Uber and Lyft would have to increase their charges since they have to pay more for their employees, this could really be detrimental to the company. Uber has made a rating system that assist customers to rate their riding experience as well as the motorist. Do you think more cities should ban Uber from entering the transportation market or let Uber run in their cities? And, there is a divide between the workers who want to remain as independent contractors and the others who want to be recognized as employees. Ask 15 different experts what innovation is, and you’ll get 15 different answers, yet at the same time, innovative companies are easy to recognize. While the CEO of Uber is optimistic that Uber will be able to make profits in 2020, skeptics are not as certain citing stricter US and International regulations, and Uber’s own spending. Stories of rides gone terribly wrong have marked Uber with a bad reputation. It is also more cost efficient than a taxi service because of the fixed rate you receive when you order the ride instead of a variable, time-based rate you would get in a taxi. Will the relationship continue and is the work performed a key aspect of the business?” All of these aspects are true when regarding Uber drivers. By innovating new services, taxi driver and companies will not lose their businesses. When landline manufacturers were peaking and in the growth stage in its product life cycle, nobody claimed it to be unfair when cell phones started entering the market. Uber has shown that digital platforms is becoming more and more important to American and their lives. Taxi companies should create a new business model, applications, better ride experiences, an overall change that can shift those consumers back. It is also cashless and the prices are much cheaper compared to taxi. Despite the new law in California Uber and Lyft drivers did not become employees in that state. They are not independent in any sense of the word, they are working on behalf of Uber. Please let me know what you think! Uber’s business model seems to basically be to act as a liaison between someone who wants to pay for a ride somewhere, and someone who wants to get paid to drive them to that destination, while taking a kind of commission off the top, from the fares collected from the rider to the driver. Share. Subscribe. The pros are that it will help remedy the image of Uber that was somewhat sullied through some unfortunate incidents. The Case of Uber in France and the US. On the other hand, I think this would help with the amount of scary experiences people have with Uber and they can work on fixing their reputation. One notable weakness Uber has directly impacts their drivers and becoming an increasingly ongoing problem that is forcing drivers to leave the app entirely. There are too many stories flying around about how people are being attacked by rogue drivers for the sake of keeping the business model under the “independent contractor” employee model. Its strengths are its cashless, it has low operation costs, and it has lower prices compared to the taxi business. Developing self-driving technology is one of the biggest technical challenges of our time. With the world always advancing and integrating new technology companies and industries either have to keep up or new differential forms of it will be created. 3) Do you think more cities should ban Uber from entering the transportation market or let Uber run in their cities? I don’t think that Uber should be banned and that it is completely fair that the taxi industry is losing business. Although Uber has some amazing strengths, it is not foreign to having some weaknesses as well. Innovation is in our DNA at Uber; we thrive on finding ways to constantly improve and refine our technology to provide safe, reliable rides. Its a win as well, because with bars and other businesses reopening, it really helps the business fire back into action again. Let’s highlight Uber who is part of the sharing and gig economy. A large majority of uber drivers do it as a side hustle to earn some supplemental income. I love the analogy you added which ultimately shows how people have invented new things as technology advances. It all depends on the preferences of people. EU-China scientific cooperation is governed by the Science and Technology Cooperation Agreement signed in 1998. When you need a ride, just pull out your smartphone and tap a button to order a car. All of these steps ensure strengths which include convenience, safety, increasing costs due to regulatory and legal processes, and connecting with local companies to gain traction in new markets. Banning Uber from cities is “absurd.” It makes no sense to take away a decently run company that is creating steady jobs and incomes for consumers who want some extra quick and easy money. Reflections on Technology, Strategy and Society, DISRUPTIVE INNOVATION AND THE GIG ECONOMY THE UBER STORY, Definitions / The Business Model: – Cierra Higgins, http:/en.wikipedia.org/wiki/Sharing_economy, http://en.wikipedia.org/wiki/Disruptive_innovation, https://whatis.techtarget.com/definition/gig-economy, https://www.wired.com/insights/2013/09/the-gig-economy-the-force-that-could-save-the-american-worker/, http://www.forbes.com/sites/aswathdamodaran/2014/06/10/a-disruptive-cab-ride-to-riches-the-uber-payoff/, https://www.washingtonpost.com/news/the-switch/wp/2017/12/21/could-europes-uber-ruling-means-affect-the-future-of-the-gig-economy/?utm_term=.2fe8f8aac2f6, https://www.washingtonpost.com/business/2020/01/14/can-california-reign-techs-gig-platforms-primer-bold-state-law-that-will-try/?outputType=amp, https://www.nytimes.com/2019/11/25/business/uber-london.amp.html, https://www.nytimes.com/2018/02/06/nyregion/livery-driver-taxi-uber.html, https://www.theatlantic.com/business/archive/2015/11/uber-is-not-the-future-of-work/415905/, https://www.sfchronicle.com/business/article/Uber-Lyft-drivers-to-state-Enforce-AB5-get-us-15030205.php, https://www.forbes.com/sites/janetwburns/2020/02/21/ubers-latest-numbers-layoffs-and-rider-tool-suggest-more-trouble-ahead/amp/. When horse and carriage was the only form of transportation way back when, nobody claimed it to be unfair when automobiles started entering the market. And it provides the drivers a safe way to be able to know where they are going to pick the customer up and where they are dropping them off. They use credit card so the passenger is forced to pay and can’t run. Fill in your details below or click an icon to log in: You are commenting using your WordPress.com account. 1. This caveat enables the company to avoid paying their employees minimum wage. Well done! I think Uber should be able to run in cities because as much as the taxi companies are suffering from this, it is natural for their to be competition in all product/service markets. Convenience is a major advantage that Uber possesses over taxi companies and that advantage is totally fair in the name of competition. – I complete disagree with the state of California requiring companies like Uber and Lyft to treat their workforce like employees as opposed to independent contractors. Uber’s business model has turned out to be very successful and popular. Our driverless car technology plans a safe path to your destination. Research and Innovation. 3. Newsletter. Uber has designed a perfect strategy for the user experience. I think just defeats the purpose of having the Uber service. They designed an innovative app that can track where ever you are and provide transportation. If the Uber driver is listed as and employee then I think Uber should have to take a more in-depth approach to vetting who can become a driver. The current system Uber has in place is not only beneficial to the company but is also beneficial to their drivers who do not use their services as their sole source of income. Uber has stated that the decision is “extraordinarily and wrong” and have since closed that loophole, To help with the safety of drivers and passengers, Uber announced a series of new safety procedures including enhanced safety training for drivers and a “discrimination button” which allows drivers and passengers to report any abuse, Despite Uber’s efforts, the London transportation authorities stood by their decision to revoke Uber’s license. In my opinion, more cities should not ban Uber from entering the transportation market. There are many strengths to Uber. Uber claims that there is a misperception between how much Uber, and other companies in the gig economy, affect the American workforce market. Another great strength for Uber is the that rider’s have the ability to rate drivers, this ensures that service is top-notch as the driver is always on a quest to get better ratings. Gig Economy, and where success is rewarded with good reviews that encourage more business. Sharing the Liberal Utopia. Since Uber drivers work on behalf of Uber, they should be treated as employees instead as independent contractors. Its weaknesses however are the lack of connection between Uber and its employees and that their business model is highly unpredictable as Uber is working in a highly regulated market. Trying to find a loophole or a way to cheat the system was pretty pathetic in my opinion because it makes no logical sense. Therefore, it can be argued that operating at low costs thorough innovation is placed at the core of Uber business strategy. The Gig Economy is growing worldwide and is predicted to soon represent 50 percent of the workforce in the United States. There have been instances where hackers have entered the app posing as a driver in order to abduct the passenger. pension plan, insurance, vacation pay, etc.)? It’s important for Uber to do many background checks and provide a code that only the real driver and passenger receive to confirm identifies. One major strength of Uber is its debit/credit card only payment method. I really enjoyed reading your post noticed that you touched on some pretty good points. Uber is just so much more accessible than trying to pursue a cab, if the Taxi drivers and the company they work for cannot move with the changing times, they should start doing Uber and Lyft. So, by simply acting as a liaison, and collecting their commission from the fares received, their revenue is minimally impacted by employee-related costs and liabilities. It is going to be hard for Uber to dominate the market, due to its competition with the limo and taxi business. What is the Uber business model? They provide this kind of car-matchmaking service without having to provide the cars, fuel costs, or other incidentals to the drivers, and while also avoiding having to pay for other employer-related costs, such as healthcare and other benefits, retirement benefits, sick days, etc. Banning Uber in the taxi or personal driving industry, would be banning Wendy’s and keeping McDonald’s. Furthermore, the gig economy is now under a microscope with regulators worldwide and Uber will have to answer questions about the uncertainty of the company. Some of their strengths are it has a high standard of service, verified drivers and cars. People like the availability of Uber (and the prices, usually), so perhaps the taxi companies should continue to evolve their own platforms to have more availability and price transparency. Print. Its simpler and more trustworthy for the consumers, and for the other businesses, its just good and pure competition. Uber and Lyft are trying to keep their drivers as independent contractors instead of converting them into employees like the California law envisions, Over 100 Uber and Lyft drivers statewide are filing wage claims with the state Labor Commissioner Office, seeking to be classified as employees and requesting to be reimbursed for their back wages, overtime and expenses for the past three years, So far the companies have ignored the law and officials are looking to start enforcing it, AB5 and the 2018 California Supreme Court decision called Dynamex that it codifies make it harder for companies to claim that workers are not employees, Gig companies are strongly resisting reclassifying their drivers as it would increase their labor costs by 30%, This would also destroy the flexibility that the companies and their drivers rely on, Uber, Lyft, Doordash, Postmates and Instacart are all backing a $110 million ballot initiative to keep drivers and couriers as independent contractors but also give them wage guarantees and some benefits, Although there are many drivers who want to become employees of the companies, there are still many more who would like to stay as independent contractors as it allows them to decide when, where and how many hours they want to work, Several pieces of Uber technologies news could suggest further challenges as it aims for profitability, Uber reported its 2019 fourth quarter earnings, with a net loss of $1.1 billion, which was actually a slight improvement from the previous quarter, The CEO announced that Uber is planning on making more profits in 2020 but market analysts seem skeptical of these claims due to Ubers struggles with US and international regulators, drivers groups and its own spending habits, Uber’s Rides division, a.k.a. Drivers can do it on their own time and do not have to answer to a boss. A weakness of the business model is that, because of the apparent skirting of regulations and employee costs/liabilities, Uber has found itself at the center of some very expensive lawsuits. In my experience Ubers have been more expensive than taxi’s so while the taxi industry may have seen a decline within recent years, I believe taxis are an affordable option for people who do not want to pay Uber prices. Through a strategic partnership with Uber, Aurora paves a path for delivering the Aurora Driver broadly. Yes, I do agree with The California State Law. I guess the best way to try and address that would be to try and have a system where gig workers can “opt in” or “opt out” of “employee” status. Apoorva, For a city of, what, 15 million people, that’s an awful big difference. If not, what range of responsibility should Uber, and other companies like Uber, have on their workforce? I really liked you post! What is the Uber business model? If so, why? The sector of … Yes, I absolutely agree with the California State Law because an independent contractor works independently. Uber is competition, just like every other business or service in the city. The cities restrict entry into the market and in return, they regulate the prices that cabs can charge their customers. I like the business model they have with independent contracting, as my job is very similar. This is because, most people forget that what set Uber apart from other car transportation services is that they let their contractors the opportunity to work whenever they felt like it and if the state takes this privilege away then the Uber service in California is likely to decline because they wont have contractors willing to work for the service. Sounds pretty dumb right? The Uber business model is centralized around an app that provides speedy transportation to its customers. The behavior of its drivers has been unpredictable and has damaged the image of the company.”. I don’t think it would be fair for cities to ban Uber. This would inevitably affect the amount of available drivers, raise prices, things that would destroy the pros of Ubers entire market. 1.What is the Uber business model? Amazing job with your discussion post for this weeks group. On the flip side, traditional taxi services are a hassle because you have to first find the taxi company phone number and then you need to talk to the operator and tell them your address for them to pick you up. If they want to be independent contractors it allows the drivers to have a full-time job but then hop on the app when they have free time to make a little extra cash. Rates vary based on time of day and if rides are in high demand. Some of the weaknesses is it could have is that drivers can refuse the passengers service, can get negative reviews because of this. Using the GPS technology from your mobile device, Uber is able to locate where you are, locate an available driver near you, and send directions to your desired destination. I have mixed feelings on the California law. The Current and Future State of the Sharing Economy, Designing for Labour: Uber and the On-Demand Mobile Workforce, Labor Platforms and Gig Work: The Failure to Regulate. Very similar to most modern products and services, Uber gives consumers the convenience of consuming its service from their smartphones and other mobile devices. What are its strengths and weaknesses? Cost-saving through innovation. ( Log Out /  Uber has revolutionized the taxi service by essentially opening it up to ride sharing and destroying the monopoly on the ride business worldwide. Il nostro team in Italia. I really enjoyed your post. I also agree that Uber is nice for drivers who want to create their own schedules, hopefully they can find a middle ground to keep some aspect of that even if they are considered employees from now on instead of independent contractors. I completely agree with what you had to say for the final question. These medallions can cost anywhere from $60,000 to $700,000! It can help the employees potentially make more money, but they are more at risk with their hours of service and also their independent ratings when they are on call. Authorities cited one major flaw in Uber’s system which allowed unauthorized drivers to sneak onto Uber. It’s the Taxi company’s fault for not updating their services. The imputed value for Uber was $17 billion. In a situation like Uber or Lyft, the drivers are working on behalf of the respective company. It is argued that Ubers expenses may have been much larger than its revenues. The criticism of Uber from taxi drivers is that Uber, and other companies like Uber, are putting many taxi drivers out of business in large cities such as New York. 1. That is, Uber (by nature of considering the drivers as independent contractors, as opposed to employees) does not assume the cost risk of things like damages and injuries caused in accidents with the drivers. Uber also has its weaknesses. If so, why? Is it fair that taxi drivers and companies are losing business? What are it’s strengths and weaknesses? A lot of the Uber drivers I have had say that they Uber as a side job. As for the individuals who want to be employees it would allow for those drivers to be fully employed by Uber and could offer them some benefits as well. Subscribe. You simply pick your pick up spot, find a driver, and make the payment all through a smartphone. You don’t ban a new product from the market just because it is better and more profitable. Perhaps a buy-back option, and a redistribution of the medallions under different prices/requirements/circumstances. Do you agree with The California State Law which now requires companies like Uber and Lyft to treat their workforce like employees as opposed to independent contractors? So, how I guess I just don’t know how you’d enable that freedom to the workers without having the businesses finding ways to take advantage of it. I also see this as a demand from society as they were not getting what they wanted from the taxi industry so they choose Uber instead. However, would it be a huge effect on their business? Contatti interni; Do you agree with The California State Law which now requires companies like Uber and Lyft to treat their workforce like employees as opposed to independent contractors? Uber ’s self-driving unit, Advanced Technologies Group (ATG), is being acquired by its start-up competitor Aurora Innovation, the companies announced Monday. -I would say uber should stay in cities; its pretty vital and handy. The driver knows where you want to go because you enter the address on your smartphone and the app has the credit card number for people to make the payment. I also believe that competition is a drive for economic growth for cities. 2. Uber and Lyft Disrupted Taxis — Now They Must Disrupt Themselves Disruption seems to be synonymous with innovation in the tech world. It allows people to make quick and easy money that they want to make when they want to. I also agree that Uber should not be ban from entering the transportation market. This would allow for the drivers to maximize their earning and could open up a few different advantages for Uber itself. 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