Contents:

    Will self-driving cars be on the road sooner than expected? Not if they can’t make left turns. In this round up, senior RSG contributor John Ince covers the struggle to improve autonomous vehicles, and Uber touts how it’s trying to improve its relationship with drivers. 

    Heads Up: We’ve learned that Lyft is going to start displaying driver pay in Net Earnings instead of Gross Earnings on Oct. 18th. It’s still the same pay as before but it might look lower since it’s no longer showing what you’re paid before they take their cut. Basically, they’re going to show earnings like Uber does.

    John Ince covers the struggle to improve autonomous vehicles, and Uber touts how it's trying to improve its relationship with drivers -

    Can You Survive the Uber Game? [Financial Times]

    Sum and Substance: Our very own senior RSG contributor Christian Perea lent his expertise to the Financial Times for “The Uber Game“, a realistic (although without the actual driving part) game that demonstrates what it’s like to be an Uber driver.

    My Take: You can play the game in ‘easy’ or ‘hard’ mode. In easy mode, you live in San Francisco and have good credit, which means you can get a better deal on a rental car. In hard mode, you live 2 hours away in Sacramento (lower fares) and have bad credit. Either way, you have two kids to support and a mortgage to pay, so get on the road!

    Overall, the game does a very good job of showing the everyday issues that plague drivers, like grumpy or messy passengers, plus costs (foreseen or unforeseen) associated with rideshare driving. Drivers won’t be surprised by the outcome of the game once they’ve finished “driving” for a week – but hopefully passengers will be surprised when they play this game, and maybe they’ll tip us more! We can hope.

    Uber Pushed the Limits of the Law. Now Comes the Reckoning [Bloomberg]

    Sum and Substance: Shortly after taking over Uber Technologies Inc. in September, Dara Khosrowshahi told employees to brace for a painful six months. U.S. officials are looking into possible bribes, illicit software, questionable pricing schemes and theft of a competitor’s intellectual property. The very attributes that, for years, set the company on a rocket-ship trajectory—a tendency to ignore rules, to compete with a mix of ferocity and paranoia—have unleashed forces that are now dragging Uber back to down to earth.

    Uber faces at least five criminal probes from the Justice Department—two more than previously reported. Bloomberg has learned that authorities are asking questions about whether Uber violated price-transparency laws, and officials are separately looking into the company’s role in the alleged theft of schematics and other documents outlining Alphabet Inc.’s autonomous-driving technology. Uber is also defending itself against dozens of civil suits, including one brought by Alphabet that’s scheduled to go to trial in December.

    Some governments, sensing weakness, are moving toward possible bans of the ride-hailing app. London, one of Uber’s most profitable cities, took steps to outlaw the service, citing “a lack of corporate responsibility” and specifically, company software known as Greyball, which is the subject of yet another U.S. probe. (Uber said it didn’t use the program to target officials in London, as it had elsewhere, and will continue to operate there while it appeals a ban.) Brazil is weighing legislation that could make the service illegal—or at least treat it more like a taxi company, which is nearly as offensive in the eyes of Uber.

    Interviews with more than a dozen current and former employees, including several senior executives, describe a widely held view inside the company of the law as something to be tested. Travis Kalanick, the co-founder and former CEO, set up a legal department with that mandate early in his tenure. The approach created a spirit of rule-breaking that has now swamped the company in litigation and federal inquisition, said the people, who asked not to be identified discussing sensitive matters.

    Kalanick took pride in his skills as a micromanager. When he was dissatisfied with performance in one of the hundreds of cities where Uber operates, Kalanick would dive in by texting local managers to up their game, set extraordinary growth targets or attack the competition. His interventions sometimes put the company at greater legal risk, a group of major investors claimed when they ousted him as CEO in June. Khosrowshahi has been on an apology tour on behalf of his predecessor since starting. Spokespeople for Kalanick, Uber and the Justice Department declined to comment.

    Kalanick also defined Uber’s culture by hiring deputies who were, in many instances, either willing to push legal boundaries or look the other way. Chief Security Officer Joe Sullivan, who previously held the same title at Facebook, runs a unit where Uber devised some of the most controversial weapons in its arsenal. Uber’s own board is now looking at Sullivan’s team, with the help of an outside law firm.

    Salle Yoo, the longtime legal chief who will soon leave the company, encouraged her staff to embrace Kalanick’s unique corporate temperament. “I tell my team, ‘We’re not here to solve legal problems. We’re here to solve business problems. Legal is our tool,’” Yoo said on a podcast early this year. “I am going to be supportive of innovation.”…

    My Take:  Great article: thorough, revealing, well written and researched.  It paints a disturbing picture of Travis Kalanick’s management style – constantly exploiting the grey areas of the law and pushing his people to take legal risks that are now catching up to the company. Although it’s a long piece, it’s well worth your time.

    Alphabet wants to launch an Uber rival this fall, but the self-driving cars get tripped up by left turns, report says [CNBC.com]

    Sum and Substance: Waymo is on the verge of launching a service with its self-driving cars that could rival Uber and Lyft, … But Waymo, Alphabet’s self-driving car company, must fix a glitch first, according to The Information: The vans have trouble making left turns. The Chrysler vans, which would pick up and drop off passengers in Arizona, would be ideally monitored remotely, rather than with a “safety” driver, The Information reported. But the software in the cars reportedly gets tripped up by certain safety issues, especially when there is no green arrow for left turns.

    doordash

    To be sure, the cars are still being tested and improved: Waymo recently released a detailed blog post about how it is using simulations to quickly train its cars to learn tricky turns.

    … Though Alphabet is an investor in Uber and may do the same with Lyft, the search giant clearly has ambitions in the transportation space itself. Google’s Waze has already launched a carpool service, and Waymo continues to hammer Uber in court over allegations of stolen trade secrets.

    My Take: There are now reports that legislation is pending in California to permit completely unmanned driverless cars on the road by June 2018. I find this rush to approval irresponsible – as evidenced by the kind of issues Alphabet is having with their self driving cars. Nevertheless, it’s a reality and we have to deal with it.

    But before we have to deal with it, Uber is going to have to deal with it – because Waymo / Google / Alphabet is coming down the pike at them – not just in the lawsuit but also in their fully autonomous, self driving Chryslers.

    How Uber’s rating system is getting better [Yahoo Finance]

    Sum and Substance: Today’s world is one of countless apps and services, but also one of ratings. In the gig economy, everything is rated — and ratings are everything. Ratings boost products and services to the first page of search results, putting them in front of consumers. Uber, like many companies in the “gig economy,” has been highly scrutinized for its driver ratings service, where the stakes are high. It may seem like a minor point of controversy for the company, which has seen scandal upon scandal — the latest being an FBI investigation for interfering with rivals — but it illustrates the delicate nature of user ratings. “If your average rating falls below a 4.3 after your first 25 trips,” Uber’s policies state, “Your profile will be deactivated and you will need to take a quality improvement course in order to be considered for reactivation.”

    The ride-sharing company’s ratings system has slipped into binary: five stars and everything else. Uber has essentially moved the goalposts so that a four is a zero. Ratings has always been a tricky game because context is so important. Is a 65% on Rotten Tomatoes good? In academic terms, it’s a D. But the site helps by certifying a film as “fresh,” if over 60% of reviews were positive, and “rotten,” if otherwise.

    Unfortunately, Uber reviews aren’t put into context, which can, at times, make the rating system unnecessarily harsh. Some customers may only give a driver five stars when the service has been stellar. However, factors outside of a driver’s control like traffic might unfairly compel a passenger to ding the driver in a rating.

    Two years ago, Frances Frei, Uber’s SVP of leadership and strategy and a Harvard Business School professor, called this five-or-bust strategy “close to useless,” arguing that a good management system was key to deal with these problems of uninformed reviewers. Michael Truong, a senior product manager at Uber, has been trying to fix these issues since he joined the company in 2015. Recently he and his team rolled out some new features to improve the “management” of reviews. “What we’ve found is that there’s actually a lot of good ratings in the system,” he told Yahoo Finance in an interview. The question then was, “Is this a good thing or bad thing?”

    … “We did test a little while back and tried different rating systems to see what they’d do,” Truong said. “The main thing we want to accomplish is seeing if there’s something wrong. A Thumbs-up system is basically: was it good or bad. In these alternate systems you only hear about things when it’s really bad. You don’t only want to know when things are really bad.”

    “The ratings protection feature ensures drivers are getting ratings that don’t come with guilt,” said Truong. This isn’t just a “nice” thing to do, but rather something that’s useful to the company. Uber can only leverage its mountain of review data if it’s honest. For the ratings team, Trong said, the question is, “How can we help improve the feedback aspects?”

    My Take:  This article covers an important subject for drivers, but unfortunately there isn’t a lot of substance to it.  The biggest thing Uber has done to improve ratings is ask passengers to expand on their low ratings.  But that doesn’t help drivers who have been dinged unfairly by a passenger who is either angry over nothing or are using a completely different scale.

    Uber’s Plan to Repair Its Relationship With Drivers [Fortune]

    Sum and Substance: … Aaron Schildkrout, Uber’s head of driver product, came to the office a few weeks ago for a Q&A. It was right after Dara Khosrowshahi had been appointed CEO, and we had a pretty frank conversation about a company trying to undo months of damage from PR missteps including a video of its former chief, Travis Kalanick, berating a driver (he later apologized) and a passenger boycott promoted on social media.

    In an effort to woo drivers, Uber launched an initiative called, 180 Days of Change — a campaign that aims to make “meaningful changes and improvements” to the driving experience. The most notable change came when Uber released its in-app tipping option in July after resisting it for a number of years. Other changes include a shorter cancellation window, driver injury protection insurance, and increasing driver’s takehome pay for UberPool trips.

    Previously, Schildkrout founded a dating app, meditated “full time” for two years, and taught at a charter school. Now he spends his time addressing driver complaints around earnings, stress, support, and communications.

    Below are the highlights of our conversation. Note that answers have been edited for clarity and length….

    SCHILDKROUT: When we talked to drivers, we found again and again some very clear themes. Drivers didn’t feel like we were listening enough. Drivers didn’t feel like the support was there. Drivers weren’t satisfied with a number of key aspects to their earnings. There were parts of our platform where we offered flexibility, but we weren’t fully delivering on that promise.

    Walk me through the things that you have implemented thanks to driver feedback.

    SCHILDKROUT: The first thing we did was work on earnings. The No. 1 most requested feature that has ever existed at Uber was tipping. And we had long-resisted launching it. In our first chapter of 180 Days of Change, we launched tipping. But we also launched a series of other changes to the earnings experience that we felt like would address a lot of the fundamental questions drivers had about earnings.

    In your time at Uber, what is one product initiative that you worked on that didn’t pan out as planned?

    SCHILDKROUT: UberPool has always been in some ways an emblem of what ridesharing is all about. Using every single available seat in every car in order to reduce congestion, reduce the prices of moving around a city, really make transportation in a city as smooth as possible.

    But when you ask drivers about UberPool, you get a very consistent extremely negative response, and there are reasons for that. We really hadn’t invested in the driver side of the Pool experience. Passengers love the low price, they love the efficiency, but for drivers, it’s actually a lot of work and often quite stressful. So we’ve got some interesting ideas of how we can fix that and improve in that area.

    My Take:  Do you get the impression that Uber’s much hyped 180 Days of Change is more PR than substance? This article certainly lends credence to that view – especially in light of Uber’s backtracking on its destination filter from 6 to 2 per day. By the way, how many of you have found that your tips have actually gone down since Uber added in-app tipping?  Before, passengers who tipped usually gave $5 or $10.  Now with the app, I get tips in denominations of $1 and $2, with only an occasional $5.

    Readers, what do you think of this week’s round up?

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    -John @ RSG

    John Ince

    John Ince

    John Ince is a former Fortune reporter and Wall Street banker. He has about 1,000 rides under his belt driving part time for Uber and Lyft.  He’s writing a book about his experiences entitled:  Travels With Vanessa:  A Rideshare Driver Tries To Make Sense of It all - For a sneak peak visit the link above.