Uber (company)

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Uber Technologies Inc.
Formerly called
UberCab (2009–2011)
Privately held company
Industry Transportation
Delivery (commerce)
Founded March 2009; 8 years ago (2009-03)
Founders Travis Kalanick
Garrett Camp
Headquarters San Francisco, California, United States
Area served
Worldwide, 528 cities[1]
Key people
Travis Kalanick (CEO)
Thuan Pham (CTO)
Ryan Graves (COO)
Emil Michael (VP, Business)
Products Mobile app, website
Services Transportation network company
Vehicle for hire
Delivery (commerce)
Revenue Increase US$10.8 billion (2015)[2]
Increase US$1.5 billion (2015)[2]
Decrease US$-2.0 billion (2015)[3]
Number of employees
6,700[4]
Divisions UberEATS, Otto (company)
Website uber.com

Uber Technologies Inc. is a transportation network company headquartered in San Francisco, California, United States, operating in 528 cities worldwide. It develops, markets and operates the Uber car transportation and food delivery mobile apps. Uber drivers use their own personal cars,[5][6] although drivers can rent a car to drive with Uber.[7]

Uber has been a pioneer in the sharing economy and the changes in industries as a result of the sharing economy has been referred to as "Uberification" or "Uberisation".[8][9][10] Uber has also been the subject of protests and legal actions.

Contents

How it works[edit]

Icon for rider app as of November 2016

The Uber app software requires the drivers to have a smartphone and the users must have access to either a smartphone or the mobile website.

Pricing and payments[edit]

An Uber ride in Bogotá, Colombia running the Uber app on his dashboard-mounted smartphone
Yellow Uber car in Moscow, Russia

In most cities, Uber offers "upfront pricing"; the rider is quoted the fare that he or she will pay before requesting the ride.[11] In some cities, Uber does not offer upfront pricing and instead calculates the price of a ride similar to a taximeter; the rider is charged based on the time and distance of the ride.[12] Uber also offers promotional rates on rides to/from certain areas at certain times.[13][14][15] At the end of the ride, payment is made based on the rider's pre-selected preferences, which could be a credit card on file, cash, or, in certain cities, other methods such as via Google Wallet or Airtel mobile wallet.[16]

Dynamic pricing[edit]

Uber fares are based on a dynamic pricing model; the same route costs different amounts at different times as a result of factors such as the supply and demand for Uber drivers at the time the ride is requested.[17] When rides are in high demand in a certain area and there are not enough drivers in such area, Uber fares increase to get more drivers to that area and to reduce demand for rides in that area.[17] The rate quoted to the rider will reflect such dynamic pricing.[11] The dynamic pricing model has led to criticism, particularly during disasters.

Rating scores[edit]

Users of the app may rate drivers; in turn, drivers may rate users. A low rating might diminish the availability and convenience of the service to the user.[18][19] If a driver rates a rider at three stars or below, the rider will never be paired with that driver again.[20] Uber can also deactivate or otherwise punish drivers that get low average ratings from riders.[21]

Requirements for driving[edit]

In some markets, where leasing arrangements for vehicles are available, the only requirement for driving for Uber, other than appropriate age, health, car age and type, and ability to drive, is passing a background check.[22][23] Both a smartphone, called a "device" by Uber, and a vehicle may be leased.[24] In many cities, vehicles used by Uber drivers must pass annual safety inspections and must have an Uber emblem posted in the lower right (passenger) side of the windshield.

Legislation in some cities, such as San Francisco, requires individuals who drive for Uber to also own a business license in the city in which they drive.[25]

Uber argues that it does not employ drivers, though this has been disputed in some legal jurisdictions.[26] As a result, Uber drivers are considered independent contractors.

Driver selfies as a safety mechanism[edit]

In September 2016, Uber rolled out a new feature to some drivers that requires drivers to take selfies before accepting ride requests. The feature is called "Real-Time ID Check" and is meant to prevent fraud and protect drivers' accounts from being compromised.[27][28][29][dubious ]

History[edit]

Further information: Timeline of Uber

Early history[edit]

Travis Kalanick, co-founder and CEO of Uber, in 2013

Uber was founded in 2009 as UberCab by Garrett Camp, the cofounder of StumbleUpon, and Travis Kalanick, who had sold his Red Swoosh startup for $19 million in 2007.[30][31] The name "Uber" is a reference to the common (and somewhat slangy) word "uber", meaning "topmost" or "super", and having its origins in the German word über, meaning "above".[32][33]

Kalanick joined Camp and gives him "full credit for the idea"[34][35] of Uber. Camp spent $800 hiring a private driver with friends and had been mulling over ways to decrease the cost of black car services ever since. He realized that sharing the cost with people could make it affordable, and his idea morphed into Uber.[34] "Garrett is the guy who invented that shit," Kalanick said at an early Uber event in San Francisco.[34][35] The first prototype was built by Camp, and his friends, Oscar Salazar and Conrad Whelan, with Kalanick being brought on as a "mega advisor" to the company.[34]

Uber's first market was San Francisco and, following a beta launch in May 2010, Uber's services and mobile app officially launched there in 2011.[36][37] Originally, the application only allowed users to hail a black luxury car and the price was 1.5 times that of a taxi.[38]

In February 2010, Ryan Graves became the first Uber employee, getting the job by responding to a tweet from Kalanick announcing the job opening, and receiving 5-10% of the company. After ten months as CEO,[39] Kalanick succeeded him as CEO in December 2010.[34][36][40][41] Graves stepped down to become the company's COO.[42]

In 2011, the company changed its name from UberCab to Uber.[43]

During the initial development of the Uber app, the company created a think tank consisting of a nuclear physicist, a computational neuroscientist, and a machinery expert who worked on predicting demand for private hire car drivers and where demand is highest.[30][44]

Uber Garage[edit]

In April 2012, Uber launched the Uber Garage initiative in Chicago, a project to experiment with other ideas for urban transportation services. The first project from Uber Garage was to give Uber users the option to hire a regular taxi driver, or a crowd-sourced Uber driver.[45][46]

UberX[edit]

In July 2012, the company introduced uberX, a service option which allows anyone to drive for Uber using their own car, subject to a background check and car requirements.[47][48] The price was 10% less than that of a taxi and the service was branded as "It’s like a taxi — only quicker, cleaner, and a little bit magical."[49] By early 2013, the service was operating in 35 cities.[49]

The launch of the UberX service caused some dissatisfaction among existing drivers whose earnings decreased as a result of the increased competition at lower rates.[50]

In India, the service is called UberGo and was launched on November 19, 2014.[51] Pricing was designed to be lower than alternatives, such as rickshaws, without the hassle of negotiating.[51]

Food delivery[edit]

In 2014, the company experimented with online food orders, pilot testing uberFRESH in Santa Monica, California.[52] The service allows users to have meals delivered from participating restaurants by Uber drivers. In April 2015, the name was changed from UberFRESH to UberEATS.[53]

Package Delivery: Uber Rush & Uber Essentials[edit]

In April 2014, Uber announced a courier package delivery service called Uber Rush, with pickup from anywhere in Manhattan.[54] While Rush only offers delivery,[55] the Uber Essentials or Corner Store service, starting testing in Washington D.C. in August 2014, allows online ordering from a list of about 100 items.[56][57]

UberTAXI[edit]

To appease taxi drivers that were protesting the increased competition from Uber, in some markets, Uber launched UberTAXI, which allows users to summon a taxi using the Uber software application.[58][59] Users pay an additional booking fee and can leave a gratuity through the app.[59]

UberPOOL[edit]

Uber announced a carpooling service called UberPool at the start of August 2014, after a beta testing phase in the San Francisco Bay Area.[60][61] UberPool matches riders with another rider who is traveling in the same direction—the app will share the first name of the other rider and the planned route. The price for this service is less than all other Uber service levels.[62][63]

In December 2014, Uber expanded the UberPool concept to New York City. The Uber blog announcement offered riders the possibility of reducing their journey costs by 20-50%, explaining: "On any given day, the vast majority of UberX trips in NYC have a 'lookalike' trip—a trip that starts near, ends near, and is happening around the same time as another trip".[64]

Self-driving car research[edit]

Uber autonomous vehicle testing in San Francisco in October 2016.

In 2015, Uber CEO Travis Kalanick spoke about his desire to eventually move to using self-driving cars for Uber vehicles.[65] By May 2015, the company had hired many researchers from the robotics department of Carnegie Mellon University and established Uber's Advanced Technologies Center the Strip District, Pittsburgh.[66][67]

On September 14, 2016, Uber launched its first self-driving car services to select customers in Pittsburgh, including Pittsburgh Mayor Bill Peduto.[68] Uber has a fleet of Ford Fusion cars each equipped with 20 cameras, seven lasers, GPS, lidar and radar equipment. These enable the car to create a three-dimensional map utilizing landmarks and other contextual information to keep track of its position.[69]

On December 14, 2016, Uber began using self-driving Volvo XC90 SUVs in its hometown of San Francisco.[70] On December 21, 2016, the California Department of Motor Vehicles revoked the registration of the 16 vehicles Uber was using for the test and forced the program to cease operations in California.[71] Uber then moved the program to Arizona, where the cars are picking up passengers, albeit with 2 uber engineers in the front seats as a safety precaution.[72] However, in March of 2017, following an accident in which an Uber self-driving car was flipped on its side by a vehicle which failed to yield, Uber suspended all testing of its self-driving service.[73]

Initiative to promote driving by veterans[edit]

In May 2015, Uber launched its UberMilitary Families Coalition, a new project to support its existing UberMilitary initiative.[74] The project seeks to partner Uber with existing military family organizations and recruit more military dependents, in addition to veterans, as drivers.[74]

Accommodations for deaf drivers[edit]

In May 2015, Uber updated its app to include accommodations for hearing-impaired drivers.[75]

Partnerships with public transit agencies[edit]

In 2015 and 2016, Uber launched partnerships with several transit agencies to encourage trips that connect the first or last mile to public transit, whereby Uber passengers get discounted fares for rides to or from a public transit station. These agencies included SEPTA,[76] Metropolitan Atlanta Rapid Transit Authority,[77] Los Angeles County Metropolitan Transportation Authority,[78] Dallas Area Rapid Transit,[79] WMATA,[80] and Pinellas Suncoast Transit Authority.[81]

Helicopter service[edit]

In July 2014, Uber partnered with Blade to offer "UberCHOPPER" helicopter rides from New York City to The Hamptons for $3,000 each, including during Independence Day.[82][83][84][85]

in 2016, the company partnered with Airbus to test UberCopter, a $63 Uber helicopter service, in São Paulo, a city famous for its extreme traffic congestion.[86] The test was a one-month trial.[87]

Uber has also provided helicopter service for specific events, including the Cannes Film Festival and Sundance Film Festival with flights from Salt Lake City International Airport to Park City, Utah.[86][88][89]

Uber announced on September 25, 2016 that it was looking into urban transportation with flying vehicles. At Re/code's Nantucket Conference, the head of Uber's products, Jeff Holden stated that the company wanted to "someday offer our customers as many options as possible to move around ... doing it in a three-dimensional way is an obvious thing to look at." A statement at the American Helicopter Society International-led joint workshop on Transformative Vertical Flight on September 29, Uber product manager Nikhil Goel stated that "To us, urban air transportation is simply a key initiative or our mission, right? Not only because it can cut congestion – it's got massive potential to do that – but it allows us to move people from Point A to B much, much faster than you would otherwise. If you do it in all-electric vehicles, you can do it with zero emissions." Wired magazine broke the details of Uber's Project Elevate on October 27, 2016 article "Inside Uber's Plan to Take Over the Skies With Flying Cars". Uber published a 99-page "white paper" exploring the possibility of developing a "fully electric, vertical-takeoff-and-landing plane" network (called "Elevate") within ten years, for use in short journeys.[90] Although technically feasible, the development of such a program is expected to encounter safety and regulatory obstacles.[90]

UberBOAT[edit]

In June 2015, in Istanbul, Uber launched a water-taxi service called UberBOAT, allowing users to travel by Beneteau boats across the city's central Bosporus strait.[91]

During Miami Art Week in December 2015, UberBOAT offered yacht rides across Biscayne Bay for $35 for a party of up to 6 people.[92]

In April 2016, UberBOAT offered free rides across Baltimore harbor.[93]

Mapping technology[edit]

In November 2015, Uber signed a global partnership deal with Dutch satellite navigation company TomTom to provide maps and traffic data for the Uber driver app across 300 cities.[94]

In September 2016, Uber began mapping UK city streets in an effort to identify the best pick-up and drop-off points. The lift-sharing firm plans to extend its mapping activities to other British cities including Manchester, Birmingham and Leeds.[95]

Marketing promotions[edit]

In July 2012, in honor of National Ice Cream Month, Uber launched an "Uber Ice Cream" program in the U.S. so that users in seven cities could summon an ice cream van for on-demand delivery, while purchases were billed to users' accounts.[96] The promotion was repeated in 2013.[97]

DeLorean "time machine" provided by Uber

In September 2013, Uber offered rides in the DeLorean DMC-12 car from the Back to the Future film franchise.[98]

During a National Cat Day promotion, Uber drivers delivered kittens for 15 minutes of cuddling.[99]

In 2013, Uber offered delivery of Christmas trees for $135.[100]

On September 4, 2013, Uber announced a promotion with the NFL Players Association to promote safe rides for NFL players.[101]

In March 2015, in collaboration with Dream Drive, Uber offered a luxury car-rental service in Singapore that included lamborghinis and maseratis.[102]

In November 2015, in collaboration with GrabOn, Uber offered Hot air balloon rides to customers in Hyderabad, India for INR 1,000.[103]

In September 2016, Uber and Bobbi Brown Cosmetics made a partnership for Bobbi Brown x Uber Retouch campaign, to celebrate the launch of the Retouching Wands and Retouching Pencils. Customers will get an opportunity to take a ride with a Bobbi Brown Makeup Artist and quick make up course how to retouch make up on-the-go.[104]

Failed partnership with UN Women[edit]

On March 10, 2015, Travis Kalanick, Uber's founder and chief executive announced a partnership between Uber and UN Women. They had intended to invest in local communities where the UN Women's group was located hoping to create 1,000,000 jobs for women globally by 2020. However, after pressure from trade unions and women's rights organizations, UN Women declined to participate, citing safety concerns.[105]

Financing[edit]

The founders invested $200,000 in seed money upon conception in 2009.[106] In 2010, Uber raised $1.25 million in additional funding.[106][107]

By the end of 2011, Uber had raised $44.5 million in funding.[108][109] In 2013, Google Ventures invested $258 million in the company based on a $3.4 billion pre-money valuation.[110][111] In December 2014, Chinese search engine Baidu made an investment in Uber of an undisclosed amount.[112] The deal also involved connecting Uber with Baidu's mapping apps.[112][113]

In January 2015, Uber raised $1.6 billion in convertible debt.[114] In May 2015, Uber revealed plans to raise between $1.5 billion and $2 billion in new funding, raising the value of the company to $50 billion or higher.[115] In September that year, Uber raised another $1.2 billion, led by another investment by Baidu.[116]

In 2016, Toyota made an undisclosed investment in Uber and looked into leasing options, which could potentially aid Uber drivers financially, a move in response to the other partnerships between Toyota's and Uber's counterparts.[117][118] In June 2016, with plans to expand in the Middle East, Uber received $3.5 billion from the Public Investment Fund of Saudi Arabia.[119] In July that same year, Uber raised $1.15 billion in debt financing.[120] In August, Uber agreed to sell its subsidiary company, Uber China, to Didi. Didi also agreed to invest $1 billion into Uber Global.[121]

In total, Uber has raised about $11.5 billion from 14 rounds of venture capital and private equity investors.[122]

Financial performance[edit]

Year 2014 2015 1Q'16 2Q'16
Net Revenue $495.3M[123] $1.5B $960M[124] $1.1B[124]
GAAP Loss -$671M[125] TBD -$520M[124] -$750M[124]

Number of users[edit]

In 2015, Uber completed its 1 billionth ride, which was still below the 1.4 billion rides completed by Didi Chuxing at that time.[126][127]

In October 2016, it was reported that 40 million riders used the service in a single month.[128]

Impact[edit]

Effect on values of medallions[edit]

The increased usage of Uber and other ride-sharing companies has negatively affected the values of taxi medallions in many cities.[129] Many banks that lent money against medallions as collateral faced increasing risks of default.[130]

Gaining local support in dealing with regulators[edit]

Uber, an experienced political operative, expands its operations by commencing operation and then engaging in a political campaign which mobilizes public support for the service. If, as is usually the case, its mode of doing business does not conform to local regulations, Uber, supported by a small army of lobbyists, mounts a campaign to change them.[131] Customers and potential customers are mobilized through social media including using the Uber app itself.[132]

In January 2015, Uber announced a program Kalanick called "principled confrontation" that included reaching compromises with local municipalities to compromise on new tax regulations. Since implementing this program, Uber has seen 17 new cities pass pro-Uber ordinances.[133] Uber had worked out an arrangement with the city of Boston to share quarterly data on the duration, locations, and times of day in which riders used the app to travel in or out of the city. This information was first delivered to the city in February 2015, and the report kept all individual user data private.[134]

Communications leadership[edit]

Bradley Tusk, a former campaign manager for Michael Bloomberg, has played a significant role in advising Uber with respect to cities.[135] In 2014-2015, Uber used the services of David Plouffe but Rachel Whetstone is now the senior vice president of policy and communications.[136]

Protests and legal action[edit]

Taxi company protesting against Uber – Budapest, January 18, 2016

Uber has been the subject of protests and legal action from - among others - taxi drivers and taxi companies around the world. These groups allege that Uber bypasses local licensing and safety laws and amounts to unfair competition.[137] Taxi drivers in London, Berlin, Paris and Madrid staged a large-scale protest against Uber on June 11, 2014.[138] In some countries, Uber drivers were also targets of attacks by taxi drivers.

Protests[edit]

Uber drivers on strike at Montparnasse, Paris, February 3, 2016
A protest against Uber by taxi drivers
A protest against Uber in Portland, Oregon in January 2015

Paris[edit]

On January 13, 2014, cab drivers in Paris attacked an Uber driver's car near Charles de Gaulle Airport, protesting competition from the transportation startup.[139] On June 11, 2014, in a concerted action, taxis blocked roads in major European cities in protest against what they perceive as a threat to their livelihoods from companies such as Uber. The cabbies contended that Uber and similar smartphone app-based services have an unfair advantage because they are not subject to the same kinds of fees and regulations placed on taxis.[140][141] On June 25, 2015, cab drivers in Paris "locked down" Paris in an anti-Uber protest.[142] Musician Courtney Love got caught in the protest and live tweeted as her Uber cab was violently attacked and she and her driver were held hostage.[143]

Jakarta[edit]

On March 22, 2016, thousands of taxi drivers in Jakarta demonstrated against Uber and a similar service, Grab. Several places were targeted during the protests, including the Indonesian Presidential Palace, the People's Council Building, and the Ministry of Communication and Informatics central office.[144] Taxi drivers accused that Grab and Uber were causing them to receive smaller daily incomes due to the rising number of app users. The demonstrators also demanded that the government ban the apps and issue a governmental decree concerning this problem.[145]

Rio de Janeiro[edit]

On July 24, 2015 a thousand taxi drivers in Rio de Janeiro blocked traffic during the morning rush hour protesting Uber's expansion there. (Lawmakers have voted to ban Uber in São Paulo and Brasilia.).[146]

2017 anti-travel ban protests[edit]

In January 2017, customers began to delete the Uber app from their mobile devices amid anti-travel ban protests, accusing the company of attempting to profit from a strike called by the New York City Taxi Workers Alliance.[147][148] Uber's CEO responded by signing an open letter to President Donald Trump that requested he rescind his executive order that temporarily banned immigrants from seven countries.[149]

Attacks[edit]

Costa Rica[edit]

On August 21, 2015, Uber started operations in Costa Rica and multiple Uber drivers were immediately attacked by taxi drivers.[150]

Brazil[edit]

On November 26, 2015 an Uber driver was beaten by taxi drivers in Brazil, and similar attacks followed.[151]

South Africa[edit]

In Cape Town, South Africa on June 3, 2016 metered taxi drivers blockaded the road to the city's airport and forced passengers out of vehicles while attacking Uber drivers.[152]

Lawsuits[edit]

Lawsuit by Atlanta taxicab drivers[edit]

In September 2014, a class-action lawsuit was filed by taxicab drivers and holders of a vehicle for hire Certificate of public convenience and necessity in Atlanta against Uber as well as its drivers for restitution of all metered fares collected via the Uber and UberX apps for trips originating within the Atlanta city limits.[153] The lawsuit claimed that Uber drivers were not properly licensed.[153]

Lawsuit by Philadelphia taxicab drivers[edit]

In December 2014, Checker Cab Philadelphia and 44 other taxi companies in Philadelphia, Pennsylvania filed a lawsuit alleging that Uber was operating illegally in the city.[154][155] On March 3, 2015, U.S. District Judge Nitza I. Quinones Alejandro denied a motion for a preliminary injunction against Uber.[156]

In January 2016, a $1.5M lawsuit was filed against Uber in Philadelphia, Pennsylvania, by Sergei Lemberg on behalf of a Philadelphia taxicab medallion owners. The suit claimed that Uber engaged in tortious interference with a prospective business advantage and engaged in false advertising under the Lanham Act.[157] The case was dismissed in August 2016.[157]

Lawsuit by Ontario taxicab operators[edit]

In July 2015, a $400M class-action lawsuit was filed against UberX and UberXL in Toronto, Ontario, Canada on behalf of Ontario taxi and limo drivers, brokers, and owners. The statement of claim alleged that UberX and UberXL violated section 39.1 of the province's Highway Traffic Act by having unlicensed drivers picking up passengers and transporting them for compensation.[158] In March 2016, Sukhvir Tehethi, a local taxi driver, filed an injunction against Uber. Toronto's city council amended a bylaw in October 2015 and, according to Tehethi's lawyer, Uber drivers are in violation of it. Tehethi decided to take action saying that it could be months, or even years, if he waits for City Hall to act.[159]

Lawsuit by Italian taxi drivers union[edit]

In May 2015, the Milan Court banned Uberpop alleging "unfair competition" and violation of the local jurisdiction regulating taxi services. The lawsuit was originally initiated by the Italian taxi drivers union.[160]

Lawsuit regarding denial of services to blind passengers[edit]

A lawsuit was filed in the U.S. state of California on September 9, 2014 by the state chapter of the National Federation of the Blind, in response to the reported denial of services to "more than 30" blind customers—the lawsuit claimed that the conduct was in violation of the Americans with Disabilities Act of 1990 and California state law. The Washington Post published a direct quote from the complaint, in which the Federation claims that its constituency "face the degrading experience of being denied a basic service that is available to all other paying customers." Two cases were described in the Post article: First, a California UberX driver allegedly stored a service dog in the trunk of his vehicle and refused to acknowledge the blind passenger's concern upon the latter's realization of what had occurred; second, a driver allegedly cursed at a blind passenger during a verbal exchange, in which the latter was explaining the nature of the guide dog. According to the complaint, the driver suddenly accelerated, and nearly injured the dog, while also striking the passenger's blind friend with an open car door.[161] Uber responded to a number of blind passengers who reported their experiences, stating that since Uber drivers were independent contractors, the company was unable to oversee their conduct. The Federation replied in a public statement that Uber closely monitored its drivers' work practices through the Uber app, that Uber advised blind passengers to notify drivers about their guide animals in advance, and that the Federation was proceeding with the filing of the lawsuit after Uber refused to enter into a negotiation with them to resolve the issue.[161]

FTC lawsuit regarding misleading driver earnings potential[edit]

In January 2017, Uber agreed to pay $20 million to the US government to resolve accusations by the FTC of having misled drivers about potential earnings.[162][163][164]

Waymo lawsuit[edit]

According to a February 2017 lawsuit filed by Waymo, owned by an affiliate of Google, ex-Google employee Anthony Levandowski allegedly "downloaded 9.7 GB of Waymo’s highly confidential files and trade secrets, including blueprints, design files and testing documentation" before resigning to found Otto, which was purchased by Uber.[165][166]

Legal action and regulations by governments[edit]

Uber continues to be involved in disputes of its legality with several governmental bodies, including local governments in the U.S., Australia and Brazil.

People have called for governments to relax legislation in favour of Uber.[167] At city jurisdictions, this might be easier to achieve.[168]

France[edit]

Uber executives were arrested in France in June 2015 after Uber continued to operate despite being declared illegal.[169]

In the first half of 2014, the UberPop version of the app was launched in Paris, France, whereby users are linked to drivers without professional taxi or chauffeur licenses, while Uber covers supplemental insurance. UberPop was expanded to other European cities over the course of the year.[170] The UberPool service was then introduced to the Parisian market in November 2014, a month after a French court had deemed the company's UberPop service to be illegal. Uber claimed that UberPool was the next iteration of the UberPop concept. Uber's Western Europe chief told reporters at the time that it was "very confident" about overturning the court decision.[170] At the start of February 2015, the UberPool service was still operational in Paris, France, despite the regulatory opposition in that country.[171] On July 5, 2015, Uber suspended UberPop in the face of pressure by the French government while awaiting a constitutional court decision on the legality of Uber's service.[172] On September 22, 2015, France's highest constitutional authority rejected the challenge to a law that bans Uber's low-cost offering UberPop, keeping the legal pressure on the company.[173] Uber stated that the decision was disappointing but they will continue to work with the French government, trying to find a solution.[174]

Spain[edit]

Uber was banned from Spain in December 2014 and returned to Spain in March 2016, this time using only licensed drivers.[175][176]

India[edit]

In Delhi, Uber is faced with limits to the number of drivers that are allowed to operate.[177]

Poland[edit]

In Poland, following protests by taxi drivers, laws were modified so that Uber drivers do not enjoy a regulatory advantage over taxi drivers.[178]

Germany[edit]

In 2015, a court banned Uber in Germany after the company violated regulations requiring all transport companies to use licensed drivers.[179][180][181][182]

Australia[edit]

The Australian New South Wales government created a taskforce to look into regulating Uber, stating that the existing regulatory framework is "difficult to enforce", and therefore not as effective as it could be. The taskforce also noted that ride sharing services "appear to meet the criteria of a public passenger service" under the 1990 Act and drivers are therefore required to pay local government services tax GST.[183] This is despite the fact Uber claims that it is not a taxi service and should not have to operate under taxi regulation.[184][185]

In Brisbane, Australia, the legal status of Uber's service has been challenged by governments and taxi companies, which allege that its use of drivers who are not licensed to drive taxicabs is unsafe and illegal.[186]

Austin[edit]

In March 2015, UberPOOL was offered in Austin, Texas, in advance of the annual South by Southwest festival.[187] In May 2016, Uber pulled its Austin program due to stricter regulations from the government.[188]

United Kingdom[edit]

In March 2017 Uber lost a legal case against Transport for London that attempted to stop a written English exam being required for drivers to obtain a minicab licence.[189]

Dubai[edit]

In January 2017, after a long spat with regulators, Uber signed an agreement with the Roads and Transport Authority of Dubai. Under this deal, Uber will be entitled to deploy about 14,000 vehicles around the city.[190]

Criticism[edit]

Alleged cancellation of orders to disrupt competitors[edit]

Uber issued an apology on January 24, 2014, after documents were leaked to the Valleywag and TechCrunch publications saying that, earlier in the month, Uber employees in New York City deliberately ordered rides from Gett, a newly established competitor, only to cancel them later. The purpose of the fake orders was two-fold: wasting drivers' time to obstruct legitimate customers from securing a car, and offering drivers incentives — including cash — to join Uber.[191] Uber later issued a statement about the incident on its website.[192]

In August 2014, Lyft, another ridesharing service, reported to CNNMoney that 177 Uber employees had ordered and canceled approximately 5,560 rides since October 2013, and that it had found links to Uber recruiters by cross-referencing the phone numbers involved. The CNN Money report identified one Lyft passenger who canceled 300 rides from May 26 to June 10, 2014, and who was identified as an Uber recruiter by seven different Lyft drivers. On this occasion, Uber did not issue an apology, but suggested in a statement on its website that the recruitment attempts were possibly independent parties trying to make money.[193][194] A Lyft spokesperson stated to CNN Money: "It's unfortunate for affected community members that they have used these tactics, as it wastes a driver's time and impacts the next passenger waiting for that driver."[193]

Operation SLOG[edit]

In August 2014, the online publication The Verge reported that a secret Uber project, called "Operation SLOG" – which recruits members with the assistance of TargetCW, a San Diego, California-based employment agency – appeared to be an extension of the company's activities in relation to Lyft. As reported, on July 9, 2014 following Lyft's expansion into New York City, Uber sent an email offering what it called a "huge commission opportunity" to several contractors based on the "personal hustle" of the participants.[195] Those who responded met with Uber marketing managers who attempted, according to one of the contractors, to create a "street team" to gather intelligence about Lyft's launch plans and recruit their drivers to Uber. Recruits were given two Uber-branded iPhones (one a backup, in case the person was identified by Lyft) and a series of valid credit card numbers to create dummy Lyft accounts.[195] After being contacted for comment, Target CW warned its contractors against talking to the media, stating that it represented a violation of a non-disclosure agreement they signed.[195]

Increased pricing during disasters[edit]

Uber fares are based on a dynamic pricing model in which fares are higher during periods of high demands for rides. When Hurricane Sandy hit New York, Uber drew criticism for doubling prices.[196] Uber ultimately waived its fees and passed on all of the fares to its drivers, and defended its pricing by noting that dynamic pricing tripled the number of vehicles available as more drivers got in their cars to take advantage of the higher rates. During the 2014 Sydney hostage crisis, fares were up to four times normal charges, and, while it defended the increased pricing at first, Uber later apologized and refunded the surcharges.[197]

In 2012, Uber CEO Travis Kalanick responded to criticism of dynamic pricing by saying: "it's going to take some time for folks to accept [dynamic pricing]. There's 70 years of conditioning around the fixed price of taxis."[198][199]

Uber has defended this "surge pricing" on its website, arguing that without dynamic pricing, there would not be enough drivers to enable riders to get a ride immediately upon request.[200] Uber cited an example of the aftermath of a sold out concert at Madison Square Garden when pricing was increased. During this event, the number of people who opened the Uber app increased 400%, but, due to the higher prices, the actual ride requests only rose slightly, enabling ride requests to be completed within the usual timeframe.

Dynamic pricing has been noted to increase economic efficiency by motivating drivers and due to the fact that customers with a more urgent need tend to accept rides first.[201]

Classification of drivers as contractors or employees[edit]

Lawsuits have been filed by Uber drivers complaining that they do not enjoy the rights and remedies of being considered "employees" under employment law.

Uber contracts with their driver partners under legal arrangements as contractors, and not employees. Since taxation, work hours, overtime benefits, and so forth may be treated differently by various political jurisdictions globally, this designation has been controversial.[202] In the United States, the US Department of Labor issued guidelines in July 2015 to deal with, what it considers, "misclassification" of workers. It argues that any "worker who is 'economically dependent' on the employer should be treated as an employee. By contrast, a worker must be in business for himself or herself to be an independent contractor."[203] The guideline is non-binding, but is expected to have some influence in various court cases which may establish new common law around the issue.[203][204]

In a class action lawsuit filed in the United States District Court for the Northern District of California on August 16, 2013 Uber drivers plead that they were employees who had been misclassified as independent contractors in violation of the California Labor Code and demanded that they be given any tips Uber had collected on their behalf and payment of business expenses such as gas and maintenance of their vehicles.[205] The District Judge, Edward M. Chen, ruled in the plaintiffs' favor with respect to a motion for summary judgement by defendants on March 11, 2015 holding that whether Uber drivers were employees was a disputed fact to be resolved by the jury.[206] On September 1, 2015 Chen certified the class but generally limited it to drivers in California hired before June 2014 (when an opt-out arbitration clause was included in the contract) who had directly contracted with Uber.[207][208]

In the United Kingdom on October 28, 2016, the Central London Employment Tribunal ruled that Uber drivers are "workers" entitled to the minimum wage, paid holiday and other normal worker entitlements, rather than self-employed. Two Uber drivers had brought the test case to the employment tribunal with the assistance of the GMB Union, on behalf of a group of drivers in London. Uber will appeal against the decision.[26][209]

Aggression towards local officials and journalists[edit]

An Uber executive is said to have advocated hiring investigators to "dig up dirt" on journalists who criticize them.[210] Portland, Oregon's transportation commissioner called Uber management "a bunch of thugs".[211] A commissioner in Virginia who opposed Uber was flooded with emails and calls after Uber distributed his personal contact information to all of its users in the state.[212]

At a private dinner in November 2014, Emil Michael, senior vice president of Uber, suggested that Uber hire a team of opposition researchers and journalists, with a million-dollar budget, to dig into the personal lives and backgrounds of media figures who reported negatively about Uber. Specifically, he targeted Sarah Lacy, editor of the technology website PandoDaily, who has accused Uber of sexism and misogyny.[213] The controversy made national news and stirred criticism against Uber. "The comments, reportedly made by senior vice president for business Emil Michael at a New York dinner attended by BuzzFeed editor-in-chief Ben Smith," wrote a Washington Post columnist, "ignited a powder keg of criticism about a company already perceived as cut-throat – landing Uber on the front pages of The Washington Post, USA Today and the New York Times."[214] Michael issued a public apology.[215] Later, he sent an email to Lacy: "I was at an event and was venting, but what I said was never intended to describe actions that would ever be undertaken by me or my company toward you or anyone else. I was definitively wrong and I feel terrible about any distress I have caused you."[216]

Speaking with the Australian media publication The Conversation on November 20, 2014, European PR agency FINN partner Raf Weverbergh said that Uber does not realize exactly how upset journalists are in the wake of the Michael incident. On the same date, the publication reported that more journalists deleted their Uber apps. Uber's Brisbane spokesperson stated that journalists will not be investigated by the company in the Australian state of Queensland, in light of the legislative difficulties that were occurring at the time.[217]

Evasion of law enforcement operations[edit]

Uber developed an internal tool called Greyball which uses data collected from the Uber app and by other means to avoid giving rides to certain individuals. The tool has been in use since at least 2014. By showing "ghost cars" driven by fake drivers to the targeted individuals in the Uber app, and by giving real drivers a means to cancel rides requested by those individuals, Uber can avoid operations by known law enforcement officers in areas where its service is illegal. The New York Times reported Uber's use of Greyball in 2014 to evade city code enforcement in Portland, Oregon.[218] In response to the report, Uber stated that Greyball was designed to deny rides to users who violate Uber's terms of service, including those involved in sting operations. Greyball may have originally been developed to help drivers avoid abusive or violent customers. However, Uber has also reportedly used it to identify government officials through such factors as whether a user is frequently near government offices or opens the app near them. Uber employees also looked at social media profiles to identify officials. The Greyball program was approved by Uber's legal team, but outside legal experts have debated its legality.[218]

User privacy[edit]

Kalanick received a letter, dated November 19, 2014, from Senator Al Franken, Chairman of the United States Senate Judiciary Subcommittee on Privacy, Technology and the Law, over user privacy. In addition to a list of 10 questions, Franken stated that the company had a "troubling disregard for customer privacy" and that he was "especially troubled because there appears to be evidence of practices inconsistent with the policy [Uber spokesperson] Ms. Hourajian articulated" and that "it appears that on prior occasions your company [Uber] has condoned use of customers' data for questionable purposes." Franken concluded his letter by asking for a response by December 15, 2014.[219] Concerns have been raised about internal misuse of the company's data, in particular the ability of Uber staff to track the movements of its customers, known as "God View". In addition to the aforementioned use of the service to track journalists and politicians, a venture capitalist disclosed in 2011 that Uber staff were using the function recreationally and viewed being tracked by Uber as a positive reflection on the subject's character.[220] An individual who had interviewed for a job at Uber said that he was given unrestricted access to Uber's customer tracking function as part of the interview process, and that he retained that access for several hours after the interview ended.[221] On February 27, 2015, Uber admitted that it had suffered a data breach more than nine months before. Driver names and license plate information on approximately 50,000 drivers were inadvertently disclosed.[222] Uber discovered this leak in September 2014 but waited more than five months to notify the people affected.[223]

Safety concerns and incidents[edit]

Driver background checks[edit]

Checkr Inc., a company that runs security checks on its drivers by identifying addresses that the potential driver lived at in the past seven years and then matching any convictions to the addresses, screens Uber drivers. Compared to most taxi companies in the United States, which use Live Scan, a fingerprinting service that checks for matches in FBI and state databases, Uber's policy has been critiqued for not being as safe.[224] The only cities where Uber mandates fingerprint scanning are New York, where a fingerprint scan is needed to apply for a Taxi and Limousine Commission license, and Houston, which has required fingerprint scans for ride sharing drivers since 2014. However, Uber claims that the extra step of fingerprinting drivers in Houston has slowed down driver sign-ups, and as a result wait times are on average 35% longer.[224]

Seizures while driving[edit]

There have also been several instances of accidents resulting from a driver having an epileptic seizure while driving.[225][226][227]

Drivers using the app while driving[edit]

Concerns arose regarding the manner in which the Uber app notifies drivers about new requests for pick-up from customers and how the drivers must respond to such requests.[228] When a customer makes a request, drivers are notified on an official Uber mobile app and are provided the customer's location. In order to accept the request, the driver has approximately 15 seconds to tap the phone to accept the request.[229] An Uber driver reported that drivers can be temporarily suspended for ignoring these requests. Deborah Hersman of the National Transportation Safety Board criticized the 15-second system, saying that it presents a significant distraction to drivers, as drivers are financially motivated to respond to fares while driving. In response, Uber has stated that the app "was designed with safety in mind," and that drivers are not required to physically look at the device to accept a fare.[228]

2016 Kalamazoo shootings[edit]

In February 2016, Uber's vetting procedures came under scrutiny once more following the 2016 Kalamazoo shootings, purportedly committed by Jason Dalton, an Uber driver in Kalamazoo, Michigan. Dalton is believed to have been driving for Uber at the time while allegedly conducting a shooting spree that left six people dead and two others wounded. This led to a seven-hour manhunt for the suspect, during which it is believed that Dalton continued to drive and accept fares. Uber was aware of the issues with Dalton, having received multiple complaints.[230] In March 2016, two Uber drivers in East Lansing, Michigan, were arrested on sexual assault charges stemming from incidents where they inappropriately touched female Michigan State University students.[231]

Austin requirement for driver fingerprint scanning[edit]

In May 2016, Uber stopped operations in Austin, Texas after the city "...voted 56% to 44% against Proposition 1, which would have allowed ride-hailing companies to continue using their own background check systems." Instead, Uber and other ride sharing companies would have to convert to fingerprint scanning, which is far more expensive and even less effective according to some.[232] Uber "argues that the fingerprint databases are often out of date and biased against minorities who have been fingerprinted but never charged with a crime."[233]

Rape allegation by Delhi woman[edit]

On January 29, 2015, a 25-year-old Delhi woman who claims to have been raped in her city by Uber driver Shiv Kumar Yadav filed a lawsuit against the company for negligence in US courts.[234] The plaintiff filed a motion for voluntary dismissal of the case on September 1, 2015, which was granted September 2, 2015.[235]

San Francisco reckless driving lawsuit and settlement[edit]

On December 31, 2013, Uber driver Syed Muzaffar ran over and killed six-year old Sofia Liu in San Francisco, severely injuring her mother and brother in the same incident. The driver was logged in and waiting for a fare, but not carrying a passenger, at the time of the accident. Liu's family filed a wrongful death claim against Uber, claiming that this made Uber responsible for the driver's actions.[236][237][238] Uber deactivated Muzaffar's account after the accident. Syed Muzaffar was arrested on the scene and was charged with misdemeanor vehicular manslaughter on December 8, 2014.[239] Uber said in a written statement that all drivers had undergone a "stringent" background check, and Muzaffar's was "clear". Muzaffar had been arrested in Florida in 2004 on a reckless driving charge, but California law prohibited private background check services like Uber's from reporting arrests and crimes more than seven years old.[240] Syed Muzaffar's vehicular manslaughter trial was scheduled to start August 5, 2015. In July 2015, Uber reached a settlement with the family for an undisclosed sum.[241]

Poor BBB scores in 2014[edit]

In October 2014, Uber received an "F" rating from the Better Business Bureau (BBB), which cited complaints over unexpectedly high charges and lack of response to customer complaints.[242][243]

Sexual harassment at workplace allegations[edit]

In February 2017 former Uber engineer Susan J. Fowler stated that she was sexually harassed by a manager and threatened with termination by another if she continued to report it. It was reported that CTO Thuan Pham had knowledge of Susan Fowler's sexual harassment allegation at Uber and her manager's threatened retaliation, and did nothing; CEO Travis Kalanick, was also reportedly aware of the harassment issues.[244][245] Uber hired former attorney general Eric Holder to investigate the claims.[246]

In the same week, Pham stopped working alongside[247] Uber's SVP of Engineering Amit Singhal, who directly reported to the CEO, Kalanick and was asked by him to resign after a month for failing to disclose a sexual harassment claim during Singhal's 15 years as VP of Google Search.[248][249][250] Farhad Manjoo wrote to the New York Times that the Uber case is expected to be a "watershed" for women engineers,[251] while Time Magazine says the sexism claims could damage Uber's brand and delay its IPO.[252] A meeting with CEO Kalanick was described by the participants as honest and raw,[253] while BBC technology reporter Dave Lee says "Uber's mess reaches beyond sexism and Silicon Valley".[254] The Silicon Valley protest has seen programmers around the globe label Uber as poisonous and encourage any friends who work there to quit.[255]

Corporate culture[edit]

Uber has been described by insiders as having an "asshole culture",[256][257] with a corporate culture in which employees are lauded for bringing incomplete and unreliable solutions[256] to market in order for Uber to appear to be innovators and winners. Likened to A Game of Thrones, the company encourages aggression[258] and back stabbing,[256][258] in which peers undermine each other and their direct superiors in order to climb the corporate ladder.[256] Human resource managers in the software industry see Uber as a black mark on the resumes of ex-Uber employees, with one industry manager saying “If you did well in that environment upholding those values, I probably don’t want to work with you.”[256]

In February 2017, a video was released where Kalanick was shimmying between two women in an UberBLACK, before arguing with an Uber driver during a heated debate.[259][260]

In March 2017, Uber VP of Business, Emil Michael contacted Kalanick's ex-girlfriend in an attempt to silence her into hiding a HR complaint. This backfired, with her being sourced as present during an executive team outing with Kalanick, where Michael, and four more Uber managers selected numbered women at a Korean escort bar, prompting a sexism complaint by the female manager who attended.[261][262]

Awards[edit]

In 2013, USA Today named Uber its tech company of the year.[263]

See also[edit]

References[edit]

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Further reading[edit]

Scholarly papers

External links[edit]