How can Uber save its place in London’s taxi market?

Uber in action. Image: Freestocks.org.

Dara Khosrowshahi will have to do more than post a humble tweet if he is to rescue Uber in London. The CEO of the ride-sharing company will need new reserves of humility, allied with positive action, if his firm is to be given a third chance to make it work in the UK capital.

Uber was first warned early in the year when it was given a short-term license extension rather than the full five years. The idea was that it would put its house in order. Transport for London (TfL), the body which issues taxi licences, was unhappy with the level of cooperation with authorities over driver checks and alleged sex attacks on passengers. So called “greyball” software designed to mislead authorities by preventing them from making checks on drivers also raised concerns.

Uber appears to be struggling to understand that higher standards of behaviour are expected from large businesses compared to start-ups. Once upon a time, Uber may have passed below the radar. But with 40,000 drivers and 3.5m customers, they are a significant business, and attract significant attention.

Control issues

It does appear that the door has been left open for Uber if it can address its behaviour, and that of its drivers. The company is lodging an appeal, which will give it a further 21 days in which it can continue to operate. The question is whether Uber is capable of bringing control and discipline to the way it operates. Does it have the structure, processes and procedures necessary to fully comply with TfL’s regulations?

The impression is left that Uber has simply not matured to the degree needed for such a large business. The extent of allegations and bad publicity is burying the business in London, its largest European market. Uber’s reported obstruction of regulation is catching up with it. Its customers have tried to make their voice heard, but online petitions are unlikely to cut much ice with TfL, whose first responsibility is for passenger safety. Uber needs to address its own behaviour first. And this is no time for an adversarial approach.

A gentle, placatory strategy is much more likely to be successful than taking on TfL. It will mean Uber going against type. The Licensed Taxi Drivers’ Association suspects Uber will seek to take on TfL through the courts, a move which would win no friends at TfL. Wars with regulators rarely end well.

Disaster area

It might seem that all is lost already if you believe some commentators. They suggest that London mayor Sadiq Khan has pushed this decision through to appease black cab drivers for political motives.

In truth, the possible loss of votes from 3.5m Uber customers and 40,000 drivers in the next mayoral election makes that rationale look flawed when you compare those numbers to the 20,000 London black cab drivers who are celebrating the decision. This action is probably Khan’s least favoured path and final resort. And it’s fair to point out that theoretically, he has no part to play in the decision, even if he clearly supports it.

From Uber’s point of view, it is no over-reaction to call this a disaster. Significant investor-funded incentives will have been poured into the London market to attract drivers and customers in developing the business. Uber has around one third of the London taxicab market but many of its self-employed drivers work for other taxicab businesses too. Some competitors also have their own apps.

This means switching costs are low for drivers and customers who switch to competitors such as Addison Lee and Gett. In the space of a few days most customers will have happily used or considered other taxicab firms. From 21 October, when the appeals process extension is due to end, Uber’s business will seep away and it will be difficult to get back. That makes Khosrowshahi’s task all the more problematic: how to develop an amicable and practical response while the clock is ticking, and when the company’s instincts may be to lash out.


Domino effect

To make matters worse, Uber operates in 40 towns and UK cities which may have experienced similar behaviour and who may now feel empowered to follow London’s example. Intense scrutiny will fall on the company from civic authorities, politicians, the media and the public. This is the cost of scale. And scale achieved too quickly makes the scrutiny hard to manage.

So, what can Khosrowshahi do? Litigation – should Uber lose the appeal which has 21 days to be heard – would be a high-risk option. If they lost the case then the London market might never be open to them again. It would also be a lengthy process and by the end of it there might be no market left for them at all.

The CEO needs to use the personal touch. He should visit Khan, cap in hand, to plead for a further three months to demonstrate that behaviour will change. He should then make sure it does. This would include transparency and full cooperation with TfL and the police over alleged driver attacks, demonstrating that all drivers have been subjected to required checks, and that “greyball” software is not being used.

The ConversationThis goes against Uber’s usual secretive and antagonistic culture. The tone of Uber’s approach in its young life has owed much to the spiky urgency of founder and former CEO Travis Kalanick’s personality. The tough task will be to convince the London mayor, and authorities elsewhere, that the culture has changed while Kalanick and his supporters remain on the board peering over Khosrowshahi’s shoulder while he is trying to negotiate a fix. How London plays out will be a litmus test for Khosrowshahi’s proclaimed wish to step away from Uber’s toxic reputation.

John Colley is associate dean at Warwick Business School, University of Warwick.

This article was originally published on The Conversation. Read the original article.

 
 
 
 

Was the decline in Liverpool’s historic population really that unusual?

A view of Liverpool from Birkenhead. Image: Getty.

It is often reported that Liverpool’s population halved after the 1930s. But is this true? Or is it a myth?

Often, it’s simply assumed that it’s true. The end. Indeed, proud Londoner Lord Adonis – a leading proponent of the Liverpool-bypassing High Speed 2 railway, current chair of the National Infrastructure Commission, and generally a very influential person – stood on the stairs in Liverpool Town Hall in 2011 and said:

“The population of Liverpool has nearly halved in the last 50 years.”

This raises two questions. Firstly, did the population of the City of Liverpool really nearly halve in the 50 year period to 2011? That’s easy to check using this University of Portsmouth website – so I did just that (even though I knew he was wrong anyway). In 2011, the population of the City of Liverpool was 466,415. Fifty years earlier, in 1961, it was 737,637, which equates to a 37 per cent drop. Oops!

In fact, the City of Liverpool’s peak population was recorded in the 1931 Census as 846,302. Its lowest subsequent figure was recorded in the 2001 Census as 439,428 – which represents a 48 per cent decline from the peak population, over a 70 year period.

Compare this to the population figures for the similarly sized City of Manchester. Its peak population also recorded in the 1931 Census as 748,729, and its lowest subsequent figure was also recorded in the 2001 Census, as 392,830. This also represents a 48 per cent decline from the peak population, over the same 70 year period.

So, as can be seen here, Liverpool is not a special case at all. Which makes me wonder why it is often singled out or portrayed as exceptional in this regard, in the media and, indeed, by some badly briefed politicians. Even London has a similar story to tell, and it is told rather well in this recent article by a Londoner, for the Museum of London. (Editor’s note: It’s one of mine.)

This leads me onto the second question: where have all those people gone: London? The Moon? Mars?

Well, it turns out that the answer is bit boring and obvious actually: after World War 2, lots of people moved to the suburbs. You know: cars, commuter trains, slum clearance, the Blitz, all that stuff. In other words, Liverpool is just like many other places: after the war, this country experienced a depopulation bonanza.


So what form did this movement to the suburbs take, as far as Liverpool was concerned? Well, people moved and were moved to the suburbs of Greater Liverpool, in what are now the outer boroughs of the city region: Halton, Knowsley, St Helens, Sefton, Wirral. Others moved further, to Cheshire West & Chester, West Lancashire, Warrington, even nearby North Wales, as previously discussed here.

In common with many cities, indeed, Liverpool City Council actually built and owned large several ‘New Town’ council estates, to which they moved tens of thousands of people to from Liverpool’s inner districts: Winsford in Cheshire West (where comedian John Bishop grew up), Runcorn in Halton (where comedian John Bishop also grew up), Skelmersdale in West Lancashire, Kirkby in Knowsley. There is nothing unique or sinister here about Liverpool (apart from comedian John Bishop). This was common practice across the country – Indeed, it was central government policy – and resulted in about 160,000 people being ‘removed’ from the Liverpool local authority area.

Many other people also moved to the nearby suburbs of Greater Liverpool to private housing – another trend reflected across the country. It’s worth acknowledging, however, that cities across the world are subject to a level of ‘churn’ in population, whereby many people move out and many people move in, over time, too.

So how did those prominent images of derelict streets in the inner-city part of the City of Liverpool local authority area come about? For that, you have to blame the last Labour government’s over-zealous ‘Housing Market Renewal Initiative’ (HMRI) disaster – and the over enthusiastic participation of the then-Lib Dem controlled city council. On the promise of ‘free’ money from central government, the latter removed hundreds of people from their homes with a view to demolishing the Victorian terraces, and building new replacements. Many of these houses, in truth, were already fully modernised, owner-occupied houses within viable and longstanding communities, as can be seen here in Voelas Street, one of the famous Welsh Streets of Liverpool:

Voelas Street before HMRI implementation. Image: WelshStreets.co.uk.

The same picture after HMRI implementation Image: WelshStreets.co.uk. 

Nonetheless: the council bought the houses and ‘tinned them up’ ready for demolition. Then the coalition Conservative/Lib Dem government, elected in 2010, pulled the plug on the scheme. 

Fast forward to 2017 and many of the condemned houses have been renovated, in a process which is still ongoing. These are over-subscribed when they come to market, suggesting that the idea was never appropriate for Liverpool on that scale. 

At any rate, it turns out that the Liverpool metropolitan population is pretty much the same as it was at its peak in 1931 (depending where the local borough boundaries are arbitrarily drawn). It just begs the question: why are well educated and supposedly clever people misrepresenting the Liverpool metropolis, in particular, in this way so often? Surely they aren’t stupid are they?


And why are some people so determined to always isolate the City of Liverpool from its hinterland, while London is always described in terms of its whole urban area? It just confuses and undermines what would otherwise often be worthwhile comparisons and discussions. Or, to put it another way: “never, ever, compare apples with larger urban zones”.

In a recent Channel 4 documentary, for example, the well-known and respected journalist Michael Burke directly compared the forecast population growths, by 2039, of the City of Liverpool single local authority area against that of the combined 33 local authority areas of Greater London: 42,722 versus 2.187,708. I mean, what bizarre point is such an inappropriate comparison even trying to make? It is like comparing the projected growth of a normal sized-person’s head with the projected growth of the whole of an obese person, over a protracted period.

Having said all that, there is an important sensible conversation to be had as to why the populations of the Greater Liverpool metropolis and others haven’t grown as fast as maybe should have been the case, whilst, in recent times, the Greater London population has been burgeoning. But constantly pitching it as some sort of rare local apocalypse helps no one.

Dave Mail has declared himself CityMetric’s Liverpool City Region correspondent. He will be updating us on the brave new world of Liverpool City Region, mostly monthly, in ‘E-mail from Liverpool City Region’ and he is on twitter @davemail2017.