Disruptive Air Taxi Uber Alles

Posted by William Herp on Tue, Jan 15, 2013

I like disruptive innovation.

If you know anything about me, that’s probably obvious. I'm a serial entrepreneur and in each of my efforts, I've sought to bring new technologies and, to use the cliché, out-of-the-box thinking as solutions to problems caused, or left unresolved by conventional thinking and out-of-date business models. Linear Air, the company I co-founded and lead today, is the best example of that.

We've trumped conventional thinking about commercial air service by using fast, efficient, safe and economical new-generation air-taxi aircraft to move busy people from where they actually are to where they actually want to be, and we do it faster and with far less time-wasting and infuriating hassles than encountered when flying with the conventional airlines. Linear Air allows you to bypass the big, congested airports that can be an hour or more away from your home or office, and a long taxi or rental car drive on the destination end of your trip. You also get to skip the maddening lines and the intrusive personal security screenings.  Operating from airports like Hanscom Field in Boston and White Plains Westchester County and Teterboro Airports in Metro New York City, not only do we get you to cities and towns that have no scheduled service, we also eliminate wasted time at connecting airports when you’re traveling to, from or between smaller markets where scheduled service is, at best, inconvenient. And we do all that at prices that in most cases are quite competitive with what business travelers would pay for trips to those same destinations using conventional airlines.

Pretty disruptive, don’t you agree?

So maybe that’s why I was immediately attracted by another new disruptive innovation I’ve recently discovered. It’s called Uber. The folks at Uber provide iPhone and Android smartphone apps that solve one of business travelers’ most annoying headaches – scheduling an executive car at the last moment. Lots of business people want to avoid conventional taxis, for lots of reasons: from the difficulty of hailing a cab during peak hours or at locations where cabs don’t normally circulate, to the sometimes, uh, “unsanitary” conditions encountered in cabs.

Uber, with which neither I nor Linear Air has a relationship mind you, allows you to summon an executive car with a simple click on your smartphone in 15 North American cities, and in London and Paris. And I have no doubt that service will be spreading to more cities. But in many cases, like in the Boston and New York City areas where I live, Uber’s expansion has stirred up opposition from local or state regulators and, in some cases, the entrenched monopolistic or oligopolistic taxi companies that actually benefit greatly from the kind of regulation that puts the kibosh on real competition. In Boston, like in many big cities, conventional taxi service is tightly regulated. Only a certain number of licensed cabs are allowed to operate. And acquiring such a license is always expensive (a New York City Taxi Medallion can sell for well over $1 million). In some cases taxi licenses are impossible to acquire without the right connections to people whose powerful assistance too often must be bought (perhaps through legal political donations, but bought none-the-less).

Here in Boston Uber ran into a big problem. The local regulatory authority claimed that the Uber app, which uses GPS technology to track and dispatch circulating executive cars, actually is an illegal form of metering under the applicable taxi regulations. Thus, the executive car companies that chose to use Uber risked losing their right to operate because they would be reclassified as taxis – and they lack taxi licenses. Massachusetts regulators took the same position. And up until the last moment this past spring, so did Gov. Deval Patrick’s office. Thankfully, as reported by the Boston Globe's Innovation Economy columnist Scott Kirsnerthe Governor re-thought the matter and determined that what Uber wanted to bring to the market was exactly the kind of innovation he aggressively has been encouraging in Massachusetts.

I celebrate that decision, in part because it’s the right decision in this particular instance, and in part because this nation needs lots of disruptive innovation to help speed up economic growth and spur job creation. Uber’s successful fight in Boston illustrates perfectly the problem we have with over-regulation in virtually all aspects of commercial – and sometimes personal – life. Politicians and bureaucratic regulators, working in the name of consumer protection, often end up protecting only established, conventional providers of services or goods. That restricts business creativity and innovation, prevents consumers from accessing new, better and usually cheaper goods and services, and stunts economic growth and job creation.

I congratulate Uber on its success thus far and look forward to its continued growth and expansion. I also congratulate those political leaders who, like Gov. Patrick, have made conscious decisions to allow and encourage disruptive innovations that bring new ideas, new goods, and new services - like Linear Air and Uber - to the market in order to help people and our economy.

See you on board.


Tags: uber, air taxi, disruptive innovation

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