Transformations Making Headway in Ridesharing

Featured in the media numerous times, a Senior Contributor for the Rideshare Guy and a regular contributor for us here at MarketScale, Sergio Avedian, a veteran Uber and Lyft driver known for his ‘surge only’ driving strategies, joins Daniel Litwin today to break down some changes affecting Uber and the rideshare landscape in general, particularly as it relates to California’s AB5 statute which went into effect on January 1, 2020, extending employee classification status to gig workers.

According to Avedian, one of the most significant changes will be that Uber’s upfront pricing will be going away. Instead, passengers will see a fare range when booking, and the final cost will be based on minutes and miles—similar to taking a taxi. Another change will enable drivers to see the destination before accepting the fare—this is an enhancement drivers have been requesting for years.

Avedian remarked, “You could understand in certain circumstances, Uber algorithms, without knowing the destination, would send you to Timbuktu; and then, getting back from there, it would be ‘dead-mile-ing’, and it would be truly devastating for the driver as far as their earnings are concerned.”

Further, Uber has revamped its Driver Terms of Service into a Platform Access Agreement (PAA) instead. Establishing a true peer-to-peer business model between the company and the driver wherein the driver will now be Uber’s customer and the rider the driver’s customer, the PAA stipulates that much like a credit card company, drivers will now pay Uber a 20-28% service fee for access to the company’s technology platform while charging the rider a Variable Marketplace Fee to use the platform. Also, Uber has capped the driver’s commission rate at 75%/25% (drivers = 75% of fare/Uber = 25% of fare).

While drivers’ earnings will remain the same (60¢ per mile/21¢ per minute), an exciting change as well is a test feature Uber launched for Palm Springs, Santa Barbara and Sacramento airport pickups (only). This new feature allows drivers to increase or decrease their own surge rate through the app by 10%, up to a maximum of 5 times. Although drivers can choose to opt-out of the surge rate, the ability to go below the normal 60¢ per mile enables riders and drivers in long airport waiting cues to be matched in a shorter timeframe.

To get more in-depth, in-the-know commentary about transformations within the rideshare ecosystem, listen to the Rideshare video stream with Sergio Avedian here. And to keep up with news, insights and trends surrounding the Transportation industry, stay tuned to MarketScale’s Transportation publications here.

Follow us on social media for the latest updates in B2B!



Healthcare IT Renovation
Got a Healthcare IT Renovation Project? We Have a DIY Book for You!
May 20, 2024

Given the rise of digital transformation demands and the persistent challenges of cybersecurity, a healthcare IT renovation project can be pivotal as industry leaders actively seek guidance on navigating these complex waters. Why now? What makes the current landscape ripe for a Healthcare IT Renovation Project, and how does one tackle such a monumental…

Read More
Retail Marketing Gamification Experts Talk
Retail Marketing Gamification is the Battleground for Customer Loyalty and Attention. How Do Retailers Win?
May 17, 2024

Retail marketing is undergoing a transformation driven by the experience economy, pushing brands to innovate with engaging and interactive customer experiences. Gamification is at the forefront of this movement, offering a dynamic way to enhance customer loyalty and drive revenue. As brands explore unique loyalty programs, immersive on-site marketing, and in-store pop-up experiences, the question…

Read More
Construction of the HPC Data Center is Prime Destination for AI Progression
May 17, 2024

As digital infrastructure continues to evolve, the strategic development of data centers is crucial. A recent update from Applied Digital celebrates the progress of the company’s HPC Data Center in Ellendale, North Dakota, positioning it as a pivotal player in the advancement of AI technologies. Highlighted in this special video is the HPC Data…

Read More
Nick Phillips of Applied Digital talks community engagement
Community Engagement is Key for Companies Aiming to Support and Impact Local Communities
May 17, 2024

Corporate responsibility is under the microscope but Applied Digital readily stands out for its positive impact on local communities. As part of the broader discussion on community engagement and economic development, there are several things companies can do to contribute to local prosperity. For a special episode for Applied Digital, Nick Phillips, EVP of…

Read More