Uber-chaos across Europe as Luddite taxi strikers try to defy digital innovation

Stuart Lauchlan Profile picture for user slauchlan June 11, 2014
If you wanted to get a cab in a capital city across Europe today, you were pretty much out of luck as the traditional taxi industry took a pointlessly 'King Canute' style stand against the tide of digital innovation.

If you wanted to get a cab in a capital city across Europe today, you were pretty much out of luck as the traditional taxi industry took a pointlessly 'King Canute' style stand against the tide of digital innovation.

At the heart of the taxi strikes that took place in cities such as London, Berlin, Paris and Madrid is Uber, a mobile app which books rides in licensed taxis and minicabs, before measuring the distance travelled and calculating a fare. In this respect, the app acts like a taxi meter, which in many jurisdictions private cars are not permitted to use.

But as licensed taxis across Europe brought their cities to a gridlocked standstill, passengers appeared to be voting with their mobile devices as Uber reported massive upswing in people downloading the app.

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Parliament Square, London

In London, for example, Uber's UK and Ireland General manager Jo Bertram said:

Londoners are voting with their fingers, tapping the app in support of new and innovative services as we see our biggest day of sign-ups in London since launch two years ago. In fact, today we're seeing an 850% increase in sign-ups compared to last Wednesday.

The results are clear: London wants Uber in a big way. Unsurprisingly the LTDA (London Taxi Drivers Association), which is stuck in the dark ages, is intent on holding London to ransom and causing significant economic impact to Londoners today, estimated to be £125 million.

London ground to a halt, with taxis ringing major routes, such as Parliament Square outside the UK Houses of Parliament and circling Trafalgar Square in the West End.

It was the same story in other European cities:

  • In Berlin around 1000 cabs blocked the roads between the Olympic Stadium, Berlin Central Station and the airport.
  • In Madrid, the two biggest taxi unions are taking part in a 24 hour shut down.
  • In Paris already mutinous taxi drivers, angered about increased competition from private car hire firms, aimed to add to the city's already notorious congestion.

Digital disapproval

The chaos – and its economic impact met with disapproval from business and political leaders who argued that while the disruptive nature of the Uber app and its like on an established business model clearly had an impact, the taxi industry could not be allowed to hold back digital innovation.

In the UK, Simon Walker, director general at business lobby group, the Institute of Directors, said:

Black cabs have been a symbol of London for many decades, known across the world. But symbols, no matter how iconic, cannot be allowed to stand in the way of innovation. Uber and its rival apps are an example of the positive disruption new technology brings, offering consumers new choices about how to travel.

The cab drivers protesting this week will not be able to prevent technological innovation any more than the machine-breakers of the nineteenth century could stop the spread of the power loom.

The battle over taxi apps gets to the heart of what creative destruction means. As a nation, we have to decide whether we want to open ourselves up to more choice and competition, or protect existing industries at the expense of consumers.

Paris strike

Those sentiments were echoed in Brussels where Neelie Kroes, Commissioner in charge of the European Union Digital Agenda, voiced her disapproval, arguing that this situation is about more than just a taxi app:

The debate about taxi apps is really a debate about the wider sharing economy. That debate forces us to think about the disruptive effects of digital technology and the need for entrepreneurs in our society.

Whether it is about cabs, accommodation, music, flights, the news or whatever, the fact is that digital technology is changing many aspects of our lives. We cannot address these challenges by ignoring them, by going on strike, or by trying to ban these innovations out of existence.

The disruptive force of technology is a good thing overall. It eliminates some jobs and it changes others. But it improves most jobs and it creates new ones as well.

If we don’t use digital technology then millions of jobs will simply move elsewhere and Europeans will get angry that they are denied the conveniences that people in Asia and Australia and America and Africa take for granted.

Many of the people making those innovations will come from America and other places, but just as many will be home-grown innovators that the rest of the world is jealous of.

Kroes called on the taxi industry to wake up to changing realities:

It’s time to sit around a table and come up with reasonable accommodations of innovation. We cannot criminalise a whole class of citizens, or drive tourists away from places that need money, in order to protect a few industries that think they can be exempt from the digital revolution. It’s not fair on everyone else, and it’s not realistic.

If I have learnt anything from the recent European elections it is that we get nowhere in Europe by running away from hard truths. It’s time to face facts: digital innovations like taxi apps are here to stay. We need to work with them not against them.

Ironically Uber is banned in Brussels, home to the European Commission,  following a court ruling back in April which imposed €10,000 fines for every Uber-enabled pick up.

My take

I never thought I'd be typing these words but: Neelie Kroes is absolutely, 100% correct.

I might disagree with her vehemently on her handling of the pan-European cloud strategy and her sabre-rattling, FUD-generating, PRISM-centric rhetoric, but on this one, we find ourselves on the same side.

For their part, the cab firms say it's not been about protests against Uber, but against the lack of enforcement of existing regulations by authorities such as the UK's Transport for London.

So it's not about trying to protect a closed shop cartel of self-interest then? Ooooookay....

Unions officials in London says that the way Uber charges clients breaks the rules:

The long and the short of it is, allowing [a company like Uber] to come in and say they're a tech company, that they don't want to be licensed ... is not fair.

When the industrial revolution got underway, bands of Luddites used to roam the countryside in the UK trying to smash up spinning machines and threshing engines to hold back innovation and protect the traditional ways. They failed.

Today, recalcitrant taxi drivers throttle the life out of essential travel routes in major cities. They will also fail.

And to what effect? Frankly this has been a magnificent day for Uber: how many more people know about its existence now than 24 hours ago? You can't buy PR and marketing like this.

Uber Chief Executive Officer Travis Kalanick last week announced $1.2 billion in new funding, valuing the company at $18.2 billion, one of the highest valuations ever for a Silicon Valley startup. I'm not imagining him losing much sleep tonight.

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