Since it achieved global popularity, Uber has been something of the poster child for disruptive change and creative destruction. Through providing consumers with efficient, convenient, and often cheaper lifts than traditional taxis, the company has managed to showcase the many benefits of innovation and competition.
In doing so, however, it has attracted the ire of those it has displaced. Traditional taxi drivers, understandably threatened by the competitiveness of Uber, have frequently protested against the app and called for greater restrictions – or outright bans – to protect their livelihoods.
Back in 2017, the protectionists, unfortunately, seemed to get their way, with Transport for London (TfL) revoking Uber’s licence to operate within the city. A few months later, the licence was reinstated, albeit only for a fifteen-month probationary period. Far from an ideal solution, but certainly better than the original decision of TfL to deny over three million uber-using Londoners the choice of cheap and convenient travel.
Yet this tug-of-war between protectionism and free choice continues to rage on, with the United Cabbies Group, a union of London taxi drivers, challenging the decision to grant this fifteen-month licence. However, just last week, this challenge was dismissed and described as “tenuous” by judges.
Clearly, this is a small victory. But while it’s refreshing to see courts side with consumer choice over protectionism, the future of Uber in London remains troublingly uncertain.
After all, the ride-sharing firm continues to operate on its probationary licence, with no guarantee of what will happen once those fifteen months are up. This is not to be defeatist – I doubt that the app will simply be banned once this period ends. But the fact that the debate over whether Uber should be allowed to operate persists gives a rather pessimistic impression that we do not yet embrace disruptive change as much as we should.
Let’s not forget, for example, that Uber is just a single example of such innovation and creative destruction in a long history of the old giving way to the new. Arguing to restrict Uber in favour of traditional taxi firms is no different from banning Netflix to protect Blockbuster.
Take a look at the Belgian capital of Brussels, for instance. Last month, Uber was banned from operating in the city after the Brussels Taxi Association claimed unfair competition, arguing that, since Uber drivers did not have to meet the same requirements on “dress, presentation, and conduct”, as the association’s members do, the competition was unfair.
Naturally, if you’re anything like me, you’ll be wondering why the Brussels Taxi Association didn’t just advise its members to reduce some of these requirements, rather than deciding to make the leap and campaign for the competition to be banned. The whole point of competition is that businesses should adapt to improve in the face of new entrants to the market, rather than trying to ban them.
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A debate is currently ongoing in Brussels over whether Uber should be banned in its entirety, or whether only specific services like UberPOP should be prohibited, while UberX continues to operate. Legal confusion aside, the Belgian example paints a picture of paternalism – only narrowly avoided in London – where established interests fight to simply ban competitors rather than improving their own services.
So, while rejecting the challenge of the United Cabbies Group was a good start, more needs to be done to protect innovative services like Uber in Britain. These innovators drive economies forward, make services cheaper and more convenient, and pass on benefits to consumers.
Lawmakers in the UK should take the recent ruling as a first step towards ensuring that disruptors can flourish in modern Britain – and guaranteeing Uber its future in London must be a priority. In these economically uncertain times, Britain needs to banish protectionism once and for all and embrace