I was going to take the day off, but reading The Wall Street Journal this morning I came across an interesting interview with Uber CEO Travis Kalanick. Uber is a car hire service many BoardingArea bloggers love to use. I’m lukewarm. It’s a cool idea, but I don’t use taxis or town cars very often. The first Morgan Freeman movie I ever saw was Driving Miss Daisy, and like the title character, I prefer to drive myself.
But for those who do want convenient transportation, Uber lets you call up a town car direct to your location using your smart phone. The fare (tip included) is then debited automatically from your account. It’s really as simple as possible. The service and comfort is better than a taxi, and the price is somewhere in between a regular taxi and a regular town car because these are unscheduled drivers with nothing else to do.
The interview covers the regulatory hurdles Uber has had to face as it expands into different markets, often in opposition to the local taxi lobbies. The taxi business is incredibly political and may be one reason why I generally hate using one. If medallions are trading at a million dollars each in New York City, that’s a good sign of an inefficient marketplace. I appreciate what Kalanick is trying to do to bring people better, cheaper transportation.
He’s also been pretty clever at using popular support to combat these forces, using Twitter and email campaigns. If the taxi and livery industries have their own powerful lobbies, the only thing you can do to fight back is create your own. In fact, it seems that some of the roadblocks Uber has faced may have influenced its decision to branch into a second business, UberTaxi, that produces even more competition for the established players.
I got the impression from Kalanick’s background that he has the typical “I’m not wrong, the world is wrong” Silicon Valley startup attitude. In most parts of the country, we call that person a jerk. But maybe it takes that kind of person to start a business like Uber. You see similar personality traits in Steve Jobs and Mark Zuckerberg, and it doesn’t surprise me that Kalanick’s first business was a Napster competitor or that he was sued for $250 billion.
So far, Uber seems to be very good about moving into markets where it has legal authority to operate. The interviewer asks at one point if they’re choosing to ask for forgiveness rather than permission and Kalanick’s response is spot on:
“We don’t have to beg for forgiveness because we are legal,” he says. “But there’s been so much corruption and so much cronyism in the taxi industry and so much regulatory capture that if you ask for permission upfront for something that’s already legal, you’ll never get it. There’s no upside to them.”