If you live in or are traveling to Austin, Texas, this morning you may want to delete those Uber and Lyft apps off your phone, look up the number for the local cab company and plan on a longer commute to your destination. After a vote on exempting the companies from certain regulations which apply to transportation companies went against them, both services are pulling the plug in that city… at least for the time being.
Ride-sharing services Uber and Lyft plan to suspend service indefinitely Monday in Austin after voters in Texas’ tech hub failed to adopt a ballot measure that would have allowed them greater self regulation.
In a dispute that could play out in other cities, Uber and Lyft say new rules required on them in the Austin area, including fingerprinting of drivers, makes its hard for them to continue to follow their business models. The pullback becomes a de facto victory for the taxicab industry, which has seen ride-sharing services turn their business on its ear around the country. Uber said it would cease operations in Austin at 8 a.m. CT.
As much as I love Uber both for good service and the basic idea of competition in a largely government rigged industry, the details of what the ride-sharing services were objecting to doesn’t inspire a lot of sympathy for them. The chief sticking point in the negotiations was a provision which would have required Uber and Lyft to fingerprint everyone applying for positions as drivers before allowing them out on the road. Their argument was that their online background checks are sufficient and the hands-on, in person interviews and processing which these rules would require would wreck their business model and drive up costs for consumers.
All of that may be true, but with so many people in the country having the same (or similar) names and known gaps in online record resources, a set of fingerprints fed into a national database and a pair of human eyes on the applicant would probably make everyone feel a lot safer. And while it’s not as if there’s a rash of cab drivers robbing, raping and murdering their way across the country (with a few tragic exceptions, of course), consumers clearly feel entitled to that level of scrutiny for the person picking them up, and that’s how the voters of Austin came down on the subject.
There are plenty of other regulatory features in the car service game which give supporters of Uber valid cause to complain. The entire medallion system which local governments use to regulate who can and can’t drive a car for hire (frequently coming with a huge price tag) wind up being a system of cronyism and corruption largely controlled by the unions and the politicians they support. Access to airport pickup areas is similarly held hostage by the well connected. But if the consumers want more thorough investigations to ensure that their Uber driver isn’t a wanted serial killer, they are clearly entitled to demand it. The downside is that their rates will likely go up in response, assuming that Uber and Lyft come back to town at all.