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Uber and Innovation are good for Anchorage

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Published in Anchorage Chamber News
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The rapid pace of innovation can be hard to keep up with. It seems like almost every day we hear about a new, innovative technology that is transforming local economies for the better. With these rapid changes occurring in the business world, more and more companies are coming face to face with outdated regulations and protected markets. One of the Anchorage Chamber of Commerce’s top priorities has consistently been regulatory reform. The challenge with regulatory reform is that it can be nebulous. However, today there is an Anchorage chamber member that has become the poster child for regulatory reform: Uber.

The company provides transportation technology that connects users with safe, reliable rides, wherever and whenever they choose, at the touch of a button in 216 cities around the globe. The safe, seamless experience means Anchorage residents never having to worry about hailing a cab or having cash.

Like other companies in the innovation economy, Uber is disrupting old markets that are unresponsive to public demands and expectations. In Anchorage, Uber’s entrance into the local market is beinopposed by the taxicab industry, which has had political and regulatory protection for decades. Taxicab permit owners have had their fingerprints all over Title 11, the municipality’s transportation code, and consumers are paying the cost.

Currently, permit owners hold 190 exclusive taxicab permits valued at $22 million, which has allowed them to operate without fear of competition, while they have defeated proposed improvements in their industry. 

Last year, even after successfully defeating substantive regulatory reforms, including a provision to require front wheel drive cars, the taxi permit owners’ attorney felt they had still given up too much. A few years ago, a former Anchorage Assembly member, who has a history of being supported by the taxicab industry, was caught on tape discussing how he was doling out cash to candidates so he could control their votes. These are the kinds of backroom deals that ensure regulatory reforms don’t become regulatory reforms. At the end of the day, consumers and businesses pay the price.

Anchorage consumers are tired of deteriorating service and old equipment from the traditional taxi industry. Uber, and other new companies like it, are succeeding around the country because their platform delivers a safer, better passenger experience and more economic opportunities for drivers. Put simply, Uber is successful because people love it and because the taxicab industry is still operating like it’s 1976.

For decades, the taxicab cartel cared little about serving customers or providing opportunity to drivers. They also cared very little about meeting the needs of consumers, including failing to venture to surrounding Anchorage communities like Eagle River and Girdwood. They haven’t evolved. They haven’t competed. They haven’t innovated. And they don’t have to, because consumers have no other choice. 

Uber is not without its own challenges. The company’s tremendous growth over the last four years has created growing pains that it continues to work through. Important local issues such as handicap accessibility need to be addressed, and will be.

However, rather than putting the brakes on Uber, the mayor and the Assembly should support a proposed temporary use permit so Uber can operate. Similar steps have been taken in cities across the U.S. Nobody is conveniently ignoring that Uber needs to abide by the law, but if they’re not allowed to operate while transportation regulations are being reformed, the taxicab industry will continue to leverage its political power to avoid reforms. Already, the taxicab permit owners are threatening potential litigation against local taxpayers “in excess of $22 million.”

New technologies are moving the business world forward into the 21st century. They have the potential to make things easier and safer, and to increase access by consumers to business. If we want to modernize Anchorage’s economy, regulations need to reflect the changing business landscape, and Uber represents the future in the global sharing economy. It’s time for major regulatory reforms to Anchorage’s transportation codes.

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