Uber ride share: taxi or tech company?
Josh Elliott, CTVNews.ca
Published Wednesday, October 8, 2014 7:10AM EDT
As the app-based ridesharing service Uber fights to stay in Ottawa, debate is heating up over whether the company is a technology middle-man or an unlicensed, unregulated taxi service.
Ottawa is the latest Canadian city to reject Uber, which connects ride-seekers with amateur drivers looking to make a quick buck. Ottawa city officials say Uber is an unregulated taxi service operating without proper security measures or insurance, while professional taxi drivers say it's stealing their business with an unsafe service at a cut-rate price.
But Uber maintains it's a technology company, and its smartphone-based app is only offering a matchmaking service to willing parties.
"We connect riders with drivers," Uber Toronto general manager Ian Black told CTV News Channel on Tuesday. "They're simply using our technology to connect."
Uber has faced similar challenges in cities around the world, and it will continue to fight them as it expands into new urban markets. It's already well-established in New York and London, for example, but other municipalities have passed laws to keep it out.
Here's a look at the state of the Uber app across Canada:
How does it work?
Uber operates through a smartphone app or web browser, allowing users to request a ride and track its progress in real time. Both rider and driver can see each other's picture and profile on the app which requires both parties to accept one another before any rides are arranged. The app then uses GPS to guide the driver to the rider, and on to the rider's destination.
Uber calculates the estimated fare ahead of time and transfers the money electronically, so no physical cash is exchanged and no one skips out on the fare.
Uber is cheaper than a comparable cab ride, since it cuts out a lot of the overhead costs that come with running a fully-licensed and regulated taxi service. Many have lauded the service as a low-cost measure to ease city traffic and speed up taxi wait times, while driving down taxi prices.
Who drives for Uber?
Uber typically offers three levels of service: UberTAXI, UberBLACK and UberX.
UberTAXI operates much like a traditional taxi. UberTAXI drivers must be licenced and certified cabbies, and they must have their own commercial taxi to offer rides.
UberBLACK requires the driver be a professional chauffeur with a commercial licence and commercial auto insurance. The driver must also have a black sedan, towncar or SUV with seats for four to six passengers.
But it's the UberX cars that draw most of the criticism. According to Uber's website, UberX drivers can be anyone over 21 with personal auto insurance and a well-maintained four-door sedan. Drivers must pass a police background check, but after that, they're free to make money off the service.
What are Uber's issues?
Cab drivers are generally opposed to Uber, typically complaining their overhead costs make it nearly impossible to compete, and also pointing out that UberX drivers are amateurs who may bend or break municipal taxi bylaws.
Critics also say UberX cars may be unsafe for driver and rider alike, as they lack the safety precautions and commercial insurance that come standard with a traditional cab ride. UberX cars are not registered or insured as commercial vehicles, and they are not equipped with in-car security cameras. Most UberX cars are not wheelchair accessible either.
The city of Calgary is home to some of Uber's harshest critics in Canada. When the company held a trial run of its operations there over the summer, the city studied its impact. It found a number of issues with UberX drivers, including one driver who was allegedly operating with an outstanding police warrant for his arrest. The report concluded that Uber "facilitates private citizens to compete with drivers for business, while not being required to uphold safety and accessibility standards and the associated costs."
But Jeff Weshler, Uber's general manager of regional expansion, says his company is not responsible for its cars, or their internal safety measures.
"We don't own any vehicles, we don't dispatch any vehicles," Weshler told CTV News Channel on Tuesday. "We are a technology company, through-and-through."
How has Uber fared in Canada?
Uber runs limited operations in Halifax and has started up in Montreal, but it's already in full swing in Toronto, where celebrities like Toronto Maple Leaf Phil Kessel and DJ Deadmau5 have publicly endorsed the service.
But Uber's Toronto success has been two years in the making, and it faced a lot of taxi pushback when it arrived in the city in 2012.
Now, it's facing similar pushback in its emerging Canadian markets. Weshler has been criss-crossing the country in recent months, fighting PR fires in Calgary, Vancouver, and now Ottawa.
Calgary booted Uber out in August after its study on the service was delivered to council. However, some on Calgary's city council remain proponents of the service, and are pushing to bring it back.
Vancouver is in the midst of its own six-month Uber study, and it has temporarily banned the service until that study is complete. The city is also headed toward a municipal election, which could have an impact on Uber's future in Vancouver.
Meanwhile, Ottawa was ready to attack Uber as soon as it started its operations this month. Two Uber drivers were fined $650 each over the weekend as part of a city-funded sting against the service.
"They think they're above the law," Ottawa Mayor Jim Watson told CTV Ottawa on Monday. "Well, they're not."
But Uber says it supports its drivers in the face of Ottawa's stings. "We stand behind our drivers 100 per cent," Uber's Ian Black said Tuesday.
Uber's Jeff Weshler says he looks forward to working with "progressive" members of Ottawa's city government to get Uber set up in the city long term. "I believe that there are progressive policymakers here in Ottawa, and I do look forward to working with them," he said.
And while Ottawa's municipal government has come out against Uber, federal cabinet minister John Baird voiced his support for the service in a tweet on Sunday.
With files from CTV Ottawa, Vancouver, Calgary and Toronto