Uber Technologies Inc (commonly referred to as Uber) is a ridesharing service that also deals with food delivery and other transportation services. Uber is based out of San Francisco, California but has operations all across the world. The business model for Uber revolves around making ride sharing convenient but also convenient and practical for the driver itself. Over the years, Uber has been faced with many legal issues and has not implemented its strategy correctly or even developed one for that matter.
Uber has had a number of scandals and even been accused of intellectual property theft. Uber has motives to get popular in a certain area while ignoring all of the regulatory laws that pose an inconvenience. When the regulatory agencies hear about what Uber is up to, Uber decides to bring the public into the situation. Uber utilizes the masses to force these regulatory agencies into allowing Uber to continue its operations however it may please. Bypassing the laws and ethical boundaries is what Uber has become accustomed to doing. There has been noise going around to allude to the idea of Uber going public and having an IPO in 2019. If this is to occur, Uber needs to get its finances and legal issues sorted out before having them exposed fully in the public eye.
Theft of Intellectual Property
Anthony Levandowski worked for Google and was developing an autonomous car called Waymo1. This project was shut down due to the safety concerns but Levandowski did not quit and contacted Uber who was also developing an autonomous vehicle of their own. Many of the technical features in Uber’s vehicle looked very similar to those of Waymo. In February of 2017, Waymo sued Levandowski, alleging that he had stole priceless information and that this information was being used at Uber . Waymo said that this constituted trade secret theft. The reason they used the word trade secret was because Waymo had come up with an idea that it did not want to share with the world. This entails that workers are prohibited from taking this idea to another company and sharing it with them. Waymo ended up dropping its lawsuit and settled with Uber outside of court. Uber continued to deny that they used any of Waymo’s information and would continue to not use any of Waymo’s information in the future. Uber also gave Waymo a certain percentage of Uber’s equity. As you can see, Uber did not imply any tactics to prove Waymo wrong but just held their ground until the problem either went away or until Uber was forced to stop using its self-driving car.
Pause of Operations in Austin
Uber had been operating in Austin, Texas for a long time. Austin is known to be a liberal city with many college students and young individuals. For this reason, Uber was a big hit in Austin. Not only is it convenient, but it is very accessible. The popularity and hype around Uber was present in Austin and Uber had no issues. However, the city decided to pass regulation dealing with the background check of Uber drivers. Austin wanted the data on the individuals who were driving, including finger print based background checks. The purpose behind this would be to make sure the drivers did not have a criminal record or posed a threat to the people of Austin. The primary reason behind the ordinance was due to the reports of drivers committing crimes such as sexual assault, theft, and even kidnapping. Uber and other similar ride sharing services do add a lot to the economy of the city as well as stimulate other businesses. Instead of addressing the issue, Uber claimed that its background checks were comparable to the background checks wanted by the ordinance. Instead of agreeing to the ordinance of the city, Uber threatened to leave Austin and cease operations in the city. This would mean a decrease in jobs, decrease in transportation and possibly an increase in the amount of pollutants since ride sharing would not be available. As you can see, Uber implemented their strategy of running at full force until problems arise. Uber has a tendency to avoid legal problems instead of facing them head on.
Protests in Bulgaria
Uber’s issues were not only limited to the US market but were also present in a global context. Bulgaria is located in Europe and is a part of the Balkans. Transportation is Bulgaria is heavily based on Taxi’s and ride sharing services such as Uber. With that being said, taxis have been a part of Bulgaria for a long time and unions even exist to protect taxi drivers and the taxi market. Many taxi drivers in Sofia, the capital of Bulgaria, claimed that Uber was doing business by breaking the law . There are many taxi agencies who claimed that Uber was taking away finances from authorized taxi agencies who provided service in a lawful manner. Many Uber drivers were driving without a taxi license which is required for any type of ride service. Furthermore, many Uber drivers in Bulgaria were also operating with a driver’s license or even legal status to reside in Bulgaria. However, on the flip side, there was also a petition created saying that Uber is a safe service. In September of 2015, Uber decided to leave the Bulgarian market instead of cooperating with the Bulgarian government2. The Bulgarian government was only asking for basic documentation from Uber which was considered reasonable to the average person. Once again, you can see here that Uber enters the market and becomes a market leader up until legal problems arise. At that climax point, Uber decides to leave the market, leaving a gap and gaping hole in terms of jobs and the economy.
Sensors in the Danish Market
A similar problem arose in Denmark. Denmark passed new laws regarding the regulation of taxi firms and other ride sharing services3. Furthermore, Uber is considered to have an unfair advantage as a competitor in this market. One of the changes that is being brought on by the Danish government is to have seat sensors and fare meters . These are to be required in all vehicles partaking in any ride sharing service. Uber has many lawsuits in the Danish market and the only way it will be able to operate is if the court rules that Uber is merely a platform that presents drivers with people needing a ride. If this is the ruling then Uber will be able to do whatever it likes in the Danish market. Holding other European countries as an example, many people do not see the court ruling in Uber’s favor.
All in all, Uber has utilized an avoidance strategy, but the damage has been significant. Uber could have avoided these issues properly if Uber had complied with the rules and regulations. Oftentimes, when one country passes certain ordinances and regulations, other countries are not far behind. If Uber were to change its practices when the first country had implemented stricter licensing requirements, Uber would have saved a lot of money and avoided many lawsuits. Furthermore, Uber has considered the innovation in technology as a race, which it is. However, the race must be won in ethical means and not by stealing the ideas of others or building upon them. Uber needs to correct these mistakes before the IPO if it wants to survive any longer in the global market.