Classifying Uber's Business Model: A Complicated Affair

Posted on December 2, 2016

Photo via Flickr user Tech Crunch
Fortune's Adam Lashinsky writes: I’ve always found the If-it-walks-like-a-duck Theory is as good as any for evaluating businesses. Retailers tend to look like each other, no matter what they’re retailing. The same usually is true for software companies and semiconductor makers and so on. The corollary also works. Companies that slapped a “dot-com” on their names in the Internet bubble era weren’t digital wonders just because they said so.

I got to thinking about my theory this week when the European Court of Justice heard a case about just what to call the ride-sharing company Uber. European taxi companies and their political patrons would like Uber to be considered a transportation company, just like them. Naturally, they’d like to see Uber regulated accordingly. For its part, Uber prefers to be thought of as a digital platform, a totally different beast that ought not to be subject to the rules that govern old-fashioned cabs.

As with so many things these days, it’s not as simple as it looks. At first blush, Uber obviously is a transportation company. I use it to get a ride to the airport just as I used to call for taxis. It seems just as obvious Uber drivers are employees of a sort, seeing as they must follow Uber’s rules. So if you follow this logic, Uber is a duck, plain and simple.

Fortune article here

Related Topics: Department of Labor, employee benefits, employee vs independent contractor, federal regulations, independent contractor issues, labor laws, TNCs, Uber

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