
Uber said to use “sophisticated” software to defraud drivers, passengers - dralley
https://arstechnica.com/tech-policy/2017/04/uber-said-to-use-sophisticated-software-to-defraud-drivers-passengers/
======
tyre
I don't see the scandal.

1) Uber's upfront estimate is based on a naive calculation of getting from A
-> B. From a software perspective, that makes sense. The consumer hasn't even
committed to riding, so let's just toss out a ballpark figure.

2) If the consumer looks at the figure and says, "Yes, that's reasonable for
transportation from A -> B", which they indicate by clicking "Request Ride",
then they are agreeing to pay that price for the service.

3) The rider can verbally request a different route once in the Uber.

4) The driver is paid based on minutes and miles, via some formula that
they've agreed to. The rider is charged based on an up-front calculation,
which they can decide if it is worth it or not.

It sounds like the lawsuit is alleging that the rider is being defrauded by
being taken on a different route than the one displayed at time of purchase.

I think this is silly because, to my knowledge, everyone taking an Uber is
paying for the transportation and not any particular route. I.e. being taken
on a specific route isn't what the rider is agreeing to pay for. Also, as
noted in (3), the rider is always free to change the route.

 _Additionally_ silly because the rider seems to be alleging that they were
defrauded by _being taken by a more efficient route._ There just doesn't seem
to be any "harm" in what's happening here. I can understand the case if the
user agreed to go from San Francisco down to San Jose, based on a route
straight down the 101 highway, then, once they got in, was driven to San Jose
through Los Angeles.

~~~
zaroth
> 4) The driver is paid based on minutes and miles, via some formula that
> they've agreed to.

TFA says the driver is paid based on an _estimate_ of minutes and miles. This
to me is key...

If both the driver and passenger are paying based on an _estimate_ of miles
and minutes, then it should be the same estimate for both of them.

However, if the driver is paid by Uber for actual recorded miles and minutes,
but the passenger is paying a fixed rate based on the estimated miles and
minutes, then I think Uber is absolutely in the clear.

Assuming it's the later, here's how I see it. The miles/minutes estimate
provided to the customer is used to derive a fixed price contract for the
ride. The customer sees a price, and can decide if they want to accept it. The
contract between Uber and the Customer is now set.

On the driver side, I don't know if drivers are contractually supposed to
follow exact route instructions from the app, or if they are allowed to
deviate based on their own knowledge of the route. But in any case the app is
giving turn-by-turn real-time instructions to the driver, instructions which
can change minute to minute as the route conditions change. This is
necessarily a completely different algorithm than the fare quoter.

There's no requirement, or even a reasonable expectation, that Uber is
charging the passenger a fixed price increment over the amount paid to the
driver. Based on anecdotal UberPool reports, I would expect there are in fact
many cases where the passenger is actually paying less than what the driver is
being paid.

On the other hand, if _both_ driver and passenger are paying/paid based on a
pure estimate of the miles/minutes to get from A->B then it is a bit of an
eyebrow raise if there's a spread between the estimates which Uber profits off
of.

~~~
travisp
You've misread the article. It in fact says that the driver is paid for actual
miles/minutes.

> Meanwhile, the software utilized in the driver’s application, which
> navigates the drivers to the User’s destination, utilizes traffic conditions
> and other variables to provide the driver with a more efficient, shorter, or
> quicker route to the User’s destination, resulting in a lower fare payout to
> the driver.

Further, if you read the actual lawsuit, its clear that the lawsuit is simply
claiming that Uber shouldn't be able to pocket the difference between the
higher estimated collected amount, and the lower actual amount. They are
claiming that Uber represented to them that they "were receiving the full
fare, minus the [Uber's] service and booking fees"

~~~
zaroth
This was the part of TFA which was unclear to me;

    
    
      This latest lawsuit claims that Uber implemented
      the so-called "upfront" pricing scheme in September
      and informed drivers that fares are calculated on a
      per-mile and per-minute charge for the estimated
      distance and time of a ride.
    

So reading that again I think you're right that's just talking about fares
passengers pay, not fares paid to the driver.

Another key question -- what if Uber underestimates due to changing traffic
conditions? Does the driver get underpaid? I doubt it.

So of course the estimate is going to be conservative. So what's the contract
say? Probably pretty clearly drivers are paid on actual miles and minutes and
not Uber's estimate. I mean, if drivers _were_ paid on the estimate, Uber
would still probably be getting sued because it is sometimes low.

------
lithos
Uber has killed so much goodwill and their reputation so well that no one will
be surprised at almost any accusation directed at Uber.

I know my first thought was "not surprising", and I imagine others will think
the same.

~~~
Judgmentality
One time when I took an Uber, the driver told me how Uber was defrauding him.
He had his friend order an Uber, and he made sure to pick him up, and they
compared the prices. The prices, unsurprisingly, were much higher for the
passenger than for the driver.

The difficulty of course is proving this to be true. And then the question is
how much does Uber lose from a settlement? Probably less than they earned from
price manipulation.

But at this point it seems people might actually think negatively of Uber as a
whole, but how long that will stick is hard to say.

~~~
basseq
Uber's driver agreement isn't and has never been, "You get X% of the fare we
charge." It's "You get $X for this fare." (Based on some combination of time
and distance actuals, which are also transparent, along with any multipliers.)

If I can charge a rider $10 for a ride and get a driver to accept $5, no one's
"defrauded". They may not _like_ the spread, but that's easy to solve: riders,
don't pay $10, and drivers, don't accept $5 in the first place.

~~~
spcelzrd
Uber drivers don't get to accept or reject rides based on destination or cost.
All they know is the pickup location of the passenger.

You really have to go through a lot of contortions to defend Uber on this one.
Remember when Best Buy created an entire shadow web site just to keep people
from looking up prices in the store? Maybe not illegal, but not a great
business practice.

~~~
eru
Uber drivers are free to leave.

(And yes, I agree that this might not be a good business practice. I like my
business practices honest and simple.)

~~~
s73ver
No. That is a terrible, terrible defense.

~~~
eru
Why? spcelzrd talked about how uber drivers don't get too choose on each
specific ride, and that's true. But that's besides the point: they are playing
something like an iterated prisoners' dilemma with uber; but they are free to
take their business elsewhere, if uber 'defects' too much.

------
Digit-Al
To me it seems the disconnect here is between the fixed fee on one side (the
passenger) and the flexible fee on the other side (the driver).

Uber is, sort of, acting as an insurer and underwriting the cost of the
journey. The passenger pays a fixed fee for a projection of how much the route
will cost and the driver gets paid by how much it actually costs in driving
time and distance. If there is some sort of unexpected delay and the journey
takes longer then, presumably, the driver will be paid more than the passenger
paid so Uber will lose out.

As with all insurers Uber charges a higher initial charge to act as a buffer
and minimise the chances of losing money on the journey.

I can't really see any way of getting round this as long as the passenger pays
a fixed price and the driver is paid a flexible fee.

------
mabbo
Both driver and passenger think they know the full truth of the matter for the
financial transaction they're agreeing to, but they don't. There's implicit
dishonesty in that, and when you combine dishonesty with money we call it
'fraud' usually.

But let's set aside the question of whether it was legal. Was it _moral?_

Software like this doesn't fall from the sky- management approved it, software
teams wrote it, maintain it and system tests probably exist to validate it
works... how do those developers feel okay about this? How do they not feel
like they're cheating people out of money? When your Mom hears about it, and
asks if you were part of it will you spend 20 minutes giving a long-winded
answer about how it was actually not a bad thing? That's a bad sign, man.

I'm reminded of the scene from 'Clerks' discussing Contractors[0]

[0][https://www.youtube.com/watch?v=iQdDRrcAOjA](https://www.youtube.com/watch?v=iQdDRrcAOjA)

~~~
TeMPOraL
If we're talking morality, then let's remember that Uber has been _very_
lacking in that area for many years now; they also don't mind, and they're
pretty open about them not minding. So from that point of view, nothing new
really happened here. It's same old Uber, doing same old shitty and
exploitative things to people.

------
tmh79
I think people misunderstand upfront fares. Its like buying an airplane
ticket: the airline charges passengers the appropriate price to fill the
plane, and it pays pilots a salary. Pilots who fly more profitable routes
don't get paid bonuses because their passengers pay more. Same thing with UPS
drivers, who get paid a fixed amount to drive packages around. The concept of
"up front fares" seems to be widely practiced in logistics companies, and is
probably a part of the transition as ride sharing companies become less like
taxis and more like UPS/airlines.

~~~
discodave
Your analogy does not work because UPS drivers and Pilots are either salaried
or hourly employees. Their contract is very clear and also covered by
employment law.

Uber treats drivers as contractors and then makes certain representations
about the payment structure. The allegations here are the equivalent of
airlines telling pilots that they get paid a percentage of all the fares, then
lying about the total fares.

------
ihsw2
The fare discrepancy can extend beyond longer/shorter route calculation --
there is also the issue of surge price disparity between driver and passenger.
For example, the user would see 3x surge pricing while the driver would see 2x
surge pricing, where the user is charged for 3x but the driver is paid for 2x.
This is pure speculation and I have not witnessed this behavior but it's
another way things can go wrong in Uber's favor.

Uber might be able to defend itself saying that the data provided to the
driver and passenger are different because of misconfigured caching and stale
data being served to either party, but it's a moot point in case Ars Technica
has concrete and verifible claims of methodical and programmatic fraud.
Personally I have witnessed being billed for $0 in-app after taking a round
trip (effectively zero distance traveled) but the email notification showed
the proper billing value, and there may be more instances of this "confusion."

------
basseq
As an Uber user, I'm unaware of this "upfront" pricing model. I thought the
price charged was based on the actual time/distance (which, incidentally, they
email me on the receipt). I know I can _estimate_ the trip cost, but I thought
that was just an estimate.

Am I wrong? What is this "upfront" pricing?

And is the reverse true? E.g., can I commit to some committed price then have
the driver take some crazy route?

~~~
basseq
I'm wrong. Huh.

[https://qz.com/874224/this-year-you-wont-wake-up-to-a-
shocki...](https://qz.com/874224/this-year-you-wont-wake-up-to-a-shocking-
uber-fare-on-new-years-day/)

But seeing this, it's neither sophisticated nor malicious. They changed their
customer pricing model from time-and-miles to fixed-price. That doesn't
defraud anyone. And of course Uber is going to balance their increased risk
(i.e., that their estimate is too low) against better profitability and
customer experience.

Like, duh.

Similarly, Uber _didn 't_ change their pricing model for drivers. It's still
time-and-miles. You can certainly argue that drivers should get "more", but
are drivers willing to shoulder the increased risk as well? I could see this
story going the other way: _Uber Slams Drivers With Increased Risk, Lower Pay_
with an example of some driver getting paid $10 for some crazy-long trip
during a snowstorm.

~~~
hug
I was also very confused about this -- I am a heavy Uber user and was under
the impression that I was paying a flagfall plus minutes & kilometers rate.

There's a hint about my confusion in what I just said above: I'm from
Australia, where drivers are considered contractors by the Australian Tax
Office and must know the gross amount charged for the purposes of calculating
their GST (a 10% VAT) burden.

I suspect that Uber aren't able to bring upfront pricing in here without a
considerable fight.

------
chickenbane
A bit off topic, but I was just in New Orleans for a fun trip. I normally use
Lyft, but apparently Lyft pickups were not allowed at the airport so I used
Uber (my last Uber ride was months ago).

After waiting at least 15 minutes in the pickup spot, my driver cancelled.
Annoyed, I requested another Uber ride (which went fine). However, I was
shocked to learn that Uber had still charged me a cancellation fee for the
first ride and continued to argue it was appropriate when I protested.

I finally resolved it when I continued to press the issue, but I found the
whole scenario incredibly customer-hostile. Along with the litany of gross
Uber stories, I will continue to prefer Lyft!

~~~
notyourwork
I ran into the cancellation loop a few months ago in Oakland. Had 3 drivers
confirm, after 10-15 minutes cancel. Ironically, one driver called to tell me
she was cancelling for another ride and then literally drove by us.

------
enknamel
This just sounds like Uber quickly charges you for the worst case since if
they charge you for the best case and things go wrong, Uber loses. No one can
know what route will even be possible given how chaotic traffic and closures
can be. Then the driver gets paid by whatever route is actually taken. I don't
really see this as an issue at all.

~~~
SomeStupidPoint
If Uber wanted to protect themselves, they'd authorize for the slower route
and settle for the actual route (up to authorization).

It sounds like Uber is using two estimates (or possibly an estimate and a
actual; unclear from article) and simply pocketing the difference to increase
their margins.

It's an incredibly deceptive practice if Uber is billing you for a route it
doesn't intend to send you on. As a customer, I feel it's outright fraudulent
-- they're simply lying about their intentions to charge me a higher rate for
their service without disclosing they're billing at a higher rate.

I wouldn't tolerate that from any contracting service -- charge more hourly,
or bill by the deliverable, but don't lie to me about how you intend to do the
work. I don't care, but I do care you're lying to me.

~~~
enknamel
Protect themselves from what? Uber is under no obligation to charge you any
amount based off of route, zone, etc. They can charge you whatever they see
fit and pay their drivers whatever they see fit. If you don't like the charge,
don't take the Uber! If the driver doesn't like the fare, don't accept it!

In case you haven't noticed this is how ALL middle men make money. They charge
more to the end user than they pay for a product.

Even your contracting example makes sense. You pay for a deliverable. Does it
matter that it costs them less to get it to you and pocket the difference?
Nope. That principle is the backbone of all commerce. You charge more than it
costs you to deliver.

~~~
nikofeyn
in this case the middleman is telling a different story between the user and
driver. uber is, allegedly, charging the user a higher price while showing the
driver a lower price so that they are pocketing extra money that should be
going to the driver. say uber takes 10% off each transaction by contract. if
they charge the user $10 but show the driver the ride is $8, then by paying
the driver $7.20 instead of the deserved and agreed upon via contract $9.00,
then they are skimming "hidden" money. this is highly deceptive.

this is how a middleman in a more seedy emplyment scenario gets their fingers
chopped off because they're making extra money on the side from the business
transactions.

------
itchyjunk
"27\. In the overwhelming majority of transportations, the upfront price is
the amount that a User is ultimately charged for the transportation services
by the driver. 28\. When a driver accepts a User’s request for transportation,
the User’s final destination is populated into the driver’s application and
the driver is provided with navigation instructions directing him or her to
the best route to the User’s destination"

\---------

It seems like User sees a price X for a ride and accepts it. The driver might
see a price X-y if conditions have changed. Doesn't that imply User agrees to
price X and driver to price X-y ? Uber might be able to adjust the price at
the end but can they be sued if both party agrees to it before hand?

\--------------

"36\. Had Plaintiff and the Class known the truth about the Uber Defendants’
deception, they would never have engaged in the transportation or would have
demanded that their compensation be based on the higher fare."

\------------

I am curious as to how they reached to a conclusion that Uber was
intentionally doing this. Did a bunch of drivers co-ordinate experiments with
riders to see if there was price differences? Did they just log out and log
back into different accounts to see the price differences?

I am neutral to Uber so I feel its natural to question if Uber is seen as an
easy target to go after since they are already in a legal swamp. IANAL so
would love to read what people familiar with law have to say.

~~~
noodle
I feel like the question is, if an Uber driver takes longer to arrive due to
unforeseen/unforeseeable circumstances, does Uber pay them more than price X?
Or is their comp always capped at X?

If they pay more than X, then what Uber's doing is fair-ish. IMO. If the
driver can never earn more than X, then that is a problem.

------
vinay_ys
UberGo is most prevalent option in India. In UberGo you are shown a fixed
final price at the time of starting the trip. This is supposedly calculated
based on the best route you will take from point A to B. Def. of best is -
cheapest cost - by trading between short/long routes vs traffic congestion on
those routes that cost time. But once the rider gets into the car and driver
starts google maps, it can show a different route due to changing traffic
conditions. Or driver can refuse to follow google maps and use his own
judgement on which route is better (for him). In either case, Uber should be
transparent and show to both rider and driver the difference between what was
initially calculated vs what it actually cost based on the actual trip. But
uber does not do this. Instead of they also add another arbitrary/opaque surge
multiplier. If at all they have to do any fraud, they are better off doing
that "fraud" by showing different multiplier for rider vs driver. Consumer
protection law agencies should insist Uber should at least be transparent and
predictable in how they determine surge multiplier and their distance/time
metering is accurate.

------
lancewiggs
Uber has deliberately fostered a culture that thinks it's acceptable to rip
off people and institutions. We should never support companies with behaviour
like this.

------
davidf18
There should be an app where different services (Uber/Lyft/Gett/Via/Arro
(which is Yellow Cabs) bid on a ride and the lowest bid gets the ride. That
would help to fix this problem.

In NYC I had noticed that Uber was charging as much as Yellow Cab for some of
the trips and I was surprised about their algorithm. Now I understand why.

~~~
martinald
Google Maps does this in London (at least on Android). Unfortunately, there's
no Lyft in the UK and Uber really dominates the market, so it's pretty
useless.

There's also services like RideGuru.

------
legulere
In the thread about Uber retreating from Denmark, people asked why taximeters
are sensible regulation. This is the reason. We need a trustable third party
that ensures fair transactions. Uber cannot be this because they have their
own interests. Regularly checked taximeters can ensure this at least partly.

~~~
eric_h
Yellow cabs in New York have meters that are _supposed_ to be checked
regularly. Never the less, I have taken yellow cabs with unquestionably
different rates per actual miles and time driven (e.g. same distance/time,
different fares, because one taxi's meter was faster).

~~~
TeMPOraL
I assume there's a procedure that you could use to report a particular taxi
car/driver, which would put them in a world of hurt for cheating. That's
another reason why it's good to have a trustworthy third party there.

~~~
eric_h
There is, at least in theory: call 311. However what's to stop the driver from
slowing the meter down before he gets inspected? There's no GPS in the meter,
as far as I'm aware, so I don't believe there's a way to truly audit the fares
the driver has already taken.

~~~
TeMPOraL
Shouldn't the meters be tamper-resistant though?

~~~
eric_h
They should, and perhaps that's improved in recent years, but it was
definitely a common problem as few as 3-4 years ago (from my experience, I've
largely switched away from yellow cabs to Uber/Lyft - mostly because the price
and experience are vastly more consistent)

~~~
TeMPOraL
I see.

Regardless of what one thinks of Uber, there's no denying that taxis worldwide
- not just in the US - totally had it coming.

------
jeffdavis
If there is a sudden traffic jam and it takes twice as long, then presumably
uber must pay the extra money to the driver. So are the drivers asking for
some kind of "flat rate or variable, whichever is greater" contract?

~~~
DrScump
It's not "extra" money, it's contracted compensation.

The driver stuck in traffic doesn't have the discretion to say, "screw _this_
crowd, I'm bailing on this trip to pursue surge pricing in the next
neighborhood over."

~~~
jeffdavis
It seems the drivers are asking for both sides... If up-front is an
underestimate, they want the contracted milage/time rate. If it's an
overestimate, they want the up-front pricing.

There is no problem with that. Many contracts are drawn up that way. I think
it may even offer a great incentive to drivers to make trips faster.

But it doesn't strike my outrage nerve that it's not happening now.

------
mrow84
Here's an article about this issue from a couple of months ago, for anyone
looking for additional information: [http://therideshareguy.com/how-to-beat-
ubers-upfront-pricing...](http://therideshareguy.com/how-to-beat-ubers-
upfront-pricing/)

------
throwaway-blue
FWIW Lyft's upfront pricing words the exact same way.

This is a non-story and just good product management. This feature solves the
problem of presenting a surge multiplier to the customer. With a surge
multiplier the customer has to guess how much it's going to cost. With this
they just see the price and figure out if it is worth it or not. Reducing
purchase friction and uncertainty increases demand and is good for drivers.

Plus, both Uber and Lyft are assuming risk with upfront pricing. They are
guaranteeing a price. Sometimes it will be higher and sometimes it will be
lower. The driver is accepting a different payment arrangement based on
distance and time.

Both companies are classic middlemen and taking advantage of consumer surplus.

------
anigbrowl
If the allegations in this suit are true, fuck Uber forever. They should go
out of business, their assets should be stripped from the investors and
redistributed to the users, and Kalanick and a bunch of other people should go
to jail for fraud. There is no way to overlook the persistent structural
problems displayed by this company. Some things could be matters of opinion
(like the values of their corporate culture and so on), but there are multiple
instances by now of Uber actively choosing to circumvent laws or deceive
people on a systematic rather than an occasional or ad-hoc basis. I've rarely
seen such a clear chase for revocation of a business license.

------
mtgentry
If they can prove it, this is super shady on Uber's part. Reminds me of
Michael Bolton's money making scheme in Office Space.

~~~
CydeWeys
It also doesn't speak well to Uber's reputation that I have no problems
whatsoever believing that this might be happening. Compared to all the other
unethical stuff that they've done (such as Greyball), I can totally believe
that they'd do this as well.

If it's possible for both the rider and driver to see the forecasted route at
the time of hailing, it should be pretty simple to throw together evidence to
show that different pathfinding is in use.

------
sharemywin
If they business model is based on breaking local laws, why would anyone
expect them to deal ethically with them?

~~~
Zak
Uber's side of that story is that the local laws created unjust monopolies
with uncompetitive pricing and poor service. For the most part, at least in
the US, they weren't wrong.

Airbnb is also based on skirting regulations and has not been the subject of
the kinds of complaints of misconduct from users, service providers and
employees that Uber has. This suggests to be that the problem is specific to
Uber rather than being inherent to companies that use new business models that
don't fit into existing regulatory frameworks.

~~~
sharemywin
I'm sure gun runners tell themselves they're just helping innocent people
protect themselves. If your basing your company on the idea that it's is above
the law then I guess you have to ask where's the line. What laws do you follow
and which ones do you ignore. to me it seems like a slippery slope.

~~~
Zak
There are actually terms in law for drawing such a distinction: malum
prohibitum and malum in se.

Malum prohibitum means "bad because forbidden". It includes most regulatory
law, requirements to have licences to do things, drug prohibition, etc....
Some of these prohibitions are probably necessary to have a society people
actually want to live in, but many are more debatable and some actively make
society worse. Prohibited conduct varies greatly between jurisdictions.

Malum in se means "bad in itself". It concerns directly causing harm to
others. While some edge cases vary, almost every legal jurisdiction has
general prohibitions on murder, rape, theft, fraud and such.

I'm not aware of any significant controversies in which Airbnb has been
accused of the latter, nor Lyft. I think most people can tell the difference
between skirting regulations that many people honestly believe don't serve the
public interest and tolerating sexual harassment or deceiving contractors.

------
Wissmania
I am not sure about the legality here, but I will say that I see this
arrangement as good for both the driver and the passenger.

As a passenger I can know exactly what I'm paying ahead of time, and don't
have to worry about my driver intentionally increasing the time/distance of a
trip to charge me more.

As a driver, you are compensated on a time/distance basis, which means you
don't have to worry as much about special requests/traffic/other issues
messing with what you earn.

Uber is the one accepting the risk here, which the chance that the payout to
the driver exceeds the flat rate the passenger paid because of an extra long
trip.

~~~
incongruity
Even if it is read charitably, as you have done, that really damages Uber'
claim that it's a effectively just a middleman connecting independent
contractors with customers. By doing this, Uber is much more than a mere ride
arranging service and, instead, they're actively reducing risk and
manipulating both sides – something a mere middleman wouldn't do.

------
employee8000
No this doesn't happen. Some people may think that Uber charges the rider a
different rate than the driver receives but it isn't the case.

A driver I had was sure this happened and asked me that on a fairly expensive
trip (I think it was around $80).

I told him this didn't happen and I gave him my personal phone number and the
amount of fare I was charged. I told him to check his daily numbers and if he
didn't see this charge then to call me immediately. He never did.

~~~
KingMob
And if he had called you, you would have done... what, for him, exactly? Paid
for a lawyer on his behalf? Given him a living wage while he was blackballed
by Uber after suing them?

Even if he uncovered an error, he probably would have concluded that calling
you would have done nothing. Absence of evidence is not evidence of absence.

~~~
employee8000
I work for Uber. I would have tried to figure out wtf was going on because
that's not how we do business, as far as I know.

------
ashish10
Hmm.. So in my area where Lyft is always expensive 20-30% more than Uber. I
don't know how much these Lyft guys are stealing ?

------
mark212
This is all very interesting, but Uber has pretty robust arbitration and class
action waiver clauses in their contracts, both with the users and the drivers.
Sadly, this will go to arbitration on an individual basis pretty quickly. I
haven't seen Uber lose a motion to compel (except once in S.D.N.Y., but it was
quickly reversed on appeal).

------
pnathan
If, at the same time, driver and customer are being shown different prices, as
the article alleges, then that is a problem.

If the price is an estimate, and the estimate is revised based upon actual
time and distance, then that is within reason.

That said, this problem would be much more tractable if the drivers were
employees of Uber. Perhaps that's what should be done? :)

~~~
wwalser
I've used Uber in NY, CA, and FL in the past 6 months. Every time I've done so
I was shown exactly the price that I would pay up front. It's a static price.
I pay that amount to go from X to Y, regardless of minutes, miles or
extraordinary circumstances.

I have no idea what the driver's compensation is based on but it isn't
transparently obvious to me that it would be fraudulent for Uber to offer me a
static fare that, over the course of the ride, turns out to be different to
the value of that ride to the driver.

Imagine: When I am offered a fare based on expected traffic that doesn't
materialize, the miles+minutes value to the driver is well under what I paid.
Other times, when I hit unexpected traffic, I pay Uber less than they pay the
driver because of the extra minutes.

I'm not saying "this wasn't fraud". I'm saying, "I can imagine a pricing and
reward scheme by which it's not." If at some point Uber said to drivers "We
take an x% cut of the fare.", then yes, it seems clear that drivers would be
defrauded by the scheme. Maybe we'll get to find out :).

edit: Other comments have links indicating that my "x% of fare" idea may, in
fact, be in Uber's contract with drivers.

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comments_db
At this rate, soon Uber will be a verb. Unfortunately, associated with all the
wrong things.

a la "...just don't uber it..."

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socrates1998
The issue is with the agreement with Uber driver's, if Uber is changing the
terms of the relationship without letting them know and agree to it, then
that's a major violation of the contract and Uber could see a massive labor
lawsuit.

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JCzynski
This seems entirely appropriate and not fraud. For a flat rate, you're charged
based on a somewhat longer, non-ideal route, rather than the optimal route
which you'll take if everything goes well.

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pizzetta
I have to think this is not their mode of operation, but if it is, what the
hell, Uber? If they actually do something like this as matter of course,
goodbye. That's just unacceptable and very dirty.

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savanaly
Are we worried that shady behavior that hurts consumers and riders might
become the new equilibrium? I don't see how it could be. Whatever the
machinations of Uber to artificially alter prices, no matter how sneaky, at
the end of the day they'll lose drivers and riders to competitors if their
margins drift too far from the economic cost of being the middle man. A driver
don't need to know in what way he or she is being lied to or maniuplated to
know that they make less per hour driving for Uber than for [Uber's next best
competitor]. Thus, I don't see how there could be an equilibrium where Uber is
overcharging and still has a significant portion of the market.

~~~
_yosefk
Leaving it consumers to worry about fraud is not how you create a functioning
market economy. The real equilibrium in places where fraud isn't punished is
you rely on the market as little as you can and everyone is poorer as a
result. Fraud is illegal for good reasons.

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AsyncAwait
I have no sympathy for Uber, but it does start to feel like someone is out to
get them, the guys just can't seem to catch a break.

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partycoder
I heard that Uber is more likely to give you surge pricing if you are running
out of battery. Might be a rumor.

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Macsenour
I'm no lawyer but I understood "fraud" to be misrepresentation. Who is being
defrauded? The passenger pays one price, the company pays the driver and takes
a bit of that fee. The company is defrauding the driver by not telling him the
full fee the passenger is paying? If they word it such as: "A % of the fee and
other fees", I don't see fraud. Not a lawyer.. feel free to correct me.

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elif
So, to both parties, they are under-promising on an unknowable future event.

that is better than over-promising?

i don't see the issue here.

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dullgiulio
Updated description for a start-up: "We are like Uber, except for the
lawsuits."

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lloydatkinson
jesus christ hacker news has a fucking erection for anything anti-uber, get
over yourselves, they provide a taxi service that actually helps people

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awqrre
They probably will blame this on previous executives...

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Rainymood
We walk a thin line between deception and incentives.

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elastic_church
All it takes is a tiny tiny line in the terms of use that states that the fare
differences can be different between client side apps.

The user isn't paying the driver, they are paying uber. The driver is paid by
uber under a separate agreement.

So it honestly doesn't matter.

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cwyers
Ars Technica Uses Sensationalist Headlines And Shallow Understanding Of
Subject Matter To Defraud People Into Reading Their Articles

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bdrool
Oh, come on.

I doubt it's all that sophisticated.

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rdiddly
One good way to make sure the fare matches the distance would be to install
some sort of device that measures mileage. The driver could start the device
when the ride starts and turn it off when it's over. It could even calculate
and display the fare for both parties!

Of course that kind of transparency wouldn't be possible unless all the
vehicles had the device. So you'd probably need a licensing system for them.
Which in turn could be overseen by a commission made up of industry reps and
local government officials to ensure fairness and local control.

Wild ideas man, wild ideas.

~~~
Dylan16807
Ha ha ha.

Half the problem is that drivers _are_ being paid based on exactly such a
device.

And your second paragraph is just a series of non-sequiturs. You're stretching
too hard to make the cute analogy. Measuring doesn't imply that all vehicles
need it. Nor does that in turn imply the need for a licensing system.

~~~
rdiddly
I was making leaps because everyone sees it coming and it's boring. No need to
make it longer.

I don't think analogy is the word you're looking for.

~~~
Dylan16807
I couldn't think of a better one in less than a minute. Do you have word
suggestion? It's pretty close to an analogy, as a hypothetical mirror from one
part of reality onto another.

~~~
rdiddly
Hmm no, now that you mention it. The technique probably has a name, but if it
does, I don't know it. That's going to bother me now. Basically just
describing existing commonplace conditions (the taxi industry) as if it were
some crazy new idea, for ironic effect.

