Got charged £15 “technology fee” by cab hailing app because it uses algorithms
stateofprogress.blogThe cost charged wasn't for the technology.
Taxis and cabs are regulated with fixed time/mileage rates. Uber isn't. It can charged dynamic pricing. The work around for Taxi apps is to shift this dynamic price into the "technology fee", as a workaround.
The user isn't paying $15 for algorithm. It's paying $15 because the ride was ordered during a high-demand time, and the app is hiding that as a dynamically priced "technology fee" to workaround regulations of fixed time/mileage rates.
Thanks for your comment. I just tool their word for it :). That's interesting though. If you can share a link validating that, I can update the article to better represent reality.
You can see in the receipt how it says "high demand" next to technology fee :). I don't have an article, but I used to work for a major rideshare co, hence the industry knowledge.
Where I am from, at times of high demand cabs used to eye you and kinda charge how much they felt they could get away. It felt like a horrible practice at the time and when Uber came up I was so happy to be able to skip the whole dodgy situation.
Then they added dynamic pricing and even though I still find it more convenient than getting measured, it amuses me how this practice is now integrate in the technology and all of a sudden it's not sketchy anymore.
I think it has to do with our innate distrust of strangers and our trust of what we perceive to be as a fair algorithms. Even somewhat familiar with technology, it still feels a bit to me that the algorithm is doing its computations in a fairer way, even though in reality it's SV moguls digitally eyeballing me through the trail of data I leave behind.
Thanks for sharing your story. Sounds like my country, Greece, a few years ago. Letting strangers in your car is high risk, especially during night and even more in particular areas of the world. Cab hailing apps already workaround this, since all routes are hailed by passengers with verified personal details. This means that it's not easy to violate and leave. Even less in the UK, where most cabs have CCTV inside.
It feels weird that the author is approaching this from the "the fee exceeds the actual cost to the business" angle. There's a much simpler and universal reason to hate fees: they distort the market by hiding information from consumers. Legislation in the US has forced airlines to quote a final price for their fares, which most travelers appreciate. On the flip side, travelers probably don't appreciate the "resort fees" that hotels charge them at check-in. I'm not sure what's the point in invoking some vague notion that software should be "at the service of the people that will use it".
Thanks for sharing your thoughts.
I do not have a problem with exceeding business cost with high profit margins. I think that's OK and actually I believe it's the right way to build a sustainable business. I do have a problem when charging for conceptually wrong reasons.
When using software, instead of traditional means, to do an existing job, it gets way cheaper. That's when you don't get to charge £15 for using it.
If you do need to charge £15 for some reason, please do. It's not the software I am paying for though in that case and I need to know what I am paying for.
This particular charge is to try to maintain the illusion that you are directly transacting with the driver personally, and separately are paying the app for connecting the two of you.
That way of looking at it weighs in on the way taxation is done and contractor/employee considerations...
Thanks for sharing this. Wow, that's plain bad.
In relation to this you can also ask yourself: how much would you charge to drive around pick up random people that are drunk, hostile, throw up in your car, dont want to pay and things that are worse?
So it is a risky business and there is only one person to pay for it.
Thanks for your comment. All your points are valid. I do understand that and I have no problem paying premium for certain services, such as high risk ones. The problem here is its marketing as "technology fee because of high demand" at £15 for a £4 (fake) route.
(1) Was the charge for the ride apparent before hailing the not-technically-a-taxi?
(2) If not, what app was this?
Thanks for your comment.
> (1) Was the charge for the ride apparent before hailing the not-technically-a-taxi?
Unfortunately, not.
> (2) If not, what app was this?
I am not naming the app intentionally. I do not want to shit on anybody's work to be honest, even though I might disagree strongly with it. I might as well be dead wrong about this and missing an important point.