TMI – Six hours ago, my Editor, BellaRose messaged me on Twitter saying Uber was losing its operating license in London. I felt quite ashamed that I had to be told considering I am currently in the city. Little did I know that I was going to see it on the second page of the London Evening Standard newspaper. With an already piqued interest by BellaRose, I picked the paper to find out ‘why?’ which I will be sharing in this article.
For many of us, we already know about the numerous challenges Uber, a $70billion (arguably) ride-hailing service has been facing. Interestingly, these challenges might have led to a decline in the quality of her services across the board especially in Lagos, Nigeria where I come from. However, I don’t think this same decline of service applied to Londoners as they seem to be in favour of not restricting the ‘app firm’, as it was referred to in the newspaper.
For Uber, London is her largest market in Europe and just to give a little context, within a space of three years (June 2012 – May 2015), Londoners’ had been driven almost 95 million miles on 20 million trips which is the equivalent of 194 trips to the moon and back.
Note: So far, “Londoners” here refer to only the Uber users. However, there is another group of Londoners who are more in favour of the eradication of the service – the Taxi drivers
The FOR – “eradicate Uber”
Perhaps, by now it will be clear the people who are most excited about the move to restrict Uber in their city, the ‘Black Taxis’ (no, it is not Taxi driven by Black people, it is simply a black-coloured cab).
The regular Black Taxi driver is said to have memorised 25,000 streets and 100,000 landmarks for a test known as The Knowledge, these people claim that Uber is taking away business from them and that Uber drivers’ are under-regulated. The average Uber trip is reported to be 30% lesser than what a regular Black Cab will charge. According to consumer behaviour, they will gravitate towards the cheaper service ceteris paribus (other things being equal), so it is not surprising that the majority of customers using the service favour it over the regular ‘black taxi’.
So, why is their license not being renewed?
Dear London: we r far from perfect but we have 40k licensed drivers and 3.5mm Londoners depending on us. Pls work w/us to make things right
— dara khosrowshahi (@dkhos) September 22, 2017
As earlier mentioned, in the today’s issue of the newspaper, City Hall Editor, Pippa Crerar titled her piece ‘Uber and Out’, which as you will expect is a catchphrase. The primary reason for the restriction of her license is positioned as “public safety and security concerns” saying “companies must play by the rules”, Mayor Sadiq Khan, Head, Transport for London (TfL), a local government body responsible for the transport system in Greater London, England. The TfL ruled that Uber was “not fit and proper” to hold a private hire licence. They took issue with how Uber had handled previous criminal cases of sexual assault by her drivers as well as their use of ‘dodgy’ software, Greybull to deceive regulators.
Here, you can listen to this person’s reaction to the ruling (I forget, but I think he is a Lawyer):
— Prince Benjamin (Trill) (@DadaBen_) September 22, 2017
About two hours ago, Uber’s new CEO, Dara Khosrowshahi argued using the number of ‘licensed’ drivers and users the app has acquired in London. He pleaded that the city of London worked with them to make things right.
N.B: 3.5million Londoners and 40,000 drivers currently ‘depend’ on Uber in London.
Is Uber’s argument logical? What were people doing before the advent of Uber in the area? Can they not return back to that? Also, remember, these drivers ain’t loyal (only EMPLOYEES are ‘expected’ to be loyal), already on TV a driver who pleaded anonymity was ready to jump ship to a rival ride-hailing company, Taxify. So, Uber’s loss in the area is actually a win for not just the Black Taxi’s but also competing services, like Taxify.
On the other hand, what does this say about London’s openness to new business innovations? Is this a strategic move for London
Conclusion: A way out – appeal the decision
Companies (in this case, Uber) are allowed 21 days to appeal a decision, in the meantime, they can keep doing business till their current license expires on Sunday, 30th September 2017. Just to let you know that this ruling had been in the works for a while, in May, their license was only renewed for 4 months instead of the usual 5 years.
Not wasting any time, Uber has already created a petition for people to sign in order to get the Tfl to reverse the petition. If you stay long enough on the site trying to decide, they send you more emotional prompts like: “Benjamin Dada needs your help, Save your Uber in London…” which I saw when I visited the site on my phone.
Update: Uber has reportedly hired a ‘powerful’ lawyer, Barrister Thomas de la Mare, one who had successfully fought the TfL before and law firm, Hogan Lovells
In Ubers’ defence, as at the end of last month, Uber announced plans on improving safety for drivers which somehow ended up including ‘everyone’ (consumers’ alike), But will all that matter now?
Here is the official letter from the TfL as posted severally on Twitter (as at the time of updating this post – 4 times)
TfL has informed Uber that it will not be issued with a private hire operator licence pic.twitter.com/1srrXNC5XR
— Transport for London (@TfL) September 23, 2017
Update: This post was updated on the 24th September, 12:26am to carry the official statement from the TfL and the paragraph about Uber’s petition site. Also, to show that Uber had brought in a ‘powerful’ Lawyer to appeal its case.