Most people with a smartphone and a dislike for London’s inflated taxi fares have heard of Uber. But how many of us actually know what the word means? According to Oxford Dictionaries, ‘Uber’ is Germanic slang, literally translating to “over” or “above”. It is relatively well-known in Anglophone communities due to its occasional use as a hyphenated prefix denoting an outstanding or supreme example of a thing or person. In the US it often replaces “super”, for instance: “Whoa, that was some uber air you caught dawg!” Recently, however, the company with the same name has been outstanding for all the wrong reasons.
For the past two months, Uber has faced a string of complaints and negative stories. In November, Emil Michael, senior vice president, came under fire after threatening to dig up dirt on journalists that had provided unfavourable media coverage of the app. Last week, the cab-ordering firm announced that it would be suspending operations in Delhi, India, following the arrest of one of its taxi drivers accused of raping a female passenger. And, as if that wasn’t enough, the firm has this week been accused of exploiting a potential terrorist situation for its own financial gain when its pricing algorithms increased fares by up to four times normal rates during the horrific hostage crisis in Sydney, Australia.
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In addition to the backlash on Twitter, one customer even posted a screenshot of the “wack” fare he was quoted. According to Uber during the hostage disaster, his trip from an area just blocks from the siege to the airport would cost him anywhere between $145-185, roughly $100 more than the calculation provided on Uber’s website.
Soon after the flood of adverse reaction, Uber made its smartest move in months and responded by offering free journeys out of the city’s Central Business District (CBD). It also refunded some passengers and issued a statement explaining that the price surge was to encourage more drivers to come online and pick up passengers from the area.
But was this enough?
I expect not. Recently Uber has found itself in waters so emotionally charged that apologies are unlikely to help it ride the latest wave of bad press. While its investors may appreciate the company’s aggressive business behaviour (it is after all valued at more than $25bn), sooner or later a change will surely be required to tighten the reins on publicity. If this doesn’t happen imminently, it may prevent it from being able to develop partnerships with others in the
technology and transport space – something it desperately needs to succeed in its battle against the worldwide taxi industry.
So will this be the tipping point? Who knows? My gut feeling is these kinds of tactics may continue. Ultimately, I would expect an investor who wants a return on a significant series of investments at such a tremendous valuation, to push the aggressive and often controversial strategy. But what’s absolutely clear is that its leadership team must be smarter about how it operates, otherwise it may find itself in a political headlock with more enemies than friends.