A Shared Ride

It’s real-time access to ground transportation, at a different price structure. It takes out the middle man from traditional taxi services.”

It’s nearing 2 a.m. on a Saturday night/Sunday morning when 35-year-old Philip Pablo drops off a group of 20-somethings at their house and heads back toward town, where people are spilling out of bars and clubs. He’ll repeat the cycle – pick up people, take them home – a couple more times before he heads home himself.

“This,” he says, driving through Chinatown, “is what I do when the baby is sleeping.”

As an UberX driver, this has become a typical night for Pablo: He puts the baby to sleep, eats dinner, then hits the road armed with his Uber app, which connects riders with drivers like him via smartphone. Uber won’t disclose specific figures, but Pablo is among hundreds of drivers on Oahu, where there also are thousands who use the app as passengers.

App-based ride-hailing like Uber is lucrative. With a presence in hundreds of cities in 56 countries, Uber is valued at more than $41 billion. And following its lead, other startups with similar models, such as Lyft and Sidecar, have launched throughout the world.

UberX, the low-cost ride-hail portion of Uber (which also has private car and taxi services), as well as Lyft, have been in Hawaii since June 2014. And now, Hawaii is the latest state to consider legislation regulating these companies. Senate Bill 1280, which was heard by the House Committee on Finance last Thursday, would establish higher insurance rates and state regulations regarding driver requirements. (The committee is slated to make a decision early this week.)

But that all might be a moot point. Uber claims that if the bill is passed in its current form, it would effectively kill tech-fueled ride-hailing in the state.

“I am hopeful that it will not go through in its current form,” says Uber Hawaii general manager Brian Hughes. “It would mean the end of ride-sharing. Truthfully, I don’t think anybody wants that.”

The bill was introduced by Sen. Glenn Wakai, initially he says, on behalf of Uber to help protect customers. But, both Wakai and Uber say, the measure since has been bogged down with insurance regulations that don’t suit tech-based ride-booking.

“Uber is not your grandpa’s taxi service. It’s real-time access to ground transportation, at a different price structure. It takes out the middle man from traditional taxi services,” Wakai says.

Hughes hopes that a reasonable conclusion can be reached – and points out that Uber already insures its rides and requires extensive background checks for drivers (check these guys out who provide pre-employment screening). Uber and Lyft both have $1 million insurance coverage once a trip is initiated, and both screen potential drivers for driving offenses and criminal charges.

The appeal of these services is obvious: Download an app, hail a car from your phone. Quick, convenient, and simple. Plus, their cars tend to be cleaner than your run-of-the-mill cab, and they will also be insured, something that all cars should have too. This can be done by reading something like these esurance reviews and opting for this plan, or enquiring about a similar policy. This way, you will be safe on the road. As well as this, some drivers even offer bottled water, candy, or reading materials to their passengers.

But critics argue that it’s a shiny veneer for a darker underbelly.

According to EcoCab owner David Jung, while transportation network companies market themselves as tech/ software businesses that offer ride-sharing, the model more closely resembles traditional commercial transportation. That means, he asserts, that they need to have the same regulations as traditional transportation services.

“The problem I have with TNCs (transportation network companies) is that they say they are not commercial vehicles when they are,” Jung says. “When you get paid to do something – to get someone from Point A to Point B, you are a commercial vehicle. How can you say you are not a commercial vehicle?”

Jung contends that these companies claiming they are anything else is a misrepresentation.

“True ride-sharing companies (are) where I say, ‘I am going from Point A to Point B anyway, so do you want to jump in and share on my gas costs?’ If you say, ‘I am going from Point A to Wherever You Want Me to Go and I am going to charge you,’ that is called a taxi service, or, at minimum that is a commercial service.”

The push for Uber and Lyft to adhere to traditional regulations is nothing new. You can practically trace these companies’ meteoric international rise through corresponding controversies and legal troubles. Uber and Lyft have been asked to leave from local governments (some have stuck, some haven’t) or have been hit with tighter rules in a number of cities. Last summer, cab drivers throughout Europe held traffic-stopping protests against Uber.

Then there have been the slew of alleged Uber incidents involving passenger safety, including multiple sexual assault allegations. And a San Francisco Uber driver was arrested for reportedly hitting a passenger with a hammer. There are now even lawyers who specialize in legal problems centred around rideshare apps, such as this Houston Lyft attorney.

(All that was compounded by numerous faux pas from Uber’s leading players, who often sound more frat bro than business executive. Senior vice president of business Emil Michael suggested the company hire researchers to prod into the personal lives of Uber’s critics. And founder/CEO Travis Kalanick was quoted in a GQ article as saying, “We call that Boober,” when talking about how his role has won him attention from women.)

Despite such controversy, these companies keep persisting, and, for the most part, thriving. Hughes says it’s because they truly believe in what they’re doing. While discussing details of the proposed legislation, Hughes turns to larger, loftier goals with the kind of bright-eyed, forward-thinking optimism that seems to be a prerequisite for tech startups: “We are able to actually compete with car ownership, versus competing with transportation alternatives. Taking around UberX instead of owning a car could actually save you money.”

It’s like a long game in the sharing economy.

Locally, Uber isn’t saying that its services shouldn’t be regulated.

“There needs to be regulation – it is an industry that definitely affects public safety, so we strongly support regulation,” Hughes says. “However, it just needs to be reasonable and actually accommodate this new business model.

“Thousands of people are able to get around at a more accessible price point, as well as a greater degree of reliability,” he adds.

Plus, as other Uber chapters have argued, stifling Uber could mean stifling entrepreneurial activity – perhaps all the more detrimental in Hawaii where the cost of living is so high.

“There are hundreds of people who have come to depend on this as an income opportunity,” Hughes says. “They are completely their own bosses. It really is an unforeseen level of flexibility for the driver.”

For Michael Shimomura, 27, becoming an Uber driver nine months ago was a convenient way to fund his education. He works part time as a personal trainer, but he’s saving up for a pricey aviation program on the Mainland. He’s had more than 1,000 passengers and says he can make up to $300 on one weekend night.

That level of flexibility also is what prompted Jing Juo, 23, to become a Lyft driver. He works full time as a restaurant supervisor, but he drives for a few hours on his days off. Plus, he says, there are times when he’s not doing anything else – so why not just hop in the car and help someone out?

Vacation rental manager-turned-Lyft driver, Everett Milstead, 35, says his hours are “off the wall,” with unpredictable fluctuations. “Sometimes it’s real busy, sometimes real slow. So this is a great way to fill in the gaps,” Milstead says.

As for Pablo, he is a technician at a dialysis clinic during the day. When he decided he wanted to make a little extra cash, it was crucial that a side gig wouldn’t interfere with his career or family time.

“It’s a perfect fit,” says Pablo, who has now been an UberX driver for about six weeks. “It is exactly what I was looking for.”