There’s nothing like watching a rent-seeking industry fall on its own sword.
Last month, taxi drivers from London to Berlin staged mass protests against ridesharing company Uber, with some 30,000 drivers parking their cars, shutting off their meters, and blockading streets. The protestors claimed that car-sharing services like Uber avoid regulation, drive down fares, and cost taxi drivers their jobs.
Yet, in a great twist of irony, the taxi drivers actions worked to Uber’s benefit, both giving them free publicity and driving a huge increase in sign-ups, with Uber experiencing a reported 850% increase in people signing up in Britain after the black cab protest.
Now London’s taxi industry has been dealt another blow, with the city’s transport regulator, Transport for London (TFL), granting permission for Uber to continue operating. From the New York Times:
Under London’s taxi rules, only licensed black taxis can use meters in their vehicles to charge customers based on distance and time. The city’s licensed taxi drivers argued that Uber’s technology, which uses a smartphone-based technology to charge customers at the end of the journey based on the length of their trip, broke this regulation.
Transport for London, however, disagrees.
“Smartphones that transmit location information between vehicles and operators have no operational or physical connection with the vehicles,” the regulator said on Thursday in a statement. The phones are “not taximeters within the meaning of the legislation,” it said.
However, the decision is not final, with TFL referring the matter to a British court to make a ruling on whether Uber’s smartphone technology can be considered a meter.
Still, until the British court makes its ruling, Uber is allowed to continue operating, which is a victory for consumers seeking greater transport options at lower cost, and another nail in the coffin of the rent-seeking taxi cartel.
