Accelerating Sharing Economy

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Several companies are investing in digital technology to improve urban infrastructure, reduce costs, and enhance the overall quality of public and private services. Based on sharing economy, these companies seek to optimize resources through the redistribution, sharing, and reuse of excess capacity in goods and services through a technological collaborative platform. Drawing from accelerationism theory this paper seeks to analyze the political economy embedded in Uber’s free-market libertarian practices. The paper shows that Uber innovative process is not a new alternative to improve quality of life, but a strategic use of digital technology to overcome the “coercive power of the state,” disrupt regulations and strengthen capitalist social relations.

Introduction

In recent years, several companies have invested in digital technology to improve urban infrastructure, reduce costs, and enhance the overall quality of public and private services. Based on mobile and social media, data mining, and surveillance practices, these companies apply digital tools to hack into (or, to use their preferred term, “disrupt”) established economic models in order to reorganize society. One of these models follows the principles of the “sharing economy”, in which individuals, corporations, non-profits and governments must collaborate to optimize resources through the redistribution, sharing, and reuse of excess capacity in goods and services. For instance, Airbnb[1] intends to help people list, locate, and rent accommodation, usually family owned; StudySoup[2] claims to be a repository of shareable high-quality notes taken by the best students to help their classmates in a time of need; Uber[3] and Lyft[4] claim to connect passengers who need a ride with drivers who have a car.

Uber is one of the famous and controversial cases. Launched in 2009, it built its own version of a sharing economy: it develops, markets, and operates a mobile application that connects users in need of a trip to registered drivers who use their own cars to provide the service, that is, drivers can offer to “share” their car with a guest, for a price — much like a taxi company. Understanding Uber practices are important because of the company’s magnitude — Uber is now located in 84 countries and more than 720 cities (Uber, 2017a; Uber Estimate, 2017) —, its aggressive economic model, and its problematic relationship with local governments and the taxi industry.

The taxi industry and the transit and mobility regulation, in general, have long been subject to city-level consumer protection, but sharing economy advocates — Uber in particular — claim that these rules are rendered obsolete by the Internet. Indeed, governments have been largely unable to stop or regulate Uber’s activities in their jurisdictions precisely because its operations are conducted primarily over the Internet. Uber operations are currently illegal in many cities around the globe as the company refuses to have its services framed within the taxi industry regulations, insisting repeatedly that “it is not a taxi company and therefore does not belong in any category of this type of service”[5] — rather, Uber sees itself as an innovative technological platform based on a network business model. But how innovative is Uber? Does it represent a technological breakthrough in which the development of improved algorithms embedded into a mobile app could lead to an enhancement of urban mobility? Is it an alternative economic model, supposedly based on sharing economy, aiming to access the power of a distributed network for the common good?

The concept of the sharing economy invokes images of neighbourhoods, villages, and human-scale interactions: decentralization, sustainability, community-level connectedness, and opposition to hierarchical and rigid regulatory regimes. Though these values have been around for a long time, the Internet has given them a new speed and scale that can potentially transform and even disrupt the current economic model of production and social relations. Interestingly, this discourse is strongly associated with both the Left, who see it as an alternative to monopoly capital, and the free-market libertarians, especially neoliberals, who see it as an alternative to the State.

This paper aims to discuss how Acceleration Theory informs Uber’s dysfunctional discourse of sharing economy and technological disruption. Instead of following or combat neoliberalism, accelerationists suggest that we should unleash latent productive forces toward a common end: “the existing infrastructure is not a capitalist stage to be smashed, but a springboard to launch towards post-capitalism.”[6] However, this springboard has been used by Uber to transforms processes while leaving capitalist structures intact. This paper shows that the outcomes are not disruptive, but rather a well-known consequence of neoliberal agenda: Uber’s model (1) constrains the productive forces of technology by performing relentless iterations of the same basic service to reduce service costs and increase profit, (2) absorbs and corrupts immaterial cultural ideals, such as “sharing,” into profitable business models attractive to large enterprises, (3) increases the precariousness of the workforce due to the lack of employee benefits and protections, and (4) develops a strong discourse founded on the deregulation of the economy in order to avoid liability, overcome the coercive power of the state, privatize and centralize decisions, and enhance profits.

Accelerationism

As a contemporary political theory accelerationism is based on the insistence that the only radical political response to capitalism is not to protest, disrupt, or critique, but to accelerate and exacerbate its uprooting, alienating, abstractive tendencies. Developed at the dawn of neoliberal consensus during the 1990s, accelerationism focuses in the examination of a supposedly intrinsic link between technological transformative forces and the axiomatics of exchange value and capital accumulation that make up contemporary society. According to Mackay and Avanessian (2014), “the term was introduced into a political theory to designate a certain nihilistic alignment of philosophical thought with the excesses of capitalist culture (or anticulture), embodied in writings that sought an immanence with this process of alienation.”[7] It seeks to reject the idea that capitalism will die of its internal contradictions by evoking an emancipatory dynamic perspective in which imagines the future as a sort of technological utopia that will somehow overcome capitalist barbarism. In that, it also carries the risk of being seen as “a cynical resignation to … a politics that must hope for the worst and can think the future only as apocalypse.”[8]

For Benjamin Noys, accelerationism is “the engagement and reworking of forces of abstraction and reason to punch through the limits of an inertial and stagnant capitalism.”[9] In the early 1970s, these forces of abstraction were thought to be the capitalist production process itself, but the current state of capitalism (neoliberal) undermines the promised acceleration. Any progress made within capitalism will be constrained by the framework of surplus value, resulting in simplifications of reality to mere statistical measures which serve to justify an economic strategy based on growth. As neoliberalism progresses, any form of cognitive inventiveness is captured and used to reduce costs of productions and increase profit, only to be discarded after. Thus, capitalism cannot be identified as the agent of true acceleration as much as it is an agent of speed: pushing and constraining the limits of inequality instead of disrupting them.

Galloway and Noys (2014) point out to a revived interest in acceleration theory due to the current capitalist crisis (especially after the crash in 2008) and the politics of austerity, other factors may have contributed to the adoption of such a theoretical model, especially within the digital technology industry. They agree with Mackay and Avanessian (2014) that today intellectual development in accelerationism theory seems to be forking in two distinct directions: those who usually align to the Left that contest and attempt to rupture the status quo — a critical approach to technology and politics, and those who embrace “things as they are” to exploit for self-benefit, usually identified with free market ideology— a technophilic network affirmationism. Thus, on one hand, the leftists see the cognitive techno-science labour — especially automated machines and network information systems — as the engine to start a revolution that could overcome capitalism; on the other hand, free-market libertarians want to use the same instruments to overcome the coercive power of the state, disrupt regulations, and strengthen neoliberal economic relations.

Accelerationism images the future as a sort of technological utopia — the promised land. But how do we get there? How they propose to decommodify the world and break with forms of oppression and violence, or to break with the state power and deregulate all sort of human activities? Start-up tech companies, especially at Silicon Valley (Frank, 2015) — seek the answer in cognitive techno-science labour. There is a clear argument toward the use of technology, science, and logic to improve means of production. That is, the current practices of tech companies are considered part of a transitional period which, in its neoliberalism form, aims to liberate the forces of creative destruction, setting free ever-accelerating technological and social innovations (Williams & Srnicek, 2013). The philosopher Nick Land sees this as a transition towards unparalleled technological singularity: “the human can eventually be discarded as a mere drag to an abstract planetary intelligence rapidly constructing itself from the bricolaged fragments of former civilisations.”[10]

The problem is that the current state of capitalism constrains the productive forces of technology, or at least directs them towards needlessly narrow ends (e.g., copyright and patent systems). Thus, instead of disruptive inventions and revolutionary technology, we live in moment where the technologic development that is publicly available is just marginally better than the last year’s gadget — monthly software updates, yearly new mobile phones, and several similar services promising to disrupt, innovate, and improve everyday life — without changing the underlying infrastructure or the established social relations. Relentless iterations of the same basic product sustain marginal consumer demand at the expense of human acceleration.

Some accelerationists admit that we might need to preserve the gains of late capitalism while going further than its value system, governance structures, and mass pathologies allow. Williams and Srnicek’s (2013) manifesto claims that instead of eliminating neoliberalism, we should reappropriate its platforms toward a common end: “the existing infrastructure is not a capitalist stage to be smashed, but a springboard to launch towards post-capitalism.”[11] For Negri (2014), this seems contradictory since capitalism would have to “react to and block the political potentiality of post-Fordist labor”[12] to advance its promised future. That is, any attempt to liberate abstract labour must occur within the evolution of capitalism itself.

Then, the question is what does “common end” mean, and who should define it? Frank (2015) suggests that free-market libertarians seem to point to a future where “politics as we know it will lose relevance,” jobs will be made obsolete by code and robots, and “the rich will enjoy bespoke luxury goods and be first in line for new experiences, but otherwise there will be no differences among people; inequality will increase but cease to matter.”[13] The process to reach such a future is not less traumatic or inventive:

There might be some civil wars, there might be many new nations, but the stabilizing force will be corporations, which will become even more like parts of a global government than they are today. Google and Facebook, for instance, will be bigger and better than ever: highly functional, monopolistic technocracies that will build out the world’s infrastructure. Facebook will be the new home of the public sphere; Google will automate everything.[14]

As digital technology and networked computers become necessary cognitive mediators for understanding complex systems like the modern economy, it seems that they have been built with a clear biased towards capitalist social relations, in which the ultimate goal is to develop a sociotechnical hegemony: both in the sphere of ideas, and in the sphere of material platforms. In this case, Uber is an example of a platform that disrupts our traditional understanding of urban mobility and shared economy but keep intact the same economic and social structures.

Accelerationists often use nihilist discourses to stress the need to reinvent norms out of an “inhumanism” that can recreate the human and take it beyond itself. Noys argues that this could be a reflex of an extremely ‘pessimistic post-war view of the world, such as that depicted by Adorno and Horkheimer in “‘The Culture Industry: Enlightenment as Mass Deception’ (1944)” (2011). On the other hand, Negri (2014) suggests that accelerationism’s techno-utopian view carries too much political and technological determinism. This view of capitalism as completely dominant is, of course, socially determined by capital itself. In this case, accelerationists not only seem to accept contemporary technological and cultural forms but also aim to pass beyond these forms without realizing how they are shaped by capitalism — a discourse certainly produced in line with the high level of investments in STEM disciplines (Science, Technology, Engineering, and Math) in conjunction with the high sum of venture capital funding start-up tech companies in the Silicon Valley in the last few decades.

Though the discourse centres on technological evolution, which insists that technology will automatically overcome social conflicts, Williams and Srnicek (2013) have some reservation about this techno-utopianism. They argue that technology by itself is not sufficient, and should be bound to social actions: changes in either should potentiate and reinforce changes in the other. The problem is that accelerationism has become a form of asceticism that fantasies with a total integration between capitalism, machines, and humans: “while these fantasies register our experience of the pains of labor and the threats of unemployment, they also transform them into the dream of ecstatic enjoyment – jouissance.”[15]

Uber: “Your ride, on Demand”

Launched in 2009, Uber is a transportation network company based in San Francisco, USA. It develops, markets, and operates a mobile application that allows car owners to “share” a ride with other people. That is, it connects people that need a trip to registered drivers who use their own cars to provide the service. Uber’s mobile app uses the user’s phone GPS to detect their location, connect to the nearest driver, and estimate the fare between the pickup and drop-off locations. When a user requests a ride, the nearest driver’s name and car details appear on the screen, and the user is notified as soon the driver arrives. Since Uber keeps the user’s credit card information, no physical cash is involved and the fare is automatically charged at the end of the trip — no need to tip. This over-advertised innovative system provides new earning opportunities for those who have a car, and helps people to find transportation to get to their destination.

The flexibility provided by the platform is of great appeal for those who become Uber drivers since they can choose when and where they will be available to accept rides. The company’s basic service package, the uberX (“the low-cost Uber”), is currently present in 84 countries and more than 720 cities (Uber, 2017a; Uber Estimate, 2017) Other services, such as TAXI (“taxi without the hassle”), uberBLACK, SUV, and LUX, are available in selected locations. To reach such a global scale, Uber received investments from the main venture capital players, including Baidu, Goldman Sachs, Microsoft, Benchmark, Jeff Bezos, AITV, and Foundation Capital, raising as much as US$ 8.21 billion (Techcrunch, 2015). Today, Uber is considered the number one unicorn company[16] (Myers, 2015) with an estimated value of US$ 69 billion (Abboud, 2017).

But how innovative is Uber? Does it represent a technological breakthrough in which the development of improved algorithms embedded into a mobile app could lead to an enhancement of urban mobility? Is it an alternative economic model, supposedly based on sharing economy, aiming to access the power of a distributed network for the common good?

Technological Innovation

Certainly, Uber’s technological approach has its merits. The app takes advantage of smartphone features, an almost ubiquitous technology in urban settings, particularly in large cities, to facilitate mobility. It is very convenient for users to request a service without having to call somebody on the phone or wait in line — the app takes care of price estimates and uses location information to find the nearest drivers. It also facilitates communication and transactions between passengers and drivers, allowing both to provide feedback that is used to monitor service quality. Notwithstanding the use of mobile devices to operate the service, most of the features used by Uber have been around for some time now: e-commerce, geolocation, instant messaging, user profiling, automatic purchase transaction, dispatching, and networking connections. In fact, many taxi companies are using a similar application to improve their services, such as the case of the Yellow Cab in Vancouver[17] and 99taxis[18].

We should not fall into the intellectual trap set up by Silicon Valley and assume that everything the Internet has given us is brand-new, argued Evgeny Morozov in an interview with John Summer: “The ‘culture industry’ presentation of Silicon Valley seems to me to dovetail quite nicely with the overall story of exceptionalism that these guys like to tell about themselves.”[19] What Uber does is no more than creating relentless iterations of the same basic service that the taxi industry has been delivering for a long time. Yet, Uber insists that it is not a taxi company, it is rather a technological platform based on an “alternative network business model.” As Williams and Srnicek (2013) argue, Uber uses all its technological innovations to reduce costs of service and increase profit. This is neither innovation nor disruption.

“Sharing Economy”

Uber appeals to the concept of the sharing economy, invoking important values in contemporaneous society with hallmarks like decentralization, sustainability, community connection, and collaboration. It promotes its services based on free initiative, flexibility, and an opportunity to earn extra income. In its splash home page, the viewer is bombarded with beautiful pictures and clever slogans: Your ride, on Demand; Better, faster, and cheaper than a taxi; the best way to get whatever you’re going.

The concept of “sharing” is not strange for us. We are used to sharing a number of different things, from ideas to hugs, food and kisses, homes and language, information and desires, land and space. This practice has been around for a long time — we have learned that many indigenous peoples used sharing as the basis of economic exchange. It invokes images of neighbourhoods, villages, and human-scale interactions. Sharing is not rational; it comes to us by instinct, as a kind and generous impulse: “it is a critical aspect of what Marx would call our ‘species-being,’ our basic nature.”[20]

The Internet has given these acts of sharing a new meaning: the possibility of new forms of economic production and social relations — networked rather than managed, self-organized rather than ordered. Schor et al. (2015) define the current practices of the sharing economy as economic activities based on digital peer-to-peer platforms. The digital component is important for scale not only because it reduces transaction costs (and processing time), but also because it allows crowdsourcing of reputational information and ratings that mitigate the risks of intimate exchanges among people who don’t know each other. Interestingly, this discourse of sharing is strongly associated with both the Left, who see it as an alternative to monopoly capital, and the free-market libertarians, especially neoliberals, who see it as an alternative to the State.

But are these new platforms using sharing economic to promote a sense of community or to make a profit over their consumer? Not for profit platforms tend to stay on the community side: for instance, Couchsurfers stay at each others’ homes without payment, Freecycle[21] and Yerdle[22] enable people to offer free stuff to each other. There is also a clear distinction between European and American initiatives: “while the Americans are entrepreneurial and commercial in the way they drive the initiative, the Europeans focus more on the civic, the collaborative, and the non-commercial.”[23] Blablacar,[24] a European-based rideshare initiative, provides a matching service for carpooling. It has stayed close to the idea of sharing, since the community limits the money that any driver can earn on one ride so that it never exceeds the cost of the trip: this means the money is cost-sharing and not income. So, how could a for-profit company, largely funded by venture capital, possibly be interested in sharing? In the U.S., the new economy has followed the enterprise model, with profit as the driving force of its growth. The platforms that are growing are those where providers earn cash and consumers get a good deal, such as Uber and Lyft, which advertise their services as a cheaper alternative to the taxi industry and a way to earn extra cash.

The tension between collaboration and exploitation has led to rapidly changing business models, leaving the original ideas of community-based sharing farther and farther behind as sharing economy models have become attractive to large enterprises. Sharing is no longer about a feeling good, being kind, or taking part in something greater than the self. As Adorno and Horkheimer (2011) once said about movies and radio, “the truth that they are just business is made into an ideology in order to justify the rubbish they deliberately produce.”[25] The same applies to the concept of a sharing economy. It lost its aura, much in the same way that Benjamin (2008) describes the decline of artwork in “The Work of Art in the Age of Mechanical Reproduction.”  The authentic gesture of sharing became an artificial and egotistical commercial act. In a sense, sharing economy has more meaning in the transaction than that the act of share itself.

In the sharing economy of venture capitalists, the consumers might save some pennies here and there, but the creators and investors in the new apps are aiming to make millions. Uber and other ride service companies are taking advantage of regulated barriers in the taxi industry in order to disrupt it: “Uber has become notorious for predatory pricing and anti-competitive practices against other ridesharing companies, bait-and-switch policies toward its drivers, invasion of privacy and sexism.”[26] Today Uber is more like a temporary agency that manages cheaper labour and becomes especially lucrative when their creators figure out ways to avoid taxes, safety regulations or insurance costs that their old-economy, non-“sharing” competitors are stuck with.

The sharing economy is Uber’s dysfunctional discourse. It pretends to unleash latent productive forces, seeking to optimize resources through the redistribution, sharing, and reuse of excess capacity in goods and services — in this case, cars and drivers — through a technological collaborative platform, thus disrupting and shifting the way we experience urban mobility. Uber follows the technophilic network affirmation side of accelerationism (Mackay & Avanessian, 2014): free-market libertarians use technology to overcome the coercive power of the state, disrupt regulations, and strengthen capitalist social relations. The outcomes are not disruptive, but rather well-known consequences of a neoliberal agenda.

Precariousness of Workforce

As the model of sharing economy quickly slides away from collaborative sharing towards further deregulated and precarious employment (Slee, 2014), companies like Uber start to treat its workforce as individual entrepreneurs, or contractors, allowing the corporation to take very little responsibility for them. The company claims that people sign up to be a driver mostly because of the flexibility of the job: no boss, freedom to decide your own schedule, less labour regulations, the level of compensation, and the fact that earnings per hour do not vary much with hours worked, which facilitates part-time and variable hours. Indeed, Terranova (2003) states,

the expansion of the Internet has given ideological and material support to contemporary trends toward increased flexibility of the workforce, continuous reskilling, freelance work, and the diffusion of practices such as “supplementing” (bringing supplementary work home from the conventional office).[27]

As expected, according to Hall and Krueger’s (2015)[28] survey of U.S. Uber drivers in January 2015, for 91 percent of respondents the primary reason to drive with Uber was: “to earn more income to better support myself or my family.”[29] Furthermore, most drivers do not opt to drive for Uber because of a lack of other opportunities in the job market – “only eight percent were unemployed just before they started working with the Uber platform.”[30] While it seems that people offer rides through Uber as a second job in order to get extra money, a full 25 percent of these drivers declared Uber as their only source of personal income, and for another 16 percent, Uber was their largest but not sole source of income (Hall & Krueger, 2015). Uber sees this as economic empowerment, the typical entrepreneurial discourse of “be your own boss,” but it is worth noting that Uber does not offer the health and social safety-net benefits found in conventional jobs.

While there is no denying that Uber is creating many jobs, there have been lots of complaints about how the company treats its drivers. The strength of these operations is their reliance upon decentralized networks of “producers” for their services; however, Uber extracts a substantial amount of money from the transactions on its platform, and the extent of these fees is not always clear. The company currently takes a 25 percent commission for every ride made through its platform. It is pretty much the same value used by app stores, usually 30/70 percent in favour of the developers, with no transparent reason or explanation as to how and why they choose this value. According to Hall and Krueger’s (2015) study, this has been a pretty good deal for drivers: Uber pays more than the taxi industry in the U.S. For instance, in Chicago Uber drivers earn $16.20 per hour, while taxi drivers earn $11.87; in Los Angeles Uber drivers earn $17.11 per hour, while taxi drivers earn $13.12; and in San Francisco Uber drivers earn $25.77 per hour, while taxi drivers earn $13.72. Hall and Krueger point out that, on average, Uber drivers earn $19.19 per hour, while taxi drivers earn $12.90 (p. 23).

However, these values are contested by independent financial analysts. Glassdoor (2015) estimates driver earnings at around $14.64 per hour in December 2015 in the U.S.; SherpaShare, a financial analytics site that allows drivers who work for on-demand companies to track their earnings, shows similar number: $10.99 in Chicago, $11.53 in Los Angeles, and $14.65 in San Francisco (Kessler, 2015). While Uber positions itself as a source of income for its drivers, it might be that Uber drivers are earning less than a taxi driver, or even less than minimum wage after considering the car and driving expenses — minimum wage in Chicago is currently $10.00 for non-tipped employees (City of Chicago, 2015). Uber has also been opaque about whether its drivers receive tips for their work. The company discourages passengers from tipping, but in a lawsuit opened in San Francisco, drivers alleged that “they get only half of the 20 percent ‘gratuities’ charge that Uber adds to some fares, and nothing extra from fares in which the company doesn’t specify the amount it’s adding to the fee for the ride.”[31]

Furthermore, Uber’s drivers are not reimbursed for driving expenses, such as gasoline, depreciation, or insurance, while taxi drivers may have some of these elements indirectly covered either by municipal bylaws or some sort of regulation over the transportation of people in urban areas. For instance, taxi drivers may not have to pay for their own vehicle, or have some sort of subsidy to buy a car for commercial purposes. To this angle, Uber seems to be a temp agency where employees must supply their own cars. Does it really make sense to work for a company that pays less than the minimum wage but demands that its employees bring a $20,000 – $30,000 piece of equipment to the job?

Unregulated and Disorganized Market

Uber claims that it is Better, faster, and cheaper than a taxi. But the sharing economy model introduced by the company creates unfair competition because Uber does not have the same expenses that taxis do: Uber does not pay taxes, licensing fees, or driver benefits, they take no responsibility for passengers’ safety, and they hire untrained, unlicensed and uninsured drivers. That is, in most of the cities Uber operates, the company not only breaks local laws, but also requires drivers to put their own personal assets at risk in the bargain.

The taxi industry, and the transit and mobility regulation, in general, have long been subject to city-level consumer protection, but Uber claims that these rules are rendered obsolete by the Internet. In fact, governments have been largely unable to stop Uber’s operations in their jurisdictions not only because its operations are conducted primarily over the Internet, but also because the company holds unfair and obscure contracts with its drivers. For instance, Uber’s Terms and Conditions for Canada states that “these Terms shall be exclusively governed by and construed in accordance with the laws of The Netherlands, excluding its rules on conflicts of laws.”[32] The same sort of restrictions is applied in Brazil, France, India, and many other countries. The exception seems to be the services offered in the U.S. and China, which have different rules. Why does a local service in Canada does have to follow the laws of The Netherlands?

In another example, in 2016, after months of negotiation to regulate the service in Quebec (Canada), Uber refused to comply with the new norms proposed by the government. The new law (Bill 100) passed in June 2016, went into effect in September in the same year and would make Uber activities illegal in the province. Just a day after the law went into effect, a deal was reached between the company and the government: Uber finally agreed to make some concessions to its business model in order to comply with Quebec laws and regulations. A 1-year-pilot project was being developed by both parties put in place in the following weeks (CBC News, 2016b). Meanwhile, the company was prohibited to operate in the province. Uber, however, deliberately ignored the new regulation and did not stop the service. Furthermore, it encouraged its drivers to continue operating in Quebec without informing them about the legal risks they faced. In an internal communication to its driver on 16 September 2016, the company even suggested that it would pay for any “trouble” the driver faces: “If your vehicle has just been seized, we will continue to support you, as we have done in the past.”[33] In any case, Uber became highly profitable by ignoring state and local laws and disregarding the damage that their business model has done to communities.

No wonder this aggressive economic model is generating problematic relations with local governments and the taxi industry. Taxi drivers have been organizing demonstrations and protests against Uber’s illegal operations (CBC News, 2015b; G1, 2015), sometimes ending with Uber’s cars turned over (Dillet, 2015). Moreover, Uber’s informal practices have been challenged and deemed illegal in many countries, including Brazil (Bergamim, 2015), France (Fourquet & Scott, 2015), Spain (BBC News, 2014), and Canada, where more than 400 UberX vehicles were seized in Montreal in 2015 (CBC News, 2015a). While this is indeed a corporative movement organized by the taxi industry aiming to maintain a market full of vicious practices, Uber holds an unfair advantage by refusing to comply with regulations imposed by local governments on the taxi industry. Not surprisingly, the National Employment Law Project has accused Uber of becoming a lot more like turn-of-the-century sweatshops (O’Brien, 2015), because they offer no benefits, no privacy protection, and no potential for unionizing.

Uber also acts in a grey area regarding insurance and safety. These are important issues for ride-sharing services, and it is crucial to know who is responsible when something goes wrong. For instance, on 31 December 2013, an Uber driver who was between fares accidentally hit and killed a 6- year-old child in San Francisco (Time Magazine, 2014). Uber claimed that is not liable since the driver was not “providing services on the Uber system’ at the time of the accident.”[34] In another incident in June 2015 in Toronto, a 21-year-old woman alleged that she was a victim of sexual assault by an Uber driver while he was driving her to her home (Doherty, 2015)[35]. These incidents demonstrate that Uber has no interest or no means to control an army of hundreds of thousands of “contractors.” Indeed, in the absence of regulation and clear guidelines, the industry relies, to a degree, on the moral policing of crowdsourced reputation scores and social network identity verification. As Schor et al. (2015) argue, “counting on the goodwill of others in an ongoing economic crisis is a risky gambit, however: assaults, thefts, prostitution rings, squatters, and other horror stories show the dark side of putting too much stock in strangers’ online profiles.”[36]

Ultimately, the lack of regulation in ridesharing activities is now hurting the consumer. Uber practices dynamic pricing, sometimes called “surge,” in contrast to the traditionally fixed fares based on distance and time in the taxi industry. Whenever the demand for a ride increases to a point that exceeds the drivers’ capacity to supply a fast and effective service (usually at night, during a large local event, or during bad weather conditions such as snowstorms and floods), the company surges the prices, sometimes increasing them to several times the base rate. While this is beneficial to the drivers operating during the surge pricing and is certainly profitable for Uber, users are infuriated by the lack of transparency of this practice, accusing the company of charging abusive rates. For instance, during the price surge on New Year’s Eve 2016, the multiplier reached up to 9.9 times in many cities around the world: in Montreal, a user was charged Cad$ 118 for a ride that would normally cost Cad$ 20 (CBC News, 2016a); in Brasília, a user paid R$ 556 for a ride that would normally cost R$ 65 (Luiz, 2016).

Usually Uber avoids, as much as possible, releasing any public statements or commenting on issues that could harm the company, such as the case of the lack of transparency on dynamic pricing. However, facing such strong negative reports in the media, Uber has begun to show how far it will go to defend venture capital money: in November 2014 Uber’s senior vice president suggested that the company hire a team of “researchers to dig into the personal lives of journalists who had written critical articles about the company.”[37]

Conclusion

The dominant discourse of the digital economy is a technophilic network affirmation that sees the sharing economy and its technological disruption as a way to transform processes without changing production relations. As put by Terranova (2003), late capitalism “nurtures, exploits, and exhausts its labor force and its cultural and affective production … it is technically impossible to separate neatly the digital economy of the Net from the larger network economy of late capitalism.”[38]

No doubt Uber aligns with free-market libertarian accelerationists. Like other tech companies, Uber seeks in cognitive techno-science labour the answer to overcoming stagnant capitalism, as they clearly make use of technology, science, and logic to improve the means of production. But there is a strong, and perhaps naive, claim that math, perfect information, and market mechanisms will solve the problems of politics. As Frank (2015) suggests, there is a belief among free-market libertarian accelerationists that humans are corruptible and that contemporaneous institutions are opaque with too much power in their hands, so it is “better to formalize our values forthrightly in code”[39] in order to overcome the coercive power of the state, disrupt regulations, and strengthen neoliberal economic relations.

That is, Uber has its own version of a sharing economy, where it encourages people to share their cars to earn extra money and save the environment. But, as a company largely funded by venture capital, it also seeks to optimize resources through redistribution, exploiting the excess capacity in goods and services through a technological collaborative platform aiming to disrupt and shift the way we experience urban mobility. As Leonard (2014) states, “by ‘sharing,’ they have successfully made an end run around the existing costs of doing business.”[40] Or, as put by Terranova (2003) in more general terms about digital economy, “the passage from the pioneeristic days of the Internet to its “venture” days does not seem to have affected these mechanisms, only intensified them and connected them to financial capital.”[41] Finally, I must agree with Leary (2015): “the discourse of innovation celebrates creativity, but just as another form of capital; it aims for the mystery of spiritual life, but summons only its reverence for authority; and it lionizes collaboration, but only for profit”[42] (para. 6). It is a dysfunctional discourse in which the outcomes are not disruptive, but a well-known consequence of the neoliberal agenda.

Notes

[1] https://www.airbnb.com

[2] https://studysoup.com

[3] https://www.uber.com

[4] https://www.lyft.com

[5] As quoted in Horch, 2015, n.p.

[6] Williams & Srnicek, 2013, para 18.

[7] Mackay and Avanessian, 2014, p. 4.

[8] Mackay and Avanessian, 2014, p. 5.

[9] Galloway and Noys, 2014, para 4.

[10] Williams and Srnicek, 2013, para 8.

[11] Williams and Srnicek, 2013, para 18.

[12] Negri, 2014, p. 1.

[13] Frank, 2015, n.p.

[14] Frank, 2015, n.p.

[15] Galloway and Noys, 2014, para 25.

[16] Term coined by Cowboy Ventures’ founder Aileen Lee to designate companies that have soared to a $1 billion valuation or higher, based on fundraising. For a list of unicorn companies see the section on unicorns at Fortune Magazine: http://fortune.com/unicorns/

[17] http://www.yellowcabonline.com

[18] http://99taxis.com

[19] Summers, 2015, n.p.

[20] Schor et al., 2015, p. 2.

[21] https://www.freecycle.org

[22] https://www.yerdle.com

[23] Slee, 2014, para. 3.

[24] https://www.blablacar.com

[25] Adorno and Horkheimer, 2011, p. 40.

[26] Schor et al., 2015, p. 14.

[27] Terranova, 2003, para 5.

[28] It is important to note that Hall was working for Uber Technologies at the time he wrote the paper; Kruger, a professor at the Department of Economics at Woodrow Wilson School, Princeton University, worked on this report under contract with Uber.

[29] Hall and Krueger, 2015, p. 11.

[30] Hall and Krueger, 2015, p. 2.

[31] Egelko, 2013, n.p.

[32] Uber, 2017b, “6. Governing Law; Arbitration” para. 1.

[33] CBC News, 2016c, n.p.

[34] Leonard, 2014, “Insurance” para. 1.

[35] For a list of incidents involving Uber and Lyft see “Comprehensive List of Uber Incidents and Assaults | Who’s Driving You?” (n.d.). Retrieved from http://www.whosdrivingyou.org/rideshare-incidents

[36] Schor et al., 2015, p. 18.

[37] Peterson, 2014, n.p.

[38] Terranova, 2003, n.p.

[39] Frank, 2015, n.p.

[40] Leonard, 2014, “The true meaning of ‘disruption’,” para. 1.

[41] Terranova, 2003, n.p.

[42] Leary, 2015, para. 6.

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A short version of this paper was presented at Canadian Communication Association (CCA) Conference @ Calgary, Canada, June 2016.

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