The Uber Story

How Uber beat the competition and outwitted regulators

The Uber Story Uber is among the most recognisable brands in the world. It has become embedded in our language and has revolutionised the way we get from A to B. Over the past nine years, the edgy digital disruptor has upended an entire industry business model and made ride sharing cool. But Uber's ride to success has been far from smooth. How did the ruthless app giant outwit regulators and crush its competitors?

“This is really make or break for Uber,” says transport analyst Hubert Horan. As the company prepares to launch its initial public offering later this year, industry experts and investors alike are taking stock. “They have 20 billion US dollars in investments so far. None of those investors have seen a penny of actual return with a few minor examples [sic]… So either they go public, investor's happy, or it's a mess.”

Travis Kalanick founded Uber in 2009. Originally envisioned as a way of hiring a car using a smartphone, it soon developed into UberX, a service for providing rides in private cars. New York Times technology reporter Mike Isaac remembers how Kalanick was “a jerk” who garnered respect for his bolshie business sensibility. “His whole journey was to just buck against regulation and against these entrenched taxi interests, against regulators who didn't want him to succeed.”

The launch of UberX proved highly controversial, sparking furious protests from taxi drivers around the world. Most transport regulators declared it an illegal taxi service. In response, Uber developed covert techniques to defy authorities whilst building market dominance. Sarah Kaine of the University of Technology Sydney thinks of their approach as “the digital equivalent of that greed is good mentality. The Gordon Gekko mentality, but in a digital space. Which is, ‘We will do this. We can do this, and no one's going to stop us.’"

In San Francisco, Uber established a global strategic centre known as the Threat Operations division. It was “made up of a bunch of ex-CIA, FBI type guys who would travel around the world, spending millions of dollars investigating competitors, investigating taxi companies, digging up dirt on folks,” says Isaac. “Just spy-type stuff that is kind of crazy to go on at a tech company.” In Australia, Uber used Surfcam spyware to spy on competitor company GoCatch and poach their drivers. “The fact that Uber used hacking technologies to steal our data and our drivers is appalling,” says Andrew Campbell, co-founder and CEO of GoCatch. “It had a massive impact on our business.”

But these dirty tactics soon caught up with the ride share giant. In 2017 Google sued Uber, accusing the company of stealing sensitive information about its self-driving car programme. The company became embroiled in the #metoo scandal when former employee Susan Fowler blew the whistle on a culture of sexual harassment. When an Indian woman raped by an Uber driver sued the company, it emerged that senior Uber executives had illegally obtained her medical records to undermine her credibility. Amid growing outrage Kalanick was forced out in June of that year, but controversies and shareholder squabbles have continued to emerge.

As Uber prepares to launch its public offering this year, it is taking pains to show that the company can continue to grow in a competitive marketplace. “When we look at strategic priorities for our company, we absolutely have to invest in newer forms of transportation that are on the horizon,” says Uber’s chief product officer Manik Gupta. “Otherwise, if we don't disrupt ourselves, somebody else will disrupt us.” Current projects include the development of driverless Ubers and aeroplane taxi service UberAir.

But many remain sceptical about Uber’s prospects. “It's massively unprofitable, it has no competitive advantage and no signs that it can expand profitably anywhere else,” says Horan. “To turn around four, four and half billion dollars of losses into steady growing profits would be one of the greatest corporate turnarounds of an operating company in history.”


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