Uber To Start Charging What It Thinks You’re Willing To Pay

The ride-hailing giant is using data science to engineer a more sustainable business model, but it’s cutting drivers out from some gains.

Uber drivers have been complaining that the gap between the fare a rider pays and what the driver receives is getting wider. After months of unsatisfying answers, Uber Technologies Inc. is providing an explanation: It’s charging some passengers more because it needs the extra cash.

The company detailed for the first time in an interview with Bloomberg a new pricing system that’s been in testing for months in certain cities. On Friday, Uber acknowledged to drivers the discrepancy between their compensation and what riders pay. The new fare system is called “route-based pricing,” and it charges customers based on what it predicts they’re willing to pay. It’s a break from the past, when Uber calculated fares using a combination of mileage, time and multipliers based on geographic demand.

Daniel Graf, Uber’s head of product, said the company applies machine-learning techniques to estimate how much groups of customers are willing to shell out for a ride. Uber calculates riders’ propensity for paying a higher price for a particular route at a certain time of day. For instance, someone traveling from a wealthy neighborhood to another tony spot might be asked to pay more than another person heading to a poorer part of town, even if demand, traffic and distance are the same.

The change stems from a feature Uber introduced last year called upfront pricing. By guaranteeing customers a certain fare before they book, the company said it provides more transparency. But it hadn’t previously said how Uber was estimating those prices and continued paying drivers using the old model.

In an attempt to ease drivers’ concerns, Uber will start reporting the price a passenger pays on each ride, though it will stop breaking out the percentage Uber takes of the fare. The company will also send drivers an updated terms of service agreement reflecting the new fee system. Route-based pricing is currently limited to 14 U.S. cities where Uber offers its carpooling service.

The difference between the calculations of rider fares and driver pay could be the future of Uber’s business. The company said it pockets what’s leftover and could parlay this mathematical framework into moving closer to profitability.

Graf said Uber’s pricing techniques have grown incredibly sophisticated. He oversees a team called marketplace at headquarters in San Francisco that’s staffed with economists and statisticians. Graf, a former Google and Twitter Inc. executive, sees financial engineering as a competitive advantage, one way that Uber can stay ahead of Lyft Inc. and other ride-hailing operators. Uber said it began experimenting with route-based pricing late last year.

“Google search is very simple to do; it’s very complex what’s happening behind the scenes,” Graf said. “The same thing here. Taking a trip is easy. To make this all work in a whole market, and sustainable, is really, really hard.”

In the process, pricing became something of a black box for passengers and another source of tension with drivers. Drivers accused Uber of cutting them out of income they were entitled to and misleading them about what the company was up to.

During the last year, Uber had attributed price discrepancies to the uncertainty around estimating fares, even as it was experimenting with techniques designed to exploit the imbalance between what customers were willing to pay and what drivers would take. The Rideshare Guy, a popular blog among drivers, conducted a study in New York City published in May, finding widespread disparities between rider fares and driver pay. Workers weren’t happy. “It is immoral and unethical behavior,” said Chris Estrada, who drives for Uber in Riverside, California.

Uber has faced a torrent of scandals this year, including a trade secrets lawsuit, sexual harassment allegations, a brief boycott over its ties to the Trump administration and a video showing the chief executive officer arguing with a driver over falling fares. Two of the longest-running criticisms of the seven-year-old company are ones that are sometimes at odds: It loses too much money, and it pays drivers too little. The company told Bloomberg in April that it lost $2.8 billion in 2016, not including its China business.

In the case of upfront pricing, Uber may move closer to resolving investors’ concerns about losses but could alienate drivers along the way. “You know our numbers,” Graf said. “We do want to run and operate a sustainable business.”

“We do want to run and operate a sustainable business.”

Uber said it isn’t hoarding the additional revenue generated from route-based pricing. The company said it reinvests much of it into increasing the number of trips, subsidizing UberPool usage and paying bonuses to drivers. Christian Perea, who writes for the Rideshare Guy, said drivers will appreciate the added transparency around how much passengers are paying. “That is a big deal,” he said.

As Uber experiments with pricing models, complexity could introduce new problems. “Society is more willing to accept wealthy people paying higher fares,” said Chris Knittel, a business professor at the Massachusetts Institute of Technology. “But if the repercussion of lower fares in lower-income places is longer wait times, that’s probably what they want to keep an eye on.” 

With such a dramatic change to pricing, it’s not just drivers Uber has to worry about upsetting. “They could really lose the trust of the riders,” said Glen Weyl, a senior researcher at Microsoft Corp. who is studying Uber with the company’s cooperation. Microsoft is an investor in Uber. “It’s a very dangerous moment for them, but there are good economic reasons to do it.”

Uber is a company filled with over-optimizers, who will continue to futz with prices and hope to find equilibrium. “If things are not balanced, we create levers to motivate people to make it balanced again,” Graf said. “There’s choices, right? Always. There’s never, ‘I have to use Uber.’”

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Silent Taxis: Japanese cab company bans drivers from starting conversations

A cab company in one of Japan’s major cities is trialling a new feature by introducing silent taxi drivers.

Miyako Taxi, which is based in Kyoto, unveiled the new idea last month without much fanfare.

The business is currently operating five “Silence Taxis” across the city as part of a trial.

The cars look like any ordinary taxi but a notice written on the back of the passenger seat will inform passengers that they have entered one of the new silent fleet.

Drivers will offer a greeting when their fare enters the car, and aside from confirming the route they will not engage in small talk.

The drivers can indulge in conversation, but only if they are spoken to first, and they are also allowed to communicate in emergency situations.

Announcing the idea, Miyako Taxi said: “This service is currently in a trial stage, with the goal of creating an in-car atmosphere that provides the most comfortable ride for passengers through limiting the driver’s speaking.”

Other than the latest initiative, the company has no official policy either way covering chatting in taxis.

According to Japan Today, they made the move after hearing reports from passengers that they were fed up being forced to indulge in chit-chat with their drivers.

And while some fares enjoyed being regaled with tales of Kyoto’s sights and attractions, it was seen as less appealing for residents of the sprawling city.

The company will assess the popularity of the trial before deciding whether to expand it and roll it out across more of their drivers in their 354 taxis.

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Square Will Replace Meters in Washington Taxis : The overhaul of the city’s cab system will help drivers compete with Uber

D.C. taxis are ditching clunky mechanical meters in favor of Square

Taxi passengers in Washington, D.C., will pay via Square starting this summer, the city's Department of For-Hire Vehicles announced today. As part of the change, taxis will also transition to app-based meters, which the department will review, certify, and make available to licensed drivers. 

Washington, D.C., is enlisting Square Inc’s help as its taxi commission tries to help the city’s cabbies compete with Uber drivers. By the end of August, all of the taxis in Washington have to tear out their traditional meters and start using smartphones or tablets, in what the city government has been describing as a complete reimagining of how the cab system works. On Wednesday, the Department of For-Hire Vehicles is announcing that Square will process the payments going through those mobile devices. 

For Square, the deal reflects an increasing focus on becoming the payment platform for a range of other company's mobile applications, websites and point-of-sale devices. No money is changing hands between the company and the city. Square agreed to satisfy the department’s requirement that drivers give up no more than 2.65 percent of their fares in transaction fees, according to the department. That’s lower than the standard 2.75 commission it usually takes and significantly less than the 3.5 percent to 5 percent commission that drivers currently pay to use the mechanical meters, according to Ernest Chrappah, the director of the city's taxi regulator. A spokesman for Square said it doesn’t comment on individual rates.

Chrappah said the lower fees will help make it easier for cabbies to sustain themselves. But the bigger changes come in the increased flexibility that taxi drivers will have once they’re untethered from mechanical meters. There won’t be a single taxi app. Instead, the department is asking developers to build apps, which it will then certify for use by licensed taxi drivers. It is currently working with seven developers, who will make their apps public between now the deadline to replace the meters. It will continue to consider adding new apps as developers pitch them. 

All of the certified apps must be able to operate as meters for street hails. They’ll also be able to provide digital receipts showing the route they took and give riders the option to rate drivers. Developers can also build services like carpooling or delivery systems that will connect drivers to local merchants looking for people to drop off food, groceries or other products. A developer could build an Uber clone, creating a way to connect drivers to passengers requesting rides through an app. The exact contours of these services will become clear as the individual developers release their software. 

Taxis will also be able to offer dynamic pricing, where drivers can give discounts during periods when they have trouble securing fares. This resembles Uber’s practice of charging more when demand rises as a way to coax drivers onto the road, only in reverse. Drivers won’t have the option to increase their fares. 

The backdrop to these changes is the rapid rise of ride-hailing companies like Uber Technologies Inc. and Lyft Inc. The city government has been trying to blur the lines between cabs and ride-hailing companies for over year. Last June, it even changed the name of the taxi regulator from the D.C. Taxicab Commission to the Department of For-Hire Vehicles. Chrappah said the changes will end a situation where regulations kept taxis from competing on even ground. “Taxis are so resilient. They’ve been around for a long time, and their demise has been overblown,” he said. “There is a unique window of opportunity to give them a chance to compete.” 

Several years ago, Square ran a pilot program to be the payment processor for some New York City taxis, but the company said this is a deeper integration. “It’s definitely exciting to be working with the Department of For-Hire Vehicles,” said Carl Perry, who leads Square’s developer team. “They're one example of thousands of developers that are going to be building solutions with Square.”

Goitom Abselab is a longtime cab driver who is now chairman of the Taxi Operators Association, a driver group affiliated with the Teamsters. The association has taken issue with many changes in the local taxi industry, criticizing everything from the city's approach to Uber to new rules specifying how their cars have to be painted. Abselab is actually looking forward to the lower transaction fees. But he's also skeptical about the more ambitious aspects of Chrappah’s vision. He said it’s hard to imagine an upstart app competing with Uber, which has seemingly endless resources and is already firmly entrenched. Nor is he particularly interested in moonlighting as a deliveryman. One advantage of driving a cab is that you can stay in your car, rather than worrying about where to leave it while you run into a store or an apartment building. “Delivery, food, laundry—for me, those things don’t look to be very profitable,” said Abselab. “I’ve lived here for a very long time, and believe me, parking is a problem.”

Source : Bloomberg 

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City of London And TfL, Ready To Go Ahead With Bank Junction Scheme, With Insufficient Pollution Monitoring In Place

Brits say they’d choose black cabs over self-driving cars as driverless taxis edge closer to reality

 

 

THERE seems to be no convincing us Brits that driverless cars are any good despite the millions being ploughed into the technology.

And when it comes to paying for a cab, do we really want to shell out for a robot driver over the traditional human cabbie? New research suggests not.

Brits have shown support for traditional cab drivers over autonomous taxis.

According to a survey of 1,600 motorists by online servicing provider, Servicing Stop, a cab driven by another person would still be favoured by 79 per cent of people, as opposed to one that is controlled by a machine. 

It could be good news for traditional black cabbies in their fight with Uber as the ride-hailing app is actively pursuing driverless setups despite people’s desire to have a driver.

Those questioned did, however, welcome the benefits of autonomous technology, with more than 40 per cent recognising self-driving cars would offer improved mobility for the elderly, disabled and children, while just under a third said they would contribute to a drop in the number of road-traffic accidents. 

Similarly, 15 per cent of motorists believe self-driving cars would give commuters more time to be productive on their journeys.

The findings suggest that while Brits may welcome the introduction of driverless technology as progressing towards a more productive society, the majority of people are still hesitant to choose them as their own method of transport.

Last month, a study found more than two-thirds of motorists said they were reluctant to accept a lift in a driverless car altogether and even feared the technology.

Despite this, firms are still pushing ahead with autonomy with a UK trial between London and Oxford planned for 2019.

All major manufacturers are researching the tech, too, with a mass-produced vehicle likely to be on sale from 2025.

CEO of Servicing Stop, Oly Richmond, suggested the perceived reluctance towards autonomous cabs could be down to people’s fondness of the traditional friendly Taxi driver.

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Taxi driver wrongly fined for travelling through bus lane feared he would lose his home after threats from bailiffs

Kanwardeep Lehal and his taxi (Photo: Anna Lythgoe)

A Taxi driver wrongly fined for travelling through bus lane, feared he would lose his home after threats from bailiffs

Gloucestershire County Council said Mr Lehal should not have received the fine

A taxi driver who was wrongly fined for using a bus lane feared he would lose his home after bailiffs threatened to seize his car.

Independent cabbie Kanwardeep Lehal, 43, was fined £90 while driving along Woodvale in Quedgeley two months ago and, despite appealing, the fine rose to £408.

The dad-of-three, who lives in Tuffley, said bailiffs put a note on his taxi ordering him not to drive it. They returned days later and allegedly told Mr Lehal, a Gloucestershire cabbie of 15 years, that the vehicle would be auctioned.

Gloucestershire County Council have since confirmed he should not have received the fine.

His partner Louise Deakins, 34, said: “We have been informed the bailiffs are coming back.

“If we lose the car, we lose our home – our family’s livelihood depends on it. It means everything to us.

“Through no fault of our own we have received this ticket and now we are being bullied. My 13-year-old daughter was the only person home when they arrive the first time and the neighbours could have seen – it’s embarrassing for us.

“We’ve been told they could come again today or they could come tomorrow.”

Ms Deakins, who works in the call centre at Gloucester’s Five Star Taxis, added: “No one wants to help at the penalty enforcement team but it would have taken one call from the council for it to be quashed but now it has gone onto the bailiff. Where do we stand?”

The couple appealed the decision at the county court but their claim was rejected. To re-appeal, they would have had to pay £350.

Jim Daniels, parking manager at Gloucestershire County Council, has since said: “Mr Lehal should not have received this fine and it has been cancelled.

“We will be contacting Mr Lehal personally to apologise for this error.”

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Minicab Driver From Bow Rapes Female Passengers, While Compliance Check Taxi Badge And Bills.

A minicab driver from Bow is facing jail for raping and sexually assaulting vulnerable women passengers after cutting off parts of their clothes

Jahir Hussain, 37, admitted attacking three women after they had been out socialising in Shoreditch last October and December.

The first victim had fallen sleep in Hussain’s car and when she woke up she discovered her jeans and belt had been cut before he groped and assaulted her on October 21.

He struck a second time on December 2 when a woman, who had stepped into his car believing it was an Uber cab, fell asleep and woke up to find Hussain kissing her mouth and fiddling with his trousers as if he was doing up his buttons.

He attacked a third passenger hours later by touching her legs and lifting up her dress as she slept in the back of his cab.

When she got home she noticed her tights and knickers had been partly cut off her body in an almost identical way to the first victim’s belt and jeans.

Yesterday at Snaresbrook Crown Court, Hussain pleaded guilty to two counts of rape, three counts of sexual assault, one of assault by penetration, fraud by false representation and battery with intent to commit a sexual offence.

He will be sentenced on July 10.

London Crown Prosecution Service reviewing lawyer Catherine Wear said: “Hussain preyed on the vulnerabilities of women passengers, cutting the clothing of two of his victims and sexually assaulting them after they had passed out in the back of his cab following nights out in Shoreditch.

“The strong CPS prosecution case which led to today’s late guilty pleas showed that there could have been no question of these women consenting to any sexual activity as Hussain initially claimed.

“We are grateful to these brave women for having the courage to come forward and glad these admissions have spared them from any court appearances.”

Editorial Comment :

   TfL...YOU WERE WARNED AND YOU IGNORED !

It's a sad fact that the public are not protected from these animals who perform these serious sexual attacks. 

We've heard from Rachel Griffin of the Suzy Lamplugh trust, that the most favoured method of dangerous sexual predators is touting, picking up unrecorded passengers who have been drinking.

   

Instead of employing sufficient manpower to police the trade they licence, combating blatent touting in busy areas, TfL would rather concertrate on harassing Taxi drivers just incase they are not wearing their badge properly, or committing the heinous act of 'over ranking'. 

But even worse is the treatment these cases recieve in the papers. It's very rare that the headline reads Minicab or Private Hire driver rapes passenger, it's usually headed...Taxi driver rapes passenger. These statements are never questioned by TfL. 

The overpaid directors/managers at TfLTPH are as much to blame for this crime as Jahir Hussain... for putting budget before the safety of the public. 

It's not gone unnoticed to the Taxi trade, the training given to compliance officers is woefully inadequate.

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