Andrew Leonard of Salon might be getting ahead of himself when he sees a triumphant Uber getting its comeuppance from regulators, not only because the ride-share leader hasn’t yet won, but because Amazon, which has won and rolled over many an industry in the process, has been able to avoid legal curtailment simply because it gives people what they want and is willing to absorb short- and mid-term losses to do so. For the foreseeable future–and perhaps permanently–convenience will rule the day. But in the very long run, Leonard’s scenario is possible. An excerpt:
“The real question we should be asking ourselves is this: What happens when a company with the DNA of Uber ends up winning it all? What happens when the local taxi companies are destroyed and Lyft is crushed? When Uber has dominant market position in every major city on the globe? ‘UberEverywhere’ isn’t a joke. It’s a mantra, a call to arms, a holy ideology.
What happens when Uber’s priorities turn to generating cash rather than spending it? What happens to labor — the Uber drivers — when they have no alternative but Uber? What happens when it rains and the surge-pricing spikes and there’s nowhere else to go? A company with the street-fighting ethos of Uber isn’t going to let drivers unionize, and it certainly isn’t going to pay them more than it is required to by the harsh laws of competition. It will also dump them entirely in a nanosecond when self-driving cars prove that they are cheaper and safer. Making the case that drivers are benefitting from the current recruitment wars starts to look like a pretty short-term play. The more powerful Uber gets, the more leverage it will have over labor.
So here’s what’s going to happen. Society is going to realize that power as great as Uber’s needs to be checked. Uber, by virtue of its own success, will demonstrate where the lines need to be drawn for the general good. When Uber is the only game in town, the necessity for comprehensive requirements for commercial insurance and background checks will be obvious. When Uber starts using its logistics clout and unlimited investment capital to go after UPS and Hertz and FedEx, regulators will start wondering about antitrust issues.”
Tags: Andrew Leonard