Uber's London License Loss Can Pave Way For New Local Apps

By | August 5, 2020

Transport for London (TfL) announced Friday it will not renew Uber’s license to operate in the city, and while some are upset about the decision, the loss of Uber could allow other apps to emerge.

TfL said Friday Uber was “not fit and proper to hold a private hire operator license.” Uber retaliated saying it would appeal the decision in court. The ride-hailing service will continue to operate in London until appeals are concluded.

“3.5 million Londoners who use our app, and more than 40,000 licensed drivers who rely on Uber to make a living, will be astounded by this decision,” said Uber in a statement. “If this decision stands, it will put more than 40,000 licensed drivers out of work and deprive Londoners of a convenient and affordable form of transport.”

Uber’s Exit Could Bring Other Apps

Uber’s possible departure could also open up opportunities for the creation of new apps and services, an effect that happened in Austin, Texas last year.

Uber stopped operations last May in Austin after it refused to follow some rules which residents in the city voted on that included fingerprinting during background tests for drivers. Uber, along with Lyft, halted operations in Austin, leaving people without many options. A few weeks after they left, Ride Austin, a nonprofit ride-hailing service used with an app, was created.

It was launched “to fill the void” Uber and Lyft left last year, said Bobbi Kommineni, vice president of strategic programs and operations at Ride Austin.

“The drivers were left without jobs and they needed a way to feed their families, and then the riders were left without services,” Kommineni told International Business Times.

That’s when city residents decided to take action.

“One hundred percent of Ride Austin is Austin,” said Kommineni. “We were funded and created by tech entrepreneurs here in Austin.”

They created an app on the driver and user’s side from scratch to replace the services that had departed. When Uber and Lyft were gone Ride Austin was doing 65,000 rides per week.

However, Uber and Lyft planned to return to Austin. After successful lobbying at the state level, Texas Gov. Greg Abbott signed a bill that overthrew Austin’s fingerprinting rule, allowing the companies to resume operations in the city on Memorial Day this year.

Ride Austin, which is still in operation, saw its number of users go down when Lyft and Uber returned. Some users went back to those ride-hailing apps and others remained loyal to the nonprofit. Kommineni said the decline in ridership was also due to students departing for vacation and hot summers.

Uber and Lyft’s return was met with mixed reviews, Kommineni said, pointing out “the manner in which they came back” by going around Austin to state level.

Uber and Lyft are companies that have more resources to tend to users. However, Kommineni said Ride Austin is a more community-involved service.

“We are a nonprofit,” she said. “The drivers make more money when they work for Ride Austin because we don’t take commission.”

Uber apologized to Austin residents when it announced operations would resume, while Lyft said it was “excited” to return.

“It was never our intention, but we let down drivers, riders and the broader Austin community,” Uber said in May. “We’ve spent the last year listening carefully and learning from the mistakes we made. While we can’t change how we got here, we can and will commit to getting it right this time around.”

While both companies are back, their departure showed how cities can cut their dependence and work for solutions on their own.

Other Alternatives in London

While Londoners could be left without Uber, there are other alternatives to get around. Addison Lee, a minicab company, is one of them, as well as the Hailo app and Gett app, which can be used to flag a licensed Black cab. Additionally, the Kabbee app lets users book minicabs, however it only has two stars on iTunes and four stars in the Google Play Store. Uber rivals Lyft and Juno are not available in London yet.


Category: Uncategorized