I have called Seattle home for more than two decades and my wife and I are raising our children here.  There’s a lot to enjoy and be proud of about Seattle – the City Council’s vote on ride sharing earlier this week isn’t one of them.

Photo via Lyft

Seattle is a different city from when Microsoft imported me shortly after college in 1991.  Seattle then was best known for Grunge rock, which I happily ruined my eardrums on. Since then, technology has completely transformed our lives, and our culture of innovation makes our community a haven for entrepreneurs and investors to create visionary startups that become lasting and enduring brands.

While Uber, Lyft and other ride-sharing startups may not be headquartered here, the local impact and benefits are not inconsequential.  I recently shared my own experience and week-long test of Uber-only transport.  But, ride-sharing isn’t just about the convenience of consumers finding a ride in minutes, it is about the livelihood of these drivers who are now operating their own small businesses and becoming entrepreneurs in their own right.

I hear nothing but glowing reviews of Uber from the drivers and how the service has had such a  positive impact on their lives – schedule convenience, income, and safety. (I recently heard a driver’s story about how, as a taxi driver, he’d had a knife to his neck when a fare demanded he be taken to a location without paying. His words: “Uber changed my life.”)

Rich Barton jumping in an Uber
Rich Barton jumping in an Uber

The spark of an idea, the power of geo-located mobile devices, and an archaic and highly inefficient, supply-constrained taxi system gave way to the creation and rise of Uber and other ride-sharing services. I have no doubt the City Council’s short-sighted decision will be overturned in time. I am just extremely disappointed – and more than a little embarrassed – that it was Seattle (the land of legalized marijuana and same-sex marriage) that failed to recognize the future is here, and the past – well, isn’t.

Last year when I spoke at the Global Entrepreneurship Summit in Kuala Lumpur, I talked about the seeds of innovation and entrepreneurial ecosystem starts with good government.

I boasted that while not perfect, our system in the U.S. provides a supportive and rational system that enables innovation.  I used Seattle as an example of a vibrant ecosystem and progressive pioneer in policy that many model and follow.

Apparently, Seattle’s City Council didn’t get the memo.

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  • guest

    I have used Uber and UberX roughly once a week since they arrived in Seattle, and roughly once a month when I travel to other cities. If there are issues with their insurance coverage not being up to snuff, let’s correct those.

    Unfortunately, capping the number of drivers isn’t a solution to the insurance problem. I’m not sure it is a solution to any problem other than keeping taxi owners in business. For drivers, it actually creates problems rather than solving them.

    I fairly regularly talk to Uber and UberX drivers while I’m riding with them, and I have learned that many are former taxi drivers. If Uber is capped, then many of them will have no choice but to stick with taxi owners, where they work longer hours and make less money. If Uber isn’t capped, more and more of them will find ways to lease their own cars and make more money as Uber or UberX drivers.

    So if the city council is actually interested in helping hard-working taxi drivers make ends meet, they would be better served be removing the cap. There would be more aggregate demand for drivers in jobs that let them earn more than they can with taxi owners. The only ones who would lose are the taxi owners. Riders and drivers would both win.

    • Nevermind


    • NotQuite

      It’s all about (lost) revenue for the city. Nothing else.

    • ClaimsAdjuster

      You don’t know what you are talking about. Most taxi licenses in Seattle/KC are held by owner/drivers.

  • http://startuplawblog.com/joewallin Joe Wallin

    I agree Rich. Well said.

  • Badmichael

    This is about the city getting their cut, nothing more. Someone’s building a business and they don’t have their hand in their pocket…yet.

  • Guest500

    Please note that importantly not a single person on the Seattle City Council owns, or as far as I can tell, has ever owned a business.

    Their perspective, if you can call it that, is a distorted, myopic, and stupid view about how to make things “fair” and avoid change and as anyone who has ever owned or run a business knows, it is changing everyday! This is unavoidable and as usual, had the government not interfered and enabled and created the ludicrous system we have in place now, the change would perhaps not be so painful for the taxi industry. Of course they participated, as every entrenched industry does, in avoiding change.

    I get and agree with the insurance gripe. Fine, require insurance. Stickers, medallions, caps, and other restrictions have no place in a free market.

    Regardless, what this really showed is that we need a city council with a much different makeup from the current council.

    • MichaelTompson

      Unregulated (as in Wild Wild West – free) public transportation markets failed many many times. In all cities it was tried in. History lessons are for all those who wish to know. But who needs facts and history lessons when paid for pre-IPO social media campaigns are oh so “real” and “believable”..

  • MichaelTompson

    You should be proud, not embarrased. Cheering for multi-billion for-profit cartel-like Cali corporations that claim innovation because “well… GPS” is absurd. Technology is not an excuse to break laws. Follow the law. Stop actively resisting regulations. Pay fees and taxes – same – as all other tranportation companies, and – operate. No problem. Truth is that ride-sharing companies are breaking laws and regulations every day. From regulatory fee evasion to use of smartphone while driving (and even two smartphones(!) as was recently uncovered by Mr. Raplan – an undercover reporter who drove one of the ride-sharing cabs for a week and had far from stellar results). Use of smartphone(s) while driving is strictly prohibited and is a major cause of serious, fatal, accidents. In fact, ride-sharing drivers were already involved in fatal and severe accidents. With no commercial liability insurance to cover losses and medical bills involved. Most readers would likely already know, the commercial liability insurance expense and enforcement is just not there for any of the ride-sharing law-breakers. To make things worse, ride-sharing drivers were also caught engaging in other criminal activities while driving passengers. The bottom line is that regulators who blindly support ride-sharing law-breaking model are gravely wrong and misguided.

    • Grant

      Dear Taxi-Cab Industry Representative – Please explain to us mere mortals how capping the total number of Ride-Share vehicles on the road at any given time addresses any of your grievances.

    • Slaggggg

      No one likes you.

  • http://seeknuance.com/ John DeRosa

    I’m sad to hear you’re embarrassed, Rich. Where are you moving to?

    • Slaggggg

      He’s moving into your nightmares, obviously.

      • Mike

        I always have nightmares of Billionaires attacking me. Doesn’t everyone?

  • CuriousOffice

    I’ve heard all manner of arguments as to how ride-share companies are “breaking the law” or putting passengers in danger. Yet, what our city council did was cap the number of drivers. They didn’t forbid these services. They clearly have an issue trying to figure out how the city can get a cut from all the revenue that satisfied customers are producing for these companies. The five city council members responsible for stifling innovation are: Sally Clark, Tim Burgess, Tom Rasmussen, Sally Bagshaw and Jean Godden.

    • ClaimsAdjuster

      They City Council did not cap drivers. They capped the number of active drivers at a time on a TNC network. How does that move get the city more revenue?

  • Paul Godsmark

    The battle lines are being drawn within the existing paradigm. But in a few short years the deployment of fully self-driving cars will simply obliterate these rules when taxi, car rental, car share, ride share and P2P models all adopt self-driving cars and end up with almost indistinguishable business models.

    You know the writing is on the wall for disruption when the incumbents are battling this hard to hold onto already outdated business models.

    Larry Page, Google, re-confirmed Google’s aspiration to have their technology in public hands by 2017. It won’t be long before the paradigm shift is obvious to all, and taxi-regulations become irrelevant. If I can’t order a self-driving taxi (if these regulations continue), then I will order a rental car for my 10 minute journey – the only difference being the logo of the SERVICE provider. Transport as a Service (TaaS) will be mainstream soon.

  • Scott Moore

    Amen, Rich. PS–Hey City Council, why don’t you fix something that is actually broken and within your power to address: the pathetic state of Seattle street maintenance and a downtown construction “plan” gone insane.
    But you do have bike lanes, I’ll grant you that.

    • Mike

      You know that the fees the taxis pay go towards road maintenance, right?

  • Kary

    I’m embarrassed that so many human beings don’t understand that just having an app doesn’t convert a regulated industry into a non-regulated industry. Uber and it’s competitors should consider themselves lucky that they weren’t run out of town entirely.

    Maybe I’ll create a bank app and see how many fools give me money.

    • http://seeknuance.com/ John DeRosa

      If you called your app “Bitcoin,” you’d get a boatload of fools.

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