A brief history of the controversial Uber mobile app

By Amy, Eastpoint Software on 18 October 2015

So Uber have won their landmark court case. What were they in court about and why is Uber so controversial?

What is it about the Uber mobile app work that was in legal dispute?

Metres are fitted to London cabs so they can calculate fares, and only taxi cabs are allowed to use these meters. Regular drivers are not allowed to use this process. The Licensed Taxi Drivers Association and London Private Hire Car Association argued that Uber drivers use the Uber app in much the same way. For Uber, information about a journey is sent to their servers and this is how the Uber fee is calculated.

It was argued that this constituted a metre, and was therefore unlawful. However, Transport for London disagree and believed the Uber app was in fact lawful. So the case was sent to the High Court to make a judgement. The judge ruled that Uber’s process was lawful and not a meter.

How long has Uber been around?

The founders of Uber decided they wanted to build something taxi and technology based back in 2008. App development began in 2009, and a prototype was produced. It was tested on a sample of three cars in 2010 and launched that summer.

A mobile app with controversy from the outset

Controvery hit almost immediately. A cease and desist order was issued in San Francisco, where the company headquarters are. This didn't stop the app being launched in more US cities. Along the way, Uber was also criticised for charging more at peak periods and during Hurricane Sandy.

The original cease and desist order was eventually removed in 2013, although other cease and desist orders continued to be sent to Uber. The reasoning behind most of the orders was that the mobile app acted like a cab company, but without the associated licenses.

in 2014 it transpired that a rival app called Lyft has been hailing and cancelling Uber jobs, and in return Uber was doing the same to Lyft.

How is the Uber mobile app monetised?

Currently, Uber takes a 20% commission on each fare. Net annual revenue is estimated at about $200m. Uber the company is thought to be worth about £10bn. 

Update: A valuation of about £50bn was put on Uber in October 2015, though this was disputed and pegged at £23bn. So still a lot, then.