May 19, 2014 - 8:04 am
Depending on who you ask, Uber is either the greatest transportation innovation of the decade or one of the biggest dangers the riding public has ever encountered.
The San Francisco-based company operates in 111 cities worldwide and 61 in North America from Albuquerque, N.M., to Washington, although it has yet to establish itself in Las Vegas.
The technology crowd hails Uber as a competitive, money-saving means to get from one location to another. Uber considers itself a technology company, not a transportation provider, by promoting ride-sharing.
It operates almost like a taxi service, which is why Clark County cab companies aren’t happy about the prospects of it taking root in Southern Nevada.
Here’s how it works: People who want a ride from one location to another must download the free Uber app from Apple or the Google Play Store. Customers wanting a ride click a request button, which pinpoints the customer’s location and assigns the ride to a driver who has been vetted by the company. Part of that vetting process is to be sure drivers and their cars are properly insured.
Because the Uber app operates using GPS, the customer can monitor the arrival of the ride provider.
The customer climbs aboard, takes the ride and then pays and tips through a pre-established credit card or PayPal account. Riders rate their drivers, which is how Uber monitors the quality of the ride experience. A few scary rides or rider dissatisfaction and Uber will pull those bad drivers off their roster.
The Uber operational model is vastly different from what’s offered by Clark County’s regulated taxi industry.
The Nevada Taxicab Authority, which oversees the 16 cab companies operating in Clark County, regulates the number of cabs on the street — about 3,000 — and, most important, how much they can charge.
It costs $3.30 for the initial activation of the taxi meter, plus $2.60 a mile after that and $30 an hour “wait time,” the time that vehicle is stopped in traffic or traveling under 12 mph.
Because Uber hasn’t arrived in Las Vegas, there’s no price list since every city has different rates and the company has three or four levels of service.
UberX is the low-cost version of Uber and is basic ride-sharing. In Denver, the UberX rate is a $2.14 base fare and 19 cents a minute. In Phoenix, it’s $2.94 plus 25 cents a minute and in Los Angeles, $1.91 and 29 cents a minute.
But there’s a catch that local Uber critics have pounced on. Uber practices supply-and-demand pricing so the fares could be higher depending on how busy the city is at any given time.
What would that mean in Las Vegas? Uber isn’t far enough along in its evaluation of the market to determine that.
But it’s likely that pricing would be higher at peak times, such as when a major convention or special event is in town, and around the hours that people are going to dinner or leaving conventions, shows and clubs.
Local cab companies have pointed to that as one reason why Uber wouldn’t work in Southern Nevada. State statutes and regulations would prohibit its business model.
But then, go back to thinking about whether Uber is a transportation company. If you take a friend to the airport, no money changes hands. You’re friends.
Uber uses technology that enables people to make new friends — except, they’re friends they didn’t know 10 minutes ago. And money does change hands, with the driver getting 80 percent of the cut and Uber getting 20 percent.
Local cab companies are concerned that Uber will attempt to enter the Las Vegas market as early as the end of this month. The company has run ads on craigslist seeking drivers and some cab companies fear their best drivers could jump ship to Uber.
It’s clear that Uber wants to get into the Las Vegas market. It has thousands of customers worldwide and the company’s customer feedback indicates that they want to have Uber as a transportation option when they visit.
At this point, the company is exploring its options here but it’s clear the company wants to be in Las Vegas. With the number of younger, tech-savvy Las Vegas visitors and residents growing, Uber would have a ready-made market if it started operations tomorrow.
But how could the company even hope to get started with the current regulatory environment entrenched in Clark County? Most of those cab company owners are well-connected with the Nevada Legislature, so it’s highly unlikely that the industry’s regulatory environment would change anytime soon.
Another possibility: Uber could begin operations and be treated by regulators the same way any other unregulated vehicle operator is. Drivers could be cited, vehicles impounded.
But could the Nevada Taxicab Authority’s tiny enforcement division keep up with what could be hundreds of Uber vehicles flooding the streets?
The Nevada Transportation Authority is another transportation regulatory body that often works in tandem with the Taxicab Authority. The Transportation Authority oversees limousines, buses and taxis outside Clark County.
In a recent authority meeting, a discussion on the service offerings by Uber Technologies was placed on the agenda. The item was pulled because members said there was nothing to discuss since Uber isn’t here and no one has applied to be an independent contractor for the company.
But the reality is Uber is coming. It’s not a matter of whether it comes, but when.
It’s time for regulators to begin having the conversation and inviting Uber to the discussion.
Otherwise, ground transportation is going to get messier than ever before in Las Vegas.