No one can fail to have noticed the Uber phenomenon. Despite numerous regulatory obstacles, the leader in ride-sharing apps has not stopped spreading across the world and is now present in 71 countries. Thibaud Simphal, Uber’s regional general manager for Western Europe, takes a look back at the elements of this American company’s success, and addresses the sometimes fraught relationship it has with its drivers.
Leaders League. Despite your dominance in the ride-sharing sector, and ever-increasing revenue, Uber has yet to turn a profit. What’s stopping this from happening and is it a concern for the company?
Thibaud Simphal. We have decided to invest massively in order to facilitate the rapid international expansion of the Uber application. To achieve this, we have raised considerable capital on several occasions, around ten billion dollars in total. Within just five years the application is available in more than 500 cities and 71 countries, where it is used by millions of passengers and more than two million drivers. Growth is currently highest in Africa and Latin America, where the authorities are welcoming with open arms this new solution for getting around. Development in Europe and the United States continues apace where Uber is considered a compliment to public transport. It’s been a costly expansion, but the outlook for the company is good.
There have been tensions between Uber and the company’s drivers in the past. Have they calmed down?
We are witnessing the worldwide phenomenon of platformization linked to technological progress, which consists of connecting service providers with those who need their services. This is shaking up numerous sectors and the situation needs to be revisited, because you can’t regulate 21st century activities and practices with 20th century rules. Technology today allows more people to be independent, which corresponds to the aspirations of the younger generation and constitutes undeniable freedom of choice. This is consistent with what drivers using our application tell us: for 87% of them the biggest plus to their work is being able to be their own boss and to work whenever they feel like it. As the drivers are independent and are not required to work exclusively with Uber, they can use rival applications at the same time, work for restaurants, bars or hotels or have their own clientele. It’s really up to us, Uber, to keep on offering them more services to convince them to use our application. Another aspect is that freelancers have, for many years, been less well provided for when it comes to social security in France, which is an established fact. We need to bring all the stakeholders together to ensure that these new independent drivers profit from technological progress (more work for them, more services for citizens), all the while guaranteeing more rights than they benefit from today (better social security, insurance, retirement etc.).
These are the issues which come up when drivers protest. We are trying to initiate reflection, propose ways forward, like when we called for a national debate on the sharing economy in France, while at the same time listening to what the stakeholders are telling us. We are a global tech outfit, but we want to be of service to cities and city dwellers in very local manner.
In your view, which initiatives are going to allow Uber to beat the competition?
What’s made Uber successful has been its operational excellence, symbolized by the emergence of the term “Uberization” and the entry of the word “Uberize” in the dictionary, defined as “to change the market for a service by introducing a different way of buying or using it, especially using mobile technology.” This provides us with a certain sense of pride, since it speaks to the impact we have made on daily life thanks to our technological and operational excellence.
Author: Marion Robert
Translator: Simon McGeady
Find more analysis articles & interviews in our 2017 Innovation, Technology & IP Report.