Friday Debate: Are "disruptive” technologies like Uber and Airbnb fair to existing industries?

2 min read
71

Uberbnb

There’s a war waging in Sandton. Last night, the Richest Square Mile in Africa was ablaze as metered taxi operators and Uber drivers clashed in an exceedingly violent confrontation. Two Uber vehicles were petrol bombed by metered taxi operators last night. Uber drivers finally retaliated with violence of their own – petrol bombs, openly carried weapons and intimidation.

It’s certainly an ugly situation and one that’s really come to a frightening head. It all stems from disruptive technology. Metered taxi operators believe that services like Uber, Zebra and Taxify are taking business away from them. It’s not a situation that’s unique to South Africa.

Last year (and the year before), Uber Drivers and Taxi Union members came to a similarly violent confrontation in Paris. Some cities, like Cologne in Germany, have taken to banning services like Uber to keep taxi operators thriving.

There’s a lot of stuff to consider with technology like Uber. Because they’re a “technology company” and not a transport one, they’ve managed to exploit loopholes to skirt certain legal and regulatory issues – including revenue going through a tax haven like The Netherlands to avoid paying tax.

The other side of it is that many people who use these services wouldn’t even think of getting into a metered taxi – so are they really taking any busy away?

Read  Razer’s new Atheris is the real Adaptive Frequency mouse you want

Are services like this fair to existing industries? Are possibly underhanded technology companies like Uber and Airbnb ruining lives – or should existing industries embrace technology, and move with the times?

The views and opinions expressed in this article are those of the author(s) and do not necessarily reflect the official policy or position of Critical Hit as an organisation.

Last Updated: September 8, 2017

Geoffrey Tim

Editor. I'm old, grumpy and more than just a little cynical. One day, I found myself in possession of a NES, and a copy of Super Mario Bros 3. It was that game that made me realise that games were more than just toys to idly while away time - they were capable of being masterpieces. I'm here now, looking for more of those masterpieces.

  • Original Heretic

    These services and companies came about because people were unhappy with the way things were being done. Many companies in the “service” industry seemed to forget why they were there in the first place: that being to serve people.
    And now they’re bemoaning the newer competition because they’re actually giving people what they want, an easy way to access these services.
    They chose not to adapt to the times, instead expecting everyone to keep doing things the same old archaic way.
    Hence, in short, I’m all for Uber and AirBnB type services.

    • MonsterCheddar
    • I_am_Duffman!

      True, but AirBnB is screwing up property prices in Cape Town.

      • Original Heretic

        Is it exclusively AirBnB screwing it up? Or are they just one of many factors?

        • I_am_Duffman!

          Not exclusively. Prices are on the rise because Cape Town is awesome.

          But the amount of apartments to rent in the CBD are reducing because of AirBnB. There are a huge amount of empty apartments because they have been converted for “AirBnB” purposes. Basically as I said up top, investors earn more from Airbnb for short term rentals than they would from their normal 12 month contracts.

          You know there is a problem when I don’t consider real estate agents the worst people anymore. They have been replaced by companies that exclusively look after AirBnB apartments for their foreign owners.

          • Matthew Holliday

            snaps

          • Kim Jong Jim

            There we go! 😀

          • Matthew Holliday

            Hadnt actually considered that AirBnB might actually be physically reducing the size of the market.
            Which is a pity, because that wasnt really the intention of AirBnB.
            Its supposed to be a “hey, Im going on holiday for a week or two, anyone wanna rent my house while Im gone?”

          • I_am_Duffman!

            Yeah I know. A colleague is going away to Mexico at the end of the year for her Honeymoon and thats been basically paid for with AirBnB. She is renting her prime spot apartment out while they are gone. That’s the right way of doing it.

            Each user must have limited properties they are allowed to use.

      • Matthew Holliday

        Thats actually debatable.
        Property value isnt affected too much, atleast its no more affected by AirBnB than it is by any of the other factors.
        But the rental scene is REALLY being put through the ringer, prices have been skyrocketing.

        • Kim Jong Jim

          Hasn’t this been an issue since the World Cup (i.e. since 2010)? I would imagine services like AirBnB which promotes competition would actually eventually start forcing prices down – unless we’re talking about massive collusion on the scale of Pam Golding.

          • Matthew Holliday

            in 2010 there was a bit of a jump, but this year alone, a 2 bedroom flat in Blouberg, in a desirable location, has gone from R10 000 to R14 000 a month.
            Which if Im honest, probably has more to do with what happened to our interest rate, than it does AirBnB.
            But the “agents” renting these places out, have definitely been taking a few leaves out of AirBnBs playbook. In recent months Ive been seeing far more short term, fully furnished rentals at inflated prices than I did last year.

            And the required credit checks that beggar belief.

    • geel slang

      The easiest way to get conned when on vacation in a foreign county is the ‘metered’ taxi from the airport to the hotel. f*ck em, Uber all the way.

  • Admiral Chief

    You know where is an epic opportunity? With our local farmers. I’d much rather buy from them directly, like a fruit/veg Uber

    • Original Heretic

      I like this idea. This is a nice idea.
      You know what else needs a service like that? Parfait.

    • I_am_Duffman!

      That won’t ever work. Farmers need their bulk contracts from their distributors (some even get huge advances a whole season ahead). Could possibly only work with the big commercial guys that already have their own distribution companies, but they won’t need something like UberFruits

      • Original Heretic

        They could still keep their bulk contracts. But bear in mind, bulk selling also means selling at a lower price.

        • I_am_Duffman!

          Ofcourse, but most farmers don’t really have a choice. I know in some areas (like milk with Parmalat years ago), they have an all or nothing approach. If you don’t sell everything you have to them at their ridiculously stupid price, they won’t give you business.

          • Original Heretic

            This is true. My family used to own a dairy farm and it was like that.
            But then, farmers do tend to keep a portion aside for “personal use”.

      • Admiral Chief

        I’d love to get fresh produce straight from the farm. Support them from getting shafted

        • I_am_Duffman!

          Farmers markets are all over the place nowadays and some of them make it fun for day outings.

          Will never forget the 1 time we got a pomegranate the size of a baby’s head for R5 in Stellenbosch!!! And that was only 3 or so years ago. #FreshIsBetter

    • Kim Jong Jim

      I always buy local, and I support this idea.

  • Skittle

    I’ve never seen a metered taxi operating in the areas I live and work in so I don’t see how Uber is stealing metered taxi’s business.

    I don’t even know how to summon a metered taxi. If I see one do I just climb in and tell they guy where I want to go?

  • MonsterCheddar

    Business is business. There is no fair or unfair. You just have to up your game to stay relevant.

    Metered taxis are the dinosaurs of the industry and Uber, quite rightfully, took adavantage of a huge technological gap in their market.

    Getting violent about it is just a typical response of an industry participant unwilling to change with the times.

  • MonsterCheddar

    What does bother me though is that most Uber drivers I have encountered are from other African countries. A huge gap in local employment is lost.

    • Guild

      Majority I encounter are from Limpopo. Took 3 different Uber’s on Monday (sold my car cause I don’t need one, Uber everywhere now)

      • Kim Jong Jim

        Let’s be honest, Limpopo is practically a different country on its own. 😀

        • Guild

          XD Can’t argue that

  • Gr8_Balls_o_Fire

    As a Financial Adviser, I have to say that there is nothing wrong with legally exploiting tax loopholes. Tax avoidance is a legal practice, tax evasion isn’t, and there’s a difference between the two.

    Whoever is disgruntled with this practice is just having sour grapes. Deal with it or fold.

    So we shouldn’t be labelling these companies as “underhanded”. They’re smart.

    • Kim Jong Jim

      Listen to this Ball of FIre, he/she/xir/Ur/Chur/nur/purr/derp is wise beyond their/ur/bur/lur years.

    • I_am_Duffman!

      True. Tax avoidance isn’t illegal. But you have to start looking into the ethical side of things.

      Yes, companies have to look after the shareholders and by paying less tax, that is a good way to up the profits/dividends. But taxes are there for a reason, lets ignore South Africa, but in other countries that are not captured, taxes are used to increase the value of life of all the people within the country. That’s were we get our nice and fancy infrastructure. So by avoiding to pay tax, you are just using “services” you don’t pay for.

      It’s not illegal, but that doesn’t make it not wrong.

      I am not talking about normal individuals, I am talking about your Apples/Ubers of the world.

      • Gr8_Balls_o_Fire

        Fair point, taxes have a purpose.

        But yourself in their position.. What would you do?

        • I_am_Duffman!

          That’s very difficult since I am just a pleb on the internet, but I think my point of view would be the same.

          I just don’t like it when wealthy companies bend the rules that others can’t necessarily bend themselves. It’s like the thousands of people that earn commission but have their advisers magically rub their fingers to get them an 18% tax directive. Yes, some of them do deserve it, but others earn hundreds of thousands and don’t spend a single sent for business, yet they get an 18% rate instead of the +-30%.

          I just like fair playing fields and companies like Uber and AirBnB sure as hell can afford to pay tax. I would like to believe that if I was the creator of a company like that, that I would stay true and pay tax where I need to and not actively dodge it by moving to havens.

          • I_am_Duffman!

            Sorry. not dodge, evade.

          • Gr8_Balls_o_Fire
          • Gr8_Balls_o_Fire

            This topic would be a very lengthy and ultimately moot discussion..

            If you were in that position and stayed true, that would be a great example for the rest of the world to recognize and follow.

            But we are where we are, and 99% of executives would not hesitate in leveraging every avenue they can.

            We can agree that the nature of business is to create and maintain advantages over the competition and market. No business survives without an advantage.

            So we have to take advantage of whatever we can. And unfortunately, there is always a tax loophole to be found, and it will be jumped through. Unless somebody like you can lead and change the world 🙂

          • I_am_Duffman!

            No no no. I think you have mistaken me for somebody else. I just have a hatred for legal tax avoidance and real estate companies that bubbled up in this conversation.

            And I am definitely not change the world worthy. I would definitely get a permaban on Disquss if I spit out any more of my points of view.

          • Gr8_Balls_o_Fire

            In an age where Donald Trump is leader of the free world, and a high school dropout who can’t count can be president, we can confidently say that anything is possible. Believe in yourself 🙂

      • Original Heretic

        Mentioning ethics when it comes to big business is also bit of a contradiction.

        Top businessmen often have psychopathic and sociopathic tendencies. Not in the “I’m gonna kill people” sense, but in the “I don’t give a shit about anyone”. Which means they can make cut throat decisions that could affect millions of people negatively. They don’t care, as long as they make more money.

        • Gr8_Balls_o_Fire

          A man who strives after goodness in all his acts is sure to come to ruin, since there are so many men who are not good.

          • Original Heretic

            “Evil triumphs when good men do nothing.”

            Too many good men have done nothing in this world.

          • Gr8_Balls_o_Fire

            Two sides of the same coin friend.. What a lovely world we live in 🙂

          • Original Heretic

            You’re right. We should start a revolution. Using baseball bats. And penguins. And hedgehogs.
            And then when the enemies are well and confused, we starting fighting for real.

          • Gr8_Balls_o_Fire

            lol what

  • Original Heretic

    Just thinking now, this is almost akin to people who were in the pager business before cellphones came out. They made loads of money.
    And then suddenly when cell phones became a thing, there simply was no market for them anymore.

    Thieves back in Victorian times used to make a killing stealing those white, frilly wigs that the wealthy used to wear.

    As the world changes, so do the markets. In the game of markets, you win or you die.

  • MonsterCheddar

    @OddSockZA:disqus I thought we were getting something nice and juicy that pisses off the masses, gets the SJW’s involved and makes me wanna jump on or burn my laptop, and now we get something everyone agrees on.
    I even had the following GIF prepared for you. *SIGHS*
    https://uploads.disquscdn.com/images/af7bfad074e2f744c6d91ffea8c9e95952bbbf40756c697c582937cdc39f073c.gif

    • Kim Jong Jim

      Mr Cheddar, you are like my brother from another mother. Together we will face the blue-haired, pan-fried, gender-potato horde and deal with them with logic and rationality. Their feelings will not be spared!

      • MonsterCheddar

        XD

  • Ghost In The Rift

    Sooo when will Pick & Pay and Spar clash with each other if this is the norm these days? Those cucumber and pineapple fights.

    • Original Heretic

      You’re on the verge of starting a whole new debate.
      Which fruit/vegetable would rather be on the receiving end of: pineapple or cucumber?

      Ugh, I think I just horrified myself.

    • Gr8_Balls_o_Fire

      When they start fighting with bananas then you know they’re on a slippery slope

  • I_am_Duffman!

    I am all for Uber since most people who use it won’t ever use a metered taxi. Also, most people can buy a car, so you can still compete with investors buying loads of Uber cards.

    AirBnB on the other hand. Screw them. In Cape Town we already have shortages of apartments to rent and now people are litteraly being evicted to create AirBnB apartments by investors. Basically, they earn more money by not having a permanent tenant (obviously area dependent). It’s just a system to screw over people.

    • I_am_Duffman!

      By the way. I have no problem with AirBnB if it is used to rent out your primary residence when you are away.

  • Kim Jong Jim

    Yes, it’s called capitalism. If you can’t adapt, you don’t deserve to be in the market. The fact that the metered taxi industry has reacted violently, is even more of an indication of their inability to adapt in a changing industry (and it highlights their growing irrelevance). I support new initiatives like Uber and AirBnB.

    Also, I will praise Crom when there are no more minibus taxis shitting all over our traffic laws.

  • miaau

    Why has no one mentioned price?

    I hear from so many people that the cost of an Uber is normally a fraction of the cost of a standard metered taxi. I have heard on radio 702 several time people from the metered taxi industry talk about regulatory costs and so on, but not ONCE do they actually name them, give a hint as to what they are or what they cost… I do not trust them, just based on hearing them talk on the radio, trying to defend them.

  • Nope. As far as I am concerned drink driving has dropped because of Uber. Metered taxis can GITFS.

    • Gr8_Balls_o_Fire

      What’s GITFS?

      • Admiral Chief

        “Get In The F$(@ing Sea”

        • Gr8_Balls_o_Fire

          Is that a new way of saying GTFOH?

  • Andre116

    Isn’t Zebra just an existing metered taxi company who were smart enough to just hire someone to develop an app for them? Shouldn’t normal metered taxis be doing the same…you know…get with the times.

    • yeah. they not doff

    • Gr8_Balls_o_Fire

      Whosoever desires constant success must change his conduct with the times.

      Niccolo Machiavelli

      • Original Heretic

        Whoa! Quoting The Prince?! What is a learn-ed one such as yourself doing here?!

        • Gr8_Balls_o_Fire

          I’m not learned. It’s all an act.

Check Also

Everything you need to know ahead of Apple’s iPhone 8 reveal

Apple is expected to reveal the iPhone 8 tomorrow at their own event, and we have a pretty…