The taxi or cabbie industry is under attack by the transportation network companies, or TNCs.
With these companies, such as Uber and Lyft, cities, counties and state legislatures are trying to figure out how to handle this new technology that allows almost anyone to become a “cabbie” without the cost that traditional taxi companies face. The authorities are not doing a good job.
In comparison to the 100+ year cabbie industry, these TNCs have been around for just a few years, but they are gaining in popularity. Uber already is available in 58 countries and 300 cities worldwide since it was founded in 2009.
Here is how TNCs work: Consumers download an app to their smartphones and request a pickup that is assigned to an Uber driver, who uses his/her own cars. This revolution was just waiting to happen once apps arrived for smartphones. It just needed someone to come up with the idea.
As a business, TNCs, in some respect, are just the middle man. No money is exchanged between the passenger and the driver (unless you want to tip). The pickup is arranged online and the passenger’s credit card is charged after the ride is completed. Uber takes its “commission” and the driver gets the rest.
But opposition to TNCs has been fierce from the taxicab industry and some government officials.
Since the cab industry had been highly regulated in America — from the medallion system that limits the number of cabs in an area to licensing requirements and criminal background checks for drivers — some people say the TNCs are unfair competition because they are doing all things a taxi service does, but they are not paying the licensing fees or meeting the same liability insurance requirements, etc.
It it looks like a duck and sounds like a duck, then it is a duck.
Consumers like Uber because it is convenient. In many areas, they can get a ride when the need one, and not wait 30 or 60 minutes. Some like it since it is an upstart challenging the the Goliath taxi industry. Others see it as free enterprise and new innovation.
My problem is that TNCs are trying to do the same service as taxis but don’t want to be regulated like them.
Also, individuals are now calling themselves taxis or car services without any certification.
In Sarasota, Florida, the city commission just deregulated all taxis. Now, no one has to file for a license or pass a background check. One taxi owner told me that he sees “new” car services by people who just slapped a magnet sign on the sides of their cars. Since anyone can call themselves a taxi driver now, all you need is a car. You don’t even need a driver’s license since no will know — no background check is in place. The driver may not have any insurance.
At least TNCs and traditional cab companies are doing criminal background checks to some level, and they have some liability insurance. But these new “rogue” car drivers? Who knows?
More than ever, consumers need to cautious. Caveat Emptor — Buyer beware.