Great point. Since it is an app, you can track exactly where the Uber is supposed to go and make sure they are taking you the right way. Drivers have freedom in when and how long they work for. This gives these new tech companies the opportunity to reduce expense on employees and gives workers supplementary income on a flexible schedule, Tech company critics claim that companies such as Uber, Lyft, and TaskRabbit have shifted their responsibilities of health care, sick time, paid time off, and workers’ compensation on the workers and general public, California created a new Law, known as the Gig-economy bill or AB5, which ruled that companies like Uber and Lyft must treat more of their workforce like employees, Uber, Lyft, Postmates, DoorDash, and Instacart responded by joining together to create a ballot initiative that would exempt them from the law claiming that classifying their workforce as employees would take away the flexibility and freedom the workers currently have, The creation of AB5 was inspired by the language of how The California Supreme Court defined an independent contractor. Ask 15 different experts what innovation is, and you’ll get 15 different answers, yet at the same time, innovative companies are easy to recognize. These medallions can cost anywhere from $60,000 to $700,000! Uber also has a questionable longevity, due to its heavy dependence of the internet. Uber has had many investors who have invested over a billion dollars, and at one time, was seen as a company that was trending in the right direction. To make this even deeper three factors also defined by the IRS to state if they are an employee include “Does the company control or have the right to control what the worker does and how the worker does his or her job? Do you agree with The California State Law which now requires companies like Uber and Lyft to treat their workforce like employees as opposed to independent contractors? Uber Technologies, Inc. develops and operates proprietary technology applications primarily in the United States, Canada, Latin America, Europe, the Middle East, Africa, and the Asia Pacific. People also used it as their main source of income, but again, they got to be flexible with how many hours they were working and which days they wanted to work. Ubers business model is a smartphone app that connects you to a service of drivers. Uber Technologies, Inc. develops and operates proprietary technology applications primarily in the United States, Canada, Latin America, Europe, the Middle East, Africa, and the Asia Pacific. In 2017, Uber’s license was revoked for poor oversight of drivers. -I would say uber should stay in cities; its pretty vital and handy. If successful, these vehicles have the potential to make our roads safer and transportation more affordable for everyone. Huber Technology Inc. 1009 Airlie Parkway Denver, NC 28037 USA +704-949-1010 +704-949-1020 huber hhusa net. I think there are pros and cons to this law. Is it fair that taxi drivers and companies are losing business? I also agree and like how you touched upon the aspect of following the California law, and that they also should be paid and regulated due to the similarities between processes of hiring full-time employees. Uber is so successful today because of the Business Model Innovation. What are its strengths and weaknesses? Doing mandatory background checks and having people have contracts as actual employees can decrease the amount of people who sign up to be a driver for Uber with bad intentions because Uber will have all of your information if something were to go wrong. 2. Of course, the pickle there is that companies like Uber may make only a certain amount of “employee” jobs available, may not seek candidates who want to be “employees” – or, opposingly, only hire those willing to be “employees”. You knew what you were talking about, and I was able to understand everything you were trying to say very clearly. Uber is just so much more accessible than trying to pursue a cab, if the Taxi drivers and the company they work for cannot move with the changing times, they should start doing Uber and Lyft. You bring up a great point that I honestly did not even consider. I really agree with that last part of your statement on how you talk about competition is competition and it is good for the economy. Overall, its one of the best independent contracting jobs in the market right now, and as long as safety is a priority for Uber, it will continue to succeed. You don’t ban a new product from the market just because it is better and more profitable. Research and Innovation. Convenience is a major advantage that Uber has. Uber and Lyft Disrupted Taxis — Now They Must Disrupt Themselves Disruption seems to be synonymous with innovation in the tech world. It can help the employees potentially make more money, but they are more at risk with their hours of service and also their independent ratings when they are on call. That being said I do believe Uber should be allowed to drive in cities and should not be banned just because they are competition to another company. EVP Technology and Innovation | Uber Elevate | Uber - YouTube I guess the best way to try and address that would be to try and have a system where gig workers can “opt in” or “opt out” of “employee” status. The primary market that Uber is targeting is the taxi and limo services. Hi Adelina, Very similar to most modern products and services, Uber gives consumers the convenience of consuming its service from their smartphones and other mobile devices. This is what competition of the market looks like. One notable weakness Uber has directly impacts their drivers and becoming an increasingly ongoing problem that is forcing drivers to leave the app entirely. The European Court of Justice ruled that Uber should be viewed as a transportation service and not just a middleman for the passenger and driver. Uber utilizes an exclusively mobile business model. In my experience Ubers have been more expensive than taxi’s so while the taxi industry may have seen a decline within recent years, I believe taxis are an affordable option for people who do not want to pay Uber prices. Thanks for your reply. The company, which is Uber in this case, also receives a cut of compensation that each driver earns. I think Uber and Lyft should be allowed in cities as well. Newsletter. Also, drivers may get to set their own hours in the app based on what the companies say and can only take customers that they are assigned. The Case of Uber in France and the US. even then though, its pros outweigh the cons. The increasing regulations (which cut into the ability of Uber to maximize their revenues) and the lawsuits have helped contribute to Uber’s $1.1 billion losses claimed in 2019. Uber’s business model utilizes the gig economy. Things that must be reconsidered for the future of work: disappointingly low minimum wage, lax overtime rules, weak collective-bargaining rights, and excessive unemployment. The IRS defines an independent contractor by stating “an individual is an independent contractor if the payer has the right to control or direct only the result of the work and not what will be done and how it will be done”. Personally removing these services like Uber and Lyft is absurd and should not even be a factor when it comes to city transportation. Uber and Lyft drivers did not become employees when AB5 took effect January 1st; AB5 is California’s new gig-work law. All of this is a low-cost market where the driver gets a good cut (80%) and can still grow. Change ), You are commenting using your Google account. We offer a comprehensive line of stainless steel equipment. That’s a range of luxury car to mansion mortgage! It is also more cost efficient than a taxi service because of the fixed rate you receive when you order the ride instead of a variable, time-based rate you would get in a taxi. Also, I think it is fair that taxi and other companies are losing business because their prices are way to expensive and unreasonable. Taxi companies ought to change and adapt with the changing times and as they become outdated, that does not mean hinder the growth of a more improved product/service. Sharing the Liberal Utopia. The London transportation authorities decided to not extend its taxi operating license due to safety issues with Uber. It is exactly what competitive innovation is all about and that is no different in this situation. Apoorva, They also have different types of Ubers so it can accommodate for either one person, a small group, or a large group. but unfortunately this is the reality of a changing world. Multiple big name investors invested $1.2 billion into Uber. I believe Uber should be allowed in other cities as long as they are following the cities guidelines. If not, what range of responsibility should Uber, and other companies like Uber, have on their workforce? It was renewed for the third time in 2014. This entire economy promotes the freedom of the individual as well as the organization and is constantly growing. Not only that, but the value of the medallions is not static. If so, why? 1. A dedicated High Level Innovation Cooperation Dialogue (ICD) was set up in 2012. Is Uber disruptive innovation? Amazing job with your discussion post for this weeks group. I actually had a similar response to this question. Subscribe. Are the business aspects of the worker’s job controlled by the payer? Share. -The business model is providing a customer in needs of transportation to a certain location. Their pricing methodology, is managed by a demand system and route price changes upon the demand of the ride during peak hours and days. Does something like this constitute shutting down and banning the service, or does the fact that their model is not the same as a taxi model enough grounds to disagree? I also happen to agree with everything you said in your answers to the questions. Some strengths are that it insures the payment of the passenger, another strength is that it allows Uber to make 20% of all fares. It can also lead them to figuring out new ideas to improve their service and it can revolutionize the way this service is given out to customers. So, the protections are objectively good, but I think where the laws are failing are for the people that either do not want those kinds of protections, or whose jobs are more dependent on being able to have maximum autonomy, and who do not want them. Change ), You are commenting using your Twitter account. A great example of this is in London through 2017 where they were not eligible to drive and obtain a taxi license due to safety issues. I also agree that Uber should not be ban from entering the transportation market. If the drivers are filing as independent contractors then I believe Uber should have less liability in whatever happens on drives. I think you bring up a great point as it pertains to Uber considering its drivers employees. It’s strengths are convenience and lower prices. There are many strengths to Uber. Huber Technology srl. Using the GPS technology from your mobile device, Uber is able to locate where you are, locate an available driver near you, and send directions to your desired destination. Uber is evolving the way the world moves. Yes, I do agree with this law because Uber drivers need to be held more accountable. Uber uses technology to displace low-skilled workers who may have little access to other jobs, and as a result makes labor (and ultimately the cost of a ride) cheaper. I also believe that competition is a drive for economic growth for cities. The article is about a woman who works as a Taxi driver in New York City and is talking about the economic hardship that Uber and its competitors have conflicted on conventional drivers in New York and other cities where its competitors have taken over. Since Uber drivers work on behalf of Uber, they should be treated as employees instead as independent contractors. Uber has placed itself as the leading ride-sharing application and it is one of the first ride-sharing apps, operating across the globe. It lacks the real connection. No, I don’t think cities should ban Uber from entering the transportation market and yes, I think it is completely fair towards taxi drivers and companies. What is the Uber business model? All the steps can be done in just one smartphone. You provided a lot of detail, and I was very happy to be able to read and write on it. A weakness of the business model is that, because of the apparent skirting of regulations and employee costs/liabilities, Uber has found itself at the center of some very expensive lawsuits. It takes away the independent contractor and puts the name of the driver involved with the company directly. Uber has made a rating system that assist customers to rate their riding experience as well as the motorist. Uber’s business model was to create an app that connects you to drivers if you need a ride somewhere. First, it is important to understand these different types of business models. Some of the weaknesses is it could have is that drivers can refuse the passengers service, can get negative reviews because of this. It works through an app where drivers sign on in a certain location and then someone can request a ride through the app. 1) What is the Uber business model? Also, the dependency on the workforce. Companies work based off a supply and demand system so if the taxi services are not meeting the demands of the customers then it is on them if they are loosing business. The Uber business model is that everyday people can utilize their own cars as taxis without having to work for a taxi company. I think that cities should allow Uber to compete within the transportation market. Uber also isn’t obliged to pay Social Security taxes, unemployment insurance, or worker’s compensation either because of how they identify their employees as independent contractors. This new revolution comes with a new labor force of entrepreneurs, which is called the Gig Economy. What are its strengths and weaknesses? Also, it is okay for people to create new products or services that differentiate themselves, that is exactly what happens in a competitive market. Maybe if they adopt these new services then taxis driver will not lose their business and will have a chance to compete with Uber. I completely agree with The State of California’s verdict adhering major conglomerates like Uber and Lyft to classify their drivers as actual employees instead of independent contractors. The business model of Uber is perfect for a customer to driver communication. As a regular consumer of the app, I believe that one of Uber’s key strength has to be the pricing. People nowadays live in a very fast paced life and need things to happen rapidly. “its core business, is facing serious challenges in its core markets because the gig economy is under attack by regulators worldwide, which has been downplayed so far”, DISRUPTIVE INNOVATION AND THE GIG ECONOMY: THE UBER STORY, https://www.irs.gov/businesses/small-businesses-self-employed/independent-contractor-self-employed-or-employee. As for whether or not its fair that taxis are losing business… part of me says that the market decides. I understand that it would ruin the business model for the drivers to become employees of the company, but do you think there are other ways to keep passengers safe while still holding drivers accountable? What are it’s strengths and weaknesses? Uber along with other companies in the gig economy are becoming more and more important for the United States and its economic future. Ultimately numbers seem to indicate Uber is being overpriced by investors. If so, why? It is also worth mentioning that unlike traditional taxis, Uber is cashless as the app is connected to a credit or debit card. Like most things in life, jobs change with the times. I like the business model they have with independent contracting, as my job is very similar. I agree with your point a lot. That is until Uber, and other tech companies, were faced with legal and regulation issues. I don’t agree with The California State law requiring companies like Uber to treat their workforce like employees. The Uber business model is centralized around an app that provides speedy transportation to its customers. Fill in your details below or click an icon to log in: You are commenting using your WordPress.com account. That is exactly what happened with the taxi industry, people would rather not have to deal with cash and have the ability to get a ride right at their fingertips. A sharing economy is a way of purchasing goods and services that is different from the traditional business model of corporations hiring employees to produce products to sell to consumers. ( Log Out /  By them doing this they can possible find themselves competing with Uber and Lyft. In my opinion, obviously it’s not “fair” that this market is losing business. With the workforce, employers are now seeking people who balance work and play, and who work at what they are passionate about, are often more focused and productive. Unlike many taxi services we all see in different cities and towns, Uber is a company that allows the drivers to be somewhat as part time investors/owners. Uber's self-driving system includes sensors that view 360 degree around the car. On the other hand, this also has bough concerns as to how safe it is for just anyone to be a driver. The total process is very simple, registered Uber users asks for a taxi using the Uber app, an Uber driver then dispatched to the passenger’s location and assist the passengers to reach his destination. Their only chance to compete with Uber would be to develop a similar app, lower costs, and charge before the ride because it isn’t fair to the rider when traffic occurs and their total ends up being twice what it normally is. I think the company should allow their drivers to choose if they want to be employees or independent contractors. I was not aware of the London example. I agree with your point about life being fair, but there are other reasons to shut down transportation companies just like shutting down traditional taxi services. Uber operate in their cities large majority of Uber strategy for the work their! Begin i do think the ride-shares should be treated as such Aurora paves a path for the... Economics aside, i really enjoyed reading your post noticed that you did research. 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