“Is Uber going to come back to Austin? They have to, right? I bet they’ll be back by SXSW.”
It’s a question and an assumption that’s been discussed a million times over in our city.
And we’re left to guess. Or we listen to the rumors circulating among drivers and riders. It might be inside knowledge. But, chances are, it’s just another guess.
Now, we have some answers — although Uber’s future in Austin remains unclear.
Trevor Theunissen, Uber’s public affairs manager, is part of a new wave of Uber officials intended to give the San Francisco-based company a new voice and face in Texas following a painful defeat for the company in Austin’s Prop 1 election in May that led Uber and its chief rival, Lyft, to give up on Austin.
“…we were kind of painted as a corporate bully for a variety of reasons throughout the campaign. And that’s really what the campaign became about — instead of about the issues of the day.”
But it’s not over. In an extensive interview with Austin Inno, Theunissen described a new vision for Uber in Austin. It’s one that includes another round of conversations at city hall over the pivotal issue of fingerprinting drivers. It’s about revamping the company’s reputation in Austin. And it’s about self-driving cars — someday.
The debate has a few new factors. The state legislature is poised to debate a statewide law in its upcoming session in January. Five of Austin’s 11 city council members face election contests this November, including several who voted in favor of stricter regulations for Uber. And the ride-hailing companies that replaced Uber and Lyft continue to struggle to handle peak demand during big events, like this weekend’s Austin City Limits Music Festival.
Now, refreshed with new faces and new tactics, Uber wants to find a compromise at city hall that could allow the company to resume service in Austin, which could radically shift the ride-hailing marketplace and the seven new companies trying to fill the Uber and Lyft void.
What you’ll read below is the conversation between Austin Inno and Theunissen, edited slightly for brevity and clarity. The conversation occurred at a downtown coffee shop a day before the first weekend of ACL Festival, which is likely to be the biggest test yet of the emerging ride-hailing startups that have replaced Uber and Lyft in Austin.
What Uber Has Done Since the Prop 1 Election
Austin Inno: What has Uber been up to since going dark after the Prop 1 election in May?
Trevor: We’ve been up to a lot. We have about 40 employees in our Austin office. Our Austin office oversees the operations of Oklahoma, San Antonio, Austin, as well as the surround areas. We also have our other product, UberEATS, which is growing tremendously, and we’re running some of those operations out of this office, as well.
I think one of the things that Prop 1 showed us is that we need to have better community relationships, that we need to be able to go out into the community and tell our story in a more effective way and that we need to build third-party relationships and better relationships with riders and drivers.
I think one of the other things we’ve been up to is going around the community to figure out how we can be better involved in Austin, how we can be part of the city and how we can understand the city better. I think at the end of the day what our services provide is a true city-based service. It helps people get around their city in ways that were never possible before. And, in order to do that, to be effective at our job, we’ve got to understand what drivers and riders have come to demand and expect and what their challenges are.
Since I’ve been on the ground the past two and a half months, one of my important focuses is to figure out how we can become more involved, more ingrained and become part of the furniture of Austin and really understand the community in ways that we didn’t during Prop 1 and before Prop 1.
AI: Tell me about some of the new faces at Uber. You’re new in Austin, since about the 4th of July. Does Uber have new people in town as a result of Prop 1 or just regular turnover?
Trevor: Part of it is regular turnover. But I also think we saw there was a need to really focus on Texas and Austin in particular. So we’ve got a new GM in Dallas. We have a new GM here in Austin. And, on the public affairs side, I’m a new face here in Texas and in Austin. I think we essentially created Texas as its own sub-region within our company on the public affairs side.
“Look, I think we did create obviously some bad blood in the community with certain members and certain groups, and that’s unfortunate. I think we have to take a step back and see what we did wrong.”
After Prop 1, I think it needed a new look and a new approach, and obviously [the election] didn’t turn out the way we wanted for a lot of different reasons. But one of the things that has been well-received in this community is having new faces and trying to really understand the community in a better way and having a new tone.
I think one of the unfortunate things is we were kind of painted as a corporate bully for a variety of reasons throughout the campaign. And that’s really what the campaign became about — instead of about the issues of the day.
AI: It seemed like, in the heat of the moment, Prop 1 created a lot of enemies for you guys. Do you have any particular regrets on how much money was spent or the message that was sent to the community?
Trevor: Sure. I think the unfortunate thing in all of this is that these topics and these conversations are really difficult. These policy challenges are really difficult, and they’re being dealt with all over the country. And you can’t communicate those in a soundbite. And it’s really hard to do with a TV ad or direct mail or a text message. So I think there’s a lot of passion, which we engaged in Prop 1 to get all the signatures to put it on the ballot because we really believe in the service that was offered.
The other thing, too, is you’ve got to remember that Austin had one of the best ordinances in the country before the new city council got elected and went down this path of fingerprinting. So, for us, it was very frustrating that we created a business around the rules that were in place, which were really good as far as we were concerned. And they changed mid-game.
So the Prop 1 ballot initiative is the way we decided to go. Now, look, I think there were some mistakes that we made, obviously. The election didn’t turn out as we wanted. And I think the election became more about our tone and our tactics than about what actually the issue was about, which was fingerprinting, which we can debate all day. But Uber felt strongly fingerprinting has inaccurate records… and that people are discriminated against based on the arrest record.
AI: And you had some people on your side on that, too, right?
Trevor: Yeah, we had numerous organizations and criminal justice reform groups. And former Attorney General Eric Holder wrote a letter to the same effect that fingerprinting and the FBI database should not be used as an employment screening tool. It’s a collection of arrest records that law enforcement use to find out if somebody committed a crime and to pick up fingerprints at a robbery scene or any other thing. It was never intended to be used as an employment screening tool.
Debating Safety: App Tech vs Fingerprints
AI: Yeah, it sounds more robust and cooler than it actually is.
Trevor: Yeah, it’s an antiquated and outdated system that is still really effective for law enforcement. But when you use it to make a hiring decision or on-boarding decision, as is our case, it’s not a great source. And there are many reports and people out there who will tell you that.
Look, I think we did create obviously some bad blood in the community with certain members and certain groups, and that’s unfortunate. I think we have to take a step back and see what we did wrong. And I think that’ has been in the process in the last several months, and having these new faces is really the after-action study of what did we do wrong and what can we do better.
We want to be a part of Austin. Over 200 million people in this country have access to Uber. And Austin is not one of those. Austin is one of the largest cities, if not the largest city, in the country without Uber and without Lyft. So, why is that? And how do we get through, given that Prop 1 happened. And, how do we find a path forward with the city, the mayor and the city council and the community? That’s what we’ve been focused on. I’m hopeful that we can find a solution in the short term, and I think that based on the conversations I’ve been having at city hall and that we’ve been having with community leaders and thought leaders throughout the community and drivers and riders.
There’s a real desire, I think, to get us back. And not only from just a ride-sharing perspective, but for self-driving cars and for Uber Pool and for Uber Access. Those were products that were here before Prop 1. UberPOOL, which was carpooling service and UberACCESS, which are wheelchair accessible vehicles — those are no longer here today. The other TNCs that are in the market don’t offer those, and those are the future — as well as self-driving cars.
So I think that’s why we want to be back obviously to offer drivers the economic opportunity they had on the platform before Prop 1 and riders the access to lower wait times and be able to push a button and get a ride fairly easily but also the new technologies that are out there.
“Uber would not be as successful as we are if we weren’t safe. There’s a financial advantage for us to be safe.”
Last week, we launched a new feature in the app that we think provides for better safety, and that is facial ID. All over the country, at different intervals throughout the day, a driver can and will be prompted to take a selfie and in real-time. We match that selfie picture against that documentation they submitted when they on-boarded, namely their drivers license picture, to make sure the picture matches. There’s a real-time check every time somebody matches with a driver and there’s that real-time check when the rider sees the face and matches it before they get in the car. So we think the technological advances that are happening on a daily, and weekly and monthly and yearly basis around safety should really be embraced. And that’s what we should be talking about. And I think we’re committed at Uber to advancing technologies that make the trip and the ride safer and it’s not just about a pre-screen fingerprint test. It’s about the technology built into the app.
AI: I think, for a lot of riders, those features are more important than the fingerprint check. But do you think you can convince lawmakers these features are superior and could make a moot point out of fingerprinting? My assumption is they’d say, ‘that’s great, but fingerprinting happens on the front end,’ so they feel they’re guaranteed they’ll know for sure the applying driver is the person they background checked.
Trevor: I think one of the really interesting things we learned from Prop 1 is that not many people really knew that Uber did background checks at all. So we had to start there to tell the story that we do a background check and we have a very comprehensive safety screening process. And it consists of all of these things — sending people to courthouses to check the arrest records at their source. It’s not just a database check. We check records at the source.
But we have to do a better job of telling people what we do on the front end and educate people on our process. What I’ll also say is 34 states around the country — 34 legislatures, governors and state police and departments of public safety — have embraced our background check process, as well as numerous cities across the country. So, it is not as if nobody has wrestled with this issue and Austin is the first city to wrestle with the issue of fingerprinting versus our background check process.
I think people value the safety in the app. At the end of the day, Uber would not be as successful as we are if we weren’t safe. There’s a financial advantage for us to be safe. Anytime something happens, whether it’s minor or severe, it’s on the front page of the newspaper, and it’s Uber attached to that. So, look, we have to make sure not only the pre-screening of the driver, but also the real-time safety in the app and in the trip and after the trip, are safe.
As we continue to talk about safety at Uber and what that entails, we’re trying to tell that story that this is about more than fingerprinting. And, even if it were about fingerprinting, there are 34 states and governors who have said Uber’s background check is great.
Uber’s Renewed Efforts at City Hall
AI: What can you tell us about the meetings you’ve had with Austin City Council members and their staff and how receptive or unreceptive they’ve been? And where do you see it going?
Trevor: Sure. I think one of the things the council and the mayor said around Prop 1 was they wanted Uber to come back to the table. And so we’re back at the table. And we have had numerous meetings with city council members and their staff and we’re having that conversation. We have new faces, we want to be back in the community we think we provide a real value. We think the other TNCs aren’t necessarily meeting the demand out there that we saw. And we want to be part of the solution to the city and mobility problems. So, given that prop 1 happened and that had an outcome that we have to live with, what does that path forward look like?
I think the conversations we’ve had at city hall have been very encouraging and productive. I think there are still challenges that are there about what does Uber potentially coming back into the market look like? And so I think that’s where the real negotiating is, but, to the mayor’s credit, he said ‘I think people should vote against Prop 1 because I want Uber back to the negotiation table,’ and we’re back.
So, for those who wonder, ‘when is Uber coming back?’ I think it’s as quickly as we can find some common ground with the city council and they get in a position where they believe that they’re honoring what prop 1 stood for and also feeling that the constituents are wanting Uber back in town.
AI: Are you guys working in concert with Lyft still? I know during the Prop 1 campaign you worked together. Is that still the case?
Trevor: From a competitive perspective and a business perspective, there’s a lot of laws around working with competitors around antitrust and competitive stuff. But on the public policy side, yeah, we certainly are in communication with them. They have a strong desire to be back in the market, as do we. And since we’re the two companies that left after Prop 1, I think we probably had similar ideas on what a compromise to get back into the market would look like.
The other thing, too, though, is… the state legislature is very interested in this topic. And part of the reason they’re so interested is that 34 other states have figured out a way to solve this at a state level. And I think Austin, and the situation in Houston, really elevated this conversation in Texas. So the legislature goes into session in January.
We’ve been contacted by numerous state lawmakers who want to find a solution to this on the state level or are interested in what’s going on. And, for us, a state bill is ideal. It creates regulatory certainty for the business across the state. And, especially on a transportation service, you cross jurisdictional boundaries every single trip, practically.
It creates market inefficiencies and it just doesn’t make much sense. So statewide regulations are an ideal scenario for us. But, that being said, even if the state does act, which we don’t know if they will, who knows what that looks like? And a potential effective date of that bill, if it does get passed, could potentially be September of 2017. I think we would like to be back in Austin way before that date. And I think that’s what we’re working towards.
AI: Is there anyway to quantify or give a sense for people of how much money and business is being lost for you being out of Austin? How big of a deal is it?
Trevor: I think it’s pretty substantial. I think a good metric to look at is the amount of drivers who are out there. Before Prop 1, it was said that Uber and Lyft had over 15,000 drivers in the city of Austin.
AI: Do you agree with that?
Trevor: Yeah, I think that’s a fair number. I think the situation we have now… is a little over 4,000 drivers who have been fingerprinted. That’s a good metric to look at.
You had 15,000 drivers as opposed to 4,000 drivers now and with the same demand. UT students are back to school, we have big events happening, and, not only Uber, but TNCs created a demand for the service and a lot of people rely on it. And those people are continuing to rely on it with far less supply and a scattered marketplace.
There are so many lost Notre Dame fans in downtown Austin right now trying to figure out life without Uber/Lyft.
— Dustin Blanchard (@dblanchard) September 4, 2016
We have seven TNCS that are officially operating, how do you know which one to download? If you’re a visitor to this city, how do you know which one to go to? The beauty of the Uber app is you can open the app all over the world and it’s the same experience and you’re guaranteed a ride and hopefully in not a lot of time. What we’ve seen, just anecdotally on Twitter and social media and just walking around the community, is that there’s a real desire to have us back because there’s a real unmet need and there’s an unmet demand out there that I think is frustrating to people.
AI: Do you expect to be working in concert with or have opposition from the TNCs that have moved into Austin since you left?
Trevor: I don’t know. It will be interesting. If I were one of those other TNCs, I’d say it benefits me that Uber is not in the market. And I think that’s why you saw such an explosion of TNCs come here and try to start here.
I think one of the interesting things is that they have agreed to comply with the mandatory fingerprinting requirements. So how is that affecting their business? Our perspective is, yes, it is affecting them.
Do they lobby or do they advocate to keep us out of the market so they can continue to gain market share or keep their market share? Probably. I think that’s a competitive advantage for them. But, at the end of the day, I think if there were to be a non-mandatory fingerprinting structure it would be interesting to see if they stick to mandatory fingerprinting for all of their drivers to be the fingerprinted TNC. Or do they say ‘wait a minute, maybe this fingerprinting thing isn’t all it’s cracked up to be. I want to be a non-mandatory fingerprinted TNC?’
In all of this, I think that’s the main point — they’ve always said we’ve got to provide choice. A lot of people who voted in Prop thought it was a vote for choice — that there should be fingerprinted drivers and, if there doesn’t need to be fingerprinted drivers, people should have that choice. And if I, as a rider, value a fingerprinted driver, I should be able to choose that. And if I don’t care about that and I just want the closest ride, I should be able to choose that.
AI: Kind of like Mayor Adler’s “Thumbs Up?”
Trevor: Correct. I think it will be interesting to see what the other TNCs do, whether they’re involved at the state legislature as that debate starts happening or whether they’re just focused on Austin, given the current situation here. Or whether they have plans to expand to other cities and other markets.
I think we’re committed to Austin. We want to get back.
Austin May Have to Wait for Uber’s Self-Driving Cars
AI: How likely and how soon do self-driving cars come? And, if so, does Austin get them, and does that throw fingerprinting out the window? There’s a lot of moving pieces to that because I assume that even if self-driving cars were to come to Austin, there wouldn’t be 10,000 cars all at once.
Trevor: I think self-driving is the wave of the future. It’s been really interesting to see the feedback we’ve received in Pittsburg where we’ve put them on the road a few weeks ago. Right now, in Pittsburgh, if you request a ride there’s a chance you may get paired with one of the limited number of self-driving cars out there.
Look, at Uber, I think we believe that that is certainly part of the future and that’s how people are going to get around their cities. There are a lot of other companies and a lot of other people who believe that, too. And that’s why you see so much investment in that sort of technology.
But, at the end of the day, you’re right, we’re not going to have 10,000 self-driving cars in Austin overnight. I think that’s still a very long way away. But there’s a real desire by Uber to have self-driving cars testing in other cities, and not just Pittsburg. And one of the interesting things for us is Austin is a very tech city and I think it has a real desire to have self-driving testing. We had some mapping cars on the road here a few months ago. That got a lot of attention. Is Uber back? Or what are these mapping cars going around the city?
AI: Yeah, it stoked the fire a little bit.
Trevor: Sure. I think that shows we’re interested in Austin as a city. I think one of the challenges though is we can’t even get regulations around our core business right. So, there are a lot of other cities that want self-driving technology where we have great regulations and we’ve been really well received.
So, from that perspective, is Austin on the list of where we’re going to roll out self-driving? Yes, absolutely. One day. But I think those cities that have figured out how to regulate ride-sharing are probably going to be higher on that list than a city like Austin where we have a tough regulatory environment for Uber’s core business, which is the ride-sharing business.
AI: Well, you bring in 20 self-driving cars and turn the Uber app on just for self-driving, immediately nobody is going to be able to get a ride because the demand is too much for 20 cars.
Trevor: Correct. That’s the name of the game — scalability. I think you see the other TNCs struggling with that as startups, and we struggle with that, for sure, and we continue to struggle with that.
I think ACL this weekend it will be really interesting to see how the demand for TNCs has been met. Obviously, people have come to rely on TNCs to get around. And, without the two largest ones in the city, it will be interesting to see where all that demand goes and how the other TNCs are able to handle it.
We had major challenges around ACL, the last two years, and we continue to have major challenges around special events. Basketball, football, games, special events, festivals — it really is a hard thing to do to ramp up the supply of drivers to meet the demand when the demand is coming out of three different exits. How do you from a capacity perspective handle that while keeping wait times low and keeping prices low? I think it will be really interesting to see how the other TNCs can handle that this weekend and next weekend.
November is an interesting point of the timeline of when we could come back or when a deal or compromise could be reached.
Handling Huge Crowds and Peak Demand at ACL Fest
AI: How did Uber and Lyft handle ACL that past two years?
Trevor: I think really well. Certainly, there were challenges.
AI: Obviously, there was surge.
Trevor: Sure. There was a surge, and I think our goal is to always keep surge down. Surge isn’t good for us, but it’s the mechanism by which we can make supply and demand correlate.
I think we performed well and people were generally pleased. But there were challenges. When that one big show lets out and people are leaving the festival, that’s going to be a challenging time. So you’ve got to figure out how to have consistent supply out there to meet the demand. That’s done through driver incentives. That’s done through marketing. That’s done through communication with drivers. So it’ll be interesting to see how that all happens.
AI: I think ACL will be really interesting. ACL, probably, has 50,000 people from out of town — way out of town. (Attendance is typically about 450,000, total.) People who are traveling… they get the ‘oh shit’ moment when they land at the airport. There’s no Uber, and they’re used to it… it’s like an alcohol-free airport. What the hell is going on?
Trevor: Our desire to be back in the community is strong. I think we have learned a lot of lessons from Prop 1. And I think having new faces here in Austin, on the ground, we are committed to learning from the mistakes that were made and also becoming part of the community again.
I think with UberPOOL and UberACCESS; with our partnership with transit agencies around the country; with our partnerships with hospitals and medical providers to deliver patients to appointments on time; to partnering with MADD to lower DUI rates… hopefully, there’s a vast array of opportunity for us to partner. And I think that’s something we do well and it’s something we want to do again in Austin.
I think the frustration for us, and you saw this in Prop 1, was the rules changed on us midway. We felt like there was no problem to solve. The sky wasn’t falling. Everything was working really well. And then all of a sudden, for whatever reason, fingerprinting was entered into the conversation with the knowledge that Uber and Lyft were vehemently opposed to fingerprinting, for a variety of reasons. And so I think that spilled over into the election and some of our tone and tactics during the campaign, because of that frustration… so let’s really have the conversation about what safety is, which is a lot of technology advances, it’s seeing your driver on the app, it’s those sorts of things if that’s really the conversation.
I think we’re committed to Austin. We want to get back. We’re back at the negotiation table with the city. We’re having productive conversations with members and staff, and I’m hopeful we’ll be able find a solution in the short-term. The other interesting thing is there’s an election out there in November where some of the members are up for election.
(Theunissen said Uber will stick to its policy of not donating to candidates’ campaigns.)
The beginning of November is an interesting point of the timeline of when we could come back or when a deal or compromise could be reached.
Featured Photo Credit: Krisztian Bocsi/Bloomberg