Why Uber succeeds: taxis, breach of trust and democracy

I started using Uber only this year, after becoming so fed up with taxis in many cities I’ve lived in and visited around the world. Let me explain my conversion as simply as I can. When I get into a taxi, I expect all of the following: (1) clean passenger seats with functioning seat belts; (2) air-conditioning; (3) a courteous, honest driver who helps me with my luggage (doesn’t need to speak English, but it helps); (4) credit card machine that works; and (5) a trunk (or boot) that is free of debris and the driver’s personal effects so that my luggage can fit in. That’s it. Of all the places I’ve been, only Singapore, Tokyo and Kyoto taxis have fulfilled all of these basic requirements unfailingly.

Here’s a question for taxi companies and the cities that pretend to regulate them: Is it so hard to guarantee that taxis meet these basic requirements of civilized service?

The reason Uber exists, continues to grow and attracts more people to use its service all around the world is that the regulatory agencies in charge of overseeing taxis companies, have utterly failed to do their job. Why have they failed? In some cases, corruption, and in other cases, pure incompetence and laziness. Do they ever have inspectors masquerading as riders to see if the taxi cabs and drivers meet the most basic standards? From my experiences, which I describe in detail below, the answer is NO. This is why Uber is successful. Instead of wasting time and money trying to ban Uber, cities need to insist on these basic standards and taxi companies need to adhere to them.

In some cities, like Valletta (Malta), there is no Uber (yet). One can use a car service called eCab. You won’t see eCabs parked at taxi cab ranks or cruising around Malta, so technically it isn’t a taxi. You have to call them or book them online. eCab is, like Uber, superior to the Malta taxi experience (although its drivers don’t have credit card machines, the one negative aspect of eCab). I went to Malta for a few days this month. The host of the apartment I rented in Valletta had an eCab pick me up from the airport. The driver was on time and courteous. His car was clean and all the luggage fit in the trunk (which was free of his personal belongings). One day during my stay in Valletta,  I decided to go to Mdina, a historic town in Malta. I went to one of the official white taxis at the taxi stand right by the main square. The first thing the driver tried to do was to cheat me. After I got into the taxi cab and told him I wanted to go to Mdina, he quoted me a rate that was above the legal fixed price for the Valletta-Mdina journey (Malta has fixed prices for taxi journeys). Imagine that, a taxi driver who tries to cheat you! Any of you reading this post, who are fans of Uber, will recognize the sorry experience. I got out of the cab and went to find another taxi driver who would take me to Mdina at the fixed regulated price. Fortunately I found one. But the thing that disgusted me was the brazenness of it all: this took place at an official taxi rank right by the main square. This is what too many taxi drivers around the world do with tourists: they cheat them. Both the taxi I initially tried to take and the one I eventually took to Mdina were old cars, the interiors were not that clean, everything seemed to be falling apart. In retrospect, I should have called for an eCab. But I did learn my lesson for my trip back to the airport – I used eCab.

Do you think my Malta taxi experience is an isolated case? Below I provide in detail my taxi experience in various cities, contrasted with my Uber experience.

(1) Manila

Taxi: I arrive in Manila at 4:30 a.m. on New Year’s Day. It’s dark outside, but the airport is buzzing with activity because many flights get in at that early hour. I go to the taxi rank and take the first vehicle in the queue. After leaving Manila International Airport and driving for a kilometer or so, I begin to notice that I can barely see ahead of me and if I can’t see, neither can my driver. I ask him, where are your headlights. He chuckles and tells me he has a flashlight! The driver pulls out the small flashlight from a side compartment and shows it to me. I feel no relief. He apologizes. Now I understand why at every intersection, the driver has to honk and turn on the hazard lights. We bump along like this in the dark, hitting several potholes, me hoping we don’t hit anything larger than a small rock and the driver, having stashed his dim, useless flashlight away, approaching every intersection with trepidation. We get to my destination in one piece. Fortunately the ride was quite cheap, but the vehicle was old and rattling and it had no working headlights. Not an experience I wish to repeat.

Uber: I decided to use Uber to get to the Manila International Airport. The Uber driver’s car was fairly new. The interiors and the trunk were clean. The air-conditioning worked. The driver was courteous and helpful; he was clean-shaven and well-dressed. The journey to the airport was as it should be: a civilized, uneventful affair. The Uber fare was very close to what I would have paid for a taxi and I did not have to fuss around with cash. When you are traveling in different countries, Uber is such a convenient service to take to the airport. You don’t have to worry about whether you still have enough local currency or whether the credit card machine is broken. (Note: The “broken credit card machine excuse” seems to plague cab drivers around the world.)

(2) Bangkok

Taxi: Fortunately I did not take a taxi from Suvarnabhumi Airport to my hotel (the Hansar, reviewed here). A car service picked me up so I was spared. However, I did take a taxi one night from a restaurant back to the Hansar and the driver tried to get me to agree to a certain price, instead of using the meter. I insisted on the meter. Thank heavens I did, because the meter price turned out to be half of his proposed “special” price. This is another classic taxi driver trick played on unsuspecting foreigners. Taxi drivers in Bangkok are notorious for cheating tourists. One taxi driver was caught on video trying to cheat a Japanese man, who happened to reside in Bangkok and speak Thai. After the incident, some taxi drivers posted signs around the taxi ranks at Suvarnabhumi airport urging other drivers not to take on Japanese passengers. Isn’t this outrageous? Do a Google search on “Thai taxi scam” and you’ll see how many people have complained about taxis in Thailand.

Uber: I used Uber for the journey from the hotel to the airport. The driver looked respectable, spoke English and was courteous. The car, a Lexus, was clean and air-conditioned. The trunk was clean and empty. It’s Uber for me, from now on, in Bangkok.

(3) Rome

I didn’t even think of taking a regular taxi when I arrived in Rome last week at the Termini train station. The last time I took a regular taxi in Rome two years ago from the hotel to the airport, the taxi driver almost ran out of petrol! He had to stop at a petrol station. Funny, I thought at that time, this happened to me in Paris. Why are taxi drivers always running out of petrol while taking you to your destination? Then, of course, upon arriving at the airport, his credit card machine was broken.

Uber: I arrived at Termini station on 21 March 2015 and found the Uber driver next to his black Mercedes. The car was clean. The driver was impeccably dressed and spoke English. He found the apartment I had rented near the Piazza del Popolo without any problems (because of course, he had a smart phone with GPS). For the trip back to the airport, I used Uber again and guess what, I got the same wonderful driver — Paolo! This is great, I told myself, it’s like having my own private car service. I felt like a VIP being driven to the airport in a black Mercedes by well-groomed, professionally dressed man. The Uber fare from Piazza del Popolo to Fiumicino airport was about the same as a regular taxi ride. No credit card machine problems, no cash exchanging hands, no emergency stops at a petrol station.

(4) London

Taxi: I took one of the London black cabs from London City Airport to The Nadler Soho (reviewed here) two weeks ago. The cab was clean, the driver was a bit grumpy  (it’s England after all) and . . . his credit card machine was broken! On the way to the hotel, he stopped at a petrol station so I could take cash out of an ATM. What is it with these cab drivers and their perpetually broken credit card machines? At least London cabbies know their way around London. In many cities, they don’t know how to get to your destination (which is ludicrous for a taxi driver) or they pretend not to know.

Uber: From The Nadler Soho to Gatwick Airport, I used Uber. The car was clean, driver was courteous (not grumpy this time) and no cash/credit card issues.

(5) Paris

I have not used Uber in Paris but I plan to do so next time I am in the city. I lived in Paris for a year and a half and found taxi service in the city to be hit-and-miss. I took G7 Taxis and most of the time, the taxis were clean and the credit card machines worked (but not always). The other taxis were strange: the air-conditioning never worked, the driver’s personal belongings were all over the front passenger seat and in the trunk (not convenient if you have luggage), and in some instances, the taxi drivers refused to take me to my destination (Was it too close or too far, who knows?).

(6) Beijing and Shanghai

Uber service did not exist in Beijing and Shanghai when I visited these cities. They need it. The regular taxi cabs are old, small cars without proper air-conditioning.  The interiors are dilapidated and don’t have functioning seatbelts. The Beijing taxi driver who took me from the airport to the hotel couldn’t even be bothered to help me get the luggage out of the trunk. He stood by, smoking a cigarette, watching me struggle to take my luggage out of his filthy, junk-filled trunk. In Shanghai, one taxi driver refused to take me on as a passenger because he felt the ride was too short (I think that’s what he felt but I’m not sure, because I needed someone else to translate the driver’s apparent displeasure with my choice of destination). Don’t even ask about credit card machines.

(7) Other cities

I have not taken Uber in other cities, but I will now. In some places, such as Melbourne, the taxis charge 10 percent extra when you pay by credit card.

Now let’s address the complaints against Uber.

The dreaded Uber surge pricing: I know people who have been stunned by the final price of the ride during a rainstorm or other occasion (New Year’s Eve) when there aren’t enough taxis and Uber cars. One should be aware of this and plan accordingly. The Uber app allows you to estimate the cost of the ride before you take it. However, at least you can find an Uber car if you are willing to pay the price. But yes, this is one of the downsides of using Uber when everyone’s trying to hail a cab or find an Uber car.

Safety issues: The much publicized rape in New Delhi committed by an Uber driver made headlines, leading people to question just how rigorously Uber screens its drivers around the world. But how thoroughly do taxi companies around the world investigate the backgrounds of their drivers? How do you know there haven’t been rapes and robberies committed by taxi drivers? Just because they’re not reported doesn’t mean they don’t occur. What about the thefts that taxi drivers regularly commit in the form of meters that run too fast, fares above the legal rate, routes taken to jack up the price of the ride?

I have reserved the best for last — a complaint in an article entitled Disruption’s Tragic Flaw, published in the Frankfurter Allgemeine and written by Shoshana Zuboff, a retired professor of Harvard Business School who has done much research into how computers (and the Internet) have changed the workplace. Her article includes a critique of Uber’s “sharing model” and a prescription for what Europe should do (the subheadline of this article is “The case of Uber shows why European companies should not follow the example of their American competitors too closely. It pays to take the needs of customers and contractors into account”).

For an academic of her stature and long years of experience (during which I assume she also took taxis), one of the statements in her article condemning Uber, comes to me as a shock:

In my view, what we see in Uber and similar cases is a tragic flaw: disruption without discipline. Disruption without the institutionalization required for systemic coherence, which is essential for trust . . . Uber’s is opportunistic disruption that does not rise to Schumpeter’s standard for moving capitalism’s evolutionary dial.

Professor Zuboff is referring to Uber’s alleged mistreatment of Uber drivers (“Uber unilaterally sets the rates and terms of their labor”), violations of various laws (union organizing rights, minimum wage laws), negligence in screening drivers, dirty tricks played against unsympathetic journalists and competitors like Lyft, privacy violations and so on. She adds that “[i]n consumer-facing service businesses we know all too well that employees who are exploited, insecure, and stressed do not easily operate in the best interests of their end consumers, as their motivations and incentives tend toward exerting the least possible effort.”

Professor Zuboff makes it sound like Uber drivers are an oppressed, unhappy lot, some lumpenproletariat viciously exploited like slaves or a bunch of rogues whose passengers cringe in terror in their back seats. Yet, in my own experience, I have found every single Uber driver in Manila, Bangkok, Rome and London to be professionally dressed (clean attire, well-groomed), English-speaking, driving a nice car (safely, I might add) and proud of it, honest and courteous.

By contrast, my experience with taxi drivers around the world (exceptions being in Singapore and Japan), has been mostly negative. Too many taxi drivers are slovenly, rude, contemptuous and downright hostile, and dishonest at worst; at best, they seem to be like automatons, simply doing a job they are neither proud of nor keen to perform — exerting the least possible effort, as the Professor points out. Their taxis are never as clean as any of the Uber cars. Often the air-conditioning fails, which leaves me in a sweaty mess when I arrive at my destination. Their credit card machines do not work and the trunks of their cars are filled with so much personal junk that my luggage (usually one backpack or one suitcase only) barely fits in.

When you look at the two kinds of drivers — Uber versus taxis — who do you think are, in Professor Zuboff’s words, “exploited, insecure and stressed”? Whose drivers do you think are screened?

As for the trust that Professor Zuboff talks about, the tragic flaw lies not in Uber’s model; it lies in the breach of the public trust by the government agencies in charge of regulating taxi companies. Uber is the result of what happens when government agencies give out privileges in the form of taxi licenses and fail to impose high standards and hold taxi drivers accountable — standards of professionalism, honesty, cleanliness, as well as insisting upon the comfort and convenience of passengers. That means agencies regulating taxis need to upgrade those standards from time to time as technology improves: requiring credit card machines, GPS equipped devices and so on.

What I see around the world today are regulatory agencies beholden to the taxi companies they are supposed to regulate. In some countries, the agencies are corrupt and accept bribes. In other places, they are simply incompetent. That means the agency officials in charge of overseeing taxi companies need to be fired. Given that this problem has been going on for decades, people, like me, have decided that we cannot wait a few more decades. So when a service like Uber comes around and provides an alternative, we stop taking taxis.

Professor Zuboff asks: Will the Uber model make societies more democratic? Should Europe imitate the Uber model?

After living in Europe for many years, I have seen democracy destroyed by governments that have protected the interests of a small minority at the expense of the public good. When government agencies continue to allow taxi drivers to cheat passengers, drive dirty cabs that have no functioning seat belts and air-conditioning, they are upholding the privileges of a very small group of people against everyone else. The Uber sharing model makes societies democratic precisely because it “bypasses old institutional structures” (as Zuboff says in her article). These “old institutional structures” are the same ones that have been keeping Europe in an economic slump, killing off small businesses and increasing unemployment among Europeans under the age of 30.

Professor Zuboff might want to spend more time investigating how to repair the breach of public trust by government officials, and propose workable solutions, to ensure democracy revives in Europe. Perhaps the solution is having private companies like Uber provide an alternative. All I know is that you won’t get European governments to come up with a solution because they’re imprisoned in “old institutional structures.”

Until taxi companies and the taxi drivers themselves are held up to high standards, Uber will continue to flourish. I don’t care if Uber never moves “capitalism’s evolutionary dial” (as Zuboff puts it). Because I travel frequently in different countries, I am at a disadvantage compared to locals who are well acquainted with the dirty tricks of local taxi drivers. I care about getting a ride from a driver who is honest, well-groomed and behaves professionally, has a clean car in good working order, knows how to get to my destination, charges me a fair rate and provides me with the convenience of a credit card transaction.