The unregulated cabs

Community taxi apps seem like a good idea -- but they're going to put people out of work 


EDITORIAL Yeah, the shared economy. Yeah, high tech. Yeah, there's an app for that. Yeah, the San Francisco cab industry is screwed up and you can never get a cab when you need one.

But that's not an excuse for the city to stand by and allow a whole cottage industry of unregulated, unlicensed cabs hit the streets, using a business model that everyone knows is fake and undermining decades of painstakingly crafted rules that govern this critical part of the city's transportation infrastructure.

Over the past year, at least five new companies have opened that offer what the taxi industry offers — rides around the city for money. They do it in a cool new way — you send a message from your phone requesting a ride, you follow where the driver is with a GPS app, and when you get to the destination, you make a "voluntary" payment through a Pal-Pal-style system.

It sounds great: Fast service that the existing industry can't always offer, an easier way to pay (a lot of drivers still demand cash only, in part because the cab companies charge drivers an extraordinary fee for credit-card transactions) and — more important to a lot of us — a way to know exactly when your ride will arrive. (Ever call a major cab dispatcher to ask when the car will be there? "As soon as he gets there," is the usual gruff response. Sorry we asked.)

But there's a reason that the city regulates taxis. Drivers are in constant contact with the public — with vulnerable people who may be tourists with limited English, seniors or others who could easily be exploited, or in the worst case scenario, harmed — so a background check is required for anyone who gets behind the wheel of a cab. Cabs have to carry extra insurance to cover passengers. There's a city office where you can file complaints against unethical drivers. Companies won't hire anyone with a serious infraction on his or her license.

There's nothing, not a single rule or regulation, to protect customers of the new startups.

The city also controls the number of cabs on the streets — in part because too many cabs chasing too few fares leads to problems. You can't legally drive a cab in the city — that is, pick up and discharge passengers for hire — without a city medallion.

The new companies, like Lyft and Sidecar, get around that rule by claiming the fare is just a "suggested donation" — which everyone knows is bogus. The companies would have no business model without charging money for rides.

The emergence of these new companies demonstrates how far behind the city and the taxi industry is — easier payment and more reliable service is such a mandate that customers are willing to go elsewhere when they don't get it. But the idea that the free market and tech-savvy entrepreneurs will solve every problem clashes with the longtime, demonstrated need for regulations in the taxi industry.

City officials need to make it clear that they won't allow these rogue cabs to keep operating. If the new outfits want to offer their services, they need to do what every other cab company does — line up medallions, follow the rules, get the proper insurance and operate within the law.


Perhaps the direct action solution to this is for supporters of the current taxi regime to order up these fake cabs and refuse to donate voluntarily.

Posted by marcos on Sep. 12, 2012 @ 10:56 am

Some cab drivers have considered doing this. . .especially with the towncar drivers who also take fares which should be going to cabs.

Posted by Guest on Sep. 16, 2012 @ 9:29 pm

This must be one of those sleezy cab drivers. Not all transportation needs to go through a cab moron. Cab driver are awful in SF and need to be changed with a more efficient driver model.

Posted by Dean Clark on Sep. 26, 2012 @ 5:43 am
Posted by Guest on Sep. 12, 2012 @ 11:20 am

Ever tried calling a cab in Queens?

Posted by marcos on Sep. 13, 2012 @ 6:46 am

I'm talking about Manhattan, which is about the same size as SF, and bounded by water on three sides. Not the suburbs.

Posted by Anonymous on Sep. 14, 2012 @ 12:53 pm

It is easy to get a cab on the east side of San Francisco. Complaints about cab scarcity come from the outer boroughs, the unincorporated rural county on the west side, the functional equivalent of Queens.

Posted by Guest on Sep. 14, 2012 @ 1:20 pm

The only thing west of SF is the pacific ocean.

Posted by Anonymous on Sep. 14, 2012 @ 2:18 pm

Maybe the commenter is referring to the difficulty in picking up a cab there?

Posted by Troll II on Sep. 14, 2012 @ 2:30 pm

An old adage comes to mind, "just because you can do something doesn't mean that you should". The taxi industry has it's failings but the idea that these rogue apps are revolutionary is laughable. The very technology they're using was developed by the taxi industry. Maybe the taxi industry didn't market these apps as well as some young kids could but that doesn't change the facts. If the folks behind these start ups really were interested in revolutionizing the legal infrastructure they could have A) worked with existing cab companies, B) worked with regulators, and/or C) started their own licensed and legal cab companies. The gimmick marketing that taxi companies and regulators are in bed together and that they've conspired to keep outsiders from bringing competition into the industry is a joke. The taxi industry profit margins are thin but without doubt there are cab companies who would have welcomed Uber and others to help. I know for certain that cab companies tried to engage Uber even before they launched. If any other corporation had come into any other industry and just ignored all of the laws they would have been the target of vicious condemnation. But the taxi industry is regarded as the stepchild of transit.

Posted by Guest on Sep. 12, 2012 @ 2:56 pm

The SFMTA is more concerned about draining the SF Taxi Industry for MONEY through medallion sales and direct leasing to taxi companies, instead of doing some thing for the good for the PUBLIC. Like, maybe centralized or integraded dispatch. All ,of course, to cover up for MUNI's accidents. While, cheating the driver on the Taxi Cab medallion waiting list and the PUBLIC.

Posted by Guest on Sep. 13, 2012 @ 3:03 am

This comment is completely on target. The SFMTA at this point is only interested in raking in money from the taxi industry. Disregarding the well being of long time drivers who have served, for better or worse, the city and county of SF. The SFMTA has abandoned them, taking the only hope they have for any financial stability in their old age by now selling all the medallions. It is ludicrous. And regulating Uber, and other 'app solutions'......well that costs money and time. They have no desire to get into it. The public, and the drivers, be damned. They have better things to do.

Posted by Guest Robert James on Sep. 13, 2012 @ 8:38 am

SFMTA is in the business of ripping people off, whether it be citizens or cab drivers to pay for its bloated overpaid, overbenefitted workforce.

Providing quality services to residents is secondary. See Muni.

Posted by Guest on Jul. 29, 2013 @ 9:12 am

This is a very clearly written, thought out editorial. The SFMTA is supposedly in charge. They have a priority of raising money for the broke bus system through taxi medallion sales. All this other stuff is secondary. I drive a cab full time. I'm doing my job, the SFMTA is failing to do it's job.

Posted by Ron Wolter on Sep. 13, 2012 @ 12:00 pm

Taxis in San Francisco are notoriously difficult to find and rarely show up when called. I can't tell you the number of times I've called for a cab and it hasn't shown up after the dispatcher claimed it did. Thank God for Lyft and Uber. Attempting to force people to use a service which sucks, like SFMTA taxis, is reprehensible and shows very clearly how much The Guardian hates private enterprise.

Posted by Troll II on Sep. 13, 2012 @ 12:28 pm

Taxis are private enterprise. If Lyft and Uber truly wanted to fix the taxi industry they could have started a licensed taxi company or worked with existing companies. They chose to work outside the law. If any other corporation did this you'd probably scream to the high heavens. What if an oil company just decided to build an oil refinery without any permits, workers comp, regard to the environment or safety inspections? Would you excuse that because suddenly they could sell gas for 50 cents a gallon?

Posted by Guest on Sep. 13, 2012 @ 6:20 pm

Because if they were so great and available then there would be no need for additional services like Uber and Lyft - would there?

Posted by Troll II on Sep. 13, 2012 @ 7:05 pm

These apps made a decision to ignore laws and to provide proper insurances. That is the point. They could have applied to start a new cab company. They could have bought an existing cab company. What is really happening is that they chose to work outside the law so that they could avoid taxes, providing workers comp insurance for their drivers, providing liability insurance and so they could profiteer. Just read Uber's terms and conditions, These apps aren't interested in service, they're interested in exploitation for profit.

Posted by Guest on Sep. 15, 2012 @ 10:40 am

Because there is no fake taxi enforcement to speak of in SF, anyone with paint to write "taxi" on their car a put a top light on it and go into the taxi biz. You are saying " why not?" Because, for one, at the end of your ride, if the driver says, "$100", you may find yourself at the wrong end of a tazer, or worse if you refuse to pay. What are you going to do, call a cop? Good luck with that; those millionares are busy filing out reports for the big money interests in The City. GO ahead; try refusing a"small donation" at the end of a trip from say GG Park to the Wharf by some silly purported dotcom scam.

Posted by Ixion on Sep. 16, 2012 @ 7:38 pm

If you use cabs frequently you should stick with one company and let the dispatch get to know you. Frequent riders who call Citywide Dispatch get very good service. Nothing is perfect, of course, but there is an app, called Cabulous, where you can hail a cab directly.

All Green Cabs are on Cabulous, as well as many other cabs.

If you are a really frequent rider of cabs why not ask some of your favorite cab drivers for their cell phone number? Many drivers, such as myself, have our own business cards.

Since I purchased my own business cards, I don't give them to everybody, but I happily give them to anyone who asks for one.

Posted by Guest on Sep. 16, 2012 @ 9:34 pm

Taxi service is simply TERRIBLE and this is the obvious result.

Call a cab- no idea if one wil come.

Drivers are rude.

Still hassle you with a credit card.

And are charging high fares for this crappy service.

Posted by Guest on Sep. 13, 2012 @ 10:16 pm

Yeah, and imagine how poor service would be if they weren't regulated. You're a fool if you sincerely believe that these apps are controlled by moral, righteous CEO's. They're controlled by greedy corporate thugs who have decided not to pay taxes, not to pay their driver's workers comp insurance and not to provide liability insurance. Nice. These people are effin saints. Look at Uber's terms and conditions where they claim that they don't even know if the drivers are licensed or insured, Corporate irresponsibility is hawt! These companies don't provide paratransit service, they drive big gas guzzling vehicles flagrantly ignoring the low emission mandates by SF and SFO but hey, they bedazzled their bs so now it's FUN! Either these comments are from the app lackeys or consumers are idiots.

Posted by Guest on Sep. 15, 2012 @ 10:47 am

im a lyft driver and I've even told the passenger that they don't have to donate. its all on them and that's is what I agreed to do. not all humans are as greedy as you or other cab drivers are. the real reason the city regulators are pushing this issue is because they are being "persuaded" by taxi union lobbyist.

Posted by Guest on Jul. 29, 2013 @ 2:08 am

What is laughable is the fact no one seems to know about the completely legal app offerings that are available to the taxi industry. Our company uses Cabulous, with the ability to hail cabs the same way you hail cars with Uber and Lyft. We can embed Cabulous into our website, people can order cabs on their website or download their free app. The difference? Cabulous requires proof that you are a legal cab company carrying all the proper licenses, insurance, etc. If you're not permitted to do business in your city, Cabulous won't offer their service to you.
But, everyone's convenience is more important than their safety. This is shown over many decades of city governments not being able to control the problem of "gypsy" cabs running illegally. Most LEGAL taxis are regulated by the cities in which they operate. This means they're "on the radar" so to speak. The "gypsy's" one knows. I've seen them with: non commercial license plates, no signage identifying them as a taxi company, regular insurance, the list goes on. But, people still use them so they don't "have to wait".
Now, the impatience calls Uber or companies that try to promise what they do. Can they find the driver that got in that accident with your daughter in the car? Does Uber's insurance cover that? Their commercial insurance? Can they provide you the information on that driver?
This industry isn't afraid of competition. This industry isn't afraid of innovation. What this industry is, however, is sick and tired of the bad rap overall. Not all taxicabs are dirty with gruff drivers. But most taxi companies can walk out and check their cabs. If they don't change it, they'll pay the price. Can Uber check their drivers and cars? Can Uber guarantee the driver you call won't be rude? The answer is no they can't.
But, and I've been watching start ups in this industry for over 15 years, Uber has planted their feet. If it works....great. But only if it's working with the same regulations the rest of us have had to comply with for YEARS. The everyday customer has not a clue about the ins and outs of the transportation industry. They just want to go "now now now". They'll even pay an increase to Uber if they don't have enough cars on the road. Can you IMAGINE the reaction to a cab driver stating that to a customer? "I'm sorry ma'am but our company doesn't have enough taxis to cover our business right now so we have to charge you an additional 1.5-7%". HOW is this okay with anyone? Why should the customer have to pay because a company doesn't have enough vehicles?
You want an executive town car? Awesome. Pay the extra. You want a legal taxi? Good. Call legal companies. Ask them if you don't know. Report taxis who's service or driver was inferior to their city regulators. Trust me, the cities give the cab companies a hard way to go. Nobody is in anybody's pockets.
A safe consumer is a smart consumer, don't let the "bells and whistles" fool you.

Posted by Tracietaxi40 on Sep. 14, 2012 @ 11:44 am

The Rideshare apps are giving people something to do by helping out their community. Taxi drivers in San Francisco quite frankly suck. For the most part they are homophobic, treat women poorly, do not want to accept credit cards, do not want to pick people up and take them to the avenues, etc.... In addition to all of this the SFMTA needs to make sure the taxi companies are placing safe cabs and drivers on the street, which they quite frankly are not doing a good job at. Instead they place drivers who do not know the city and have a difficult time communicating with their customers. Fix the problems. The new apps are not putting people out of work who should be fired anyway for incompetence!

Posted by Dean Clark on Sep. 15, 2012 @ 8:37 am

Nice try Dean you phony schizoid.

Posted by Guest on Sep. 15, 2012 @ 10:50 am

Dean guess you are not getting the attention you want about your blaming everyone else for you wrecking a cab!! Now you make up crap and pretend you are a customer instead of fired cab driver!

Posted by Ohbrother on Sep. 15, 2012 @ 1:03 pm

You should get your facts straight, but knowing you are a cab driver you are unable to do that. I was hit by a motorist dumb ass!

Posted by Dean Clark on Nov. 19, 2012 @ 11:35 pm

What planet is this person from, I drove a cab for seven years and was in an accident of no fault of my own. I found out taxi companies are not required to follow state law and carry uninsured motorist coverage nor does the SFMTA do a good job in ensuring air bags are replaced in cabs when in a prior accident. Cab Companies and the SFMTA need to make sure they are following the laws before they start making false claims that these tech companies are not. Just because the state law governs what they are doing does not mean that the city needs to regulate them.

Posted by Dean Clark on Sep. 15, 2012 @ 8:41 am

Dean you're a fraud and a nutjob. According to you every court in California is wrong. You're desperate for attention. Go to therapy and get an education.

Posted by Guest on Sep. 15, 2012 @ 10:53 am

Wow, must be another cab driver who likes to attack people instead of having an intelligent conversation. Many of you know I hold a masters in Education. I am simply seeking safe cabs and safe drivers for the taxi industry in San Francisco.

Posted by Dean Clark on Nov. 22, 2012 @ 10:12 am

With Mayor Lee the whole city has gone corrupt in greed for money. The man who runs the cab company John Lazar says it takes eleven minutes on average to answer a call but the lady from the tourist bureau says she never can get a cab. Somebody is obviously lying and the MTA listened to them. 1600 cabs and she can not ever get one. Even during rush hour those cabs are picking up somebody. It is the grid lock traffic that makes it hard during rush hour. More taxis on the street will just be a bigger grid lock.

Posted by James on Sep. 17, 2012 @ 8:00 am

With so many parasites sucking blood out of that taxi meter then the driver ends up a poor immigrant without the fabric of the American Ethic Standard. Tourists coming out of the Westin Hotel needing to go to the hospital and the drivers refuses them, he only goes to the airport. Out of town guest come out of the Mark Hopkins in the morning and the same line. Drivers refuse to go to Pier 39, they only go to the airport. The blow back is that hotels are now supporting these pirate cabs and town cars.

Posted by James on Sep. 17, 2012 @ 8:15 am

No sympathy for the cabbys. They can lay blame where it belongs...on themselves. If they did their jobs worth a sh/t, there would be no market for this service. As for the city..f/uck them too. Money grubbing bas/tards looking for any and every way to steal undeserved dollars through bogus regulatory fees and taxes that they flush down the toilet. SF is the sh/thole by the sea and needs to be flushed.

Posted by Guest on Sep. 22, 2012 @ 9:50 pm

If you have not already left SF, please feel free to do so now and don't let the door hit your ass on the way out. If you have already left, let us know where you reside so we can all have a laugh.

Posted by Richmondman on Jul. 29, 2013 @ 2:04 pm

Amazing Commentary while I was working as a cab driver in San Francisco I was hit by an uninsured motorist, the taxi company did not carry uninsured motorist coverage. In fact when I checked with the SFMTA and was told by Jarvis that cab companies are not required to carry uninsured motorist coverage. This type of insurance coverage is required by state law. How can the SFMTA say that cab companies are not required if we have a state law.

In addition we can all see the claim about credit card fees, it is about having a paper trail and paying taxes when it comes to taxi drivers. Next time you get in a cab ask the driver how much did you pay in taxes last year. The answer may surprise you, most likely nothing.

What kind of background checks does the city do on their taxi drivers and what kind of follow through with their 311 system. This year alone there has been several incidents of taxi drivers running over pedestrians, hitting passengers over the head with tire irons because of using credit card, and constant abuse from taxi drivers regarding passenger drop off. The cab drivers have done this to themselves, cab drivers suck in San Francisco and the SFMTA needs to follow through on their promise to the public.

Posted by Dean Clark on Sep. 26, 2012 @ 5:40 am

Whoever wrote this either works for the government or have strong attachments to someone who does.

In addition they might never use cabs so poor service is not a real life issue to them. Or maybe they just didn't bother to use Uber/SideCar/Lyft before writing this piece of propaganda.

You've got to have a horse in the race to knowingly say that we should put up with the (un-usably) crappy cab service when there's a service that's way better (and more fun).

But better for who? For the consumer, the taxpayer. Not better for the government, or the unions, or other entrenched interests. So that's why I say the author's got a horse in this race.

Posted by Sanchez on Nov. 19, 2012 @ 12:51 pm

Is the government being effective in San Francisco by regulating cabs? When I started to drive a cab about 7 years ago I was told that we were covered by auto insurance. In 2010 I was in an accident with an uninsured motorist that was not my fault and was not covered by insurance of the taxi company (National Cab Company) I reached out for understanding about the issue to Chris Hyashi, and Scot Leon at the SFMTA and am still waiting for a response over two years later. I even reached out to Ed Reiskin thinking I could get some help mandating uninsured motorist for all cab companies to make it safe for the taxi drivers and the public. Instead I get black listed and am unable to drive a cab, I have applied at Desoto, and Luxor. Luxor had me come in and go through a training and minutes after I finished Martin told me there were no cabs available to drive for them. The taxi system is corrupt and by having the government to involved it makes it that much more corrupt. All I was trying to do is bring awareness about public safety, including the taxi drivers as part of the public. I have been told by some cab drivers that I am a trouble maker, for what? Because I care about my fellow cab drivers and myself. I now am injured with a few disks in my spine, along with other injuries. Not even one cab driver has come up to me and asked how I am doing. Thats what the taxi industry is like in San Francisco.

Posted by Dean Clark on Nov. 19, 2012 @ 11:32 pm

Cab drivers are being squeezed from all sides. The MTA is part of the problem, because for the past year or so it has been energetically focused on enhancing the city's revenues by selling taxi medallions ($200,000) and putting hundreds of new cabs in service, at the expense of drivers. This happened to coincide with the introduction of Sidecar and Lyft, to which the MTA's response is painfully slow and ineffective. Neither problem is being resolved to the benefit of drivers.

SideCar and Lyft pretend that they're just folks doing community service car-pooling, while being backed by millions of Venture Capital dollars. They are trying to be taxi services while avoiding using the word "taxi" in their name. They don't want to talk about driver safety or insurance issues. Cab drivers are heavily regulated for a reason, for your safety. There is accountability in the system.

There is no oversight of the new industry interlopers. The way these companies operate is not safe and not legal. When I went through my City-required week of driver training, photographing, fingerprinting, Justice background check, and fee paying, everyone involved took it very seriously. If a cab driver screws up in any way, the company pulls you off the street. Taxi drivers are held to a high standard of performance. We're not the pizza delivery guy who's now using his car to "ride-share" people around. Most of the time it won't matter, until it really does matter. With SideCar and Lyft, if something goes wrong, you'll find yourself with no protection and nowhere to turn.

The regulatory framework needs to catch up with the technology, which is here to stay. The larger cab companies already use GPS technology, Luxor uses the "Taxi Magic" or "Cabulous" app to connect cabs to people who need rides.

Taxi driving is a very hard job. You have to know the city, you have to deal with all kinds of people, and have the patience of Job, make no mistakes, and be OK with little better than minimum wage -- but there are no wages for cab drivers, what you make is whatever business you can manage to find -- with no guarantees or benefits. The driver is the sole merchant, and he or she takes all the risks.

The taxi industry is already in a situation where "too many cabs chasing too little money leads to bad behavior - and bad drivers." The 'cease and desist' order against the interlopers is being ignored. The fines imposed on them are being challenged and appealed. The taxi industry is dysfunctional, with lawyers on all sides making things worse, and the drivers are the only ones who are suffering the consequences.

Posted by jc on Nov. 30, 2012 @ 9:36 am

So apparently the editorials in this newspaper are written by fatcat limo operators? This piece is a joke. Yes, the demand for a license exists because cabbies come in to close contact with the public. Thank heavens the millions of others in the world who come in close contact with the public aren't killing us all off with their ebola and other various super bugs.

And too many cabs facing too many dollars? That's an actual argument? That's as ludicrous as complaining that there are too many companies making ice cream, or dammit there are too many different companies selling cars on the open market. The rules exist to uphold the status quo. Regulators are in the pockets of wealthy big business owners whose business models aren't good enough to face competition. Plain and simple, and only an editorial writer would ignore that fact with inane arguments that "gosh, cabbies deal with people with limited English! Can you imagine not having a license to deal with foreigners!?!? Gahhh!!!"

Comeeeee on!

Posted by J T B on Dec. 02, 2012 @ 10:31 pm

City/state/federal laws and regulations do not concern me. I want reliable, inexpensive ride service. I don't care if Uber/Lyft/Sidecar is not paying taxes to some inept branch of government. I feel much safer and more comfortable while riding with Uber/Lyft/Sidecar then any taxi service in SF. FREE MARKET SF!

Posted by Don't Care About Rules/Regulations/Government/SAFETY! on Dec. 31, 2012 @ 8:25 am

Cab drivers: Would you try driving for one of the alternatives? (yes, you have to drive your own car and for fun, yes you have to put a pink mustache on it)

Alternative drivers: Would you try driving a taxi? (yes, you have to pay the gate fee and the bribe money to get your keys, but the plus is, you can pick ANYONE up and drive ANYWHERE)

Please answer .... and why or why not?

Posted by Guest on Apr. 10, 2013 @ 6:37 pm

Come on - this editorial is a joke.

When you call for a cab, you realize you have no idea if a cab is coming right? What other business on the planet operates like this? (Imagine ordering a pizza to be delivered and you have no idea whether you're having dinner.) Cab drivers are incredibly rude. No, they don't greet you with "hello" - they greet you with "cash only." AND on top of this, they recently raised their rates to the highest in the country (or tied with Las Vegas). Horrible service + high rates = new competitors.

The REAL reason the City wants to crack down on taxi apps is that they can't milk them for money like they can the taxi companies. The primary purpose of City government is to squeeze the most money out of its residents to cover its bloated, overpaid workforce. Secondarily, the City attempts to provide services and no, they are not quality services - see botched SFO plane crash response e.g.

To those Lyft and other drivers posting here....THANK YOU!

ATM machines cost people jobs - should we abolish them too?? At least you have President Obama on your side of the argument.

It's not about cab drivers losing their jobs, it's about cab drivers adopting to new technology and improved service.

Posted by Guest on Jul. 29, 2013 @ 9:30 am

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