Monthly Archives: December 2015

Uber surge pricing no substitute for operations planning

I got the this text from Uber yesterday and the graphic pasted below showing an hour by hour prediction of demand for New Years Eve.

UBER: 3 days until NYE – the BUSIEST day of the year is almost here! You can make great money driving between 7-11pm and 12-6am on New Years Day. See you on the road!

Your Uber Team

Unfortunately for Uber these texts promising riches are losing their effectiveness because they are no longer credible. It was the same for the Rugby World Cup – as soon as a text went out promising windfalls at Twickenham I just left the area.

Of course it makes sense for Uber to flag up periods of high demand and encourage drivers out onto the road to meet the demand. But typically this results in market over supply with meagre money for the many and much money for Uber. Last year a colleague made £90 gross working 12 hours on New Year’s Eve for Uber and that was typical. I suspect Uber knows this well – it certainly has the data to divine this – but chooses to mislead drivers to maximize its own profits.

So what?

What this proves is that surge pricing, at any time, is totally unnecessary and represents only a failure in operational planning. The experience I and other drivers have had with depressed incomes when Uber promises high earnings shows that Uber has tremendous capability in demand prediction and supply side mobilization. Some of us have also anecdotally noticed an up tick in surge pricing towards the end of  each quarter, perhaps due to internal pressure to meet revenue targets.

Uber NYE

Given Uber’s superior ability to predict both demand and supply so well then surely setting modest surge price increases in advance would likely clear the market more efficiently and at less cost than allowing the algorithm to try to solve the problem dynamically when there is simply no available additional supply in the market to instantly tap? At any rate, the market cannot operate effectively in the long run so long as suppliers do not have the information they need to make a decision to participate.  Perfect markets operate effectively when all actors have all information. When demand and supply information is hidden under the table by a market dis-intermediator such as Uber then efficient outcomes cannot be achieved. Taking Uber’s word for it when earnings fail to pan out time after time won’t wash for long.

If Uber keep crying wolf to drivers with promises of earnings that don’t materialize then it will have no choice but to either offer realistic incentives in advance to get drivers on the road or clobber riders with run away dynamic surge increases which just might tempt the patience of the regulator or the riding public.

The invisible hand is no substitute for the visible hand of effective operations management.

Uber wants me to lobby TfL for …… Uber

Oh the irony. Uber, the very company that refuses to enter into any consultation with its drivers, is asking us drivers to enter the TfL consultation process on its behalf. I say ‘on its behalf’ because, like anything with Uber, the input is selective, in its own interests only and dressed up as if its for the driver’s benefit. Its a bit like the tired argument used every time Uber wants to drop prices to grab more market share and drive their competitors out of business – ‘drivers win because now we will be more productive and earn more per hour’. See how this works?

Last night Uber sent me a text telling me there were only 2 days left to respond to the TfL consultation. When I clicked the link – hey presto – it opened my email and generated text to send directly to TfL with Uber’s preferred reply. All I had to do was hit send – no thinking required, just the way Uber likes it. It even autogenerated a bcc to Uber itself so that big brother at Aldgate Tower can monitor which drivers are the true believers and who are just not to be trusted.

Unfortunately, Uber forgot to add some of the issues I am interested in raising with TfL in the consultation. Here are a few of the key points of difference for me:

  • Uber, you need to start protecting driver privacy if TfL is going to mandate you send my picture electronically with every booking confirmation. Jo Bertram’s side kick Tom Elvidge told me at the GMB demo last month that Uber didn’t have the resources neceessary to enforce user ToS to make users  take down social media postings of driver identification. Sometimes the richest really are the poorest.
  • Uber forgot to tell us to lobby TfL to review and approve business model changes such as the recent Uber driver contract and UberPool before launch. Yeah, let’s just keep shtum on that one, shall we.
  • Neither did Uber tell me to say anything about app based security and biometric recognition that TfL is so keen on. My position is pretty clear about this – as long as Uber customer credit card details continue to leak all over the web I’m less than keen to hand over my biometric data.
  • Uber didn’t give any advice about what to say about having a landline. I thought about it myself and concluded its pretty damn important I can actually get someone from the operator side on the phone in an emergency situation – just like the time I was assaulted in March. Uber finally gave the police the details they asked for on the night – but just 10 weeks after the fact.
  • The bit about showing vehicles on the app was interesting. Uber suggested it would be pretty luddite behaviour to hide this. I think the sensible compromise is that the operator can show the vehicle enroute once booked. Anyway, its already pretty embarrassing to see the thousands and thousands of idle Uber cars displayed all over London. Someone has to pay to keep all that metal hanging around and it sure isn’t Uber.
  • Uber could have kicked in to speak up against some of the more illiberal aspects of the proposed regulations effecting drivers  like TfL wanting to send our details to DWP and TfL’s idea about monitoring our ‘behavioural indiscretions’. But none of that adds to Uber’s bottom line so zip on that one.
  • Uber wants me to speak up about the proposal that operators must be able to take a booking 7 days in advance. This one is really odd. Uber wants me to be against this cos there are ‘plenty of other operators’ for this. Huh? I can’t agree on this one. I’m inclined to believe the customer is always right and never turn away business. If the customer wants to book in advance we should let them. That’s more work for me, not less as Uber says it will be, if they have to take advance bookings.

One thing we did agree on – probably for different reasons though – is that I should be allowed to work for as many or as few operators as I like. None of these sweat shop London operators are offering anything remotely approaching a decent income let alone contractual security so I’d like to keep my options wide open. Thanks all the same though TfL (and Addison Lee) for the thought.

It’s a shame Uber missed the opportunity to represent their drivers better here and speak out against TfL’s discriminatory impulse. But at Uber, only Uber comes first.

If you’re struggling with insomnia, what follows is the perky little email Uber auto generated for me to send to TfL. I sent it to the delete bin instead.

Dear Transport for London,

Please accept this email as a formal response to the Private Hire Regulations Review. As a licensed private hire driver in London, I feel strongly about some of these proposals and would like to ensure my voice is heard.

New technology, mobile phones and apps have made my life better.  They’ve made it easier for me to get work and make more money.  And I know that my customers feel safer too.

With regard to the proposals in the Private Hire Regulations Review:

2. Operators must provide booking confirmation details to the passenger at least five minutes prior to the journey commencing
I do not agree with this proposal. Making people wait five-minutes for their car even when it might be round the corner would make it harder for me to make a decent living.  I also worry that my customers less safe as they may have to needlessly wait around on the street late at night.

5. Operators must offer a facility to pre-book up to seven days in advance
I do not agree with this proposal.  Drivers and customers should be able to choose how they want to book a car. There are plenty of other operators where I can choose to work with journeys booked seven days in advance.  But it would mean that I do fewer journeys, make less money and can’t choose my own hours.

8.Operators must not show vehicles being available for immediate hire, either visibly or virtually via an app
I do not agree with this proposal. Customers frequently say that they love the ability to see cars live in their smartphone – knowing when their car will arrive in real-time and meeting drivers at the right time.  Having this information means I spend less time looking for passengers and more time making a living.

15. Drivers to work for one operator at a time
I do not agree with this proposal. It is important to me, and drivers, that we have the freedom to work for who we want when we want and can switch easily between operators. This makes sure that operators have to compete with each other to give us – as well as customers – the best deal.

Regards,

My personal submission to TfL private hire consultation

Everyone has at least one if not numerous opinions about how TfL should develop the private hire regulatory problems. Actually it doesn’t take a rocket scientist to figure out the answer to the problem is to impose a cap to stop the city congesting itself to a coronary and to protect worker rights so private hire drivers don’t end up suffering the same.

Here is what I will be submitting personally to TfL before consultation closes tomorrow. UPHD will be sending in its own submission also on behalf of the member base. Register for free membership at UPHD to see a copy of its submission.

Do you agree with my answers? Feel free to use an adapt it at will to submit your own feedback to TfL.  You can find the consultation document including the questions asked which I respond to below at this link.

Question 1
Do you agree with the above proposal? If you don’t agree, please explain why.

Answer:
No I do not agree to this. I already wear a TfL picture ID which is sufficient and already a much higher standard than the taxi trade. I am not convinced that my personal details will not be misused or leaked on to the internet

Question 2
Do you agree with our proposal for a time delay between journey booking and commencement? If you don’t agree, please explain why.

No I do not agree. An imposed waiting time will only lead to more congestion and income loss for drivers and pose a safety threat for passengers.

Question 3
Do you think that a different time interval to five minutes is appropriate? If you do, please say what you consider an appropriate time interval to be, and why.

There should be no time delay imposed.

Question 4
Do you agree with our proposal? If you don’t agree, please explain why.

Yes, I agree with this proposal.

Question 5
What are your views on ensuring that app based platforms are secure and do not allow passenger or driver fraud?

I don’t have a view on how operators manage passenger fraud. I believe drivers wearing a picture ID at all times provides sufficient security. I don’t believe the problem is app specific. For example a taxi driver can easily pass his badge and cab to an unlicensed driver.

Question 6
Do you believe that there is sufficient technology available to achieve this and if so what technology do you believe we should consider?

I don’t believe the technology exists to properly secure driver details. At the moment driver details are being cut and pasted from the app to social media channels. The best security is not to collect data that is not needed.

Question 7
Do you agree with our proposal? If you don’t agree, please say why.

Yes.

Question 8
Do you consider a period other than seven days to be appropriate? If you do, please say why.

The same advance booking period as airlines allow.

Question 9
Do you agree with our proposal? If you don’t agree, please say why.

No. Large trade events and concerts cannot be serviced adequately and safely without on site service. If TfL bans this it will only encourage touting.

Question 10
How would you propose that venues and temporary events ensure safe and adequate transportation options for those attending such events?

On site operator could be asked to register and submit driver and phv details in advance.

Question 11
Do you agree with our proposal? If you don’t agree, please say why.

Yes but there must also be a manned support line for operators to support drivers 24×7.

Question 12
Do you agree with our proposal? If you don’t agree, please say why.

Yes I agree.

Question 13
Do you agree with our proposal? If you don’t agree, please say why not.

No I don’t agree. I have no objection with the operator supplying my details to TfL but I do object to your monitoring of ‘behavioural indiscretions’. TfL must stick to writing and enforcing regulations only. I would like TfL to get professional, independent advice on equalities.

Question 14
Do you agree with our proposal? If you don’t agree, please say why.

I do not agree. It’s impossible to fix a time and distance fare in advance. To mandate this will result in either the passenger being overcharged or the driver being underpaid.

Question 15
Do you agree with our proposal? If you don’t agree, please say why.

Yes I agree. I also believe I must be told of the destination at the time of booking confirmation so that I can prepare for the journey and also have the option to decline or discuss with the operator if I feel I am unable to complete the journey.

Question 16
Do you agree with our proposal? If you don’t agree, please say why.

Yes, I agree to this proposal.

Question 17
Do you agree with our proposal? If you don’t agree, please say why.

No I don’t agree. I don’t see why an operator cannot organise and market their business anyway they chose.

Question 18
Do you agree with our proposal? If you don’t agree, please say why.

I don’t agree.

Question 19
What standard do you think it would be appropriate for applicants to demonstrate?

I suggest TfL gets professional, external equalities advice on this question.

Question 20
Do you agree with our proposal? If you don’t agree, please say why.

I completely disagree with this proposal. It would directly reduce and harm my employment prospects. I should be allowed to work for as many operators as I chose. Not all operators can offer me enough work to provide a full time income.

Question 21
Do you agree with our proposal? If you don’t agree, please say why.

I completely disagree with this proposal and I resent the implication that I or my colleagues are benefit cheats. TfL should stick to regulating the taxi and private hire trade where it already has more than enough to do.

Question 22
Do you agree with our proposal? If you don’t agree, please say why.

Yes I agree.

Question 23
Do you agree with our proposal? If you don’t agree, please say why.

Yes I agree.

Question 24
Do you agree with this proposal? If you don’t agree, please say why.

I disagree.

Question 25
Do you agree with our proposal? If not, please say why.

Yes I agree

Question 26
Do you agree with our proposal? If you don’t agree, please say why.

Yes, I agree to this proposal.

Question 27
If you agree, should the driver be required to display the insurance in the vehicle?
If you don’t agree, please say why.

Yes but only via a windscreen sticker but not inside the car.

Question 28
Do you agree that Hire and Reward fleet insurance put in place by operators is necessary in addition to, or instead of, individual driver insurance cover? If you don’t agree, please say why.

Yes I agree that operators should carry fleet insurance in addition to but not instead of driver HR insurance.

Question 29
Do you agree with our proposal? If you don’t agree, please say why.

Yes but TfL should bring detailed proposals back for further consultation.

Question 30
Do you support the above proposal? If not, why not?

Yes I support the proposal. Ride sharing should not be allowed. Based on my experience I believe it is unsafe for me as a driver and for the passenger.

Question 31
Do you agree with our proposal? If you don’t agree, please say why.

No I do not agree. I see no reason for any further restrictions.

Additional measures:

I agree with the additional you propose and in addition I think the following are essential also:
• Safety and security training for drivers to be provided by operators.
• TfL should provide whistle blower protection and an anonymous complaints lines for drivers and operators to report concerns to TfL.
• Driver deposits need to be protected by a TfL approved scheme to stop operator abuse.
• TfL should carry out credit checks on operators to ensure they are fir for business.
• TfL should ensure that operators provide suitable rest, kitchen and toilet facilities 24×7.
• TfL must provide suitable rest areas throughout London.
• All operators must provide a 24 hour, live, manned support line for driver operations.

TfL’s behavioural indiscretions

Last week I joined UPHD in their demonstration against TfL at Windsor house. Its great to hear private hire drivers raise their voices but it will be an uphill battle to get TfL to see reason and and practice fairness.

We raised three main issues:

  • End UberPool  – TfL have effectively pre empted the regulatory review which sets out to deal with licensing for such services. They ignored universal advice it received in the first wave of the private hire regulatory review consultation where respondents expressed serious concerns about safety. TfL have said they have sought and received assurances on this from Uber but when pressed they are so far refusing to publish this.
  • Cap private hire licensing – even TfL recognises that there are far too many private hire drivers in London which is leading to congestion and unsafe working hours. TfL plays the shill game in saying it is lobbying for primary legislation but the boss is Boris Johnson MP and would be Tory leader. So what exactly are the results of all TfL’s supposed lobbying. Drivers are growing tired of this plausible deniability in a supposed local versus central government spat. Time to sort it out.
  • An end to TfL discrimination. Private hire drivers suffer much populist abuse, most of it unfair and unwarranted. However, when such rhetoric starts to be reflected in proposed regulation we have to demand an Equalities Impact Asssessment.  Again, TfL says it is doing this but will not tell us what external review has been carried out, when the work will be completed and when the review will be published. That isn’t good enough.

Many will not yet accept TfL have a problem on this last score  – especially if you haven’t actually been on the receiving end of discrimination. But here is a small example from the current private hire regulatory proposals. Here TfL is proposing that Operators routinely share driver details with the regulator. Nothing wring with that but there is something desperately wrong with TfL’s justification for the regulation change:

It also means we can better monitor whether drivers connected to a particular operator
are consistently committing offences or other behavioural indiscretions. This will
enhance enforcement and compliance activity.

Let’s be clear, TfL’s job is to set and enforce regulation and to do so fairly and in the public interest. It is far beyond TfL’s role to imagine and deal with non existent ‘behavioural indiscretions’.

The characterisation and language used here by TfL in this just one example is totally unacceptable and must be rejected out right by drivers. TfL must set and enforce the law. That is all.

UberPool – TfL has failed us all again

Last Friday, Uber launched UberPool to the utter dismay of every private hire driver on the platform. We were given no notice, allowed no opportunity for advance consultation and no choice to opt out. Even at launch, while Uber was providing extensive details to the public on fare structures, we drivers were left in the dark. Some of us were offered in person training via an SMS message but when I went to book there were no slots available at all.

As drivers, completed the basic on boarding training details started to trickle out and it was worse than feared, First, Uber have opted to grab 35% commission share – much higher than most markets in the US. Drivers are paid on a flat fare based on historical data but you can bet that the fare is constructed to benefit Uber and not the driver. We saw some fares netting as low as £3.50 for 2 miles over twenty minutes. This is simply uneconomic and it is unreasonable for Uber to force drivers to accept these fares if we are notionally independent business people.

Uber has proven itself to be an unrepentant profit seeking machine without regard for drivers but we are entitled to expect more from our regulator who we pay to order our trade through our taxes and license fees. So why are they asleep at the wheel when it comes to UberPool?

Let’s consider the reason why private hire regulations are under review at the moment. This from the introduction to the PH regulatory review on TfL’s website:

Because of a number of developments within the private hire industry including advancements in new technology and an increase in the different ways people engage and share taxi and private hire services, we are undertaking a review of the current policies and processes that govern the licensing of private hire drivers, vehicles and operators.

With new regulations not due until June 2016 why has TfL then jumped the gun to allow UberPool before the consultation has even finished? In the first stage of consultation there was universal concern over safety of ride share concepts such as UberPool:

Many stakeholders expressed concern about this proposal, with particular anxiety about sharing at night and ensuring that customers can make an informed choice on whether to share…….The GMB trade union argued that all sharing should be prohibited because of the risks to drivers and passengers; the taxi trade associations felt that sharing should not be allowed in private hire vehicles

So there you have it, consensus agreement that there are very serious issues in operating ride sharing. As a result TfL pledged:

….the regulatory framework must properly any safety concerns and the safety of passengers and drivers must not be put at risk. We will continue to take action in relation to the use of any vehicle undertaking journeys for commercial reward which circumvents the licensing system.

And yet last week Garrett Emmerson, Chief Operating Officer for Surface Transport said publicly that TfL had sought and received assurances from Uber on the safety of UberPool. Funny that, because Uber says its not the transportation provider – we are. So what assurances did TfL get exactly and why didn’t TfL ask us as the relevant transportation provider?

Clearly, TfL has rode rough shod over the consultation process and pre empted our collective participation by giving UberPool an immediate go ahead.

We’ll be looking for answers at our demo outside TfL on December 17. Join us there.