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Smoking-Gun Evidence That Uber Is the Most Cut-Throat Startup on Earth
Scott Lucas | Photo: Courtesy The Verge | August 27, 2014
The Verge reads Uber its rights.
Sleazy but probably not illegal.
That characterizes about half of the news coming out of the tech world right now. The app that lets you pay money to cut in line at a restaurant. The guys who gleefully hacked Tinder to drum up more dates. And now, the emerging details on how Uber has been running game on rival Lyft, putting together a secret program to poach drivers from its rival.
The Verge broke the news yesterday, with its report that as part of competition for the New York market, Uber had been using independent contractors to book rides on Lyft with the goal of convincing those drivers to switch over, taking pains to conceal the project from both its rival and the public. In part, that effort also led to thousands of ordered and then cancelled rides for Lyft.
According to the article, "Uber requests rides from Lyft and other competitors, recruits their drivers, and takes multiple precautions to avoid detection." Uber also engaged in some creepy-seeming corporate espionage, creating "a private group on the messaging app GroupMe where members of the street team could post Lyft driver profiles."
Super gross—we'll grant that. Damaging to the consumers or drivers? Not so fast.
As the New York Times argues, it's not as if stiff competition for drivers is a bad idea. By contrast, the opposite would be much worse: "It would be far more offensive—and probably illegal—if Uber and Lyft executives got together in a room and secretly agreed not to poach each other’s drivers. Several tech companies, including Apple and Google, did exactly that in recent years [and] the companies are set to pay millions in a legal settlement." (Ordered and subsequently canceled rides, on the other hand, are not so great.)
That goes a long way to explaining why Uber CEO Travis Kalanick defended the poaching program, comparing the practice on Twitter to poaching an engineer using an office phone.
If nothing else, these competitive practices could be much worse. Uber drivers in Los Angeles are claiming a spate of gunpoint assaults that, at least some of them allege, have been connected to the taxi industry.