[Updated 8/20/2012, 10:05 a.m.: Massachusetts Governor says Uber is “free to continue operating” in the state. Click here to go to update.]
It seems like the world just can’t get enough of Uber, the startup smartphone livery service app that allows users to get a chauffeured car or SUV on demand with a couple of taps on their phone screens. It’s good for users who want a chauffeured vehicle ASAP and it’s good for operators who want to fill downtime by putting some of their metal to work around the city. (Click here to watch a video of Uber’s CEO explaining the service).
But the problem is that Uber has been declared to operate illegally in several of the cities it serves, most recently Boston, where it has been hit with a cease and desist order (scroll down to view the letter).
Related: Uber Breaks Toronto Bylaws
The main issue is that Uber doesn’t play by the same rules that registered livery operators and taxi cab services do. The payment structure of Uber vehicles is a time+mileage-based fare model, unlike the full-disclosure-of-price-before-pickup set fare model of the livery industry, but it doesn’t use a regulated in-vehicle meter that is required of the taxi cab industry.
Instead, the fare is calculated by GPS tracking on the smartphone, which is considered an “unlicensed device to measure mileage,” in Boston.
Uber responded to the cease and desist on its blog: “We strongly believe that the consumer has every right to new, innovative technology that makes their lives better and easier, and that the consumer’s needs should always come first. Uber will continue full speed ahead with the mission of making Boston and the surrounding areas a great place to live and travel…”
The Boston Business Journal reports that the Division of Standards of the Commonwealth of Massachusetts, which issued the cease and desist order, gave no comment but may issue a statement Wednesday, Aug. 15.
The city administration has plans to meet with Uber reps “in the near future.”
What really matters?
How do you feel about Uber and what do you think it means for the future of this industry?
What is your biggest concern? Is it the app’s ability to provide instant service? The unregulated, illegal fee structure? The lack of proper licensing and registration?
Please share your thoughts. I’m interested to know what you think are the biggest issues with Uber. Despite the friction it’s faced with regulators, Uber is a tech-tool that may just end up sticking around, especially since it’s popular with consumers. I want to discover not only what this means for our industry, but also how to help operators stay competitive and thriving in the face of this disruptive1 technology.
Pro-Uber Point of View: Why Shutting Down Uber is a Bad Idea for Cambridge, the Commonwealth, and Consumers
— Michael Campos, LCT associate editor
City of Cambridge MA Hearing Decision
1. Disruption is not necessarily a bad thing, nor is it necessarily a good thing; it just is. It is bad or good depending on if you ask someone benefitting from it or someone hurting from it. Most operators might say Uber is hurting them, so by all means, protect what is yours! But keep an open mind, because there may be an opportunity for operators to learn from and improve upon this entire experience.
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