So Far, 2017 Just Hasn't Been Uber's Year
It would be an understatement to suggest that Uber has had a bad couple of weeks. It kicked off with a highly publicized blog posting from former engineer Susan Fowler describing intrinsic sexual harassment at the San Francisco-based ride-hailing service. This was followed by an open letter from two of its investors condemning the company for fostering poor corporate behavior and unhealthy business practices. This, of course, was fast followed by a lawsuit from Google-parent Alphabet’s Waymo that alleged Uber stole some of its driverless car technology.
That was last week. This week saw Uber CEO Travis Kalanick asking his senior vice president of engineering, Amit Singhal, to step down after it came to light that Singhal had neglected to reveal that he was the subject of an ongoing sexual harassment investigation at his previous employer Google. However, Kalanick ended up being the subject of his own controversy just a few days later.
A remorseful Kalanick issued a public apology to his employees at Uber after a video surfaced on Bloomberg in which he had a heated exchange with one of his own drivers regarding declining fares. “My job as your leader is to lead,” Kalanick wrote. “That is not what I did, and it cannot be explained away. It’s clear this video is a reflection of me — and the criticism we’ve received is a stark reminder that I must fundamentally change as a leader and grow up. This is the first time I’ve been willing to admit that I need leadership help and I intend to get it.”
As if that were not enough bad publicity for the company, vice president of product growth Ed Baker left Uber after three years at the company amid the growing scrutiny of the company’s business practices and claimed toxic culture. Meanwhile, Fowler said on Thursday that she had obtained legal council while accusing her former employer of investigating her unfairly over a string of Uber app deletions.
The final blow came from a New York Times report that alleged Uber had been using a program, internally called Greyball, to circumvent authorities in markets where its ride-haling services were resisted or outright banned. Having been in place since 2014, the program uses data collected to avoid suspect hailers on a global scale.
In a statement, Uber claimed, “This program denies ride requests to users who are violating our terms of service — whether that’s people aiming to physically harm drivers, competitors looking to disrupt our operations, or opponents who collude with officials on secret ‘stings’ meant to entrap drivers.”
[Image: Jason Tester Guerrilla Futures/ Flickr ( CC BY-ND 2.0)]
A staunch consumer advocate tracking industry trends and regulation. Before joining TTAC, Matt spent a decade working for marketing and research firms based in NYC. Clients included several of the world’s largest automakers, global tire brands, and aftermarket part suppliers. Dissatisfied with the corporate world and resentful of having to wear suits everyday, he pivoted to writing about cars. Since then, that man has become an ardent supporter of the right-to-repair movement, been interviewed on the auto industry by national radio broadcasts, driven more rental cars than anyone ever should, participated in amateur rallying events, and received the requisite minimum training as sanctioned by the SCCA. Handy with a wrench, Matt grew up surrounded by Detroit auto workers and managed to get a pizza delivery job before he was legally eligible. He later found himself driving box trucks through Manhattan, guaranteeing future sympathy for actual truckers. He continues to conduct research pertaining to the automotive sector as an independent contractor and has since moved back to his native Michigan, closer to where the cars are born. A contrarian, Matt claims to prefer understeer — stating that front and all-wheel drive vehicles cater best to his driving style.
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The idea that taxi service is a stupid industry in desperate need of disruption, and the idea that Uber is a den of flagrant jerks who profoundly deserve all the bad things that happen to them, are not mutually exclusive. Both of those things can be true at the same time.
Washington DC used to have some of the worst taxicabs ever. No meters, just "zones" which even a 37-year resident like I am could never figure out. And, of course, the zones do not extend to any of the 3 DC area airports. Most of the vehicles were clapped-out Panthers, purchased after a hard life in police duty, with busted seats, busted shock absorbers and oil-smoke spewing exhausts. And the drivers almost all "just off the boat" who knew only how to get from the major airports and the major downtown hotels. Unlike some other cities, e.g. NYC, there was no "medallion" system and no legal monopoly. So, I was an early adopter of Uber. They usually under-priced the cabs, you didn't have to deal with cash and they were dependable. (I had quite a few instances of cabs failing to show for early-morning pickups at my house to the airport.) That said, I'm not insensitive to the plight of their drivers. I have a feeling that a lot of them who signed up early on and maybe even purchased a vehicle based on the expectation of a certain amount of revenue are getting squeezed as Uber ratchets the prices down to compete with Lyft. Like a franchisor that won't commit to a maximum number of franchised stores in a given territory, Uber's interests and it's drivers' interests are not aligned.