Socio-economic and Legal Assessment Report

Running head: Socio-economic and Legal Assessment Report of Uber
Socio-economic and Legal Assessment Report of Uber
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Socio-economic and Legal Assessment Report of Uber1
Executive Summary
This socio-economic and legal assessment report studied the case of Uber and analysed the
business model of the company. It has been found that the company is majorly based on the
concept of sharing economy. The company was founded in 2009 and started its mobile
application based cab booking service. It is the first of its kind and has been quite successful. The
report studied and found the major drivers of the business of Uber. The socio-economic changes
and technological changes are the main factors that boosted the growth of Uber. The inclination
of people towards collaborative consumption has also supported the growth of Uber. The concept
of sharing economy is clear to the people now and they understand that it reduces their cost of
travel and thus Uber has expanded and has the largest market share. The disruptive technologies
such as internet on mobile and location sharing via mobile are the basis of the organizations
business and the improvement in this areas has helped the organization to grow. However, there
has been many criticisms against Uber as it worse off the condition of traditional taxi drivers but
the benefit it provides by reducing the cost of the sector is a commendable task. Efficient
resource allocation and utilization are additional benefits provided by the organization. The
political factors such as industry rules and regulation has significant impact on Uber. The
business model of Uber has sustained only due to the sharing economy. Therefore, the report
found the different aspects of the business model of Uber and thereby recommends strategies for
long term sustainability of the firm.

Socio-economic and Legal Assessment Report of Uber2
Table of Contents
Introduction......................................................................................................................................3
Literature review..............................................................................................................................4
Impact of legal framework and political factors............................................................................10
Conclusion and recommendation..................................................................................................13
Reference List................................................................................................................................16

Socio-economic and Legal Assessment Report of Uber3
Introduction
The report focuses on the study of app cab giant Uber. In this study report the main
aspect that shall be covered are socio-economic and the legal areas that affect the concerned
industry and thereby the concerned company. The full name of Uber is Uber Technologies, Inc.
and the company started its business first with the peer to peer ride sharing services. Currently, it
is the largest app cab service provider in the World. It was founded in 2009 by Garrett Camp and
Travis Kalanick. The socio-economic problem of the hiring a private cab driver at high price
(Acheampong et al. 2018). The objective of the company was to reduce the cost of riding by
sharing the cab service with another person. The company does not only solved the problem of
high price for cabs but also reduced the problem of unavailability of cabs during urgent hours.
Thus, the company solved the problem improper resource allocation in the cab industry largely.
It has not stopped there with the cab service only. With change of time and innovation in the
technological area and the change in habit and demands of the people, the company has come up
with other services as well and met new demands of the people addressing the socio-economic
change. The company has introduced new services under its new subsidiaries such as Uber Eats
and Jump Bikes (Shaikh and Sia 2018). It has also acquired Careem a Dubai based app cab
company that serves the countries in Middle East, South Asia and Africa. Therefore, it can be
seen that Uber has always been eager to respond to the socio-economic changes. Uber eats is a
food delivery service app using which people can order food of their choice from nearby
restaurants. On the other hand, Jump Bikes are the electric bike rental service mostly popular in
the United States, France, Canada, Portugal, Germany and Mexico. Therefore, it can be observed
that Uber has taken all its steps addressing the socio-economic trends. The trends that affecting
the business of Uber are people’s dependence on outside dependence on restaurant food,

Socio-economic and Legal Assessment Report of Uber4
increased rate of availing cabs even for shorter trips, awareness for environment pollution. In
addition to that people’s tendency towards liking pick and drop facility at door service, cost
cutting attitude, prefer travelling in group than alone due to safety purposes and other socio-
economic service that affect the safety and financial status of people (Kim, Baek and Lee 2018).
Therefore, the report discusses the above mentioned socio-economic trends in detail.
Additionally, the report makes literature review to put light on the key issues and current
company concepts that are affected by the social, economic and technological changes. Apart
from that, the report puts emphasis on the legal and political aspects that the impact the business
of Uber. Under legal aspect, special focus is being given on anti-trust laws and under political
factors economic growth has been considered in this report.
Literature review
Brishen Rogers has emphasized on one of the major issues and that is social cost that the
app cab service providing company imposes on the nations it is doing business. The first social
impact made by the company is on the car hire sector. The car hire sector was highly fragmented
and cost of getting cab, waiting for cabs and gap of the communication between the passengers
and cab drivers are the main problems in the sector that Uber reduced by addressing these
problems (Hou 2018). The company has integrated the sector both vertically and horizontally.
This integration of the industry has reduced the cost of the sector and thus it helped to reduce the
fare of the cab service. The benefit of it is extended to the passengers as they are able to enjoy
the same service at a much lower cost and along with that, the waiting time for cab has reduced
by significant amount. The multiple options for payment system such as debit card, credit card,
app wallet and cash has made it much easier for the passengers to avail the cab service (Alvarez
and Argente 2019). However, apart from these benefits there are harmful effect of advent of

Socio-economic and Legal Assessment Report of Uber5
business of Uber. Starting from its foundation day the company has grew manifolds. The worth
of Uber business was $40 billion in 2015 as per the article (Rogers 2015). It had become the
largest cab service providing company in the US. The major negative impact of this has on the
individual cab drivers who lost the business gradually going out of business. For survival, they
are left with only one option of becoming a driver of Uber cabs. The main allegation that is being
imposed upon Uber is that it is not going by any specific fare charge. It is charging well below
the market standard charge of normal private cabs. Apart that it is discriminating customers by
charging different fares to different passengers. Including these issues there are no fixed pay for
the drivers and along with that there are not health polices for the drivers (Agarwal 2019).
Therefore, even though passengers are benefitting from low prices during normal hours but
during peak hours they are paying more than market standard. These are all the visible issues that
are directly related to Uber service but the most important issue from the passengers end is that
the company is storing the bank card details of the passengers which is not legal and apart from
that, it is unethical also. Due to this, the passengers are financially under threat of monetary loss
if the servers of Uber are being hacked and in that case, it is unclear who is to be held
accountable for such incidence. Hence, it is evident that with many beneficial effect Uber comes
with significant disadvantages. It is argued that by using the above mentioned strategy Uber is
trying to capture whole market and eventually become a monopoly company in the cab sector
(Gabel 2016). Therefore, it is possible that the low fare price situation in the cab industry will
possibly change in the future when passengers have to pay high for taking service from Uber as
there will be no option left to the passengers to choose from since Uber has captured all of
market share by then.