How Uber is driving transportation democracy
Uber is popular with consumers, and it leverages them as political constituents, reframing legal conflicts as battles over consumer choice.
We must consider the tradeoffs between investing in public transit or ceding ground to mass private operations
Technology ethnographer and author of Uberland: How Algorithms are Rewriting the Rules of Work. She is a researcher at the Data & Society Research Institute.
In Vancouver, one of the few major Canadian cities where Uber does not provide services, the ride-hailing app is already a source of tension. The absence of Uber in a metropolitan area is a wrinkle on that city’s reputation, a sign that it lags its more progressive peers. So in Vancouver, the company strategically signed drivers up to the app years ago, ensuring it’s ready to launch at the right moment.
In fact, in most cities, such as Toronto, Uber expands in a legal grey zone – without a permit to operate, eschewing regulations designed for taxi companies – by arguing that it is, instead, a technology company. Uber is a chameleon, becoming what it needs to be at different times, in different places, but the promises it makes to drivers and to the public can be misleading. For example, in 2014-15, it advertised that its drivers’ median income in New York was US$90,000 a year. It was an appealing claim: Uber promised to scale entrepreneurship for the masses with technology in the aftermath of the Great Recession, when people had lost their jobs and cities were experiencing urban blight from foreclosure crises. At a time of economic instability, it seemed to offer a brighter path to the middle class. But the U.S. Federal Trade Commission found that less than 10 per cent of Uber drivers actually earned US$90,000 a year, so it brought a complaint against the company for recruiting drivers with exaggerated earnings claims across many cities. Uber settled for US$20-million.
As a technology ethnographer and researcher, I observed Uber drivers at work from mid-2014 through the winter of 2018, across more than 25 cities and 8,000 kilometres in the United States and Canada. And by observing the workplace culture they built in local and national online forums, where I followed some 300,000 members collectively, I saw patterns start to emerge. What I’ve observed is a cross-section of experiences that illustrate how the company evolves over time – and how it can shortchange its early allies in the long run. In 2018, economist Lawrence Mishel of the Economic Policy Institute surmised that driver compensation averages US$11.77 an hour after deducting Uber fees and vehicle expenses from passenger fares. And some drivers I spoke with consider it a “good bad job” compared with their other options, such as working in fast food. Even if some of Uber’s bigger promises falter, its drivers continue to reap benefits – from the scheduling flexibility to the social connections they make with passengers. Striking the right balance when it comes to regulating Uber can be tricky because there are so many stakeholders in its future and because Uber affects them differently at different stages.
Austin, Tex., and Calgary were at a similar stage in 2016, when they tried to regulate ride-hailing, in both cases leading to stand-offs. Austin tried to implement fingerprint-based background checks for drivers through a municipal ordinance, and Calgary tried to implement a bylaw that would require Uber to pay an annual licensing fee of $1,753 and a fee of $220 per driver.
Rather than comply, Uber and its competitor Lyft abruptly left Austin, leaving drivers and passengers stranded. A factory might threaten to relocate overseas if it doesn’t get tax breaks from a local government, but relocating a factory is a big undertaking. Ride-hailing giants can just turn off the service.
Uber is popular with consumers, and it leverages them as political constituents, reframing legal conflicts as battles over consumer choice. The company sent robo-texts to passengers in Austin urging them to vote to repeal the ordinance. “Melissa, this is Cameron from Uber. Ridesharing is on the ballot & early voting ends tomorrow! Can we count on your vote FOR Prop 1 to keep Uber in Austin?” Uber sent so many of these messages that it faced a class-action lawsuit for allegedly violating the Telephone Consumer Protection Act. In Calgary, it urged users to sign a petition to be submitted to city council with messages such as: “This is your chance to stand with us and send a message to your elected officials that Calgary deserves a new set of transportation choices. Consumers love Uber because the taxi industry doesn’t come close to offering the same convenience and reliability.” The city eventually adjusted the bylaw, and four months after it relaunched in Calgary in December, 2016, Uber touted having 70,000 riders and 1,500 drivers – numbers that seemed to prove Uber is what people want.
The company’s ominous threat to rally consumers (who love the convenience of its service) against regulators (who rein in the company) is a gambit that may give regulators pause. Uber uses the language of technology to manipulate regulations as well.
By self-identifying as a Silicon Valley technology company, it has argued that it isn’t covered under the Americans with Disabilities Act because it’s not a transportation company, so it is not obligated to provide accessible services for passengers with disabilities. This language comes from the culture of Silicon Valley, where internet companies such as Facebook and Google claim their platforms are neutral and their services, from the news feed to search results, are curated by objective algorithms. Uber claims it has a hands-off relationship with drivers, but it actually collects granular details on their behaviour, manages them with algorithms and experiments on their pay.
In all the ways that drivers are subject to algorithmic manipulation and experimentation by “neutral” algorithms, we can see how consumers of Silicon Valley services can be taken advantage of, too. Facebook, for example, experimented on users’ emotions by displaying sadder posts to some and happier posts to others in their news feeds. Their study suggests that people are vulnerable to mass emotional contagion.
But the real impact of the study was evident in the public outrage: Facebook revealed that the algorithmic news feed could be manipulative, and users were upset over being treated like guinea pigs.
Sometimes I get the feeling of whiplash, jumping from cities where Uber’s arrival is exciting and imminent to places where the company is the subject of sustained protest. How drivers experience the company usually depends on what stage Uber is at in their city; for example, while hundreds of drivers in New York gathered in front of Uber’s local headquarters to protest rate cuts in 2016, drivers in Montreal – who used the banned app furtively, often pretending to offer rides to friends – were allied with the company. While many cities struggle to regulate ride-hailing, Uber appears to be a bit more conciliatory as it evolves, and the Canadian regulatory environment may be a bit more demanding or less vulnerable to the logics of disruption. Quebec’s pilot program, for example, requires drivers to undergo more training and tighter background checks. And although Uber threatened to leave the city, it eventually conceded.
Where ride-hailing has become entrenched, predictable patterns have followed. First, the Uber model is cited for potential labour law violations around the world over allegations that it misclassifies drivers as independent contractors. Like many companies, it has also been cited for mishandling data, privacy and security complaints, which affect both drivers and passengers. Then complaints that affect transportation more widely follow suit; for example, a recent study suggests that ride-hailing companies worsen congestion.
In New York, which is in one of the most evolved stages of Uberland, 2018 saw a rash of taxi driver suicides, highlighting not only the financial blow Uber and Lyft pose to medallion owners, but the declining wages for all drivers in both ride-hailing and taxi work.
The success of ride-hailing companies prompts us to consider the tradeoffs between investing in public transportation or ceding ground to mass private transportation. By looking at the evolutionary stages of ride-hailing, we have a chance to define our ideal vision for such services.
Entrepreneurial regulators might see an opportunity among Uber’s missteps to regulate Silicon Valley companies more broadly. As Facebook CEO Mark Zuckerberg testifies to Congress about the platform’s role in the U.S. elections and critics such as media scholar Siva Vaidhyanathan argue that Facebook disrupts democracy, we are at a turning point in debates about the full impact of technology on society. Whether we’re discussing transit, democracy or the myriad other parts of our society that are intertwined with technology, we should consider that the power of that technology is political – not neutral.
By positioning itself as a technology company, rather than a taxi company, Uber exists in a legal grey zone, a chameleon able to become what it needs to be at different times, in different places, while promising great things to its drivers and customers alike.