Streams

Clarifying Prices When You Hail a Cab with Uber, other Apps

Thursday, January 10, 2013 - 10:05 AM

(San Francisco Bay Area) Back in December, KALW ran a story about Uber, the app that matches users to the closest town car or taxicab. Uber gets its money by charging its own rates for livery cabs, which can cost much more than a typical meter.

Listener Mark Gruberg called in to let the station know that they missed something: that regular cabs are using apps, without the extra cost.

MARK GRUBERG: "One significant thing that was left out is that the cab industry is using the same kind of app as Uber – services like Cabulous and Taxi Magic put you directly in touch with a driver from your cell phone, the driver picks you up and charges you a taxi rate, not an Uber rate, which is approximately 70 percent higher than taxis at best. Then because they use surge pricing, it could be astronomically higher at busy times."

KALW asked Isabel Angell, who reported the original story on Uber, if she had anything to share.

ISABEL ANGELL: "So here’s the deal with Cabulous. It’s now called Flywheel, and it works a lot like Uber. It’s the same idea of using an app to match the passenger to the closest cab. But here’s where it’s different: unlike Uber, Flywheel doesn’t mess with the meter. They just take 60 cents from the driver off each Flywheel-generated cab ride. You can pay the driver in the car or use the app, like Uber. A third of SF cabs use the app – that’s about 580 taxis. So right now, I have the app pulled up on my phone, and I can see all the cabs using Flywheel around San Francisco. Currently, they’re mostly centered around Downtown, the Mission, and the Marina, with one lonely cab in the Inner Sunset. So maybe I would have to trek back to the Outer Richmond to see if it really stands up to the test!"

Uber's "surge pricing" system means that when livery cabs are in high demand, the price of a livery cab spikes. This is designed to encourage more drivers to stay on shift when cabs are needed most, like in the rain or on holidays, according to Uber. In New York City for instance Uber issued a warning to the press and users  before New Years Eve that prices could be five times the rate of a normal Uber ride, which is already more expensive than a yellow cab ride. They even added a "surge sobriety test" that required users to confirm that they understood how much they were paying.

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