Uber (3)

Uber’s boss Travis Kalanick has resigned. But maybe the real problem is not the rapport Mr Kalanick has with staff, maybe Uber is an example of a latter day utility company, and should be regulated accordingly.

By all accounts, Steve Jobs was not the easiest man to work with – famous for firing people in the elevator – he was an incredible business man, but not everyone’s favourite manager. It claimed his scalp, however, he was ousted by John Scully, the very man he recruited. But then just as famously, Apple suffered one abysmal failure after another in the post Jobs years, until the prodigal son returned. There is not much evidence Mr jobs had repented on his previous man-management techniques, but he certainly turned Apple around.

Mr Kalanick had a row with an Uber driver, who had the gall to complain to his boss about him trying to raise standards while cutting prices. The Uber boss did not react well – alas for him, the cameras were rolling.

Mr Kalanick later apologised, saying he was ashamed. But the problem seemed to go deeper. For example, Eric Alexander, boss of the Asia Pacific part of the business, had evidence of a driver raping a passenger. He shared the evidence with Mr Kalanick, but was fired this month. Maybe, the cause of his dismal had nothing to do with the allegations and indeed evidence he had obtained, but it makes many suspicious.

But then Mr Kalanick was the man who created Uber, it was his brainchild, and it was he who controlled the board – in terms of votes.

But investors matter, especially when they are venture capital firms, who have ploughed in tens of millions of dollars – it was these investors who forced the issue. Mr Kalanick is still on the board – but no longer the driving force behind Uber. The question is, will Uber without its founder at the helm be like Apple in the wilderness years, between – as it were – between Jobs.

But there is wider point.

In some respects, you could say Uber drivers are managed by algorithm. Their fees, and indeed the business they obtain, is determined by data analysed by AI. Which kind of begs the question, which is the worst, a tyrannical boss or a tyrannical algorithm?

But while the debate concerning management by algorithm is important, and has implications beyond ride hailing companies, for the likes of Uber and Lyft, etcetera, it may not be relevant for long – because Uber drivers will lose their jobs as the age of autonomous cars approach. They won’t be managed by algorithm, instead they will be replaced by one.

There is another point about an Uber type business model combined with autonomous cars – it may be a natural monopoly. If an app on your smart phone can only tell you about the availability of cars in your area from one company then it is not so useful.

And if the sharing economy really is going to change the nature of the motorcar and how we get from one location to another, then won’t this become one of the most important parts of our lives and indeed the economy?

In the age of autonomous cars and the sharing economy, there will surely be only one ride hailing app per region and this service will be as important to us as the products from utility companies such as water, gas and electricity firms.

In short, an Uber type company in 15-years’ time will be like a utility – and a monopoly at that.

In the city of Austin, Texas, the local government required Uber and Lyft drivers to submit to background checks. Both companies pulled out of the city as a result. In their place, came local start-ups, including a number of non-profits. The locals get an Uber/Lyft type service, but without Uber and Lyft.

The future is ride hailing and autonomous cars. Ride hailing and autonomous cars is a future utility, but whether such services will be provided by the likes of Uber and Lyft, is not so clear.