SXSW could be the beginning of the end for an Uber-less Austin
RideAustin is pretty normal, man; the app works pretty good, and they have a lot of drivers. Michael Ferguson, a professional realtor and recreational beer consumer
AUSTIN, Texas, has spent the last 10 months engaged in a big experiment in urban transportation.
Uber and Lyft suddenly stopped operating there last May in protest of a law requiring drivers to be finger-printed. Since then, a wave of startups emerged to fill the gap left by the US ridehailing giants. Success would be proof that alternative visions of ride- sharing can flourish in a major American city.
But the model will face its biggest test yet on Friday, when crowds in the several hundreds of thousands will start descending upon Austin for the annual South by Southwest festival, a nine- day event that could be accurately described as a tech conference, a music and film festival, and a huge mess.
In tech circles, SXSW is renowned for propelling Twitter and other apps to prominence, at least temporarily. This year’s speakers include Mark Cuban, Gawker’s Nick Denton and Reddit Inc. co-founder Alexis Ohanian. There are currently seven ridehailing apps operating in Austin, all of which were in compliance with fingerprinting rules as of Feb 15, the city said. None of their names will sound familiar to most SXSW attendees. Two apps are leading the pack: RideAustin and Fasten. Both claim to be the city’s leading ride-hailing provider.
Michael Ferguson, a professional realtor and recreational beer consumer, prefers RideAustin to get him home after a night of drinking. “RideAustin is pretty normal, man; the app works pretty good, and they have a lot of drivers,” Ferguson said. “I don’t think that for the customer, getting around this town is an issue anymore.”
The data suggest otherwise. Both Uber and Lyft have said they had about 10,000 drivers in Austin at their peak. According to the city’s transportation department, 7,077 people had completed the required background checks as of Feb 1. Licensed ride-hailing providers completed about 108,000 trips a week in January, the last month for which city data is available. Many full-time drivers appear to have stuck around because volume is only down about 13 per cent since Uber and Lyft left, according to estimates from RideAustin.
But SXSW will put a significant strain on the capacity of these young startups. Fasten sees it as an opportunity to capture the national spotlight and reach venture capitalists. It plunked down cash to be an official SXSW sponsor. The company, which is based in Boston, raised US$ 10 million in funding last year, and Kirill Evdakov, its chief executive officer, said he’s seeking an additional US$ 20 million ( RM90 million) to expand in more cities. “Not many people know about what we do,” Evdakov said. RideAustin has slightly less riding on SXSW because it’s a local non-profit with no plans to expand geographically. Still, it’s been working feverishly to mobilise drivers for the nineday festival. The organisation is encouraging Uber drivers to come to town temporarily.
Joe Deshotel, director of community engagement at RideAustin, boasted that drivers from those cities periodically travel to Austin for days-long work trips- a national trend that has raised social and economic concerns elsewhere. “They’re not making enough in Houston, so they’re coming here,” Deshotel said.
While Uber and Lyft will skip SXSW this year, they’re not giving up on Austin. They continue to fight fingerprint proposals country-wide, saying the programmes would keep many people from driving for their platforms. — WPBloomberg