Uber

Whining Uberites & Lyftites

Uber_ride_Bogota_(10277864666).jpg

Adapted from Robert Whitcomb's "Digital Diary,'' in GoLocal24.com:

The complaints from car-hailing services and their passengers about the $6 pickup fee at T.F. Green Airport, in Warwick, R.I., ring hollow to me. Jim Hummel wrote about this in a good Jan. 28 Providence Journal story, “Driving revenue: Price of arrival rises at T.F. Green’’. All users should help pay for the airport, which has been much improved in recent years. Uber and Lyft have taken away some of the airport’s revenue from rental cars and taxis. It’s generally cheaper to take a car-hailing service than a ca b. Further, many airports charge to drop off and pick up passengers.

As usual, people want more services but lower charges. Take the federal gasoline tax. It was last raised in 1993! No wonder the roads are such a mess. And while Trump talks about improving transportation infrastructure, he got Congress to enact a huge tax cut, mostly for business and the rich. America remains a fiscal Fantasyland.

Llewellyn King: And now, electric planes

The Solar Impulse 2 is an electric-powered plane using solar energy to generate the electricity.

The Solar Impulse 2 is an electric-powered plane using solar energy to generate the electricity.

Electricity, the world’s silent workhorse for a century, is about to conquer new worlds.

While electric cars are coming on fast, their acceptance will speed up geometrically in the next decade, according to an extraordinary new study by RethinkX, a San Francisco-based research group and think tank. Indeed, the group is predicting a true revolution in electrified transportation.

In this revolution, futuristic companies with a lot of talent and a lot of money — like Uber, Google and Amazon — will be seminal players. Old-line car companies and the oil companies will have to deal with a new order in which their roles could be dramatically diminished.

The big winner in this transportation future is electricity. Even the electric airplane — an idea about as old as aviation — is surging forward.

While RethinkX raised the curtain on the future of ground transportation in its new study, Uber raised the curtain on the future of the electric airplane this month at its Elevate conference in Dallas. More than 500 aviation enthusiasts attended the conference: dreamers, designers, builders — and even venture-capital investors, who have already signed their checks. Dozens of designs for small electric airplanes, using multiple rotors and batteries, were on display. Enthusiasm was incandescent.

This July, small, electric pilotless aircraft — crosses between drones and helicopters — are scheduled to go into service in Dubai. They are supposed to ferry single passengers from their hotels and other gathering points to airports and recreation centers in the largest and most populous city in the United Arab Emirates.

These small aircraft, with electric motors and batteries, have an endurance time of about 30 minutes. EHang, a Chinese company, developed them.

If Uber, and more than a dozen other U.S. companies have their way, similar aircraft will one day take their place in the skies of America and other advanced nations. Uber hopes to test-fly an electric airplane in 2020.

According to RethinkX, the private car is about to disappear, or to be rapidly reduced in importance. The report — which might boost the stock of futuristic companies and electric utilities, and depress the stock of oil companies and old-line car makers and oil companies — is making waves in the far reaches of corporate thinking.

Tony Seba, co-founder of RethinkX and co-author of the report, told me that mainstream analysts are not yet on board with the changes, which will rock the automobile, oil and electric industries. They have not understood the impact of technological convergence, he said.

He sees a future, about to happen, in which driverless electric cars, owned not by individuals, but rather by transportation companies like Uber, flood the streets, to be summoned by phone and directed by voice: “Take me out to the ballgame.”

Seba, an MIT-trained engineer and student of what he calls “disruption,” told me he expects a convergence between electric vehicles, automated driving and ride-sharing will come soon, reducing the number of vehicles on U.S. roads from 247 million in 2020 to 44 million in 2030.

“The average family will save $5,600 in transportation costs,” Seba says.

Apart from the transport companies, the big winner will be the utilities that will see a demand growth of 18 percent, Seba predicts. He believes present infrastructure can accommodate this growth surge because demand will be mostly off-peak.

There are similar expectations of a golden future for small, electric, vertical takeoff airplanes, incorporating drone and other technologies. The limit for the aircraft, which use lithium batteries, is the batteries. But the enthusiasts gathered at Uber’s conference say flight is possible now with present-day batteries and these will only get better.

Richard Whittle, a leading aviation journalist and author who chaired an Elevate session, told me, “It was a pretty impressive event.”

While the arguments by Seba and his co-author James Arbib, a Silicon Valley entrepreneur and philanthropist, point to an electrified transportation future, I have one question: Will people give up the personal, primal pleasure of owning a car?

Seba and Arbib think so, pointing out that people used to take pride in their LP and CD collections, but now they access their music electronically.

The future is pulling up on a highway near you; it may also be flying overhead.

Llewellyn King (llwellynking1@gmail.com), a frequent contributor to New England Diary, is host and executive producer of White House Chronicle, on PBS, and a veteran publisher, columnist and international business executive. This piece first ran in Inside Sources.

Llewellyn King: The gig economy -- by turns liberating and exploitive

An Uber driver at work.

An Uber driver at work.

 

You might not know this, but if it has not happened yet, you may be about to become a company of one.

Welcome to the gig (as in a musician doing a gig) economy. It is coming and faster than anyone expected. In fact, it is coming so fast that in 2050 more people will be in gig employment than conventional employment, according to Wired magazine.

I want to stand on my chair and utter three cheers for it. Except I can only muster two cheers.

In the gig economy workers become consultants, contractors, freelancers.

From the worker point of view, it is an end to conventional bosses, burdensome hours and fitting into a corporate culture.

For the firm outsourcing what used to be salary work, it is a freedom from the costs of employing, like healthcare and retirement plans, safety rules and regulations.

The poster example of gig employment is Uber. Let me say, parenthetically, that I love Uber in almost all ways: the convenience, the ride tracking, the clean cars and polite drivers.

Also, I love the idea that the personal automobile, a large capital investment for most, can be put to work.

It works almost as well for the owner of other capital-intense possessions, notably apartments and boats. Get a little back on your sunk investment. What could be better?

Not much, but there are problems. Primarily, the architecture of our society is not ready for the shift from corporate to private, from big to very small.

At the heart of this stage of the gig economy is the Internet and its ability to bring the willing buyer, renter, seller and worker together.

Companies that have understood these uses of the Internet have gone for the capital-intensive goods: boats, cars and homes. But at the low end, freelance workers are hooking up with customers who are seeking pure service plays like car detailing, dog walking, home computer assistance, house cleaning and repairs of all kinds.

Most of this should only worry the tax man. If you work for one of the ride-sharing services, like Uber or Lyft, the taxman knows all about you.

But if you are in a less-dragooned environment, tax collection halts. Do you withhold taxes from your house cleaner, for example?

One can understand why ride-sharing is beating the daylights out of the taxi business, and so what? Well, the problem is to use ride-sharing you need a credit card and a cell phone. The very poor, or those in temporary difficulties, do not have these. They need taxis.

The law has not caught up with new realities.

The promise of the gig economy is every worker is a contractor protected by a contract. The reality, as with the ride-sharing services, is that the internet company becomes an employer in all but name. The worker has given up the security of a job for the insecurity of entering into a contract he did not write and cannot amend. In weak economic times, the worker is vulnerable to a global system of serfdom.

It is easy to single out Uber, which has greatly improved the quality of life for passengers, and the usage of under-used assets. But what of the drivers? There are laws that govern the old workplace with wage-and-hour standards, workers’ compensation and conditions monitored by the Occupational Health and Safety Administration.

If you are semi-self-employed, say as a delivery contractor, the Internet-facilitating company holds the whip hand when it comes to paying the drivers. Nowhere have I read that drivers really can make a living driving. A little extra, yes. The problem is the independent contractors are not so independent if they just have one customer — and that is not the passenger, but rather some ubiquitous computer network.

The gig economy knows and cares nothing about health care, sick leave, Social Security payments, tax collections, vacations and working conditions. It is free, it is exhilarating and it is the future. But it may be exploitative as well.

Llewellyn King, a veteran publisher, columnist and international business consultant, is host and executive producer of White House Chronicle, on PBS. This first appeared on the opinion site “Inside Sources,’’ where New England Diary overseer Robert Whitcomb also contributes essays.

 

Robert Whitcomb: Drawbacks of deregulation and DIY

  For years, deregulation and the Internet have been pulling us into a more decentralized and freelance economy, in which there’s wider consumer choice, albeit with stagnant pay and a decline in person-to-person service that forces us to do more tasks ourselves that were previously done by those dinosaurs called “employees’’.

Consider Uber. As I discovered when one of my daughters pulled out her iPhone a couple of years ago on a busy Manhattan street to summon an Uber driver, it’s sometimes faster to find one of these mobile freelancers than it is to find a regulated Yellow Cab in a big city.

But the cabs, being regulated, function as a public utility. They have to meet certain basic minimums of availability, cleanliness and safety that can’t be imposed on the likes of Uber, whose drivers are, of course, not obligated to provide services in the same way as cabbies. I don’t think that we want unregulated drivers to totally replace generally reliable and regulated cabbies.

Long before Uber, of course, there was the partial deregulation of the airlines. While this led initially to lower prices for many travelers, it has also made travel more chaotic and unpredictable. And deregulation, the “Hub-and-Spoke’’ system and relentless airline mergers mean that mid-size cities get shorted on flights.

While better electronics systems make planes less likely to crash these days than three decades ago, air travel itself is increasingly miserable.

In the old, tightly regulated days, figuring out airline schedules and fares was comparatively easy. Now it’s an ordeal, and conditions within airplanes are increasingly crowded and unhealthy. And as the airlines, like other businesses, seek to outsource service to computers so that they can lay off more people, addressing problems by communicating with customer-service humans gets tougher.

Then there’s the new do-it-yourself, deregulated and decentralized energy world. Consider that many affluent folks are saving money and reducing their carbon footprints by having solar panels installed on their roofs. Good in itself! But this takes business away from the utility companies, which could jeopardize the viability of the huge electric grids that utilities maintain. We’ll continue to need that grid to support modern society, with its ever-increasing supply of electronic devices.

Might not it be better if we put more focus on producing green electricity with huge solar-panel arrays and wind-turbine farms maintained by utilities that serve everyone – rich and poor?

xxx

The Obama administration has worked very hard to craft a deal with Iran to try to get it to at least postpone continued work on nuclear weapons.

But the administration’s effort will probably turn out to have been in vain. For one thing, the corrupt theocratic dictatorship that runs Iran will cheat and cheat as it evades inspections. It may receive technical help in this cheating from the likes of fellow police states Russia and China, two of the signatories to the nuclear deal, which will happily sell them militarily useful stuff.

Iran will almost certainly use the billions of dollars freed up by the ending of economic sanctions to increase its troublemaking. Iran’s regime seeks to dominate the Mideast – partly to protect and promote its fellow Shiites and partly because domination is fun and profitable for its leaders. And Tehran hasn’t really toned down its “Death to America and Israel’’ rhetoric.

Now we have made the mullahs more macho. No wonder Iran’s neighborhood is scared.

Some complain that America, as the first nuclear power, is hypocritical in trying to keep nuclear weapons out of the hands of other nations. That seeks to make an equivalence between a democratic nation like America and a dictatorship like Iran. And remember why we started our nuclear-weapons program in the first place – to defend ourselves from Germany’s mass-murdering Nazi regime, which was working hard to create an atomic bomb.

Some say that expanding trade with Iran will somehow make it kindlier. They said that about Germany before World War I and China now. Nations have other reasons besides economics to be nasty – for instance, paranoia, power for the sake of power and religion.

Robert Whitcomb (rwhitcomb51@gmail.com) oversees New England Diary. He's also a Fellow at the Pell Center, in Newport, and a partner at Cambridge Management Group (cmg625.com), a healthcare-sector consultancy. He used to be the editorial-page editor of The Providence Journal, the finance editor of the International Herald Tribune and an editor at The Wall Street Journal, among other jobs.

 

 

 

 

Uber Urban Partnership in Conn.

New England Council member Uber has announced a new initiative called UberUP (Uber Urban Partnership) in Connecticut. The program seeks to relieve transportation issues that workers face when seeking employment. In addition, the program seeks to recruit drivers in urban areas that could use the work by adding over 1,500 drivers over the next year. In January, Uber and the New Haven chapter of the NAACP published a report on the affects of lack of transportation on chronic unemployment in the area. Now, Uber is working to relieve these problems through their urban program. The program waives the deposit and weekly fee for drivers who do not have a smartphone and offers seminars in skill-building for locals. Uber is working with the NAACP, The WorkPlace, and Workforce Alliance to put on these events. In addition, Uber will recruit new drivers who live in urban areas who could use the work.

Scot X. Esdaile, president of the NAACP Connecticut, praised the program stating, “The Connecticut NAACP & Uber partnership helps brings jobs and greater economic opportunities to the inner cities of Connecticut. The Connecticut NAACP is committed to thinking out of the box and creating new relationships that deliver economic substance for the communities we serve!”

The New England Council commends Uber for its mission to create employment opportunities and looks forward to this new program’s success.

Llewellyn King: The individual as microbusiness

 

The genius of Uber is dumbfounding. I’m not talking about what it pays its drivers (not enough), whether it’s putting taxis out of business (it is). I’m talking about the sheer brilliance of unleashing the value stored in the family car. Likewise, Airbnb which isn’t denting the hotels, but is causing tax collectors to go apoplectic.

These Internet companies are unleashing the value that families have had hidden in their driveways and spare bedrooms.What’s next? Your guess is as good as mine. If your guess is right, there are folk over at Google who’d like to talk to you.

Airbnb (which connects people looking for accommodation with those offering it in their homes) may be a tad more exciting than Uber (which puts private car owners in the transportation business) because it is catering to a specific traveler market. Hotels have become so unpredictable in their opportunistic pricing that private travelers are happy to leave them to business travelers who are less price-sensitive.

Then there’s GrubHub, which offers free online ordering from thousands of delivery and takeout restaurants. It may well be the next big thing in the market.

These are three examples of how the Internet, which giveth and taketh away, is reordering the economy. They’re beacons for how the economy might replace the jobs that are being lost to computers. They also offer extra income or full employment for people who don’t have marketable educations: driving a car and keeping a pretty home don’t require college degrees in science.

The nature of work is changing, and one of the consequences is that more of us are becoming self-employed: private contractors.

The Internet enables a large number of artisan skills to be marketed. I’ve just found an online advertisement for a dressmaker. Long before Walmart and “Project Runway,” dressmakers abounded. Women would ask their neighborhood dressmaker to “run up something” for a special occasion or whatever. Mass retailing, plus the difficulty of marketing beyond word-of-mouth, pretty well ended that, but it may come back. Now you may live in Atlanta, but you can order a bridal gown from an Etsy dressmaker in Seattle.

The Red Truck Bakery & Market, housed in an old gas station in Warrenton, Va., sends its Meyer Lemon and other goodies across the country. Artisanal baking meets the Internet.

Years ago, a friend of mine developed a knit teddy bear. It was a beautiful thing; tactile, safe for small children. I don’t recall whether my friend had gotten around to naming her stuffed bruin, but he was a darling -- although I don’t know why stuffed bears have to be male.

Anyway the said unnamed, unsexed, stuffed bear didn’t make it into many young arms because of marketing. The big retailers didn’t want it. Things are very competitive in Bear Land, and Paddington Bear and company don’t want other teddy bears crashing their picnic on the store shelves.

That was more than 30 years ago. Today, Bear X could be sold on the Internet. Now I’d wager the big chain retailers would come begging -- offering the little thing a whole shelf for itself.

The miracle of today is that it could happen differently. The concomitant fact is that we’re going to need more cottage industry and more self-employed contractors because the jobs of yesterday are disappearing, and the companies are less and less inclined to hire permanent staff.

Years ago, the jewelry business moved offshore; now it’s moved to American homes. It’s possible for a creative person to make jewelry at home and sell it online.

A new age of self-employment is at hand. Recently, I’ve worked with two inspiring millennials. One is a gifted and filmmaker, and the other a computer wizard. Both are making a living, and neither has given any serious thought to getting a job in the conventional way.

It’s not the age of small business, but microbusiness: the individual with something to sell, whether it's artisanal furniture or a skill. The millennials seem to know this instinctively, the rest of us are learning it.

Want to hire a veteran journalist who works from home? Call me.

Llewellyn King (lking@kingpublishing.com) is executive producer and host of "White House Chronicle" on PBS.  He is a long-time  entrepreneur, publisher, editor, writer and international business consultant.

 

 

Llewellyn King: Rooftop solar energy burns the poor

  Leon Trotsky said, “You may not be interested in war, but war is interested in you.”  The same thing might be said about disruptive technologies.

The U.S. electric system, for example, may not be interested in disruptive technology, but disruptive technology is interested in it. What Uber and Lyft have done to the taxi industry worldwide is just beginning to happen to the electricity industry; and it could shock consumers – particularly the less affluent – as surely as though they had stuck their finger in an electrical outlet.

The disruptive revolution is not only happening here, but also in Europe, as Marc Boillot, senior vice president at Electricite de France (EDF), the giant French utility, writes in a new book.

Ironically in the United States, disruption of the otherwise peaceful world of electric generation and sale last year was a bumper one for electric stocks because of their tradition of paying dividends at a time when bond yields were low.

The first wave of disruption to electric generation has been a technology as benign as solar power units on rooftops, much favored by governments and environmentalists as a green source of electricity. For the utilities, these rooftop generators are a threat to the integrity of the electrical grid. To counter this, utilities would like to see the self-generators pay more for the upkeep of the grid and the convenience it affords them.

Think of the grid as a series of spider webs built around utility companies serving particular population centers, and joined to each other so they can share electricity, depending on need and price.

Enter the self-generating homeowner who by law is entitled to sell excess production back to the grid, or to buy on the grid when it is very cold or the sun isn't shining, as at night. The system of selling back to the electric company is known as net metering.

Good deal? Yes, for the homeowner who can afford to install a unit or lease one from one of a growing number of companies that provide that service. Lousy deal for the full-time electricity customer who rents or lives in an apartment building.

There’s the rub: Who pays the cost of maintaining the grid while the rooftop entrepreneur uses it at will? Short answer: everyone else.

In reality, the poor get socked. Take Avenue A with big houses at one end and apartments and tenements at the other. The big houses -- with their solar panels and owners' morally superior smiles -- are being subsidized by the apartments and tenements. They have to pay to keep the grid viable, while the free-standing house – it doesn’t have to be a mansion -- gets a subsidy.

It's a thorny issue, akin to the person who can't use Uber or Lyft because he or she doesn’t have a credit card or a smartphone, and has to hope that traditional taxi service will survive.

The electric utilities, from the behemoths to the smallest municipal distributor, see the solution in an equity fee for the self-generating customer's right to come on and off the grid, and for an appreciable difference between his selling and buying price. Solar proponents say, not fair: Solve your own problems. We are generating clean electricity and our presence is a national asset.

EDF's Boillot sees the solution in the utilities’ own technological leap forward: the so-called smart grid. This is the computerization of the grid so that it is more finely managed, waste is eliminated, and pricing structures for homes reflect the exact cost at the time of service. His advice was eagerly sought when he was in Washington recently, promoting his book.

While today’s solar may be a problem for the utilities, tomorrow’s may be more so. Homeowners who can afford it may be able to get off the grid altogether by using the battery in an all-electric car to tide them over during the sunless hours.

The industry is not taking this lying down: It is talking to the big solar firms, the regulators and, yes, to Elon Musk, founder of electric-car maker Tesla Motors. He may be the threat and he may be the savior; those all-electric cars will need a lot of charging, and stations for that are cropping up. There’s a ray of sunshine for the utilities, but it's quite a way off. Meanwhile, the rooftop disruption is here and now.

Llewellyn King (lking@kingpublishing.com), a longtime publisher, journalist and international business consultant, is executive producer of "White House Chronicle,'' on PBS.

Sam Pizzigati: Let holiday heart go out to the Uber-greedy

hansomcab
Peace on Earth, good will toward men. We honor these noble values every holiday season — and some people actually work to advance them all year long.Other folks, by contrast, mock these values. They spend their days chasing after ever grander stashes of personal treasure.

These greedy souls love the shadows. So a few years back, the inequality weekly I edit for the Institute for Policy Studies began publishing an annual list of America’s top ten greediest. I’ve just introduced this year’s list, bringing tales of plutocrats young and old.

The oldest character on it: the 79-year-old Wall Street mover and shaker Ken Langone.

Langone began making headlines right at the start of 2014 with his advice for Pope Francis. The pontiff, he told New York’s archbishop, should cool it on the inequality front. Papal broadsides against “the powerful feeding upon the powerless,” Langone complained, could leave America’s wealthy “incapable of feeling compassion for the poor.”

Langone himself has always been a generous sort — at least for his friends. As a New York Stock Exchange director, he greased the skids for a $190-million exit package for his buddy, NYSE president Richard Grasso, in 2003

Langone has been a bit less generous to the powerless. As a director at Yum! Brands, the home of Taco Bell and KFC, he cheered on company efforts to oppose hikes in the minimum wage. As he likes to tell regulators: “Leave us alone and let us hire people.”

Home Depot, the retail giant Langone’s financing helped propel to big-box dominance, shows what happens when you leave corporations alone. Big-box giants, notes the research group Good Jobs First, don’t create jobs. They “grow mostly at the expense of existing competitors,” many of them local businesses.

Big-box giants, on the other hand, do create massive concentrations of personal wealth. Forbes now estimates Langone’s net worth at $2.6 billion.

Among the youngest of America’s 2014 top ten greediest: the 38-year-old Travis Kalanick, the CEO and cofounder of Uber, a taxi-like service that lets travelers hail cars through a mobile phone app.

Last January, Uber was running cars in just 60 cities. Now it’s spread to 250 cities — in 50 countries. That growth has propelled Uber’s worth to $40 billion — more than long-established transportation heavyweights like Hertz and United Continental.

Not bad for a company, the AP notes, “that didn’t exist five years ago.” And Kalanick himself, Forbes estimates, is ending the year worth a cool $3 billion.

How has Uber soared so quickly? The company is pumping up profits, critics charge, by taking short cuts like not running adequate background checks on drivers. Officials in Los Angeles and San Francisco have just filed suit against Uber on driver- safety checks, and governments from Spain to India have also taken legal action against the company.

Other critics include customers like Leah Kappen of Indianapolis. She took an Uber ride downtown to the Dec. 6 Big Ten football championship game. That ride cost her $30. The 18-minute trip home after the game cost her $450. This past Halloween, an 18-mile ride home ran New Yorker Elliott Asbury $539.

Uber’s “surge pricing” — a policy that ties rates to the supposed market demands of the moment — generated these outsized fees. But anyone upset by $500 cab fare, says Kalanick, needs to start “getting used to dynamic pricing in transportation.”

Uber drivers are complaining, too. One of Uber’s competitors, Lyft, gives all the extra profit from “surge pricing” to its drivers. Uber takes a 20 percent cut. Why not, The Wall Street Journal asked Kalanick, follow suit?

“We are a business,” he replied.

So much for good will.