When Uber arrived in Toronto three years ago and challenged the taxi industry's legally protected monopoly, City Hall had two choices: Ban Uber, the way Vancouver and Calgary have done, or find a way to let consumers take advantage of its many benefits.
Toronto chose the latter, with Mayor John Tory leading the chorus of those who said the ride-sharing service was just another step in technology's inexorable march, and to fight it would be to fight progress itself.
A noble sentiment. So it will be interesting to see whether Mr. Tory feels equally progressive now that Uber is challenging another Toronto sacred cow: the city's protected monopoly on local mass transit services.
That gauntlet was thrown on Monday when Uber announced a new service called UberHop. Until then, Uber had been content to connect people looking for rides with drivers offering one, via a smartphone app. It's a taxi service, basically, but without the restrictive, cost-inflating rules of a regulated municipal monopoly.
Now that same smartphone app will allow people to gather during the morning and evening rush hours at fixed pickup spots to catch a ride with four or five other passengers in an SUV or minivan. The driver will then take his riders to a fixed point at the other end of the line – a transit service, in other words, but without the inefficient infrastructure of the Toronto Transit Commision. The cost is $5 each way.
As of Tuesday, UberHop was running four lines between the burgeoning condo developments on the edges of the downtown core and the financial district in the heart of the city.
Because of rapid growth in and near downtown Toronto, the TTC has been overwhelmed. In some central neighbourhoods, its streetcars spill over with harried riders during rush hours, and are also hampered by a huge volume of cars, containing one passenger each, gridlocked on the streets heading into the core.
The reason for this is that public transit planning in Toronto has always been guided more by politics than economics. New lines are added to appease the largest number of voters, not to snag the largest number of riders – witness the expensive, underused Sheppard subway line. The money would have been far better spent in the high-density neighbourhoods UberHop is targeting.
Allowing the private sector to provide competition for an overburdened public service, by offering a cheap shuttle ride, is a brilliant solution to a pressing problem. It relieves the pressure on streetcars by giving riders another option, and may even remove cars from the streets, if fewer people resort to driving alone.
It's hard to see how anyone loses with the arrival of a private company offering needed transit to willing, paying customers. The problem, though, is that it is illegal. The City of Toronto Act gives the TTC the exclusive authority to "establish, operate or maintain a local passenger transportation system within the City."
Officials announced Monday that the city was lawyering up in response to Uber's new insurgency. The union representing TTC workers has also come out swinging and demanded the city protect its members by enforcing the TTC monopoly. Its president, Bob Kinnear, is (predictably) predicting a traffic apocalypse if UberHop, not to mention Uber's unlicensed taxi service, is allowed to exist.
"All they will do is create congestion, chaos and conflict on Toronto streets, especially in the downtown core, where congestion is already intolerable," he said. Yes, congestion in Toronto is often intolerable. But no current city or TTC plans do much to relieve it in the neighbourhoods where UberHop is operating.
The big question now is, will the Mayor and the city be consistent in their logic? They've maintained that allowing Uber to run over the taxi monopoly is justifiable on the grounds that technology like Uber's ride-sharing app is coming whether we like it or not – and it turns out a lot of customers and voters rather like it. Now that same technology is knocking on the door of the TTC. Will the city make way for UberHop, too?
It should. It makes sense to allow the private sector to fill the gaps where the TTC offers limited or poor service. The City of Toronto Act already makes exceptions for taxis; UberHop certainly falls within the bounds of a taxi service – it's a stretch to call it a bus service. As well, it promotes an inexpensive and sane use of city streets, with people going to the same destination sharing rides rather than driving alone, or taking a taxi alone, or waiting fruitlessly for a streetcar they can't get on.
And the best thing about it? If people don't like UberHop, or any other private transit offering, they won't use it and it will go away. It is entirely demand-driven. It's called the free market. If the TTC can do a better job in the neighbourhoods Uber is going after, it should. But if it can't, it should get out of the way.