Laura Bliss is CityLab’s west coast bureau chief, covering transportation and technology. She also authors MapLab, a biweekly newsletter about maps (subscribe here). Her work has appeared in the New York Times, The Atlantic, Los Angeles magazine, and beyond.
The company is announcing new partnerships with dockless bike firms, car-sharing services, and transit startups, signaling its desire to help cities service all types of mobility.
Like Google, FedEx, and Xerox, Uber has become a verb. Its name is synonymous with an action—in its case, summoning a car via app. But a string of news from the company this week suggests it might prefer a broader definition.
On Monday, Uber announced its acquisition of Jump, the New York City-based dockless bikesharing company. On Wednesday, CEO Dara Khosrowshahi revealed that Washington, D.C., users will be able to book a Jump bike right from the Uber app. The bikes were already available to app users in San Francisco, stemming from Uber’s pilot with Jump in February.
At the same event, Khosrowshahi announced that Uber will also test another partnership for the San Francisco market, this time with the peer-to-peer car-sharing company Getaround. Within the Uber app, Bay Area users will be able to book and drive “Uber Rent” vehicles by the hour or day, at prices set by the individuals who own and list them on the Getaround platform.
Lastly, Uber unveiled that it has inked a deal with Masabi, a company that facilitates mobile transit ticketing in 30 cities worldwide, and is working to provide its services, too, among the Uber app’s menu of options wherever Masabi is available. That means users in New York, L.A., Boston, and beyond should be able to book regular commuter rail tickets with the same app they might use to order a regular Uber pick-up when they’ve reached their destination.
“This is about scaling up alternatives that reduce personal vehicle use in cities,” Andrew Salzberg, the head of transportation policy and research for Uber, said in an interview on Tuesday. “This is in alignment with what cities are trying to do.”
It is also about Uber aiming to be an “everything company” for transportation. With its rumored $100 million acquisition of Jump, Uber has leaped into the Wild West of dockless bikesharing, an industry that has exploded since the technology was introduced in China in 2014. Last year, a surge of venture capital brought the colorful, sensor-enabled bikes onto U.S. soil from both Chinese and American players; startups like Ofo, Mobike, Limebike, and Jump have been vying for dominance in dozens of American cities ever since.
Dockless bikes are cheap to use, averaging just $1 per 30-minute ride. Thanks to built-in sensors, they can be parked anywhere, unlike their docked predecessors. The business model for dockless bikesharing is not proven yet—just as Uber’s blast to ride-hailing domination has required a king’s ransom in investor backing, so do the startup leaders of the shared cycling world. But the new mode has been largely welcomed by cities as an answer to mobility woes. To reduce unnecessary car trips, cheap, zero-emissions, easy-to-access bikes could be a simple choice for many travelers, compared to the high costs of gas, parking, and traffic (and, often, a lack of high-quality transit).
In the Wall Street Journal, Khosrowshahi acknowledged that offering dockless bikes could cannibalize some riders from Uber’s comparatively more lucrative car-based services, but said the company’s goal is to meet demands for all kinds of trips. Similarly, Getaround rentals could replace some of the more exceptional types of Uber trips, such as running errands or out-of-town treks. But that’s OK, Jahan Khanna, head of vehicle products, said on Tuesday. “If we’re serious about replacing every use case that a personal car fulfills, we need to be able to provide them,” he said.
Peer-to-peer carsharing has taken off recently. According to a policy brief by UC Berkeley’s Transportation Sustainability Research Center, membership increased 111 percentage points across the six North American peer-to-peer operators (most of which are local; Turo and Getaround are the major national companies) between 2016 and 2017. Sam Zaid, the CEO of Getaround, said in an interview with CityLab that the mutual aspiration between his company and Uber was to take the partnership to “many more markets.”
The enlightened stage that Uber is aspiring to reach is “mobility as a service,” which transit-tech thought leaders frequently bleat as “MaaS.” Coined in Finland, MaaS refers to the concept of a single platform where travelers can source and pay for rides across multiple transportation modes. Rather than juggling Google Maps, train schedules, Uber apps, bikeshare kiosks, and whatever else separately, riders can compare all shared options converged in one MaaS app and purchase tickets via subscription or one-off buys. Such convenience could reduce temptations to drive, the logic goes.
MaaS is a concept (and a real-world product in a few European cities) that rhymes well with the ride-hailing industry’s on-demand, app-based business paradigm. According to an estimate by ABI Research, the market for MaaS could be worth $1 trillion by 2030, assuming the introduction of cheap, shared, driverless vehicles builds up consumer desire for on-demand mobility services. "Autonomous is part of the solution, and I think longterm is going to be a very important part of the solution of getting rid of car ownership," Khosrowshahi said at a press event in Washington, D.C. on Wednesday.
That’s a big assumption, though, especially in the wake of the self-driving Uber that killed a pedestrian in Tempe, Arizona, last month. With the investigation into that incident ongoing, it’s not yet clear how far Uber or the driverless vehicle industry as a whole has been set back by the crash. Already, the dream of a single MaaS app is a huge challenge to realize, given the number of transportation agencies, services, and payment and mapping entities that must harmonize for it to function.
Uber might conceivably be able to leapfrog more easily into the position of multi-modal ride broker than others; with its deep existing user base, it holds potential to scale up the MaaS model. However, the company has not made itself known as a particularly accommodating civic partner. Initially, Uber, Lyft, and other on-demand vehicle services were welcomed by public officials as a break from the single-occupancy vehicle mold. The companies advertised that their services would complement transit and reduce personal vehicle travel—a powerful message for cities grappling with traffic congestion and vehicle emissions. But a spate of recent research suggests that these promises aren’t all coming true; in fact, vehicle-miles traveled and congestion are increasing in many cities and transit ridership is declining. Ride-hailing appears to be part of the explanation for both trends. And the industry’s unwillingness to part with ridership and trip data has proven a sticking point for many cities now struggling to manage its effects.
On that front, Uber is making two more small steps towards reconciliation. On top of the three partnerships it announced today, it also launched an expanded version of Uber Movement, a platform that houses maps and datasets for historic average travel times across various city zones. Previously available for a handful of places, it is now expanding to include 12 world cities. In addition, Uber is partnering officially with SharedStreets, an open-source, third-party platform that aggregates anonymized mobility data that cities and private companies can use to learn and plan. “As we build up, we want to give back to the public agencies we work with,” said Salzberg.
The company’s acquisition of Jump and partnerships with Getaround and Masabi could also buy Uber some goodwill with the local entities those companies have already forged relationships with, as well as buy some friendly PR in the wake of the fatal Tempe crash. The company’s narrative this week is that it is looking to help, not (quite literally) hurt. To err is Uber, to pivot is divine.
Bringing a large public transit system into its operational fold could be the next critical piece of Uber’s transportation-service puzzle. Speaking of which, at a conference in February, Khosrowshahi made a comment about wanting to run a city’s bus system, perhaps suggesting a scaled-up version of the Uber subsidy programs that a number of suburban communities have picked up in lieu of bus or paratransit service. “We want to help people connect to transit,” Salzberg said in response. “It’s not about replacing [transit].”
However, with its carpool option becoming cheaper and more bus-like, it may be fair to say that Uber already is.
Hanging further over the company’s promises to cities is the question of Uber’s financial sustainability. It’s widely believed that Uber and Lyft rides are heavily subsidized by reserves of venture capital. “What happens when the VC money runs out is anybody’s guess,” said Adam Cohen, a research associate at UC Berkeley’s Transportation Sustainability Research Center. “Do we end up in a scenario where these services are automated and cost less, or do we all end up with increased trip prices?”
Imagine if that day of reckoning happens after the company has pivoted into an all-encompassing MaaS-dispenser, absorbing more public transit systems into its operations, too. That could hurt communities for whom a dependency on shared modes is not chosen but forced by financial constraints. Any meaningful shift away from private car ownership will require alternative services to be affordable on a virtually unlimited basis, Cohen said. Which happens to describe the original concept of mobility as a service: public transportation.