New York City's Taxi and Limousine Commission voted today in favor of a one-year test program that would let people use a smartphone app to hail a taxicab.
And that was sweet news for startup Uber. The private-car service had begun offering its app to cab users in September but stopped the effort a little more than a month later when the commission raised concerns over a long-standing agreement between the taxicab and for-hire vehicle industries.
That arrangement prohibits prearranged rides in New York's iconic yellow cabs, and members of the for-hire industry had said apps like Uber's could threaten their livelihood.
Uber CEO Travis Kalanick seemed satisfied with today's news. "The city government listened," he wrote in a blog post today. "Mayor Mike Bloomberg -- himself a technology pioneer who saw how a storied old industry needed to be reinvented for a digital age -- pushed for changes. And his Taxi and Limousine chief, David Yassky, got it done."
Kalanick said that the return of Uber's taxi service was "imminent," and he seemed certain the test phase would lead to a permanent change. "We already know how this pilot will turn out," he said in the post. "As you may remember, New York City's first experiment in e-hailing yellow cabs was only a couple months ago. Along with quite a bit of controversy there was enormous, unprecedented demand from New Yorkers."
The test program is a compromise of sorts, according to various reports. The commission had been expected to OK such taxicab apps outright but apparently realized it wouldn't have the needed support among commissioners.
"Bringing apps into New York would be a change in the way people get taxis," commission Chairman David Yassky told The New York Times. "It makes sense to see how that pans out and see if any of the supposed problems with that materialize before you make it permanent."
On the other hand, the Times points out that the city doesn't want to be seen as out-of-it on the tech front. When Uber discontinued its offering earlier in the year, Kalanick posted a blog item containing a remark that could've been perceived as a swipe at New York. "New York City's [Taxi and Limousine Commission] will hopefully get things moving," he wrote, "and let UberTAXI back out in the wild.... In the meantime you can try UberTAXI in more innovation-friendly cities -- including Boston and Toronto."
The test program includes some fine print, according to the Times. In Manhattan's central business district, passengers must be within a half mile of a cab to hail it with an app. Elsewhere in the city, that distance increases to a mile and a half.
In July, Uber won a battle over draft legislation proposed by Washington, D.C., that could have forced it to dramatically increase its fares. But the company is being sued in its hometown of San Francisco by the city's cab drivers, who are claiming unfair business practices. It also faces a lawsuit in Chicago.