01-20-2015, 06:06 PM
Let me expand on my previous comments.
The present system in many larger cities including here is for them to sell a limited number of taxi licenses or medallions. As a result of these limits the market value of these medallions is now in the $100s of thousands. Since new taxi drivers generally can't afford these prices they have to lease medallions from a relatively small number incumbent owners, some of whom own many medallions. Consequently the license owners generally no longer have direct contact with taxi customers. Like larger property owners they deal only indirectly with those who rent or lease apartments.
I suggest that the city or region change this model to lease licenses directly to taxi drivers. This will give them more control over licensees, for instance by not renewing licenses of those drivers who generate complaints, and give them more control over the cost of leasing a license so as to better attract more new drivers. It will also give them a constant stream of lease revenue rather than higher but irregular revenue from selling new licenses.
As I understand Uber's model, they keep a portion of the fares they collect from taxi customers and pass the rest on to their drivers. If Uber wants to operate here then let them now pay the city/region a percentage of their fare revenue that approximates the revenue they get from license leasing. This way the city/region will also have more control over the quality of service provided by Uber's drivers and their vehicles. This will allow for competition between the existing taxi industry and Uber on a fairly level playing field. The taxi industry will then be able to adapt to competition from Uber or die like any other industry that can't deal with change from new disruptive technology.
The present system in many larger cities including here is for them to sell a limited number of taxi licenses or medallions. As a result of these limits the market value of these medallions is now in the $100s of thousands. Since new taxi drivers generally can't afford these prices they have to lease medallions from a relatively small number incumbent owners, some of whom own many medallions. Consequently the license owners generally no longer have direct contact with taxi customers. Like larger property owners they deal only indirectly with those who rent or lease apartments.
I suggest that the city or region change this model to lease licenses directly to taxi drivers. This will give them more control over licensees, for instance by not renewing licenses of those drivers who generate complaints, and give them more control over the cost of leasing a license so as to better attract more new drivers. It will also give them a constant stream of lease revenue rather than higher but irregular revenue from selling new licenses.
As I understand Uber's model, they keep a portion of the fares they collect from taxi customers and pass the rest on to their drivers. If Uber wants to operate here then let them now pay the city/region a percentage of their fare revenue that approximates the revenue they get from license leasing. This way the city/region will also have more control over the quality of service provided by Uber's drivers and their vehicles. This will allow for competition between the existing taxi industry and Uber on a fairly level playing field. The taxi industry will then be able to adapt to competition from Uber or die like any other industry that can't deal with change from new disruptive technology.