Uber drivers colluding to trigger surge pricing: study
Some Uber drivers are colluding to drive up fares, according to a study by the University of New York and Warwick University in the UK.
It works like this.
Uber is far cheaper than a taxi at off-peak times.
But at busy times there can be too many passenger requests for the number of drivers on duty.
That’s when Uber’s automated system triggers what the company calls “surge” pricing, driving up its standard fares by 20%, 50% or even 100% or more to attract more of its contract-drivers on to the road.
Researchers from the NYU and Warwick interviewed Uber drivers in London and New York and analysed 1012 posts on the independent Uberpeople.net site.
They say they discovered that some Uber drivers were playing the company’s algorithms.
According to the researchers, drivers in the same area co-ordinate to log out of the taxi-hailing app so their cars drop off the list of available rides – artificially inducing surge pricing.
They quote a snippet of chatter from Uberpeople.net as evidence:
On the platform Driver A said: “Guys stay logged off until surge.” Driver B said: “Uber will find out if people are manipulating the system.” Driver A added: “They already know cos it happens every week. Deactivation en masse coming soon. Watch this space.”
Uber Australia New Zealand spokeswoman Katie Curran tells NBR, "This behaviour is neither widespread or permissible on the Uber platform, and we have technical safeguards to help prevent it from happening."
She also points to the company's Australasian "community guidelines," which state: "Fraudulent or illegitimate behaviour undermines the trust on which Uber is built. We may deactivate any account(s) associated with this type of activity, including: abusing promotions; collusion between rider and driver; disputing fares for fraudulent or illegitimate reasons; or duplicate accounts."