Uber – Don’t Bother With Rules

Driver and rider matching service Uber has found itself on the wrong side of the law – not for the first time – in Germany, where “The regional court in Frankfurt said in an emergency ruling that Uber, which connects self-employed drivers with smartphone-wielding passengers, did not have the necessary permits”. The ban applied to the whole of Germany. Uber will be appealing.

The reason for the ban? “German law only allows drivers to pick up passengers without a commercial license if the driver charges no more than the operating cost of the trip. Because Uber stands to take a cut of any charges, the court held it liable and issued an injunction against the service”. Having been banned, Uber will, however, effectively take no notice and carry on its German operation.

Any fines, presumably, will be paid by Uber from its estimated $1.5 billion war chest. So will it, in the meantime, look to ensure its drivers comply with the rules and get commercial licenses? You jest. Here we get to the crux of the Uber attack: all manner of spin, lawyers and lobbyists are deployed in order to allow the organisation to ignore the rules, or at least have them bent in its direction.

A spokesman deployed the obligatory spin: “We believe innovation and competition is good for everyone, riders and drivers. You cannot put the brakes on progress ... Trying to limit people’s choice doesn’t ever seem like a good idea”. Yes, never mind the rule breaking, look over there at the allegedly increased choice.

Another typical Uber deflection of criticism was to point out that more people were downloading the App: “Across Germany, Uber says signups have risen by three and a half times, while in two of the five German cities where it has been operating demand has gone up more than sixfold. Dusseldorf has seen signups increase by 518%, the company reported, and signups in Hamburg increased by 590%”.

People want it, so that’s OK. One may be able to think of all sorts of goods and services that are illegal, although they may be potentially popular. But those products don’t have an army of lawyers and lobbyists in tow: Uber’s response to the German ban has included hiring “Mark MacGann as head of public policy for Europe, the Middle East and Africa”. He is a lobbyist.

Meanwhile, in Germany, Uber shows no inclination to comply with the law. How it will win its appeal is unclear, but what is all too obvious is that this is an organisation that believes in free market competition only when that market can be rigged in its favour, if necessary by legal and lobbying muscle.

The ultimate objective, meanwhile, is to continue the aggressive expansion, if necessary by screwing over its own drivers, as well as doing whatever it takes to eliminate competition. Welcome to the reality of Uber.