THE STORY OF UBER
“ Industries operating under their current models will have to either adapt to these new technologies or perish .” the way traditional taxis work .
If you want some examples of other industries that have seen similar shakeups , here are a few of the most glaring :
• The music industry blatantly ignoring and dismissing digital music options , leading to file sharing sites like Napster , BitTorrent systems , and companies like Apple ( with iTunes ) taking over their market share .
• Kodak , one of the oldest names in photography , filed for bankruptcy in 2012 , having completely missed the boat on digital photography and ignoring encroachment by phones into their market . Mobile phone photography has shaken up the entire industry .
• Netflix , and subsequently Hulu and Amazon , began to innovate streaming online video . By providing high quality , on-demand service to the people who wanted it , they have changed the entire landscape of television . This has even led to a long-term mainstay , HBO , having to release its streaming platform , HBO Go , to people not subscribed to cable merely to keep up the pace .
WHAT IS THE COMMON THREAD HERE ? A new technology came along , disrupted the current state of affairs within an industry , and then knocked the current players off of their pedestal . Evolve or perish , as the old saying goes . Survival , in business especially , is sometimes a matter of how well a company is able to adapt their practices to the current landscape .
This is something which taxi companies are currently experiencing with Uber . For one thing , nobody has to talk on the phone . You don ’ t have to call a dispatch and talk to someone to send out a taxi . The taxi is simply right there on your phone . You can get the closest driver available and be ready to go almost instantaneously , depending on how far away they are located .
SO WHAT MAKES THIS UNIQUE ? WHAT ARE THE ISSUES ?
• Every individual driver gets a rating . This works similarly to how Amazon or Yelp might collect reviews for individual products or companies . Unlike traditional companies , you basically know what you are going to get before the person shows up .
• Uber does not pay local taxes or licensing fees . They are , in truth , not a taxi company . Since their operations take place largely online , governments are unable to regulate them to the level that , perhaps , they need to . Traditional taxi companies hate this and have begun protesting .
• Uber does not require different contact information for different locales . The same app will get you a driver in Los Angeles , New York , or right around the corner from your house . This means one company will have you covered anywhere .
• Taxis have to adhere to regulations . They have to pay for permits . Uber , like it or not , removes bureaucracy from the equation . You click the app and you get a driver . For drivers , they sign up and go through a background check and are good to go .
Note the response that the traditional taxi companies have had to many of these problems . Is it to improve their own service ? Develop a mobile app their own customers can use ? No . It has been to declare that Uber is “ unfair ” and that the old ways need to stay . This has , of course , never worked . Entire business courses are taught on this type of market disruption and , every single time , the solution has been to either adapt or shutter the doors . Complaining and turning to the government for help is not the right solution .
Any industry , in truth , could experience this . It is impossible to know which one might see it next , but it could happen anywhere and at any time . There is no shortage of industrious entrepreneurs out there with an Internet connection and all the new technology they could need to change the world . The really perplexing part is , industries often don ’ t know they need shaking up . People don ’ t know they want something different until they experience it . As Henry Ford once said , “ If I had asked people what they wanted , they would have said faster horses .”
Uber is doing what hundreds of other companies have done since the beginning of business .
THEY CREATED A PRODUCT AS A RESULT OF DEMAND USING NEW TECHNOLOGY THAT DISRUPTED THE OLD WAYS OF DOING THINGS .
Much like record companies having to accept digital music options , and camera companies having to deal with the existence of high quality camera-phones , taxi companies are now experiencing the same disruption . It would pay to think about new advances in the industry you are in as well . Is someone waiting in the wings to throw a wrench into the way you typically do business ? If so , what are you planning to do in response ? +
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