Uber’s cynical London charm campaign
Your Uber app is telling you to take the bus?
It’s not an alternate transit planner paradise reality. It’s London, and the feature is coming soon to users across the British capital.
Uber’s app, of course, is not the only way to get this information, but in a city as congested as London, it’s a tantalizing way to easily compare the cost and duration of the city’s many transportation options. The company is also planning to roll out its e-bike share service in London in the coming months that will add yet another last-mile option to public transportation itineraries.
The San Francisco-based company is billing this new feature as “central to Uber’s efforts to reduce private car ownership, clean up London’s air and make the city a healthier place to live”. Does anyone believe that Uber, whose IPO will soon make someone like Travis Kalanick a billionaire off the backs of $10-an-hour contract workers, have sincere interest in any of those three objectives?
More importantly, why is Uber being so nice to London when London has been so nasty to it? The answer is simple.
Because Uber knows that London is the bellwether for its future outside of the United States. If investors see the company can’t get London right, a city where Uber does not have to adapt their product or business model as meaningfully as they do in other markets, their international future is limited. And as the company gears up for an IPO, London is front of mind for their large pool of investors abroad.
See, Uber has not been as successful outside of the United States as their founders would have hoped. It has been challenged out of existence in Southeast Asia, beat at its own game in Russia, bulldozed in China, and set on fire(literally) in places like Spain and Latin America. Much of the world (including many in London) hasn’t resigned itself to a private foreign company controlling their urban transport infrastructure, which is why Anglophone London is such an important exception.
Trying the high road to drive wages lower
On the surface, this little gesture to add in public transportation seems like your garden variety PR campaign. But what makes it so cynical is that it has been (and continues to be) accompanied by a well-financed and well-organized legal strategy to make sure that the city’s decisions do not hold up in court. It is a ferocious legal campaign whose desired effect is almost entirely to drive down wages of taxi drivers in London, and British courts have repeatedly rebuffed Uber’s claims that their London drivers are contractors,
After successfully beating back London’s 2017 revocation of Uber’s license to operate, and while it waits on final word on its drivers’ labor status, its next target is a shift in congestion charge policy that levies a £11.50 ($15) fee on for-hire (mini-cab) vehicles, but not on London’s traditional black cabs. Uber is actually arguing in court that the fee is “racist”, claiming that mini-cab drivers are more ethnically diverse than black cab drivers.
All of this is evidence that Uber, like many other companies from Silicon Valley, are unwilling or unable to meaningfully adapt their products to serious market differences. From labor rights to taxation, congestion policies to complicated questions like racial discrimination, Uber’s playbook does not look all that different in London as it did in New York City or other North American municipalities that have given it trouble.
Its retreat from major markets after losing significant amounts of money is proof that this growth model has serious challenges that can’t be won or lost in court. They’re won or lost by adapting a very simple product to the very complex landscape that is the world.
Samuel Johnson famously quipped to his biographer James Boswell, “when a man is tired of London, he is tired of life”. I’d argue that Uber and its investors might find out, 330-some years later, that getting tired of London might mean something much more existential.
