22 September 2017

The right are defending Uber, because they don’t really understand it

TfL's judgement isn't what stops Britain being a hub of digital innovation. But the reaction of its critics is.

Rest in peace, British capitalism. You had a good run, but thanks to Sadiq Khan’s decision to end Uber’s licence to operate in London, it’s all over now.

Even the usually sensible Conservative MPs, like Tom Tugendhat and Matt Warman, have got in on the action. Tugendhat wondered if Khan would “switch off the Internet” next, while Warman warned that the move sent “a clear message” that digital businesses were not “welcome in London”. The ASI’s Sam Dimitru describes it as “a disaster for Londoners”, who, he says, benefit from the flexibility it offers both to customers and drivers.

What all these statements do is reveal Uber’s very, very clever marketing trick, in that they’ve convinced a large number of politicians, across the left and the right, that they are a digital start-up. What they actually are is a minicab firm that has invested time and money in an excellent app.

That matters because the regulation they have fallen foul of has nothing to do with their “digital” contribution and everything to do with their human contribution. As Jonn explains in greater detail here, Transport for London has suspended Uber’s licence because of their repeated refusal to vet their drivers.

These are not problems that Uber is incapable of addressing while continuing to turn a profit. Nor can they be said to be essential to Uber’s “model”, such as it is. Frankly, there is no reason a business can’t provide the things that people enjoy about Uber – the easy-to-use app, the low cost, and the quantity and quality of cars – and address TfL’s concerns about vetting their drivers. The “disaster for Londoners” that the loss of Uber represents can still be avoided, while also avoiding the disaster for Londoners that is getting into a cab with a dangerous driver. (Uber is losing money overall worldwide but I am reliably informed that it does make a profit in London.)

What is striking is that there is an excellent example at the moment of government interference risking the future of a digital business, and it’s not coming from City Hall but Downing Street. It’s the repeated insistence from the Prime Minister and Home Secretary that communications companies such as WhatsApp “ban end-to-end encryption” in order to prevent terrorists plotting on the service. But end-to-end encryption not only protects terrorists, but anyone transferring money, or confidential details, or medical records from one place to another. Countless businesses, not just WhatsApp, literally could not function without encryption as it exists.

That there isn’t the organised wailing from Conservative MPs and the right-wing press about encryption that there is about TfL explains the real barrier to digital businesses in the United Kingdom: that our political class just doesn’t understand technology as well as it should.