Many hail the sharing economy as the new economy, but like any economy there are dark sides. What seems so innovative and new may just be the same old taxi company, or car hire firm, operating right on the edges of the law.
The City of Los Angeles is the latest to tell ride-sharing apps SideCar, Lyft and Uber that they are operating car services without a license and must cease and desist immediately.
The California Public Utilities Commission has made a deal with Uber, that will allow the company’s black car service continue to operate while rules are finalized that specifically address mobile apps that allow users to arrange for rides with black car drivers and private citizens.
The California Public Utilities Commission today said that it has entered into an agreement with Lyft mobile application, revoking a cease-and-desist order until a rulemaking process addressing ride-sharing apps concludes six months from now.
Avis rental car company will acquire the car-share company Zipcar for $500 million, the companies announced today. Zipcar has been a standard-bearer for the sharing economy fueled by Internet technology, and the announced deal caused Avis to rise up among trending topics on Twitter.
After citing Lyft and Uber with $20,000 fines, regulators are re-evaluating California’s laws regarding charter-party carriers. This decision comes after New York City and Washington D.C. moved to legalize e-hailing services.
“The Commission has a responsibility for determining whether and how public safety might be affected by these new businesses. The purpose of this Rulemaking is not to stifle innovation and the provision of new services that consumers want, but rather to assess public safety risks, and to ensure that the safety of the public is not compromised in the operation of these new business models.”
While regulators are mostly concerned with public safety, Lyft and Uber creates are public forum on poor services and subsequent backlash is much more visible in today’s mobile commerce. current taxi and charter systems do not allow for public feedback, thus making Lyft and Uber’s technology a lot more confidant in the public’s eye.
Companies such as Lyft are based in San Francisco, a city whose economy is largely tech-driven. San Franciscans suffer especially on rainy days and Saturday evenings when every cab is full of riders. Removing such restriction would allow businesses like Lyft, Uber, and SideCar to develop alternative transit in a city that is sparse in parking spaces and low in taxis.
Uber “wasn’t ready” for a public emergency like Hurricane Sandy, Ryan Graves, the company’s head of global operations, admitted in a public interview in San Francisco today, but otherwise did little to backpedal from his company’s brash approach to pricing and regulation.
The California Public Utilities Commission, which regulates car services and ridesharing programs, will vote on December 20 on a proposal that would open a proceeding seeking to address its public safety concerns without stymieing the innovations offered by apps such as Uber, SideCar and Lyft.
It hasn’t been a good week for San Francisco taxi and ride-share apps. On November 9, two taxi drivers filed what they hope will be certified as a class action lawsuit against Uber stemming from its months-old taxi service in the city. And yesterday afternoon, Uber, SideCar and Lyft were fined $20,000 for operating what the state considers unlicensed charter businesses.