The Socialization of Uber

On December 14, 2014, Australian time, a man took hostage several people in a downtown Sydney café. Initially few people in downtown new about the situation, but once it broke the news people began fleeing the city not knowing what was to come, possibly fearing it might be the start of a larger terrorist attack. For some, they escaped using Uber, a car ride-sharing service similar to a taxi service. People hail an Uber ride via an app on their computer or smartphone. Uber determines the price of a ride based on location, distance of the ride, traffic conditions, and simple supply and demand between its available drivers and people wanting or needing a ride.

In the case of this hostage incident, the demand for rides became very high, much higher than was expected. As a result, Uber effectively ran out of drivers. To encourage drivers to go to downtown Sydney and give people a ride, Uber increased the price of a ride to a rate much higher than normal. According to The Washington Post, the minimum cost was $100 Australian ($82 US). Since you pay upfront with a credit card, initially people didn’t care. They just wanted out of downtown, away from the hostage situation. But after everything settled down, they protested the price rise and demanded Uber give them a refund. It was unfair, they said, to take advantage of people in a time of crisis by raising prices.

I find this reaction incredibly odd. Not Uber’s reaction. Uber’s users’ reaction.

Anti-gouging laws are not uncommon. These laws prohibit businesses from raising prices exorbitantly, as determined by politicians (oh the irony), during times of crisis (i.e., natural disasters, terrorist attacks, etc.). The goal is to prevent businesses from taking advantage of consumers when they are most vulnerable. Ok, I’ll give you that.

What I find odd about this whole situation with Uber is that Uber wasn’t even available in Sydney until the end of 2012 (per Wikipedia). And yet because it has chosen to do business in Sydney, just two years later Uber has effectively become obligated to provide a service at a price that may or may not be reasonable, but rather politically palatable. In other words, Uber has become a social program, forever indebted to society for being given the privilege to operate.