New York Times Chicago and New York Officials Look to Build Uber-Like Apps for Taxis by Mike Isaac

New York Times
New York Times
Chicago and New York Officials Look to Build Uber-Like Apps for Taxis
Mike Isaac
12/11/2014

If you can’t beat them, join them.

Regulators in Chicago have approved a plan to create one or more applications that would allow users to hail taxis from any operators in the city, using a smartphone. In New York, a City Council member proposed a similar app on Monday that would let residents “e-hail” any of the 20,000 cabs that circulate in the city on a daily basis.

It is a new tack for officials in the two cities, a reaction to the surging use of hail-a-ride apps like Uber and Lyft.

Regulators in New York have not yet voted on the bill on the e-hail app, which was first proposed by Benjamin Kallos, a councilman who represents the Upper East Side and Roosevelt Island.

In Chicago, the plan to create such apps is part of the so-called Taxi Driver Fairness Reforms package, a plan backed by a taxi union and City Council members that would update regulations around taxi cab lease rates and violations like traffic tickets, among others. The city is expected to solicit third-party application developers to build the official app or set of apps. The City Council gave no further details on its selection criteria, nor did it give information on how the initiative would be financed.

“These reforms represent what is necessary to further modernize this growing industry,” Rahm Emanuel, Chicago’s mayor, said in a statement. William Morris Endeavor, the talent agency where Mr. Emanuel’s brother Ari is co-chief, is an investor in Uber.

In just five years, Uber and Lyft, start-ups based in San Francisco, have shook up the taxi and limousine industry, offering a more tech-savvy approach to ride-sharing. After downloading the companies’ apps, customers can summon cars to pick them up based on GPS location data tracked by their iPhones or Android phones without having to whistle or call for a cab on the street.

Many taxi and limousine unions argue that the start-ups have pushed their way into hundreds of cities around the world without stopping to abide by local rules and regulations. Lawmakers in many cities have pushed back against Uber and Lyft, calling for more comprehensive legislation and stricter policies on how the companies screen their drivers.

Other start-ups have tried to marry existing transportation infrastructure with new technology. Flywheel, for instance, allows users to e-hail local taxicabs in San Francisco, Seattle and Los Angeles using a smartphone app. Hailo, another app-based start-up, offers a similar service.

Uber and Lyft, however, far outweigh these alternatives in popularity and funding; Uber has raised about $2.7 billion in venture capital to date, while Lyft has raised more than $300 million. This year, Hailo pulled its business out of North America to focus entirely on Europe; at the time, Hailo’s chief executive cited the “astronomical” cost of marketing the service in the United States and the popularity of Uber as his company’s reasons for leaving the country.

Issue: 
Technology
Transportation