Griffin on Tech: The lesson from Uber’s cut-throat gameplan
Big Tech is leaking like never before.
Last year Frances Haugen walked out of Facebook with thousands of internal documents outlining how executives ignored evidence their platforms were causing harm to users.
Weeks later she was in front of the US Congress giving testimony to lawmakers who are drafting legislation aimed at curbing the influence of Big Tech platforms.
Google engineer Blake Lemoine was suspended last month after going public with somewhat overblown concerns that the company’s LaMDA artificial intelligence system had become sentient. Now Mark MacGann, a former lobbyist for Uber who helped the ride-hailing tech company expand beyond the US in the chaotic days under the leadership of founder Travis Kalanick in the mid-2010s, has leaked 124,000 internal Uber documents to the Guardian.
Uber's share price is down 55% in the last year
“I regret being part of a group of people which massaged the facts to earn the trust of drivers, of consumers and of political elites,” MacGann said.
“I should have shown more common sense and pushed harder to stop the craziness.”
The resulting investigative series reveals the extent to which Kalanick drove Uber to ignore local transport regulations, aggressively lobby public figures, and mislead the police to cement its disruptive business model around the world.
Break it till you make it
MacGann is now apparently full of remorse over pushing aggressively throughout Europe and the Middle East for the liberalisation of transport rules to further Uber’s aims. In New Zealand the company just ignored letters from transport officials pointing out that it was breaching existing regulations that governed how taxis and private car companies operated.
Uber’s plan was to get the Uber app onto as many phones as possible and lure drivers in with the promise of low start-up costs and the opportunity to earn decent money. If it moved fast enough, Kalanick hoped, Uber would become part of the fabric of transport and politicians and bureaucrats attempting to enforce regulations would face a consumer backlash.
It sort of worked. But it turned out to be a lot messier than that, a sordid tale of unethical, if and possibly illegal activity that stretched around the globe.
In many respects, MacGann’s leaks are convenient for Uber, which has spent this week pointing out that Kalanick left Uber in 2017 and the company has changed its ways.
“We’ve moved from an era of confrontation to one of collaboration, demonstrating a willingness to come to the table and find common ground with former opponents, including labour unions and taxi companies,” an Uber spokesperson said this week.
Uber’s local court battle
But Uber has only ever “come to the table” to collaborate and find common ground when it has been forced to. Last week, Employment Court hearings concluded in a case labour unions have taken against Uber in an attempt to force it to treat drivers as employees rather than independent contractors.
As I found out last year when I interviewed numerous drivers for a New Zealand Listener story, working for Uber is a poorly-paid, stressful and precarious existence. Drivers have been booted off Uber after unsubstantiated complaints from passengers, without and ability to dispute the claims.
Uber sees itself as just a technology platform provider, not a transport company with a duty of care for a workforce of drivers. Despite being forced into working with unions in many countries and even entering collective bargaining arrangements with drivers, Uber is happy to fight it out in court here. A decision on the case will be released later in the year.
The lesson from Uber and the now well-documented evidence of its bullying, and manipulative tactics, is that we need a more mature approach handling disruptive technology. Uber revolutionised what was a clunky and expensive experience - getting from A to B in a taxi. It then bundled in food deliveries with Uber Eats changing how restaurants dispense takeaway food too.
But the business model that came with that innovation required Uber to scale as rapidly as possible which incentivised its executives to break the rules and pursue growth at all costs. When it was finally in 10,000 cities worldwide, it cut the commission it paid to drivers and increased prices for consumers.
Despite the hard-nosed tactics Uber still struggles to turn a profit and its share price is down 55% in the last year. Uber's conduct has also sparked a backlash around the world that could result in it and other tech companies facing hurdles trolling out their products in future. The only ones to really benefit from Uber's relentless push for global domination seems to be the early co-founders and investors who were able to achieve an exit when the company went public - Kalanick now has an estimated wealth of US$2.8 billion, mainly derived from selling his Uber stake.
Do it right next time
Consumers, politicians and business leaders were seduced, and then blindsided by Uber’s tactics. Thanks to the whistleblowers we now have insights into types of behaviour that transpires when disruptive tech outstrips laws and offers an opportunity to generate vast wealth.
We need people in government who study and can learn from the examples at Meta, Uber, Theranos and even Megaupload closer to home, so that they can spot the warning signs earlier in the next batch of disruptors. We need to enable innovators to move quickly without accepting the social and economic carnage that can result from unfettered innovation.
As Guardian columnist Rafael Behr put it this week:
“The cost of innovation might be invisible to the consumer, but that doesn’t mean it isn’t there. And the job of democratic politicians is to be guardians of public interest, not the lubricants to private gain.”
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Excellent article, Key point: "Uber sees itself as just a technology platform provider, not a transport company with a duty of care for a workforce of drivers". Sadly this public exposure of bad behaviour has occurred too long after the horse bolted. And, if the NZ Taxi industry had operated under sound governance, they might have had a fighting chance of retaining market share.