Uber has tried hard to destroy itself. Its failure to do so — despite every infraction short of assaulting the customers — shows the powerful forces turning the ride-hailing app into a monopoly. Such dominance is good for neither drivers nor passengers. There is, however, an elegant answer: to copy the very symbol of free market capitalism and treat Uber like what it truly is, a stock exchange.
Online platforms such as Uber for rides, eBay for auctions or Airbnb for hotels enjoy a network effect. This very quickly results in one player in the market. The more drivers on Uber’s taxi-hailing app, the better for riders; once the riders are using Uber, the drivers can go nowhere else. That network effect underpins its $70bn valuation, forced Uber to sell its China operation to local leader Didi Chuxing, and explains why behaviour such as founder Travis Kalanick’s sweary tirade at a driver does little business harm.
Platforms are one species of the superstar companies taking an increasing share of total income in the economy, according to economist David Autor and colleagues. A dominant Uber is bad for riders, who get no choice or innovation; bad for drivers, who face a monopoly employer; bad for competitors, who have no chance no matter how good their product; bad, in short, for everyone except a few founding investors who capture most of the value in the global taxi industry, forever, simply by moving aggressively on a fairly obvious idea.