Competition Bureau: Taxi Services Like Uber are “Innovative Business Models”

The Competition Bureau has provided its stance on the emerging digital taxi services industry, such as companies like Uber, seen as changing the closed taxi model and opening it up for greater competition.

The Bureau today has released a statement as part of its period publication The Competition Advocate to say it deems these new taxi services as “innovative business models” seen to offer consumers benefits such as lower prices and convenience:

The Competition Bureau is of the view that these innovative business models have the potential to offer important benefits to consumers through more competition, including lower prices, greater convenience and better service quality for a variety of reasons.

First, digital dispatch services offer an innovative and convenient alternative to traditional methods of arranging urban transportation, such as hailing a taxicab on the street or phoning a traditional dispatcher. This is very convenient for consumers.

The Bureau also noted the concerns municipalities have raised over these new taxi services, mentioning how Montreal, Calgary and Vancouver recently banned ridesharing services and also how Ottawa and Toronto have used enforcement to prevent these digital dispatch services. Here’s what they recommend:

The Bureau believes municipalities should consider whether prohibitions on digital dispatch services and ridesharing applications are necessary and explore whether less restrictive regulations could adequately address their concerns.

The agency also stated it has received numerous complaints against the current taxi industry over the years, specifically mentioning long wait times and expensive pricing.

While the Bureau says they are aware of safety and privacy concerns raised, it says those responsible for oversight of new digital dispatch services “properly consider the impact their rules and policies have on competition and ultimately, on the prices, choices, and service quality available to consumers.”

What do you think? Should taxi services like Uber face regulations like traditional taxi companies?

Founder and Editor-in-Chief of iPhoneinCanada.ca. Follow me on Twitter, and @iPhoneinCanada, and on Google+.

  • DrDca

    Maybe i’m missing something here, but I fail to see why “digital dispatch services” should be lumped together with “ridesharing applications”. Here in Vancouver, I can use a digital dispatch service to get a regular taxi service — to me that’s quite distinct from a ride sharing service regardless of the booking method.

  • FragilityG4

    The problem with Uber is their lack of insurance coverage for drivers and passengers. Until they take responsibility and cover everyone properly I stay clear.

  • Chrome262

    They do have coverage. I don’t know why people keep saying that. All drivers have coverage.

  • FragilityG4

    They have a loop hole that they use. When there’s an accident they claim that the driver is not an employee and just a contract so their five million coverage does not apply. The drive than has to use their own personal coverage which in no doubt is unaware that the person was using the car as a “taxi” thus not being covered. The driver and passenger are on their own. This is a big problem, that’s why it’s banned many countries around the world.

  • Chrome262

    That maybe the case for the xl and I haven’t seen any data in Toronto that on any claim issues. But the black fleet is comercial and has comercial coverage. They also have taxis you can use the app for so if you are worried you can use the app to call a city taxi.

  • FragilityG4

    I’m not worried about myself, I drive and stay clear of Toronto … It’s commuting nightmare down there.

  • Tim

    Even if this is the case, life is short. You can not ride Uber if it concerns you that you’re going to be the 1 out 100,000th person affected by an incident like this, but then you also might be the guy who’s not very fun to party with.

  • FragilityG4

    Where did you get those stats from? I love a good party!! But I’m not the one at the party yelling out “Life is short” before taking a couple of shots of gasoline because someone bet me!

  • Chrome262

    LOL I don’t own a car anymore and only take public transit. Rarely take cabs, so expensive.

  • Salinger

    I’ve only heard of Germany, and that was briefly overturned and will likely be again shortly. It wasn’t over insurance per se, it was over essentially taxi permits. ie, municipalities weren’t getting their cut as is the same problem most municipal governments have with Uber’s model. They just cloak it under the guise of safety because, at least in Toronto, if safety was really the core of the issue, half the cabs in the city wouldn’t be allowed to operate.

    What are the many other countries where it’s banned?

  • FragilityG4

    Google it.

  • Salinger

    Cheers, that’s what I thought.

  • FragilityG4

    Belgium, Australia, the Philippines five US cities its own home state is trying to shut them down! Not to mention they got a “F” rating from the BBB … No regulation, questionable insurance, but hey, Uber away.

  • Salinger

    Banned in Belgium? Nope, Australia? Nope, Philippines? Nope. They’re all over the US. In fact, they’re in more than 230 cities in over 50 countries.

    We all acknowledge that the establishment has a problem with Uber, in much the same way the Big 3 had a problem when they thought Verizon might set up shop here.

    Having a problem with uber is fine; making up facts to artificially support that position is not.

  • FragilityG4

    What did I make up? I have a problem with a company that doesn’t take public safety seriously by refusing to meet minimum standards. This is not a matter of deflecting competition, it’s safety. But hey, pretend it’s anticompetitive if that makes you feel good.

  • Salinger

    You may well have some legitimate points, but you provide no backup for it. When I questioned what were the many countries where it was banned, you came back with a very short list where in fact they operate. That just makes me question the veracity of your other problems with them. Is it fact or opinion?

    You talk about insurance issues and how they use “loopholes”. If it were that well known and black and white, they wouldn’t be the success they are and as widespread as they are; especially in a litigious state like the US. They’d have been sued out of existence long ago.

    In any case, Uber ranks very low on my list of things that are important to me and it’s clear you’re not one to let something drop, so I’m more than happy to do so. Cheers.

  • FragilityG4

    Read the news, the insurance loopholes are one of the main reasons why Toronto wants it banned. Why else? I don’t care about Uber either way, I drive, but the fact is this company refuses to meet any safety guidelines, wether it’s insurance coverage for drive and passenger or training for driver. These rules are there for a reason, public safety. Why should they not follow them?

  • FragilityG4

    Read the news, the insurance loopholes are one of the main reasons why Toronto wants it banned. Why else? I don’t care about Uber either way, I drive, but the fact is this company refuses to meet any safety guidelines, wether it’s insurance coverage for drive and passenger or training for driver. These rules are there for a reason, public safety. Why should they not follow them?