Uber ridesharing service coming to Houston (Part I)

Mike Morris at the Chron last month provides our background.

A smartphone app could be the subject of the year's most spirited regulatory battle at City Hall, as lobbyists line up for a fight that pits taxicab companies against a car-service technology company called Uber.

The firm's entry into more than 20 U.S. cities has sparked lawsuits and cease-and-desist letters from taxi owners concerned for their livelihoods and regulators accusing the firm of skirting the law. Uber says it is merely a broker between riders and drivers, using a smartphone app to make getting a ride more efficient.

Uber must seek a change in ordinance for its business model to work in Houston, said Uber CEO Travis Kalanick. Company representatives first met with city officials in May; a social media marketing push launched in recent days.

The service the San Francisco-based startup wants to offer in Houston is UberBLACK, which would allow riders to hail town cars - also known as black cars or sedans - using the Uber app, alerting the nearest participating driver to respond. The fare is based on speed and distance using each smartphone's GPS technology, with the fare charged automatically to the customer's credit card.

Drivers who want to participate are given smartphones with the Uber app installed, said company spokeswoman Nairi Hourdajian, and must pass a background check and comply with all city licensing rules. Drivers continue to work for their limousine company or themselves; they do not work for Uber.

Houston is the last major U.S. city in which Uber does not operate, largely because of the city's "draconian" regulations, Kalanick said, calling the city's rules typical of those negotiated by taxi companies to protect themselves at the expense of riders.

Uber's jab at the local cab companies reflects their Libertarian-styled business plan. They give away ice cream and T-shirts as part of their initial marketing campaign, but they also don't invest in vehicles or other transporation company infrastructure, which is why they depend heavily on lobbyists to sway municipal lawmakers to change or drop existing ordinances. More about the local lobbying effort in Part II posted later; see here for what's going on in their home base, San Fran.

San Francisco’s taxi drivers plan to turn up the pressure on companies such as Lyft, Uber and Sidecar.

Taxi drivers said they will hold a rally outside City Hall on Tuesday to draw attention to "unlicensed, uninspected, unregulated and underinsured taxis" that are "allowed to roam the streets, creating a public safety hazard, increased congestion, greenhouse gasses and unfair competition against law-abiding cab drivers."

Taxis, which are regulated by the city and public utilities commission, said that Lyft, Uber and SideCar should all have to abide by the same rules.

"We’re not against innovation," said Barry Korengold, president of the San Francisco Cab Drivers Association. "We’re just against unfair competition. Everybody with a four-door car can now go be a taxi."

Back to what's happening in H-Town.

Uber wants to drop the minimum fare for a sedan ride in Houston from $70 to $5.50; wants regulations changed to enable on-demand service, as opposed to rides arranged at least 30 minutes in advance; and wants to delete the four-car minimum required for new limo and sedan companies, among other tweaks.

"City government has decided, 'In Houston you're allowed to get a quality ride, but it'd be bad for you to get it quickly; we need to make sure that doesn't happen because chaos would ensue,' " Kalanick said. "That's a little tongue-in-cheek, but the point is, that is a law designed to ensure there is no alternative to taxis. There is no way to get a nice ride quickly in the city of Houston."

Chris Newport, spokesman for the city's Administrative and Regulatory Affairs department, said the changes Uber seeks are "significant" and will not be undertaken before a study of Houston's taxi industry, begun in April and expected to finish later this year, is done. Recent revisions allowing jitneys, pedicabs and low-speed shuttles, Newport added, prove the city's rules are not protective of cabs.

"Obviously, we want to encourage innovation and smart, new ideas. We just need to make sure we do it in a smart way, and our most important consideration is always going to be the safety of the riding public," Newport said.

Isiah Carey at Fox26 had a good report also.

Houston weather, traffic, news | FOX 26 | MyFoxHouston

A roundup of other recent stories include the Houston Business Journal and CultureMap Houston. Yelp has some favorable comments from Houstonians who used the service elsewhere. Wall Street is simply wild about the company, and Google Ventures is all in with over a quarter of a billion dollars invested in Uber. Even the Chron's editorial board *cough*Evan Mintz*cough* registered support.

(O)ne only has to look at other cities where Uber operates to see the benefits of fresh blood in the market. Residents in New York City's outer boroughs, where cabs never tread, suddenly found themselves with access to cars. Uber could do the same for the vast cab-less swaths of Houston. In California, writers and bloggers have touted Uber as a solution to drunk drivers. And we imagine that Uber will also help alleviate Houston's inner-loop parking problems.

So with all of that positive press, who's saying no (or at least 'slow down')? That's coming in Part II.

John Kerry's turn to roast on the liberal spit

Hey, I didn't draw 'em.

But really, let's not let the commander-in-chief off the hook here.

Facing mounting domestic and international pressure to respond to the deployment of chemical weapons by the government of Bashar al-Assad, White House sources confirmed today that President Barack Obama is carefully weighing his option for dealing with the war-torn Middle Eastern nation. “The president has conferred with his top advisors and is currently considering everything from authorizing missile strikes against Syrian regime targets, to taking out Syrian regime targets with missile strikes—nothing is off the table at this point,” said White House Chief of Staff Denis McDonough, noting that the president would “take all factors into consideration,” including the well-being of the Syrian people and the strategic interests of the United States, before settling on his only option.

“The president recognizes that the situation in Syria is extremely delicate and that the U.S. faces complex consequences regardless of what he chooses; that’s why he’s giving the one option in front of him so much thought. He will not act until he’s confident in the inexorable decision he’s making.” At press time, Obama had reportedly narrowed his option down to missile strikes against Syrian regime targets, but stated that he would consider it for several more days before making a final decision.

I went ahead and split that long paragraph in two, so that the delicious Oniony flavor would pop.

On greed, and driving the message

Two posts about sports in two days! Don't worry; it's not a trend.

-- Forbes reported earlier this week that the worst MLB franchise by won-loss record, our Houston Astros (soon to be three 100-loss seasons consecutively) are also on track to be the most profitable team ever in history.

The Astros are on pace to rake in an estimated $99 million in operating income (earnings before interest, taxes, depreciation and amortization) this season. That is nearly as much as the estimated operating income of the previous six World Series championship teams — combined.

Yet the Astros are 43-86, worst in the majors. Of the 270 Major League Baseball teams who have taken the field since 2005, none have finished with a worse winning percentage than Houston’s.

The Astros trotted out their new kid, Nolan Ryan's son, to say "No, we're not" but he didn't offer any evidence to the contrary. Astros owner Jim Crane whined louder about being outed as money-grubbing douchebag, but ultimately took the Jamie Dimon approach (scroll down) with his rationalization.

"I didn't make $100 million by making a lot of dumb mistakes."

Forbes rejoined, saying they stand by their math (and their reporting). The good news here for Jim Crane is that nobody whose opinion he cares about actually thinks he is stupid. The bad news? You guessed it: he doesn't care what anybody thinks.

Update: There's actually two different Forbes bloggers arguing with each other about whose math in regard to the 'Stros' P&L is more accurate. 

-- That provides the segue to this report from KHOU about the Dome.

Harris County voters will determine the fate of The Astrodome in a bond referendum on the November ballot, a $217 million plan to convert the dome into a convention and exhibit facility. The Harris County Sports and Convention Corporation put forth the proposal after rejecting a number of privately-submitted proposals that it decided weren't financially feasible.

"It would be a shame, in my mind, to see that asset go away," said Harris County Judge Ed Emmett. "Because ten years from now, somebody looks up and says, 'Well, if we had the dome, we could do this.' Well, this is a use for the dome that makes sense and it preserves the dome for possible future uses."

But with election day a little more than two months away, a critical component of the plan is conspicuously missing. When big bond issues backed by the county's heavy hitters appear on the ballot, political and business leaders often form committees to sell the plan to voters. So far, nobody has emerged as The Astrodome's head cheerleader.

"I think it's going to take some sort of organized effort," said Bob Stein, the Rice University political science professor and KHOU analyst. "Bond proposals of this sort usually succeed when there's an overwhelming majority of campaigning and spending on behalf of a bond."

Emmett said a number of people have talked about leading the effort, but nobody's grabbing the ball to run with it.

"Typically, right after Labor Day is when things crank up," Emmett said. "And so we don't know who all is going to be involved, frankly."

Among people who've watched with dismay as the dome has fallen into disrepair, this only fuels suspicion that a failed bond election will give county leaders political cover to destroy the dome. Even a Houston Chronicle editorial recently opined, "The Harris County Sports and Convention Corporation comes to bury the Astrodome, not to praise it …We'll see it on the ballot only with the intent of it being voted down."

So the TV station riffed off this post two weeks ago. That's cool; I riff off them too. It's just nice to know that a little blog most people have never seen or heard of can occasionally drive the message.

Update: With former county judges Jon Lindsay and Bob Eckels now recruited for the effort, I would have expected Ed Emmett to show more enthusiasm. It's not showing up, though, from either him or them.

“You know, I know former Judge Eckels, former Judge Lindsay, people at the Harris County Sports and Convention Corp., are talking about it,” Emmett told reporters. “Now, how it gets formed, they have to wait and see.”

[...]

“All I can say right now is we’re working on it and trying to get organized,” Lindsay, first elected in 1974, said, describing the effort as “preliminary.”

[...]

Lindsay, however, expressed skepticism about fundraising potential, saying  he and Eckels don’t have the clout that they did when they held office.

“I doubt that we’re going to be able to get any significant money to run this campaign,” he said. “We’re going to have to run it on a shoestring.”

Charles Kuffner seems impressed by this development. I am very much not.

-- Last, more from Forbes about some other local greedy bastards. This time it's a bunch of desk jockeys at TransCanada, the company building the Keystone XL pipeline. What's wrong with it, James Conca asks?

Just Greed and Politics.

Pipeline defects have been identified along a 60-mile stretch of the southern segment of the Keystone XL pipeline, north of the Sabine River in Texas (Winnsboro, Texas). 
Sections of pipe have dents, faulty welds, and pin-holes in some sections enough to see daylight through.

The installers have been digging up parts of the new southern segment of the Keystone pipeline that only recently have been installed. 
It seems that the existing leg of the Keystone has spilled more oil in its first year than any other first-year pipeline in U.S. history (HuffPost).

With the tens of billions of dollars this pipeline will make for these companies each year, you’d think they’d spend a little extra to build it right.  Or that they’d care about using new pipe that’s up to specs. We do have specs.

I can just imagine the mid-level manager’s thought processes on this. ”Hmmm…I’m making a decision on a pipeline that is involved in an extremely political battle, that may have a huge impact on the American economy, that could make tens of billions of dollars a year for my company but that could, if done badly, destroy the drinking water and irrigation supply for the bread-basket of America, and that even has international diplomatic ramifications.”

“So, yeah, I’ll save a few bucks and go with the crappy pipe.”

I understand making money. I even understand greed. But I just don’t understand the excessive super-callousness and super-greed required to make these kinds of bad decisions that risk so much just to save what amounts to a pittance on top of already enormous annual profits.

I'll have to explain Houston and Texas Republicans to Mr. Conca sometime, I suppose.