She sat in the middle of a panel of her comrades from cities across the United States, as well as a few delegates from Europe, speaking to the press at the end of two days of meetings. The main subject: Uber, the smartphone app turned global transportation phenomenon that is undercutting traditional taxi drivers by bringing thousands more into the marketplace.
In many cases, the taxi incumbents have succeeded in getting judges and regulators to crack down; parts of what Uber does have been banned in dozens of countries and individual cities across the world. Much of the meeting last week was devoted to complaints about Uber’s buccaneering attitude toward regulation, and representatives vowed to keep up the pressure.
“We will send this message to every country, every government, that Uber is not welcome,” said Mac Urata, the London-based head of surface transportation for the International Transport Workers Federation. “They have no place to hide. Everywhere they go, we will fight them, shame them, and get them out of business.”
But the worker groups also know that asking for a government response may not be enough. Many cities have updated their regulations to accommodate Uber after realizing how much citizens like the service. Uber has raised $3.3 billion to date to fund its growth, with the latest round pegging its value at $40 billion.
That’s why Desai and her equivalents are working to come up with an alternative: their own app, backed by taxi unions, that would work only with licensed drivers and wouldn’t sent a chunk of their profits to investors. Uber’s fundamental mechanism is well known at this point, after all — if its drivers could be persuaded to revolt or use another app, then even Uber’s billions in venture capital wouldn’t be enough to take over the market.
“For us as taxi drivers, we’re there to serve the public,” said Mateos Chekol, an organizer with the AFL-CIO who has been working with drivers in Montgomery County, Md. “And if you take away the convenience of the app, the ability to go from point A to point B on your cell phone, what else does Uber have?”
Of course, coming up with an Uber-beater is much more complicated than it sounds.
There are already a lot of alternatives out there, after all. In San Francisco, most cabbies have signed up with Flywheel, which works the same way as Uber — only with licensed drivers and without Uber’s practice of jacking up prices during periods of high demand. But representatives from the San Francisco Taxi Workers Alliance say that Flywheel lacks Uber’s advertising firepower and hasn’t gained as much traction.
Or take Brussels. Cab companies there have their own Uber-esque smartphone apps, but Uber is also banned, which makes it much easier for them to gain users. Still, Uber continues to operate illegally; it’s very difficult to stamp out. “The question is not whether you want to have technology or don’t want to have technology,” said Frank Moreels, co-president of the Belgian Transport Union. “The discussion is you want to have an organized taxi sector.”
Some cities are already designing their own apps to help cabs compete — including Washington D.C., which by this spring will require all cabs to use a program that will be managed by an industry co-op. Similar efforts are underway in New York and Chicago.
Only a few of those cities, though, have entirely shut down Uber or any other e-hailing apps, like Lyft and Sidecar. If these companies are allowed to operate with unlicensed drivers, taxi unions worry about the pool of part-time providers growing so large that any one cabbie — some of whom are still paying off the medallions they bought for the right to have a job — can’t make enough to support a family. Although it might be nice for people with free time to earn some extra cash by driving people around, they’re also taking away business from people who used to drive for a living.
“We think good jobs that exist now in that sector will become bad jobs,” as Moreels put it.
And so far, the consumer case against Uber hasn’t made much headway. Cab drivers and taxi companies alike talk about how all the ways in which the regulations they obey keep customers safe: Uber doesn’t have as stringent background checks, vehicle inspections or insurance requirements as most municipal taxi regulators. And if an Uber driver does something terrible, such as rape a passenger, the company’s terms of service state clearly that it doesn’t guarantee the safety of its riders.
If Uber’s growth is any indication, however, riders seem willing to trade some risk for convenience.
So the taxi unions are stepping into a complex landscape. Desai recognizes that if they ever got an app off the ground, they would have to persuade other cities to adopt it, which at this point involves substantial switching costs. But she thinks there’s still room for a new entrant, whether it’s Flywheel — which the unions could simply endorse and promote — or something entirely their own.
“Even in cities where there’s an app that’s dominant, clearly it’s not dominant enough,” Desai says.
The question of ownership, in the end, may be the most important factor to consider. Taxi workers have no love for the garages and fleet owners who have charged high prices for leases of cars and medallions, while denying their independent contractor drivers anything in the way of benefits or workplace protections. That’s why the unions, which have been ramping up their activity and gaining members as Uber encroaches, want to develop something they control.
“They see technology as a way to democratize the world,” says Desai of the tech platforms that match up customers with drivers. “But what Uber has done is use it to grab power for itself. We want to take it back as a tool to improve the lives of workers.”