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Earlier this week I wrote a “Tech Tuesday” post talking about Uber’s new Smart Routes functionality, which it is currently testing out in San Francisco. At the end of the post I ended by saying that it’s not just the taxi industry that should be thinking about Uber, it’s also public transit authorities.
And that’s because many people in cities rely on multi-modal forms of transportation (I know I do) and in my mind it is clear that Uber is trending away from just “Everyone’s Private Driver” to a service that is starting to look and feel a lot like urban mass transit.
Then today my good friend Evgeny sent me a post called, “Public Transit Should Be Uber’s New Best Friend.” And it’s one of the best pieces I’ve read on Uber and its impact on urban mobility. I highly recommend you give it a read, particularly if you’re in the city building arena.
The article does a deep dive into how New Yorkers commute. Here’s how they broke it down.
It then talks about what it will take for a company like Uber to make a meaningful dent in car ownership (which is one of the company’s goals) and how the truly big opportunity for Uber is to go more mass market and tap into the public transit market – either by interfacing with or by building its own version of it.
Here’s their concluding paragraph:
But there’s a much wider potential audience if Uber can also reach middle-class customers who want to save money. Perhaps in the distant (or even the not-so-distant) future, Uber can build its own version of “public” transit, making rides so cheap that they cost less than the $4 or $5 that Americans now pay, on average, to make a trip in their personal cars. In the meantime, it might have more success among “car-cutting” customers who can use Uber along with public transit. That might mean Uber’s growth is concentrated more in cities like New York, San Francisco and Chicago — and in Europe and Asia — that already have reasonably strong public transit networks.
It’s definitely worth a full read. Thanks again for sending this over Evgeny.
Early this morning Peter Cheney of the Globe and Mail published an article called: How Uber is ending the dirty dealings behind Toronto’s cab business.
And I highly recommend you read it. He’s been investigating this industry for decades.
Though the article is specific to Toronto, I know that there are middle people and archaic policies governing the taxi industries in many other cities around the world.
Here it revolves around taxi licenses issued by the city (known as “plates”), which are expensive and almost impossible to get. Last year the average price of a plate was $118,235 (2014).
The way it works is that people – typically non-drivers – buy/inherit/get these plates and then charge rent on them to drivers who want to use them. The result is a taxi cartel:
In fact, Toronto’s taxi plate system is anything but free enterprise. Instead, it is based on the artificial restriction of a natural market, and the granting of licences to a fixed number of participants. Even those who paid top dollar for a plate used to enjoy an annual return of more than 12 per cent. And for those who inherited plates, the return was manna from heaven.
So it shouldn’t come as a surprise that the taxi industry is grouchy about companies like Uber. But the cost structure of the incumbents is going to need to change if they want to stay in business.
Jeff Bezos of Amazon is famous for saying, “Your margin is my opportunity.” And that’s exactly what is happening here. A bloated legacy cost structure is being quickly supplanted by better/cheaper.
Earlier this week I wrote a “Tech Tuesday” post talking about Uber’s new Smart Routes functionality, which it is currently testing out in San Francisco. At the end of the post I ended by saying that it’s not just the taxi industry that should be thinking about Uber, it’s also public transit authorities.
And that’s because many people in cities rely on multi-modal forms of transportation (I know I do) and in my mind it is clear that Uber is trending away from just “Everyone’s Private Driver” to a service that is starting to look and feel a lot like urban mass transit.
Then today my good friend Evgeny sent me a post called, “Public Transit Should Be Uber’s New Best Friend.” And it’s one of the best pieces I’ve read on Uber and its impact on urban mobility. I highly recommend you give it a read, particularly if you’re in the city building arena.
The article does a deep dive into how New Yorkers commute. Here’s how they broke it down.
It then talks about what it will take for a company like Uber to make a meaningful dent in car ownership (which is one of the company’s goals) and how the truly big opportunity for Uber is to go more mass market and tap into the public transit market – either by interfacing with or by building its own version of it.
Here’s their concluding paragraph:
But there’s a much wider potential audience if Uber can also reach middle-class customers who want to save money. Perhaps in the distant (or even the not-so-distant) future, Uber can build its own version of “public” transit, making rides so cheap that they cost less than the $4 or $5 that Americans now pay, on average, to make a trip in their personal cars. In the meantime, it might have more success among “car-cutting” customers who can use Uber along with public transit. That might mean Uber’s growth is concentrated more in cities like New York, San Francisco and Chicago — and in Europe and Asia — that already have reasonably strong public transit networks.
It’s definitely worth a full read. Thanks again for sending this over Evgeny.
Early this morning Peter Cheney of the Globe and Mail published an article called: How Uber is ending the dirty dealings behind Toronto’s cab business.
And I highly recommend you read it. He’s been investigating this industry for decades.
Though the article is specific to Toronto, I know that there are middle people and archaic policies governing the taxi industries in many other cities around the world.
Here it revolves around taxi licenses issued by the city (known as “plates”), which are expensive and almost impossible to get. Last year the average price of a plate was $118,235 (2014).
The way it works is that people – typically non-drivers – buy/inherit/get these plates and then charge rent on them to drivers who want to use them. The result is a taxi cartel:
In fact, Toronto’s taxi plate system is anything but free enterprise. Instead, it is based on the artificial restriction of a natural market, and the granting of licences to a fixed number of participants. Even those who paid top dollar for a plate used to enjoy an annual return of more than 12 per cent. And for those who inherited plates, the return was manna from heaven.
So it shouldn’t come as a surprise that the taxi industry is grouchy about companies like Uber. But the cost structure of the incumbents is going to need to change if they want to stay in business.
Jeff Bezos of Amazon is famous for saying, “Your margin is my opportunity.” And that’s exactly what is happening here. A bloated legacy cost structure is being quickly supplanted by better/cheaper.
Tickets are free, but going fast. If you’re interested in this sort of thing, I would encourage you to sign up today. And if you do register or are already registered, drop me on a line so we can connect. I’m excited to see what kind of solutions we’re all able to come up with over the course of a weekend.
But as I was registering and reading through the website, I couldn’t help but think about some of the traffic problems that we won’t be solving over the hackathon weekend, namely the politicization of transportation planning in this city.
As an example of that check out a post by transit blogger Steve Munro called, The Vanishing Relevance of SmartTrack.
SmartTrack is the transit platform that Mayor John Tory ran on last year. And this post explains why it is unlikely to achieve its pitch promises.
Tickets are free, but going fast. If you’re interested in this sort of thing, I would encourage you to sign up today. And if you do register or are already registered, drop me on a line so we can connect. I’m excited to see what kind of solutions we’re all able to come up with over the course of a weekend.
But as I was registering and reading through the website, I couldn’t help but think about some of the traffic problems that we won’t be solving over the hackathon weekend, namely the politicization of transportation planning in this city.
As an example of that check out a post by transit blogger Steve Munro called, The Vanishing Relevance of SmartTrack.
SmartTrack is the transit platform that Mayor John Tory ran on last year. And this post explains why it is unlikely to achieve its pitch promises.
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