30 Days of Badger – Day 29

Posted on September 2, 2014

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What a whirlwind summer it has been for the relatively young Silicon Valley start-up company, Uber. As Emily Badger reported back in June, the four year old company took on a valuation of $17.2 Billion, and city by city, are continuing to expand their business worldwide.

Unfamiliar with Uber? Curious how it works?

In today’s technology driven economy, it’s never too surprising when a smart-phone application company is valued at over 10 figures. What is surprising, is how controversial Uber seems to be across the board; from financial economist’s arguments as to why Uber Isn’t Worth $17 Billion, to anti-Uber protests in European cities, that Emily has also covered. One of the most controversial matters that exists for Uber is the regulation of the private-for-hire transportation industry on the local government level.

Although they have tried and failed to enter the market in Portland, Oregon, it still remains a big objective for them moving forward. Their Portland-dedicated Twitter account: @Uber_PDX has come up with the hashtag #PDXneedsUber to demonstrate that they “have their sights set on Rose City!”

I recently sat down with Frank Dufay, Regulatory Division Manager with the Portland Bureau of Transportation, to discuss Uber, similar companies, and the structured set of regulations the City of Portland currently enforces. (Full disclosure, Frank Dufay is a good friend and colleague of mine.) Frank and I discussed a lot of the recent stuff you read online, in the paper, or hear on the radio about the outlook for Uber in Portland. The main issue we arrived at during our chat about these mobile, ride-hailing applications was a lack of accountability. A concern best covered by my new favorite journalist, Emily Badger in her article: The Wrongful Death Suit That Could Finally Define Uber.

After our talk, Frank sent me over an email to point out a couple of items from Uber’s  41 page “Terms and Conditions” (with added emphasis) for using their service.

“The company (Uber) does not provide transportation services, and the company is not a transportation carrier….the company offers information and a method to obtain such third party transportation services, but does not intend to provide transportation services or act in any way as a transportation carrier, and has no responsibility or liability for any transportation services provided to you by such third parties.” (P.3)

“The company makes no representation, warranty, or guaranty as to the reliability, timeliness, quality, suitability, availability, accuracy or completeness of the service or application…you acknowledge and agree that the entire risk arising out of your use of the application and service, and any third party services or products, remains solely with you, to the maximum extent permitted by law.” (P.26)

“The company may introduce you to third party transportation providers for the purpose of providing transportation. We will not assess the suitability, legality or any ability of any third party transportation providers and you expressly waive and release the company from any and all liability, claims or damages arising from or in any way related to the third party transportation provider.” (p.28)

“The quality of the transportation services scheduled through the use of the service or application is entirely the responsibility of the third party provider who ultimately provides such transportation services to you. You understand that by using the service, you may be exposed to transportation that is potentially dangerous, offensive, harmful to minors, unsafe or otherwise objectionable, and that you use the application and the service at your own risk.” (p. 31)

There are some dissimilarities between Uber’s user-agreements and Portland’s regulatory laws, which provide oversight and promote public safety for the for-hire transportation within the city. But what Frank told me was this: “The lack of accountability inherent in [Uber’s] business model, is a substantive problem the Board and Council would need to address in any potential regulatory framework that might be proposed for them to operate in Portland.”

It is safe to say that the sharing-economy has a huge impact on local governments and is busy stirring things up with “old school regulation.”  This is precisely why it is an exciting and challenging time for young, intelligent minds to pursue careers in public administration and policy.

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