Net-based ridesharing: High quality, efficiency

Advances in technology are changing the way we live, work and play. By simply going online, a bed and breakfast in San Luis Obispo can book rooms, a salon owner in Pasa Robles can market her team of stylists, and farmers in Watsonville can let buyers around the world know when to expect their shipments of strawberries.

Now, too, residents of the Central Coast can increasingly use an app on their smartphone to connect with a ridesharing company and quickly get the transportation they want when they need it.  And, unlike taxi’s, drivers for Uber, Lyft and other ridesharing companies are able to work on their own time, on their own schedule, and as little or as much as they want. It’s a safe, high quality service that is meeting consumer demand. And despite its skyrocketing popularity amongst consumers all around California, the viability of this new Internet-based industry is being threatened by legislation pending in the state Capitol.

A bill currently moving though the California State Senate could threaten the ridesharing services residents of the Central Coast rely on for their transportation needs.  Assemblywoman Susan Bonilla’s AB 2293 is poised to grant the type of anti-ride sharing legislation that would saddle these innovative startups with unreasonable insurance requirements and must be resisted.  The amendments propose excessive insurance requirements upon ridesharing services, well beyond the requirements placed on their taxi competitors and well beyond what makes sense for consumers.  AB 2293 is an attempt by entrenched industries to protect their turf from innovation and competition.

As the unified voice of the Internet economy, The Internet Association opposes these anti-competitive efforts.  The Internet economy has created tremendous opportunity throughout California, but AB 2293, if amended at the behest of legacy industries like taxi cabs and trial lawyers, would stifle this innovation and reduce competition in the state. That is a bad combination for consumers in the Central Coast.

Large taxicab companies are having a difficult time competing with new services offered by ridesharing companies. Not only have they been losing customers, but they have also been losing drivers. But rather than innovate and adapt, cab companies want to force drivers and consumers back into the cab, and back in time, via legislative fiat.  Their efforts, combined with those of insurance companies and trial lawyers, are creating a bit of a perfect storm of anti-innovation in the State Capitol this year that will result in higher costs and fewer choices in California for consumers that love ridesharing.

Many businesses and consumers along the Central Coast and around the world are taking advantage of the benefits provided by the Internet. Ridesharing is but one example.  Still, we must recognize that when innovation brings disruption to the old way of doing business, the entrenched special interests dig in and attempt to force the status quo.

It is essential that members of the California Senate Insurance Committee reject efforts that protect entrenched interests and stymie innovation and instead support smart laws that ensure consumer safety and allow small businesses to flourish.

Ed’s Note:  Robert Callahan is California Executive Director of The Internet Association. 

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