Harry here. Lot of interesting news broke this week, and today senior RSG contributor John Ince takes a look at Uber’s new flying car white paper, self-driving trucks on a beer run and an interesting employment law development across the pond.
Inside Uber’s Plan to Take Over the Skies With Flying Cars [Wired]
Sum and Substance: In less than a decade, Uber has redefined the idea of flexible labor and gutted the American taxi industry. The company launched a fleet of self-driving cars in Pittsburgh. It’s on its way to becoming the most valuable startup ever. Whatever.
Today, Uber is promising flying cars. … Within a decade, according to a 99-page white paper released today, Uber will have a network—to be called “Elevate”—of on-demand, fully electric aircraft that take off and land vertically. Instead of slogging down the 101, you and a few other flyers will get from San Francisco to Silicon Valley in about 15 minutes—for the price of private ride on the ground with UberX. Theoretically.
These aren’t flying cars in the sense that they both drive on the ground and soar through the air. Uber is using the much more exciting, Jetsons sense of the term: a future that lifts you over the brutality of traffic jams and congested roads. That dream has been around as long as planes and automobiles.
The idea landed the first of many Popular Science covers in 1926. Henry Ford promised the tech was nigh in 1940. And it’s exactly the sort of thing Silicon Valley’s proponents say modern technology companies can and should produce—instead of useless apps and infantilizing on-demand services. Now, Uber plans to be the one to make the dream happen, with a chunk of help.
The San Francisco-based transportation goliath has no intention of designing or building these things, instead hoping to catalyze the market, bringing together private and government parties to solve a pile of technical, regulatory, and infrastructural problems, from battery density to aircraft certification to air traffic control.
“If you can do all those things,” says Jeff Holden, Uber’s product chief, “you’ve got the potential for a new transportation method.” Once the pieces are in place, Uber can do what it’s already done with cars: enrolling pilots, connecting them with its massive customer base, advising on routes, and collecting its share of the fare. “We’re just turning the corner now to make that possible,” Holden says. “Our intent is to help the industry get there faster.”
My Take: For those who are skeptical about Uber’s driverless car initiatives, here’s something to push you right over the top – flying cars. They’re actually talking with a straight face about a future in which you tap an app and for the cost of an UberX ride, you get to hover and hopscotch right over traffic jams and land on the closest helipad to your destination. What do you think? Fantasy? Investor hype? Or a real possibility?
Watch Uber’s Self-Driving Trucks Make a Beer Run [Time]
Sum and Substance: Otto, the self-driving truck company owned by Uber, recently completed what it claims was the first commercial delivery by a self-driving vehicle. A truck outfitted with Otto’s autonomous driving technology shipped a truckload of Budweiser beer from Fort Collins, Co. to Colorado Springs, a distance of about 120 miles. Otto says the truck drove hands-free from exit to exit, though a human driver was in the cab for local streets and to take over in case of an emergency.
Other Otto vehicles pre-mapped the route ahead of time, which followed Colorado’s I-25. Some naysayers may consider that cheating, but it highlights an advantage of self-driving trucking fleets: As one such vehicle travels along a particular route, it can send mapping and other data to vehicles behind it as a helpful status update. That’s similar to the way airline pilots share weather reports to help other aircraft avoid turbulence and storms. “The beauty of highway mapping with trucking specifically is that there are only about 200,000 highway miles in the U.S., so it’s pretty straightforward to scale that cost,” says Otto co-founder Lior Ron.
For making the delivery, Anheuser-Busch paid Otto an amount comparable to the market rate for such a shipment with normal, human-driven trucks, which Ron said was about $470. Anheuser-Busch, a subsidiary of AB InBev, had been building a relationship with Otto since the trucking firm went public this past spring. “We think the benefits are very clear,” says James Sembrot, Anheuser-Busch senior director of logistics strategy. “This is the future of transportation. The benefits in terms of safety, environment, and operating more efficiently make it something we’re very excited to pursue.”
The adoption of self-driving passenger vehicles will likely be slowed by reluctance among buyers to be driven around by what’s essentially a robot. That problem is less present in the trucking industry, where the commercial advantages of self-driving vehicles are more immediately obvious: They can be safer and more fuel efficient than human drivers, making them cheaper to operate.
One complicating factor may be the role of human labor in an increasing self-driving trucking industry. Otto executives say the technology will aid rather than replace drivers. But that may not appease truckers anxious about their long-term future as their vehicles do more of the driving on their own.
My Take: The “beer run” aspect to this story sure gives it a nice hook for media impressions. The question in my mind is: is there something more to this than media impressions? Yes, Uber has bet over half a billion on driverless trucks by purchasing Otto. Sure the technology is advancing pretty quickly. But a beer run? Sure smacks to me of media hype. At this stage of development, putting out press releases like this just distorts the picture. Perhaps it’s the influence of new Uber board member Arianna Huffington. After all, she parlayed nothing more than words into a multi-million dollar media play.
The Vanity Fair New Establishment Summit 2016 [Vanity Fair]
Sum and Substance: For the third consecutive year, the Vanity Fair New Establishment Summit brought together titans of business, technology, media, and entertainment in San Francisco.
For two days, the Summit, presented by Condé Nast in association with the Aspen Institute, wove through some of the most pressing issues of the day, with the powerful individuals working to solve them. Amazon C.E.O. Jeff Bezos sat down with the Aspen Institute’s Walter Isaacson for a discussion of The Washington Post, technology, and Donald Trump; Priscilla Chan spoke about philanthropy; and Disney’s Bob Iger, Apple’s Eddy Cue, Sarah Jessica Parker, CBS’s Leslie Moonves, Rashida Jones, and Sean Parker all took the stage. Graydon Carter, editor of Vanity Fair, discussed Uber with its founder, Travis Kalanick and concluded the Summit in a conversation with Barry Diller. You can view full panels and highlights from the event, which took place on Oct. 19 and 20, above.
My Take: Vanity Fair has long been one of those curious publications that caters to well to do – the same folks that brought you Uber. The name says it all: Vanity Fair. Their annual “New Innovation Summit” has become one of Silicon Valley’s hottest tickets – a three day confab where the movers and shakers rub elbows with others in their socioeconomic strata.
In this year’s conference, Vanity Fair’s editor Graydon Carter exhibited an amazing hairdo while interviewing Uber CEO Travis Kalanick. It’s a bit long (both the interview and the hairdo) but worth the time – as this video provides a revealing glimpse of life behind the Uber corporate curtain.
The interview is revealing not because what Kalanic says. He mostly responds to softball questions with stock answers that most likely have been vetted by his cadre of PR experts. No, what’s revealing here is how insulated Kalanick comes across. Somebody who seems to have no consciousness of that big elephant standing over there in the corner – driver dissatisfaction. No mention of the safety thing, no awareness of the stark conditions that exist for most drivers, no awareness of the toil and the frustrations of the drivers.
Instead he’s talking about big concept issues, as he must because these are the issues that his people want the hear about. His people, of course, are the investors, the analysts, the lawyers, and the media reps who have come together to make the Uber phenomenon one of the most fascinating stories of the entire decade.
Uber loses right to classify drivers as freelance in the UK [The Verge]
Sum and Substance: A panel of employment tribunal judges in the UK ruled that Uber drivers should not be considered freelance, but instead should be paid a living wage, according to The Guardian.
The ruling is a blow to the San Francisco-based ride-hailing company, which has long argued that its drivers are independent contractors not entitled to traditional employee benefits. Uber says it plans on appealing the decision. Much like similar rulings in the US, the initial impact of the UK decision is limited to two drivers. But lawyers representing them were optimistic that the ruling could have broader implications.
“This is a ground-breaking decision,” Nigel Mackay from the employment team that represented the drivers, told The Guardian. “It will impact not just on the thousands of Uber drivers working in this country, but on all workers in the so-called gig economy whose employers wrongly classify them as self-employed and deny them the rights to which they are entitled.”
Indeed, the case could open up Uber to claims from thousands of drivers in the UK, and could have implications for other companies in the gig economy as well. In a statement, Jo Bertram, regional general manager of Uber in the UK, said that surveys of drivers hold that a majority prefer the flexibility of freelance work. … Yet Uber and Lyft will continue to classify their drivers as independent contractors because their entire business model depends on it. And federal courts and state regulators will make small-bore rulings that seem to directly challenge the crux of Uber’s relationship with its workforce.
Class action lawsuits end in settlements (or don’t) that result in incremental changes, some vague promises from Uber, a few extra dollars for the drivers included in the suit, and that’s about it.
“I think the broader effect of all these incremental issues is going to be limited,” said Harry Campbell, an Uber driver who blogs as The Rideshare Guy. “I’ve talked to drivers who’ve gone through this process and it’s extremely laborious for what you end up with. Uber seems happy to fight these individually or settle since they don’t set much of a precedent on a national scale. I suspect we’ll see more and more of these but don’t think they’ll have any real effect on Uber’s business model.”
My Take: I tend to agree with Harry on this one. There aren’t many drivers who want to go through all the hassle of fighting Uber tooth and nail. Remember Uber’s lawyers are paid to fight these battles. Uber drivers aren’t paid to fight the battle and they only benefit if they win, and the spoils of victory are very limited at this stage.
I don’t know enough about the law to predict whether these minor victories have precedent value. I suppose any judge who’s done his or her research would read the argumentation in cases like this and that might influence them – perhaps in a case that could threaten Uber’s business model at some point down the road. What’s your take on this?
Readers, what do you think of this week’s roundup?
-John @ RSG
