I suppose it's nice to hear that Uber is not uniquely exploitive of drivers - or even the worst, if I'm understanding things correctly.
A few years ago, Uber and Lyft left Austin, which in turn created a local, non-profit MVP rideshare app called RideAustin that worked OK. It wasn't perfect, but it covered the bare necessities of ridesharing fairly well.
The drivers I spoke with were pretty happy with RideAustin because they made more money than they had been using Uber and Lyft since RideAustin took a smaller cut.
When Uber and Lyft returned, they enticed drivers with rates that RideAustin couldn't keep up with. Within a few weeks, it became a lot harder to hail a ride through their app. And within a month, I couldn't get a ride consistently from my apartment in north Austin. If I wanted to get a ride, it had to be through Uber or Lyft.
Once they regained the market, they cut the rates to drivers, who have no rights to negotiate pricing since they're contractors. Rideshare drivers are essentially a captive labor force that must accept all conditions to work without really any say over what they're paid.
> Rideshare drivers are essentially a captive labor force that must accept all conditions to work without really any say over what they're paid.
They clearly aren't "captive", otherwise they couldn't have just switched to RideAustin in the first place. Nothing stops them from becoming completely independent drivers either, but then they need to find their own customers.
In the end, they are getting paid market rates. Maybe those rates are really bad, but that's just what happens when supply is far larger than demand. Prices are always driven down by the people at the bottom, how can Uber/Lyft be faulted for that?
As far as what happened to RideAustin, from last year:
> Uber and Lyft's brand recognition, as well as discounts the companies were offering when they returned to Austin, made it difficult to compete, RideAustin's Tryba said.
This is the argument against "price dumping", but that strategy doesn't work in the long run. These companies are burning through their cash reserves to achieve that "dominant position". Once they're done with that, they will have to raise prices and competition is viable again.
Secondly, it’s not enough to look at Uber’s price manipulation, it’s necessary to look at the opportunities that the small, local startup lacks. Even if their prices are competitive with Uber’s, they likely don’t have the cash to do what Uber did, namely subsidize/incentivize drivers to drive even when there are not enough customers.
It becomes a trap: Uber artificially lowers prices, boxing out the smaller players. Once the market is cornered, raise prices. The smaller players are now price competitive, but the two-sided marketplace has already been defined. The passengers are already in an app with their preferences, and the small percentage who are comparison shoppers might fire up the startup app, only to find that there are not enough drivers - why? Well the drivers don’t have enough capacity to keep them busy, so they drop off the startup app to focus on the big guys.
Free markets are fine and good in a vacuum, but the equivalent to a truly free ride sharing market would be where there was only one app, all the platforms put their inventory on it, and users could decide where to put their money, based on price, luxury, ideals, whatever. To claim the current system is free market is to willfully ignore the other dynamics at play.
The final profit margin has nothing to do with the concept of exploitation.
You don't see the glaring differences between a slave on a cotton plantation and an Uber driver?
1. Access to customer base
2. Subsidizing the service provider over market rates
You're responding to an argument that is claiming that the second thing is irrelevant to the conclusion.
i.e. whether or not you are subsidizing the service provider at a loss is irrelevant for the exploitation value. The exploitation is coming from elsewhere, and the subsidizing doesn't do anything about it.
I, personally, don't think they are being exploited but I agree that the subsidy doesn't remove exploitation if it did exist.
What exactly is nice about that?
Could they though? Can Uber be expected to lose money at an even faster rate?
Drivers take the low pay largely because they lack better alternatives. As long as that remains true and drivers can't negotiate pay, the drivers are absolutely being exploited.
Rideshare companies aren't going to raise rates because there's no labor competition to threaten their workforce and boost wages. On top of that, drivers can't negotiate pay.
How many people do you really think take jobs like that with low pay and no negotiating power because they really really want to? Many of the drivers I've ridden with don't have many other options.
There's an entire political movement eager to campaign on that has been gaining energy the last few years because people are losing faith in the current system.
I would also wager that the vast majority of ordinary taxi drivers are self-employed and working for some agency, an arrangement not too dissimilar to that of Uber/Lyft.