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> A $125 / 12 hour lease fee comes to over $90,000 per year

This comes out as 8640 hours per year, which is 360 days.

So we're talking about the income a taxi owner can get from a medallion.

What an individual taxi driver had to pay to work is a much lower number. Typically a full time job is around 2000h/year.

> The cheaper rates in NYC which are extremely high compared with the rest of the USA were because there was no $125 / 12 hour lease fee because there were no medallions.

As explained elsewhere in the thread, Uber does not and has not ever competed with medallion taxis for their main product (Uber X/Uber Black) in New York City. Uber's direct counterpart would be the for-hire cabs which are also regulated by the TLC, and are not required to have medallions.

Uber is already subject to the exact same requirements of the TLC that their predecessors were - Uber drivers in NYC have to have a valid TLC license. So there is literally no difference in supply-side regulatory cost there.

You clearly don't live in NYC. Uber absolutely changed how people in NYC get around.

Whether or not they fill the same requirements, they made it so easy to get a car that it was easier than standing on a street corner and hailing a yellow cab.

And aside from that, they added accountability. Yellow cab drivers were rude, the cars were moderately clean at best, and generally took opportunities to rip people off. I remember leaving my phone in a cab around 2008, I immediately called it and the dude picked up, said he was around the corner and to meet him outside. He was more than willing to give me my phone back- for $60 and had a shit eating grin on his face. I had the same thing happen in an Uber about 5 years later- the guy dropped the phone off at my house free of charge with a smile.

There is a reason that NYC taxi medallions have pretty much halved in cost since Uber started here- because they are directly competing with yellow cabs!

> You clearly don't live in NYC.

I very clearly do.

Rather than respond to the anecdotes, I'll point out that I was rebutting the original claim: that Uber was cheaper because it (unlike medallion cabs) does not have to pay for licensing fees. Uber does pay for licensing fees, just under a different classification. More importantly, that's exactly who Uber's competition is on the drivers' side, which is exactly what OP was talking about. Uber drivers are generally people who have driven livery cabs for years and either split their time between Uber and other livery cab services, or have switched over to Uber for livery cab driving.

When talking about the price, it's more accurate to compare Uber to other livery cabs, and to say that Uber has caused the share of livery cabs in the overall cab market in NYC to increase, rather than to look narrowly at the medallion market, and ignore the regulatory field that they are in, ignore the costs of that regulation, and ignore all of the direct competition on the supplier side.

> Rather than respond to the anecdotes, I'll point out that I was rebutting the original claim: that Uber was cheaper because it (unlike medallion cabs) does not have to pay for licensing fees.

It is not about licensing fees, it is about that because of the medallions, taxi drivers had to pay $125 / 12 hours for the lease. Before Uber/Lyft those medallions which were restricted to 13,000 for a city of 8.5 million (as well as many visiting tourists, business people, and in a city where many don't own cars), the price of a medallion was $1.2 million. After Uber/Lyft the price decreased to $700,000 and many Yellow Cabs are idle. Prices are lower, service is far better.

If your point is 'Taxis can't compete with Uber because of the medallion system', then you're probably right.

But if your point is 'Uber was primarily successful because they found a way to get around the medallion system', then I don't think so.

The reason being, livery cars were around long before Uber, are much more comparable, and they also did not have to deal with medallions. So, why didn't livery cars put the taxis out of business a long time ago?

I think the real reasons for Uber's success are:

1. Livery cars were a hassle to arrange. Uber solved this by using smartphones with GPS.

2. Livery cars were slower to pick you up. Probably because there weren't enough drivers on the road. Which is probably because there weren't enough riders. Uber solved that catch-22 by subsidizing the rides to jumpstart a positive network effect.

Also- Clear transparent pricing. No getting to the destination and the dude suddenly asking for $30 more than you previously agreed to or arguing over a tip (I live outside Manhattan- nearly every time I took a trip home in a cab, there would be some kind of hassle- the guy wanted cash-often claiming his credit card machine was broken, more $ because traffic was heavier than expected, was just pissed about a $20 tip not being enough... there was something nearly every time.

Accountability and a feedback loop- if the guy did try to rip you off somehow, prior to Uber, you really had very little recourse. There is a process to lodge a complaint in NYC, but it involved paperwork, showing up to a hearing (which you will have to take time off of work for), and then maybe something might be done.

You kind of touched on it, but also just some kind of visibility into when exactly your car will arrive. When Uber was new in NYC, wait times were much longer, generally 10-15 minutes, which I didn't mind much because that's probably about how long it would have taken me to find a cab, and I could finish my drink inside the bar/restaurant and finish as the driver pulled up. This has actually gone downhill a bit over time- So many times I pull up the app to see a half dozen cars within 4 blocks of me, and then when I actually try to reserve, its a 7-8 minute wait. Or they accept the trip but then I guess got a better offer on Lyft or something and is just heading in the wrong direction- meaning you have to cancel and then fight with Uber over being charged a cancellation fee, which usually isn't too hard to do, but its just a hassle and a way drivers can currently beat the system.

The share of taxi rides in Manhattan has decreased by almost the same amount Lyft and Uber rides have increased [1]. The overall number of rides has increased in the other boroughs due to Lyft and Uber ridership.

1. http://toddwschneider.com/posts/analyzing-1-1-billion-nyc-ta...

Interesting, thanks. It justifies Uber spending more money on marketing to expand market share.

Maybe, it is very likely that NYC rides need to be propped up with incentives by ridesharing companies. We won't know the economics until somebody tries to IPO or shutters their company.

Actually, the normal Yellow Cab rates are so high in NYC that Uber can still charge rates twice that of Chicago Uber and come out ahead (NYC $1.75 per mile, Chicago $0.90 -- twice the amount).

i don't follow your math. can you expand on the increase. $125 / 12 hour means it is around 12 bucks an hour. if you have 3 rides an hour (don't know if doable), it would increase a single ride by 4 bucks. that doesn't seem the end of the world

I would estimate my typical cab fare in NYC to be around $17-$25. $4 for a single ride is 16% - 23%. That's a big difference.

At least in downtown San Francisco, many shared rides cost $4 total.

Not being from SF, how long is that ride and how many share the ride?

~10 minutes avg ride time in SF. You also need to take into account the extra 4-5 avg minutes it takes for a driver to pick up the person. So I would assume a driver in SF can make 4 rides an hour.