Uber’s mission is to get its users from point A to B in a safe, reliable and cost efficient way, and to give car owners the ability to share their journeys if they so choose. This will help cities become smarter and more efficient by taking unnecessary cars off the road. Take Paris for example, where there are approximately 2.3 million cars standing idle in parking spaces for almost 23 hours a day, and when they are being used they only have an average of 1.3 passengers in them per trip.
It doesn’t have to be this way, however, many of the laws that currently regulate our transportation networks were created long before smartphones (or even mobile phones) were commonplace. That is why policy makers across the world are thinking about what kind of legislation they need to introduce to help create the smart cities of the future; making the most of technology to reduce pollution, increasing job opportunities and ensuring every community is served by some form of affordable transportation.
Uber is keen to contribute to these conversations. We want to bring transport policies up to speed to reflect consumer needs in the 21st century. Uber believes that car owners should be able to offer a spare seat or two to people that need a ride, and they should be able to recoup the cost of doing so. Not only does this enable the driver to pay for the upkeep and running costs of their car, it also means there are less cars on the road – reducing the impact on the environment and decreasing congestion in cities. However, many policies don’t currently allow for this.
We believe the most sensible option is for legislators to allow new transport platforms like Uber to co-exist with established forms of transportation within a carefully-formed regulatory environment that upholds safety standards whilst providing consumers with more choice.
Uber has been talking about the future of modern mobility since our formation four years ago, but now some more voices have joined the conversation. Across the world, influential thought leaders and policy makers are suggesting the need for updated policies reflecting the new demands of the smartphone era. We thought it would be useful to highlight those varied voices here.
Growing political momentum:
21 January 2016 – The Spanish Commission for Markets and Competition authority (CNMC) announced in a press release that the “Royal Decree regulating the transport law has many restrictions that are against the basis of the efficient economic regulation and the market unity, lacks of an economic justification, obstructs the effective competition in the urban passengers transports within all the national territory and reduces the overall welfare.”
27 January 2015 – “Uber is giving the taxi market a chance to develop by coming at it from a lifestyle point of view… Uber is good for the market by pushing the industry to use a different technique, a new platform… Change is good… we want the market to grow.”
28 November 2014 – “There is clearly a need for further deregulation of the taxi market in Norway. We think that the present rigid regulation of the number of taxis results in poor competition to the detriment of the consumers. So the present system which limits the number of taxis should be given up as quickly as possible.”
28 November 2014 – “We welcome Uber to Finland, where we hope the company can contribute to creating innovation in the branch which will benefit the consumers. Of course there has to be an authorization procedure that regulates who may be allowed to drive a taxi. But at the moment the regulation is so rigid that it blocks for new products and in reality put a stop to innovation and entrepreneurship in the industry”
28 November 2014 – “The competition on the [Danish] taxi market is characterized by regulation through laws and executive orders that restrict competition. If you want to provide those taxi services that match what the consumers would like to have, you must at any rate make sure that there are not too many restrictions on what you are allowed to do and what not. That will make room for innovation and new products.”
25 November 2014 – Bureau press release about emerging digital dispatch services states that ‘these innovative business models have the potential to offer important benefits to consumers through more competition, including lower prices, greater convenience and better service quality for a variety of reasons.’
16 October 2014 – The Catalan Parliament passed a motion to create a Commission to study collaborative consumption with the objective of defining a general framework for public administrations, including new regulations if required. The Commission is a joint effort with Parliamentary groups, commercial operations, consumer groups and public administration.
16 October 2014 – Dutch government is embracing innovation and held a debate in parliament about an evaluation regarding the fundamental vision on taxi legislation. Deputy Minister of Transportation explicitly mentioned that UberBLACK, UberLUX and uberPOP will be an integral part of the discussion.
14 October 2014 – New taxi services that are offered by private drivers per app like Uber should be approved without any government regulation, calls the former Federal Transport Minister Peter Ramsauer, now Chairman of the Parliamentary Committee for Economy and Energy.
14 October 2014 – Verhoeven and de Rouwe argue that, “uberPOP must get the opportunity to prove itself”. De Rouwe: “I see advantages for uberPOP. It’s a good thing when there’s room for innovation”. According to Verhoeven, the Dutch cabinet must review how uberPOP can comply with existing rules and regulations, so that there’s a “level playing field” for old and new suppliers of taxi services. A ban of uberPOP is “not a real solution”, according to Verhoeven.
4 October 2014 – Andreas Mundt, President of the Federal Cartel Office, positively stated that Uber brought more competition to the taxi market. He also stated that the impulses originating from Uber should be used to discuss more liberal amendments to current regulations in Germany.
3 October 2014 – Singapore’s Prime Minister, Lee Hsien Loong, says that it is futile to try to prevent Uber from providing its services, as it betters lives of people in Singapore and other places. He strongly emphasises the increased options and improved services for commuters and other users.
September 2014 – The Australian government’s competition policy review shows strong support for ‘on-demand ridesharing’ that was not envisaged when laws governing the taxi industry were drawn up. It states, “California was the first jurisdiction to recognise and regulate services such as Uber, creating a new category of regulation for ‘transportation network companies’ (TNCs). The regulation of TNCs covers driver background checks, driver training, drug and alcohol policies, minimum insurance coverage and company licensing. […] Australian regulators have yet to demonstrate such flexibility and openness to new modes of business.”
30 September 2014 – The Brussels based think-tank Bruegel published a positive analysis of Uber’s business model, its impact on consumer welfare and the need for regulation to adapt quickly: “Banning Uber would massively disadvantage the consumers who are enjoying lower prices and better quality due to the increased competition in taxi services.”
15 September 2014 – Professor Rupert Scholz, German expert in constitutional law and former Minister of Defence, comes to the conclusion that the Uber business model is fully in line with German regulation. He perceives recent prohibition decisions on Uber in Germany as illegal.
15 September 2014 – In his blog post for the British Chamber of Commerce in Belgium, Peter de Keyzer criticizes politicians for hindering Uber to offer its innovative service that would clearly benefit welfare and society. He argues that only looking at one interest group, such as the taxi industry, would impose a threat to progress.
13 September 2014 – The German Ministry of Economic Affairs, Sigmar Gabriel, calls for a review and if necessary an adaption of existing rules to the demands of the digital world and the changing mobility needs of consumers. He also argues in favour of more competition in the taxi market and changes in the German Passenger Transport Act.
12 September 2014 – Communications Consultancy Penn Schoen and Berland conducted 1,002 online interviews in Germany with respondents 18-35 years old. Results prove that the vast majority of Germans are in favour of ridesharing with 70 percent either considering doing it, or having tried it already. Furthermore, more than half of those polled believe the Government should do more to support new transportation alternatives.
12 September 2014 – Dutch Members of Parliament send very supportive signals via Twitter on the need to embrace innovation and regulate uberPOP. Banning Uber and Airbnb would not be in question. “On the contrary, they’re needed to shake up the established order”, says D66 parliamentarian Kees Verhoeven. “Established players face new competitors, so the consumer has more of a choice.”
11 September 2014 – The EU commissioner for digital agenda, Neelie Kroes, calls for better opportunities for innovative companies to join and disrupt markets. She urges Germany: “Germany wants southern European economies to reform and become more flexible. It is untenable politically to expect of others what one is not willing to do oneself.” Kroes goes on challenging the authorities governing services across Europe: “Find ways to preserve basic protections without stopping citizens from organising themselves and using the services of their choice. It is hard to see proportionality in a €250,000 fine for a €6 fare. I think Europe can do better than that.”
9 September 2014 – Pascal Smet positively notes that Uber taxis should be allowed to operate in Brussels as long as they comply with the region’s regulations. Smet states that Uber can provide a useful alternative to licensed taxis and that it is not necessarily unfair competition.
3 September 2014 – UC Berkeley researchers found that in the evening rush, 92 percent of rideshare cars arrived in under 10 minutes, while only 16 percent of taxis did so. Most respondents indicated that they preferred a rideshare over a taxi because of ease of payment. Another study from MIT found that 95 percent of all taxi trips could be shared, without significantly increasing ride times and at the same time reducing traffic pollution.
- MIT ” Quantifying the benefits of vehicle pooling with shareability networks”
- UC Berkeley “App-Based, On-Demand Ride Services: Comparing Taxi and Ride-sourcing Trips and User Characteristics in San Francisco”
3 September 2014 – Spanish consumer association states that it is important to differentiate services aimed at profits from new forms of sharing economy that merely share resources. OCU thinks that there should be no limitation for users that want to share rides as well as costs. They ask for clear rules that foster new forms of collaborative consumption.
17 July 2014 – Felip Puig, Regional Minister of Enterprise and Employment at the Government of Catalonia, assesses that collaborative consumption could not be stopped. He points to Airbnb and Uber as examples of new models that require new regulatory environments, ones that already exist in many other countries.
15 July 2014 – The government of Helsinki pilots a project to end the need for car ownership through a combination of taxis, ride-sharing apps, carpooling, and traditional public transit. Plans exist to launch the pilot program at the turn of the year. According to the Helsinki Times, the plan may involve some type of software platform that allows citizens to choose from a wide variety of transit options.
10 July 2014 – Association calls on the French government to mobilise in favour of digital transformation. The competitiveness of the economy is based on the diffusion of innovation and it is counterproductive to adopt models of regulation based on the prohibition of innovative technology.
14 May 2014 – Parliamentary report on the development of the French digital economy advocating for a more flexible framework and highlighting the necessity to support innovation in the economy. On the impact of technology on modes of transport, two French MPs welcome the innovation introduced by platforms like Uber, stressing that “the rise of VTCs (private-hire vehicles) are inevitable and that these companies must also be recognised for their innovations and their ability to meet unmet demands so far” (p. 36).
2014 – Today, the five main sharing economy sectors (lending and crowdsourcing, online staffing, P2p accommodation, car sharing and music and video streaming) generate $15bn in global revenues. According to PwC, by 2025, these same five sharing economy sectors could generate a potential revenue opportunity worth $335bn. Car sharing is assumed to increase 23% per year until 2025.
13 December 2013 – The French Competition Authority issues a critical opinion on a 15 minute delay requirement between booking proposed in the Thévenoud bill. The Authority argues that the 15 minute delay requirement would result in protective, unnecessary and disproportionate market distortions. Instead of pushing back on innovation, the Authority argues the legislative framework for taxi (tarification) should be liberalized to enable taxis to compete with innovation.