Is it only a matter of time before Uber, Lyft, and Airbnb have to play by the rules?
Uber, Lyft and Sidecar are very popular and they hold an advantage over regular taxis in that they are not regulated. This absence of regulation allows them to use some very innovative business models.
However, we all want to know just how much regulation is required to control these services and how soon will these regulations take effect
Regulated taxi services
Taxi services as we have known them have been heavily regulated. Their fares are controlled and so is their paint scheme as well as number of vehicles. These rules somehow do not apply when you hail a vehicle from an app and the laws that are currently in force were made without keeping such services in mind. In some ways, Uber and Lyft as well as Airbnb operate illegally. The government too is still writing regulations for them.
Easy ordering process
Most of us enjoy using these services because the ordering process is very easy and handy while the payment process is also very seamless. Such advantages have ensured the success of these services. However, in the case of transportation, there are several risks for the consumer that need to be addressed. The fact is there has been a sixty-five percent drop in regular taxi usage and Uber in particular, has been accused of behaving in a very dubious manner to get an unfair advantage.
Are regulations required?
It therefore raises the question whether regulation is required to protect the general public. The airline industry underwent deregulation in 1978 though the government did collect information about airlines and the routes they operated on. This information is being crunched by the government and others. The good news is we will know when airlines do something fishy.
Deregulating taxi markets
Many cities in the US are thinking about deregulating their taxi markets but they do require these companies to provide information about what kind of services they operate in a transparent manner. This allows the general public to keep tabs on such services. It is imperative that cities do ask these services to release information about their origins and trip destinations as well as things like wait time and fares. Some cities are already gathering information from the traditional taxi services and New York in particular has released such information.
Information that helps consumers
This information can be used by the public to understand when and how these services are using surge pricing. As long as such information is used fairly and the consumers are in the loop, they can understand how services like Uber and Lyft as well as Airbnb operate. The fact is Uber and some of its competitors are offering better and also cheaper service as compared to regular taxis. This explains their popularity but it also explains why when legislators do something that they do not like being told what to do.
When asked to disclose information services like Uber may cry wolf saying that the government is trying to close them down. This is something that consumers should not take at face value. The more transparent these services are, the easier it becomes to regulate them. Regulating UBER may well prove to be a boon for everyone involved including UBER itself.
