Doug Clarke thinks this is an appropriate read for today – from the New York Times:
When Uber and Airbnb Meet the Real World
THE regulatory woes seem to be never ending for the newest wave of tech start-ups — the on-demand apps that connect people who need something (a driver, a house cleaner, a grocery shopper) with people who want to do the job. …
Why have these companies run into so many problems? Part of the reason is that they think of themselves as online companies — yet they mostly operate in the offline world.
They subscribe to three core business principles that have become a religion in Silicon Valley: Serve as a middleman, employ as few people as possible and automate everything.
The first principle is to be a middleman — or in tech lingo, a platform — connecting the people who post on YouTube with those who watch their videos, or the people who need a ride with people who will drive them. As platforms, the thinking goes, they are just connectors, with no responsibility for what happens there. …
“These folks grew up in a world where platforms are not responsible, and then when they go do stuff in the real world, they expect that to be the case,” said Ryan Calo, an assistant professor at the University of Washington law school who studies cyber law. …
That mentality may be why new on-demand companies are running into trouble with workers. Most of these companies avoid having employees by using contract workers. But some are wondering whether the companies are pushing the definition of contract worker too far. Uber drivers have filed class-action lawsuits in Massachusetts and California, and advocates are pushing for things like benefits and disability compensation for workers at many start-ups.
The third related principle is to automate everything — whether selling ads, flagging inappropriate content or assessing employee performance. That notion also meets its limits in the real world. …
The belief that problems can be solved without involving people is probably why many of these companies did not meet with regulators and officials before starting services in new cities. And it has come back to haunt them. Luther Lowe, director of public policy at Yelp, had some basic advice for Uber that could apply to Airbnb, Lyft and others: Hire a lobbyist and meet with the mayor and the city council before setting up shop. …
DESPITE these three major differences between web companies and the ones that bridge the digital and physical worlds, they all share another guiding Silicon Valley principle: the belief that if enough people want to use a product, the company will succeed. …
That leads to yet another principle shared by both older and newer tech companies: Regulators are little more than roadblocks standing in the way of innovation.
Full article here.
Well said.
regulators do have their role, but often they are highly unionized, overstaffed and overpaid, and then care more about the regulations or the regulator as opposed to the benefits of the public.
A common middle ground has to be found. Using Uber & cab companies (with associated city unions and cab driver unions) as an example, here are a few issues:
a) getting a taxi in a city is often difficult AND THAT MUST CHANGE given GPS, online apps and ample capacity. Cab companies need to show where their cars are so I can click one online. Much improvement required here by the old world established firms
b) paying a driver takes far too much time, and some often do not even use a CC reader. Uber has a clear advantage here where the payment happens automatically. Cab companies need to catch up ASAP here.
c) some taxis are so old with worn our shocks, 400,000+ km on them or worn out seats, often dirty, that regulation is all but meaningless. As such Uber with online commentaries might improve quality actually as opposed to being lower quality.
d) cab licenses are often just a cash-cow for cities, for example $600,000 to $1M in New York. So to get another billion New York releases 1000-1200 new plates. As such Uber needs to pay cities more, perhaps far more, to become licensed.
“Hire a lobbyist and meet with the mayor and the city council before setting up shop. …”
Which is exactly what Uber did in Vancouver. Of course, they had to meet Geoff Meggs as the Mayor of Vancouver believes strongly in delegation of responsibilities.
And anyway its the PTB that decides these things here.