Uber has more in common with the world's first ride-sharing service than its CEO might want to admit.
This week, the CEO of Uber used his first TED talk, ostensibly on the "future of human-driven transportation," to draw attention to the lessons of ride-sharing past.
There was "an Uber before there was Uber," Travis Kalanick said, referring TED audiences to the tale of jitneys, informal, unlicensed cab services that sprung up with the popularization of the Model T and challenged the entrenched transit monopolies that dominated the nation at the time. That is, Kalanick says, until they were regulated out of existence by municipal governments and the then-powerful trolley lobby.
According to Ars Technica's Ken Fischer, Kalanick asked, "How can we use technology to cut traffic, congestion, and parking woes?" before he "suggested that we have the technology; the problems lie in the current regulatory landscape." It is somewhat convenient that the solution to decongesting the world's cities also happens to be the solution to maximizing Uber's market access, but let's take his argument at face value.
Could it be true that if the jitney, considered the first bona fide example of ride-sharing, "had survived the future of transportation would probably already be here," as Kalanick claims?
A "jitney" is 1910s slang for a nickel, the cost of a typical trolley fare at the time. In 1914, those trolleys were typically packed: long lines marred daily commutes across the nation. Also in 1914, the Ford Model T was suddenly becoming widely available, thanks to Henry Ford's rapidly accelerating mass production schema. (In 1912, 68,773 Model Ts rolled off the production lines for $590 a pop; the next year, in 1913, 170,211 were produced, and prices dropped to $525.)
So, when an early Los Angeles entrepreneur named L.P. Draper began offering rides to those stuck in trolley rides for the same fare, the concept exploded. Kalanick claims that jitneys were doing 150,000 rides a day by 1915—about what Uber is doing one hundred years later—and that's probably about right. The jitney craze swept the continent in literally a matter of days, and were soon available everywhere from Kansas to Canada.
Then, in Kalanick's telling, the threatened trolley monopolies, vying to protect their outmoded trade, lobbied city governments to at first restrict where jitneys could and couldn't go, then banned them altogether. Regulations and bureaucracy destroyed a promising innovation, and flattened the future, stripping consumers of choice and flexibility in transit options. And if we're not careful, by the way, the same thing will happen to Uber. The End.
The truth, as usual, is much more complicated. It's true that trolly monopolies did pressure city lawmakers to pass regulations damaging to the upstart ride-sharers. But it's also true that the jitneys were, in many cities, largely considered dangerous, cartel-driven sexual harassment mobiles.
Here's their story, according to MIT's Realtime Rideshare Research database:
"The first historical incidence of ridesharing success was the tremendously popular yet short lived "Jitney Craze" beginning in 1914...The jitney idea spread incredibly rapidly; by December 1914 (merely 6 months after the idea was believed to have been conceived) Los Angeles had issued 1,520 chauffeur licenses for jitney operation...Many of the original jitneys operated on well-known streetcar lines and effectively survived by siphoning off streetcar passengers."From the passenger's perspective, the jitneys offered service improvements over the streetcar. Jitney's often operated at speeds 1.5 to 2 times faster than streetcars and could occasionally be convinced to deviate from main routes for drop-offs closer to passenger destinations. For passengers, the ability to choose between two service offerings for the same price was also an attractive service feature. While the reliability of jitney service was sometimes questionable (many only ran during peak periods, few ran during bad weather), passengers had a second option in the form of the streetcar. Travel time savings, route flexibility and transport mode choice were the major value propositions for passengers.
"Jitney use was not without tradeoffs. Jitney drivers were known to drive aggressively and accidents were frequent. With passengers standing on the back of vehicles and on the running boards, serious injuries did occur… The downfall of the jitneys was nearly as rapid as their rise. By early 1915, concerns over safety and liability were being reported in the popular press (New York Times, 1915)."
For instance, here's an account of the impact of the jitneys in 1915 Toronto, from the National Post, that begins by noting many customers appreciated the convenience and lower fares:
"But as today, not everyone was happy with this innovation. Traffic regulation was minimal in 1915 and there were serious car accidents in which jitney passengers were injured and even killed (at the same time, in August 1915, a 'law-abiding' Toronto jitney driver helped police nab a fleeing thief). There were concerns that some jitney drivers were packing in too many passengers, some of whom were innocent young women with nowhere to sit except on the laps of eager young men. Male "jitney joy riders" were castigated in the press for targeting crowded jitneys with women passengers for the sole purpose of flirting with them."
"The jitneys were scandalized further when, gasp, women started driving them, though Saturday Night magazine praised the women drivers for their "careful handling" of the vehicles. And in Winnipeg, the police raised concerns that the jitneys were ferrying too many men each day and evening to the city's brothels. Jitney associations were organized to deal with the various problems."
So much of this is Uber in a nutshell. Some genuine improvements—the opening of access to more workers, the convenience—and some persistent problems—harassment, lawlessness, bad, unvetted drivers behind the wheel. Clearly, there are issues with the pre-Uber taxi regime—in most cities, taxis are regulated by the medallion system that can create cartels in which those who own one of the fixed number of them rent them out for exorbitant prices.
But, as is happening now with Uber, the cartel model that the jitneys rose up to combat began to be adopted by the disruptor, too. Here's the Chicago Tribune: "Defenders of a live-and-let-live approach to Chicago's jitneys claimed they offered employment opportunities in neighborhoods where jobs were scarce." But at the time, a Tribune editorial dissented, noting that "drivers rented jitneys from a few fleet operators. The bosses took their share of the proceeds; politicians and cops got a cut… The cabdrivers concerned cannot be regarded as struggling little business men. "Rather they are metropolitan sharecroppers." (Jitneys persisted in Chicago long after they were crushed elsewhere, where they were often used by black riders who couldn't find rides otherwise—and black drivers who couldn't find other work.)
Uber, meanwhile, has launched its own fee-laden "pay-to-work" rental program, which lets car-less drivers rent Enterprise vehicles in order to drive them for Uber, and has pushed subprime loans on prospective drivers as an incentive to join its freelance workforce. These drivers receive no benefits.
If anything, the jitneys are a useful reminder that Uber is anything but the technological disruption to transit that it is so often described. While it has opened some windows for progress, many of the regulations it skirts are safety-related. Uber's background checks, for instance, are so lax that in 2015 the company allowed 25 convicted felons, including drunk drivers and murderers, to become drivers in LA and San Francisco. The checks are carried out by a third-party company online, and are notoriously easy to game. Uber, meanwhile, is planning on loosening background checks further.
It's cheaper to hire drivers if they don't have to pass extensive driver testing—which, in many cities, even those with very difficult taxi license tests, they often don't. (In some, like New York, they do.)
Uber's major disruption, in other words, is an idea that's 100 years old, gussied up with a slick, high-functioning app, and swathed in buzzspeak. Here's the description for Kalanick's TED Talk, as listed on the TED page:
As Uber's founder and CEO, Travis Kalanick is not only disrupting an entrenched industry but also reinventing urban transportation as we know it.
In 2010, entrepreneur and angel investor Travis Kalanick, with his co-founder Garrett Camp, took a niche product — Uber — and turned it into a global platform that has transformed the way we move around our cities.
In 68 countries and 360 cities, riders can push a button and get a ride and drivers have a flexible, independent way to make money. With big investments in China, India, carpooling, self-driving cars and logistics, Uber's future promises to be as headline-grabbing as its past, continuing to reinvent urban transportation as we know it.
So what did Kalanick do, once he stepped up to the podium? He delivered a talk about how Uber was pretty much exactly like this great, informal ride-sharing service that predated the computer. But as he does with Uber, he ignores the problems that accompany the jitneys' lack of regulation—the safety issues, the harassment of women, their eventual cartelization—and chooses to reside in a frictionless fantasy where removing red tape and increasing efficiency solves the world's traffic woes. And, of course, makes him richer in the process.