Considering how Uber was apparently wanting to evade to be considered a transportation service this is IMHO a correct decision.
Just because you're a startup/funded/unicorn does not mean that laws do not apply.
This is pretty much the biggest thing that will change the "new economy". The market has reached a point where rightfully so people start to wonder why IT startups should be evading laws. They should not.
Running a business comes with duties for everyone. That is in the end in the interest of all consumers.
I agree 100%. All this "disruption" thing is mostly about being in a grey zone where you can cut corners, avoid paying taxes and not respect regulations.
The legal system will slowly catch up and the initial advantage will disappear. In the end this is how economy works.
I think it already started. If you sublet your apartment you are either a landlord or a hotel service, and have to follow all the safety/fire/health/ regulations for one of those. It's pretty obvious you aren't supposed to be allowed to just "share" your apartment for a fee, where some startup unicorn takes a nice cut because they cornered the market with a web site.
So yes. Uber and AirBnB are innovators in the sense that they aggresively invade legal gray areas. I think they will fundamentally change markets (e.g. will cause taxi monopolies to be removed, or reduce the red tape hotel businesses) - but they won't exist in a decade doing what they do now.
There is one issue here: what Uber and AirBnB are doing is not a grey area.
Both transportation and renting are regulated markets for a reason: because we already have experience that infrastructure related markets without regulation will be abused.
While there are some issues in both taxi and hotel businesses, I strongly oppose to Uber and AirBnB being a solution. Both companies apply IT methods but none of them have contributed any fundamental improvements to transportation or renting so far.
A real disruption should involve producing a beneficial iteration that moves forward a topic.
- Uber did basically invest their disruption into the return of 19th century labour methods.
- AirBnb is basically inflating rents.
All those unicorn sparkles aside, it is probably time to look at unicorns with a clearer view. Sustainable value is not created by lawless disruption.
> Both transportation and renting are regulated markets for a reason: because we already have experience that infrastructure related markets without regulation will be abused.
While that's true, that experience comes from a different time period. I don't agree with the idea of exploiting unenforced laws, but this is also an issue where the community, government, or regulatory bodies aren't reacting quickly enough.
There's this weird dissonance where people like the new ideas and convenience, but don't wish to revisit the rules around these industries for any reason.
If every person prefers to hail cabs from an app to get in an unmarked car, then the city or state or whichever body should be forced to contemplate medallions. And if people want to AirBNB, the community should find reasonable compromises in rules that keep everyone happy.
It seems like the law makers and citizens are taking a slide, forcing judges to evaluate crummy old laws against what look like scammy businesses that the people love.
> There's this weird dissonance where people like the new ideas and convenience, but don't wish to revisit the rules around these industries for any reason.
I do not think the issue is in most of these rules. Transportation has e.g. insurance enforced. Uber evades that rules and thus endangers customers. Willingly. And fights for continuing to do so.
The thing about Uber and AirBnB is a two-sided coin:
- laws should never be evaded. If a company like Uber wants to see laws change, there is a political process. But: that process can never start with breaking the law.
- law makers need to wake up. Society is moving faster because of the internet, thus something like a revisiting cycle for laws should be mandatory in every industry.
But: that needs to come from us as citizens. We have to demand that every company needs to follow laws, and use lawful processes if they want change to be implemented.
Meanwhile, I still think companies willingly breaking laws to disrupt markets should be punished. That includes Uber and AirBnb and many others.
Just because you're a startup/funded/unicorn does not mean that laws do not apply.
This is pretty much the biggest thing that will change the "new economy". The market has reached a point where rightfully so people start to wonder why IT startups should be evading laws. They should not.
Running a business comes with duties for everyone. That is in the end in the interest of all consumers.