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Uber in Europe: back to the future

Where will Uber stop? After the news that the Saudi’s have decided to invest $3.5bn in the company, came details of a further $2bn Uber wants to raise from financial markets using tecniques never deployed before by a start-up. Uber already has a war-chest of $14bn. to spend in expanding its role in the Middle East, Africa, India and China, as well as to develop new services like driverless cars and car-pooling. But it’s in Europe that the company has encountered the greatest opposition to its presence and its methods, confirming the Old World’s status as the place where America’s tech giants find their toughest official critics and most militant opponents in local business.

Uber’s urge to simply ignore local regulations and apply the same aggressive drive to attract drivers and customers that worked so well in the US has backfired in Europe, as it has in nations as far apart as Indonesia, South Africa and Chile. In June 2016 a French court found that Uber had been guilty of starting an “illegal” car-booking service, of “misleading commercial practices” and “complicity in the illegal exercise of the taxi profession.” Large fines were imposed on the company and its local directors. After German courts banned the basic Uber service, Dieter Schlenker, head of Taxi Deutschland, a trade association, said the judgment “benefits all those who find it hard to defend themselves alone against the interests of big corporations.” (Financial Times, 6 June 2016)

The Uber story is a classic example, from a very long line, of American innovations which disrupted traditional European ways of organising life, government, business, culture and much more. This is the true American soft power challenge: demonstrating the force of an example which is exceptionally big, dynamic and attractive, and so cannot be dodged. Invariably it places Europe’s institutions, economies and peoples up against the conundrum of whether this is progress or not, and how to come to terms with it. Does acceptance imply some degree of “Americanization”? Does rejection mean opting for backwardness and marginalization? If some sort of adaptation is proposed, how to produce the resources of political and business imagination to develop alternatives and apply them?

Uber app. Photo by freestocks.org. Public domain via Flickr.
Uber app. Photo by freestocks.org. Public domain via Flickr.

No society better than America demonstrates that what a soft-power superpower deploys always is a special ability to generate and deploy models of change and innovation, and to identify them as modernity: showing the world, society, the individual, possible ways to advance for the better, however defined. Such models offer what the sociologist Peter Wagner, in his essay on “Modernity,” calls “the interpretative and practical power of (their) normativity and functionality”; in other words – those of his colleague Gerard Delanty – their “normative salience.” The way Uber pushes its ‘normative salience’ is just what long-established taxi firms fear most.

Every traditional idea of modernity, sovereignty and identity in taxis is put in doubt by the Uber challenge. Modernity, because Uber shows how digital applications can revolutionise a traditional transport sector; sovereignty because its app functions world-wide, while most national and local governments have long evolved norms for running taxi services themselves; identity, as taxi drivers have always considered themselves a distinct body of workers in Europe with their own skills and knowledge, even their own particular vehicles in the case of the celebrated London black cab.

Uber’s force and ruthlessness seem exceptional even by the standards of Silicon Valley. “It’s easier to ask forgiveness than permission,” is one article of faith attributed to the firm. But its drive for constant innovation and ubiquity places it naturally in the long line of American service sector imports into Europe which started controversially with chains of down-market stores in the 1920s and cinema palaces in the 1930s. It then proceeded with coffee bars after World War II, shopping malls from the 1950s on, McDonald’s from the 1970s, Blockbusters in the 1980s, before morphing into the digital world from the 1990s on. Starbucks arrived in the early 2000s. In many nations the activities of chain stores were limited by those who sought to defend the rights and privileges of small shopkeepers (Hitler too played that game), an attitude still to be found in societies like India. As for McDonald’s, the hapless company has found its road blocked in the past, even violently, by activists from Hampstead to France, from Italy to Iceland.

Why the Old World itself has been unable to generate a world-dominating net-based service has generated discussion ever since Google started to loom so large, and has been renewed in the face of Uber. Technical and legal arguments have been taken up and dropped: sheer lack of imagination and ambition gets most of the blame these days. But the investors prepared to pour extraordinary sums in to Uber, and lose them, putting market share world-wide before profit, have no possible rivals anywhere. The head of Google in Europe has blamed the EU for ‘protecting the past from the future’. If so, it is only doing what so many of its citizens, with taxi-drivers head of the queue, would want it to do. But on the 2nd June, the EU made clear it was in favour of ‘the sharing economy’ in whatever form it might take, suggesting only that common guidelines across the ‘single market’ should emerge to help its growth. Given current attitudes in much of Europe to the EU’s eternal harmonising efforts, Brussels may well be wasting its breath.

Headline image: January 13, 2015, around 70 of Portland’s 460 Taxi cabs protested fair taxi laws by parking in Pioneer square. Photo by Aaron Parecki. CC BY 2.0 via Wikimedia Commons.

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