlier this year that highlighted what sort of money can be made as an Uber driver.) [City Paper]

Of course, the way this would probably shake out is that some people would drive a lot, and others just a little. And to some that flexibility is a significant feature of the setup, not a problem -- the ability to make a little cash during open spaces in their schedules will be a boon.

There's also the issue that the taxi app companies have contended that drivers who work for them don't really work for them so much as alongside them. This arrangement moves a lot of the risk -- financial and otherwise -- from the taxi app company to the drivers. It's become a point of conflict in places like California. And some critics see these sorts of "uber for..." business arrangements as a wedge further separating people with stable employment and those who are constantly struggling to gain foothold as the ground below their feet erodes. [Washington Post] [Governing] [Medium]

Uber will probably get what it wants

Uber is a behemoth, reportedly worth something like $50 billion. And in its many regulatory battles, it tends to get what it wants. Just this past summer it won a public fight with NYC mayor Bill DeBlasio. (And maybe the upstate push is part a plan to outmaneuver New York City and its regulations, which currently restrict Uber to a more traditional hired-car type of service. ) [Investors.com] [Bloomberg] [NY Mag] [Politico NY]

So, whether it and other services like it get the OK to expand into Upstate New York probably isn't so much a matter of if, but when and how.

Earlier on AOA

+ Alongside the push for Uber

+ A Lyft for Albany?

+ An attempt to hail Uber for the Albany area

Comments

I'm gonna guess that when Uber inevitbly arrives (because, it must) all of a sudden taxis will install credit cards swipers and will start charging a time/mileage rate instead of this inane zone pricing. I will giggle and thumb my nose at them while my uber driver brings me home!

I really like the story business owners use to explain that competitors should not be allowed: There is no demand, customers don't want that, that will be a loss.
Sure, so what are you afraid of? Let them try and fail.
Not that I think Uber is best thing since sliced bread - but I start understanding why existing taxi service is what it is...

I agree with the above comments... why not let Uber come into the area, and if it fails, then it fails? If it's a success, then the users win. I've had countless horrible experiences with taxis in Albany. I'm on a flight out of Albany tomorrow and am planning on paying to leave my car at the airport rather than take a cab just because I want to avoid another bad experience. If Uber was an option here, there wouldn't be a second thought to using that service instead of driving myself. I understand the local cab companies are upset, but maybe they should have tried updating their cars, technology, and employees awhile ago when they saw the car-sharing services sweeping the rest of the country. I honestly can't imagine they didn't see this coming.

I live in Center Square - if there was a service like Uber in Albany, I would be far more likely to frequent restaurants and bars downtown, in the warehouse district, and on upper Madison, especially in the winter. My friends and I tend to stick to the Lark Street area so we can avoid driving ourselves or taking taxis. I'm sure I'm not the only one who feels this way...

I would totally use it and I hate cabs. Date nights would be so much more fun!

If taxicabs have been so upset about the status quo for so long then why haven't they done more to fix it? There's also no demand for current taxi services because current taxi services are medieval at best. Anyone who's been forced to ride one will avoid it if they can.

I really hate the overall tone of this piece. It reads like a taxicab association apologist. WHy are you highlighting all of the potential (not even actual) negative aspects of Uber? "It's a great service, with friendly people and reasonable rates, but these drivers might be classified as independent contractors rather than employees, and that's a bit of a gray area in the law still under serious debate in some states - I better not use it" said NO ONE EVER. How about focusing on the fact that its an amazing service that people LOVE to use both as drivers and passengers.

Next time your out of town talk to your Uber drivers about driving. Most of them love it! It's a chance to set their own hours, pick up a few extra bucks, and (for many) a way to finance a nice new set of wheels. Few are making a career out of it, but why is that a problem if no one WANTS to make a career out of it?

Quite a few are former taxi/black car drivers who quit their old job because they liked the job with Uber more. But a bunch of a-hole liberal reactionaries in Albany are going to tell drivers everywhere they know what's best for them?? It's a joke, and shame on anyone who doesn't realize it and helps propagate this nonsense.

I've had nothing but bad experiences with Albany area taxis and nothing but good with Uber. If your business is suffering innovate or prepare to close down.

I hate Christmas so now I can put my December holidays to good use and make some $$$$ with Uber.
Woo-hoo?

Traditional taxi driving is not a good, stable job at risk of displacement. Typically, you drive the company's car, pay rent for the privilege, assume all operation and maintenance costs, and live on whatever excess you can hustle. You're a sharecropper. This isn't a good gig, it's the best gig you can get. Here's hoping the Crown Vic you're assigned doesn't need a new transmission on your watch.

I'm sure it seemed like a good idea to regulate livery service in a prior age -- important enough for the state to grant protected franchises in exchange. But that's unraveled, and now the state is in the awkward position of having to withdraw those franchises, walk back the protection system it created.

Uber's a high-quality service and way better for passengers. It's way better for drivers -- though a tougher gig to enter, since you must bring your own vehicle and every rider is rating your service. Sometimes I think that the core complaint, boiled down, is that Uber takes "jobs" from the working poor and gives them to folks with decent cars and manners. Most of the time I think it's cab companies pissed at their racket coming undone. If my family owned a traditional taxi company I'd likely be more sympathetic.

Disruption always sucks for somebody, but hear this: take an Uber car once and you will again. It's a better model, the price can be right, nobody's exploited. It's almost friction-less. If for some reason you decide tomorrow that you won't do Uber again, understand that your driver can and might well decide the same.

LQ

but these drivers might be classified as independent contractors rather than employees, and that's a bit of a gray area in the law still under serious debate in some states

Hm, how about "if the driver gets in an accident, their insurance may not cover me"? "The Uber background check process is a joke leading to numerous assault cases"?

Let's get Uber/Lyft here. Making sure i's are crossed and t's are dotted isn't reactionary, though.

I've used Uber in Boston, DC, and Asheville. Other than Uber's surge pricing, which sucks, I have have nothing by good experiences with Uber.

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