The local cab system in Austin, Texas, can’t support the flood of people in town during the annual South by Southwest festival. The city’s old-fashioned solution—pedicabs—does little for those staying at far-flung hotels and Airbnb rentals. Transportation has always been a problem during SXSW. There’s an obvious solution, of course: ride-sharing and taxi apps like Sidecar, Uber, Lyft, Hailo, and Flywheel. They’ve been around for the last three years, but this is the first year they’ve been legal in Texas.
“In Austin, a city where people enjoy their libations, the mayor has resisted [Uber] more than almost any other city,” said Bill Gurley, an Uber investor and University of Texas alumnus, during a keynote interview. Later, Lyft CEO Logan Green noted that his company has always participated in SXSW, including offering piggyback rides in 2012, but this year is the first time it can actually offer its service to attendees.
The need for more transportation options in Austin was abundantly clear at 2 a.m. on Saturday night of the festival, when pricing for an Uber cab surged to five times the normal cost.
Because of taxi apps’ newfound legality, it’s only fitting that the two most prominent services be featured prominently on stage at the festival. Both Green and Gurley gave keynotes. While Gurley’s comments focused the “transformative” qualities of Uber, highlighting job creation and reduced traffic in San Francisco, Green attacked Uber’s ethics and growth strategy.
Green stated that Uber is an unethical company. “They’ve crossed a handful of lines,” he said. He noted that Lyft has filed a lawsuit against its former COO Travis VanderZanden, who joined Uber and allegedly took confidential internal documents to the rival company.
Green also dissed Uber’s international expansion strategy. “Uber is struggling in a lot of these markets,” he said. “They have low single digit market share in all of these countries with no immediate sign of being able to really make a dent. I don’t think their current strategy is working.” Lyft plans to expand internationally soon, but it won’t attempt to compete with taxi services there the way Uber has, Green said.
When asked how Lyft differs from its much larger, better-funded rival, Green said the two companies have “completely different visions for the world.” Lyft is different because its goal is to make cars unnecessary. “We never set out to make a better taxi cab,” he said.
But isn’t that Uber’s goal, too? “Their original motto was ‘Everyone’s private driver,'” Green explained. “Most of the population cannot afford a private driver.” It’s true that Uber has used that slogan, but the company has also expanded its target market and pricing to include cheap rides. In many cities, Uber rides are cheaper than a regular taxi.
In fact, Uber CEO Travis Kalanick said as much publicly. In February, he tweeted, “Our intention is to make Uber so efficient, cars so highly utilized that for most people it is cheaper than owning a car.”
Like the debate over Austin’s best BBQ joint, the issue wasn’t settled during SXSW. If anything, the rivalry only deepened.