Despite its reputation as an innovative and tech-friendly city, Seattle has emerged as an unlikely battleground for the future of online applications, Internet start-ups and innovative technology. The Seattle city council is on the verge of passing the most restrictive, anti-competitive and anti-Internet measure in the nation, which would keep start-up ridesharing companies like Lyft and innovative ride-for-hire services like Uber out of Seattle. The Internet community is watching closely as Seattle's reputation as a destination for entrepreneurs and tech start-ups is at stake.
Uber and Lyft use online platforms to connect drivers with riders for on-demand transportation. Transactions are conveniently cashless, with users' credit card information stored on the application, and interactive, allowing riders to rate their drivers and leave feedback, improving the quality of service. These startups are revolutionizing urban transportation options and changing the way we look at existing systems.
The Internet is a fundamentally disruptive technology and the utilization of online platforms to promote ridesharing and ride-for-hire services are no different. Not surprisingly, taxi cab companies, who have been shielded from competition for years, are fighting to keep their anti-competitive sweetheart deal in place. The taxi cab industry has run to regulators and politicians seeking protection from competition. Unfortunately, for the citizens of Seattle, these efforts are succeeding.
In the coming days, the Seattle city council will consider a measure to effectively regulate Internet ridesharing services out of existence. If councilmembers take this draconian step, it will irrevocably harm Seattle's Internet-friendly image while killing jobs, investment and economic opportunity.
It is an economic truism that competition is good for business - it's the American way. Consumers also win when a market becomes competitive and stays that way. But the Seattle city council has it backwards. The proposal before the council is not intended to safeguard consumers and increase choice, but rather to protect taxi cab companies' bottom lines and drive competitors out of town. They should drop the charade about public safety. If this debate were truly about public safety, then ridesharing platforms would win every time.
Of course, regulation to protect consumers is an important function for city government. No one in the Internet community is suggesting otherwise. But the proposed regulation is contrary to the public interest, will hurt the very consumers the council represents and is opposed by a vast majority of Seattleites.
Politicians of all stripes like to pay lip service to the Internet economy, the virtues of disruptive technologies and new and innovative thinking. But when cutting edge technologies clash with entrenched special interests with deep pockets and long histories of campaign contributions, we all know who usually comes out on top.
What happens in Seattle has implications beyond just Lyft, Uber and Seattle residents. It will affect the entire Internet interactive business model that allows individuals to use online platforms to share, rent, buy or borrow goods and services. Entrepreneurs and the Internet industry are watching how Seattle treats these start-ups and will make capital investment decisions accordingly. Telling Internet businesses that Seattle is "closed for business" sends a chilling message throughout the Internet economy.
Companies like Lyft and Uber are not only changing the future of transportation, they are also driving economic growth and job creation in cities all over the world. The Seattle city council has a choice. Its current path threatens small businesses and will destroy the city's image as a destination for innovation and entrepreneurship. Bringing competition to Seattle's transportation market will result in more choices, better prices and higher quality. Why should Seattle, home to dozens of innovative and dynamic companies, share less and be left behind?