Even as it is under fire, Uber’s role is expanding. Photo via Uber
Over the past seven years, Uber and ride-sharing have taken the transportation world by storm, changing consumers’ transportation habits, and forcing cities around the country to rethink their own transportation systems.
Uber’s troubles still get most of the attention.
Last week, a federal judge ruled that a lawsuit by Google’s self-driving car division, Waymo, will go to trial. Waymo has accused one of its former engineers of stealing thousands of pages of trade secrets when he left, and taking them over to Uber. The judge rejected Uber’s claim that the dispute was an employment matter that should have been settled through arbitration.
In the meantime, Uber is moving beyond its original approach of growing its customer base through individual customers. Some states and cities are ncreasing the role of Uber within their jurisdictions.
Five Florida cities are subsidizing Uber rides, and providing further support by paying for rides to public transportation stations. A New York City proposal, if passed, would force Uber to add a tipping option for riders within the city. And Edmonton, Alberta has begun exploring a partnership with Uber and other ride-sharing companies, in an effort to replace bus routes.
Making deals with cities
Last June, the Florida cities of Altamonte Springs, Longwood, Lake Mary, Sanford and Maitland, began their pilot programs with Uber. The five are located just north of Orlando, and aim to save money, reduce traffic congestion and increase ridership of their SunRail train system.
The program subsidizes 20 percent of every Uber ride beginning and ending within the city. Trips that end or begin at a SunRail station are subsidized 25 percent, according to the Orlando Sentinel. These ideas are often referred to as “last-mile programs,” meant to bring riders to public transportation stations.
Uber kept the amount of money it received from each city a secret until January, when a Longwood city clerk, Michelle Longo, released the invoices from Uber to the Sentinel.
Longo told the newspaper, “While Uber claims this invoice is a confidential trade secret and exempt from disclosure under the Public Records Act, it is the City’s position that this invoice is not confidential and exempt and that the public should have access to this invoice reflecting the amount that Uber is seeking payment from the City under the Pilot Project Agreement.”
Cities began receiving invoices from Uber on Jan. 17. Altamonte Springs owes the most, at $14,863.59, ahead of Sanford, owing $7,869.99. The other three cities owed less than $1,000.
In another form of a last-minute program, Summit, N.J., a suburb of New York City, began a six-month pilot program last October, subsidizing Uber rides to and from its train station to accommodate for heightened ridership. The pilot program is being tested with 100 riders. It grants free rides to residents with prepaid parking permits and $2 rides to those without prepaid permits.
The idea was an effort to alleviate congestion at the Summit train station and avoid adding more parking spots. The partnership with Uber will cost taxpayers $167,00 million annually, as opposed to the $10 million it would cost for a new parking lot, according to Buzzfeed.
The program is the first of its kind in the country, and if successful, could be looked to by other cities and states as a model for changing their own transportation systems.
Meanwhile, Seattle launched single-day agreements with Uber. Seattle offered discounted Uber rides on Halloween and New Year’s Eve last year in an attempt to keep drunk drivers off the road.
A public transportation replacement
The Edmonton Transit system plans to ask the city council for permission to begin exploring a partnership with Uber or other ride-sharing or taxi services to replace a number of bus routes and develop routes into suburbs, according to the Edmonton Journal.
The transit strategy won’t be going to the city council until next month, but if an agreement is reached, it could be the first of its kind with the end result eliminating bus routes. Transit strategist Sarah Feldman told the Journal that Edmonton Transit is looking for different ways to scale back community buses.
“We’re not sure what the business case would be or their interest. so we need to start having those conversations,” Feldman said.
Uber’s troubles continue
Although many cities’ relationships with Uber have flourished in the last six months, others have regarded Uber’s presence within their cities as perilous and have taken action, in some cases, to keep Uber from operating within their jurisdiction.
In November, 2014, a judge in Nevada issued a preliminary injunction which banned Uber and other ride-sharing companies from operating in the entire state. The following September, the Nevada Transportation Authority gave these companies to operate there.
Uber had a short life in Alaska, where it offered its first rides in 2014. But the Alaska Department of Labor and Workforce Development became concerned that the ride-sharing drivers did not have workers’ compensation insurance. It reached a settlement including a $77,925 fine on Uber for not paying the insurance, according to Alaska Dispatch Publishing.
Part of the settlement required Uber to leave the state until the state amended certain laws to exempt companies like Uber from such insurance requirements. In late March, the Anchorage Assembly passed regulation to allow companies such as Uber and Lyft in the state, but the companies are awaiting action from the state, according to Alaska Dispatch Publishing.
Meanwhile, a court in Rome, Italy has taken more direct measures in handling Uber, completely banning the ride-sharing company from the country during the first week of April. The court ruled that the service is contributing to “unfair competition” faced by the taxi industry in Italy.
Rather than completely banning ride-sharing companies, the New York City Taxi and Limousine Commission announced a proposal on April 17 that would force ride-sharing companies to include a tipping option within their app. If implemented, it could change ride-sharing companies approach to tipping around the country.
Uber’s rival, Lyft, already includes the option within its app.
Going forward, the role Uber and ride-sharing companies play within cities and states is bound to change, with new markets opening, new regulations emerging and new partnerships forming, any of which could alter the role of ride-sharing companies in other parts of the country and world.