To launch a taxi or ride-sharing app is to live in constant legal peril. Uber, one of the forerunners in the taxi app business, is slogging through lawsuits in New York, San Francisco, Chicago, and other cities — most recently, Boston Cab Dispatch filed suit and accused Uber of "running roughshod through the city of Boston." While the taxi lobby has been vocal in opposing its new competitor, ride-sharing services like SideCar face different challenges. Unlike Uber, SideCar doesn't rely on licensed cabs, instead letting drivers with extra seats pick up passengers and receive donations in return. Because of this, it's argued that it isn't subject to taxi regulations: "It's not a transportation company, it's a communications platform," CEO Sunil Paul has argued.
That hasn't stopped local governments from asking SideCar and similar apps to case operations. California's Public Utilities Commission issued $20,000 citations to Lyft, SideCar, and Uber for "public safety violations," though Lyft and Uber later had the fine suspended. In response, SideCar has gone on the offensive. Before SXSW, the company announced that it would ignore an order to stop operating in Austin, giving free rides to visitors to promote the brand. Shortly thereafter, it sued the city, asking for a decision that would affirm the right to operate ride-sharing apps. "We believe the Austin Transportation Department has misinterpreted its City Code," wrote Paul, "and that rideshare is legal and protected under Austin transportation law." Now, it's continuing its expansion into three new markets: Boston, Chicago, and Brooklyn.
"We believe the Austin Transportation Department has misinterpreted its City Code."
For now, operation in the cities will be limited. On Friday and Saturday nights, users can find or provide rides from 5pm to 3am, with more hours and days coming "as the community grows." As it does in other cities, it will also be actively recruiting users. And while this marks its entry into New York City, Brooklyn is a different market from Manhattan, where fewer people own cars and yellow cabs serve most private transportation needs.
Even so, SideCar's expansion could raise the hackles of New York's Taxi & Limousine Commission. After Uber's failed launch last year, New York said it would launch a pilot program to test cab hailing apps, but the TLC scuttled the plan with a last-minute injunction. Likewise, despite the fact that SideCar's drivers undergo background checks and must keep insurance and driver's license details on file, consumer protection regulators still may take a dim view of letting it operate without going through a licensing process. Even if payments are voluntary, it's still a business that organizes transportation, and the recent arrest of a DC Uber driver for alleged rape highlights the fact that startups aren't exempt from the safety concerns traditional companies face. But SideCar shows no signs of slowing its push to expand, and to be recognized as a legal and legitimate service.