Tag Archives: uber

Arizona scores a victory as DMV vanquishes Uber

by Steve Blum • , , ,

So what if Acme got a permit?

Angry taxi drivers couldn’t do it. Stroppy city councils couldn’t do it. But California’s department of motor vehicles did it. The DMV has, um, driven Uber out of California, and into the arms of Arizona. The fight over Uber’s (sorta) self-driving car test in San Francisco ended with the offending vehicles being loaded onto a truck and hauled across the Colorado River. According to a story on SFGate.com, Arizona is happy to see them…

“Our cars departed for Arizona this morning by truck,” an Uber spokeswoman said Thursday afternoon in a statement. “We’ll be expanding our self-driving pilot there in the next few weeks, and we’re excited to have the support of Governor Ducey”…

In a statement Thursday, Arizona Gov. Doug Ducey called California’s regulations burdensome and said Arizona welcomes Uber’s self-driving car test with “open arms.”

“While California puts the brakes on innovation and change with more bureaucracy and more regulation, Arizona is paving the way for new technology and new businesses,” he said.

In contrast to the DMV, which issued a scolding press release claiming 20 companies had bowed to its authority and decreed “Uber shall do the same”, Arizona’s department of transportation said no worries, mate

Part of what makes Arizona an ideal place for Uber and other companies to test autonomous vehicle technology is that there are no special permits or licensing required. In Arizona, autonomous vehicles have the same registration requirements as any other vehicle, and nothing in state law prevents testing autonomous vehicles.

California not only requires a special permit for autonomous vehicle operation, it also demands that companies turn over test data, by default making it public. That was one, maybe the main, reason Uber pushed back. Companies, like Google, that have a working relationship with the open source world, can factor that kind of disclosure into their business plans. Up to a point, anyway. But proprietary, pre-IPO unicorns like Uber will not do their R&D in the glare of publicity – except when that publicity serves a purpose.

Instead, they’ll make a run for the border.

Uber’s DMV showdown is a make or break for self-driving cars in California

by Steve Blum • , , ,

Uber and the California department of motor vehicles appear headed to court in a dispute that could add some needed clarity to the state’s position regarding regulation of self-driving cars. On Friday, the head of Uber self-driving car team, Anthony Levandowski, said that they didn’t need the DMV’s permission to run their vehicle on San Francisco streets because it wasn’t really autonomous

From a technology perspective, self-driving Ubers operate in the same way as vehicles equipped with advanced driver assist technologies, for example Tesla auto-pilot and other OEM’s traffic jam assist. This type of technology is commonplace on thousands of cars driving in the Bay Area today, without any DMV permit at all. That is because California law expressly excludes from its law vehicles that have “collision avoidance” or “other similar systems that enhance safety or provide driver assistance” and, like our self-driving cars, are “not capable, collectively or singularly, of driving the vehicle without the active control or monitoring of a human operator.”

That brought a sharp reply from the California attorney general’s office

We, as attorneys for the Department of Motor Vehicles, by this letter, are asking Uber to adhere to California law and immediately remove its “self-driving” vehicles from the state’s roadways until Uber complies with all applicable statutes and regulations. If Uber cannot advise the undersigned that it will immediately remove its self-driving vehicles from California public roadways until it obtains the appropriate permit, as 20 other companies have done, the Attorney General will seek injunctive and other appropriate relief.

More than any other state, California has jumped into the legal and regulatory void that initially surrounded self-driving cars, even rubbing up against federal regulators who want to carve out their own, exclusive authority. In many ways, that’s been good – at the least, California’s nascent rules create a safe harbor of sorts for companies that are developing the technology.

But that early advantage can quickly turn into a disincentive, as other states follow behind and adopt a more entrepreneurial approach to self-driving cars and other advanced transportation technologies. Uber’s rapid rise to the top of the ride sharing market was the result of a willingness – almost a compulsion at times – to challenge laws and regulations that served the interests of taxi companies. Uber has been largely successful in that regard, to the great benefit of the public.

At the least, by challenging the DMV, Uber could force the state to draw a sharper line around what it does and doesn’t regulate. Where that line falls is important – a tight circle would encourage autonomous car and other advanced technology development here, expansive limits could drive innovators to Texas. Either way, at least we’ll know.

Brown’s taxi reform veto protects Uber’s competitive advantage

by Steve Blum • , , ,


Cities and other local agencies will retain their current authority to regulate the taxi business. Governor Jerry Brown vetoed assembly bill 650 today. The measure, by assemblyman Evan Low (D – Silicon Valley), would have moved taxi regulation to an undefined state agency. Brown thought that was going too far:

This bill removes significant regulation of taxicabs by cities and counties and declares the intent of the Legislature to transfer the regulation of taxicabs to the state.

This bill fundamentally alters the long-standing regulation of taxicabs by cities and counties and makes the determination that this responsibility should be shifted to the state. I do not believe that such a massive change is justified.

The problem with Brown’s analysis is that a massive change has already happened. Transportation network companies – Uber and Lyft, in other words – are regulated at the state level and have done massive damage to the traditional taxi business model. Which depends to a large extent on high prices and low service expectations that are made possible by the artificial limits on taxis that are 1. imposed by local governments and 2. vigorously supported by operators and unions. But once market-driven competition appeared, that cosy relationship turned into a death embrace, making it impossible for the taxi industry to respond. Low’s bill would have gone a long way toward levelling the playing field.

AB 650 might have had a better shot if a tentative agreement to change the way transportation companies of all kinds are regulated in California hadn’t collapsed in the final hours of the legislative session. It was part of much larger package of reforms aimed at overhauling the way the California Public Utilities Commission regulates utility companies. Two bills that survived the collapse – senate bills 215 and 512 – are still under consideration by Brown. He has until the end of the day on Friday to make up his mind.

Online ride sharing companies adapting to Californian rules

by Steve Blum • , , , , , , , , ,

If Lyft’s customers were this happy before there were rules, just think how they must feel now.

California’s pioneering attempt to regulate online ride sharing services such as Lyft and Uber seems to be going as smoothly anyone could expect. The California Public Utilities Commission was briefed this morning on progress made since it adopted rules setting safety, training, insurance and other operational standards for transportation network companies, as it now calls them, including…

Obtain a permit from the [CPUC]…require criminal background checks for each driver, establish a driver training program, implement a zero-tolerance policy on drugs and alcohol, and require insurance coverage.

Five companies applied for permits, including Rasier, which is Uber’s California arm, Lyft, Wingz (formerly Tickengo), Sidecar and Summon (formerly InstantCab). Only Summon has made it though the process, with the other four still smoothing out rough spots in their applications.

As might be expected from entrepreneurial start ups, all five had innovative interpretations of what the regulations actually require. None proposed using traditional state-certified driving schools for their training programs, instead relying on various mixtures of online training and in person coaching. The CPUC hasn’t fully blessed those approaches – it kicked back Rasier’s original plan to just give drivers a list of schools – and plans to evaluate actual results in the fall.

Originally, these app-enabled companies tried to fly under the regulatory radar by claiming to only be connecting willing private individuals who were looking for casual rides. But as the businesses became more sophisticated it was increasingly difficult to maintain that position in the face of bitter opposition from taxi companies that were accustomed to leveraging local licensing rules to restrict competition and keep prices artificially high. After some initial skirmishing, including fines and cease and desist orders, the CPUC developed and approved the new rules last September.

In other actions, the CPUC delayed voting on three broadband projects proposed for subsidies from the California Advanced Services Fund. The contentious Cressman proposal submitted by Ponderosa Telephone Company was bumped to April to comply with public notice laws and the two Surfnet projects were delayed two weeks, so they can be taken up at the same time as the related Sunesys project.

Tellus Venture Associates assisted with several CASF proposals in the current round, including the Surfnet and Sunesys projects, so I’m not a disinterested commentator. Take it for what it’s worth.