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Can a New Ridesharing Upstart Threaten Uber?

Get Me is the newest entry, but likely not the last, in an increasingly competitive market that Houston officials continue to monitor.

Less than two years after Uber disrupted Houston's taxi market -- with most of that time spent largely competition-free -- the company now finds itself the established player facing upstart competition.

Get Me, a Dallas-based company that launched in North Texas in August and Austin earlier this month, is scheduled to start serving Houston on Thursday.

The company, similar to Uber and others in that it connects clients and drivers via a smartphone app, offers rides for people and the delivery of goods.

In the company's parlance, it is providing something or somewhere, said Jonathan Laramy, Get Me's co-founder.

"We built around those SOS moments," Laramy said this week from Las Vegas, where the company will launch next month. "We all have these different scenarios where we're having people over and need something, or you have an emergency and need to get somewhere."

Every driver who accepts passengers will comply with the city's regulations regarding paid rides, company officials said. Many drivers who have signed up so far are already approved because they are joining Get Me after stints as Uber drivers, Laramy said, and will likely work for both organizations.

"They should do whatever works best for them," he said. "The drivers deserve to earn a fair wage. If that's with us, great."

More competition likely

Get Me is the newest entry -- but likely not the last -- in an increasingly competitive market that city officials continue to monitor. An industry ruled for decades by entrenched taxi companies is facing massive upheaval in a short amount of time, with Uber establishing itself as the dominant player.

Get Me's entrance into the market, however, indicates that Uber's position as chief disrupter is by no means secure.

"That's the way capitalism is supposed to work," said Dean Baker, co-director of the Center for Economic and Policy Research, based in Washington.

Taxi companies enjoyed a virtual lock on paid rides for years, Baker said, and as a result many didn't adapt or focus on customer demands.

"Uber disrupted that, and that is a good thing," he said.

Still, disruption doesn't mean abandoning safeguards or closing off competitors. Baker said cities are empowered to decide what rules to make all drivers follow, then not make those rules so cumbersome as to ward off new companies.

"I think Uber, understandably, they want to be it," Baker said. "I get why they want that. They want the change to benefit them."

In Houston any growth is currently going Uber's way. As part of broader changes proposed to the Houston codes governing paid rides, the city has decided not to add to the 2,480 taxi permits available, except for a pilot of 25 permits to allow independent drivers to form a small cab company.

Roughly three-quarters of the city's taxi permits are held by Greater Houston Transportation Company and Houston Transportation Services, the parent companies of Yellow Cab and Lone Star Cab.

Latest coverage: Stay on top of the latest Chronicle stories on Uber

Taxi firms aggressively advertise their ability to compete with Uber for space on smartphones. Yellow Cab has a Hail-A-Cab app, while Lone Star and other cab companies joined Curb, an app that coordinates rides. A handful of other apps also exist.

Uber, however, dwarfs its competition in terms of brand awareness, riders said, and many applaud the company for breaking the cab companies' hold on the market.

"Everyone I know uses Uber," said Katie Stone, 23, who lives in Midtown. "I have never heard of... what was that called again?"

Success in the ride market also has Uber looking at other options and expanding its offerings. From the basic Uber X service in Houston, the company also offers black car service and XL service aimed at giving rides in larger vehicles. Uber also has tested delivery service, called UberRUSH in New York, San Francisco and Chicago.

Local setbacks

Dominance, however, has come with setbacks in Houston. Uber continues to criticize rules the City Council passed last year, specifically the requirement that all drivers undergo fingerprint background checks. The company has encouraged passengers to urge council members to change the rules, calling them onerous and unnecessary.

Council members say fingerprint checks are essential, especially since city staff found numerous Uber drivers last year who had passed the company's background check but failed the city's scrutiny.

Attempts during this year's legislative session to have the state supersede the city's authority, imposing rules that would not include require fingerprint checks, failed. Last week, an Austin City Council committee approved rules requiring fingerprint checks. San Antonio made fingerprint checks voluntary to lure the app companies back, after Uber and another paid ride company, Lyft, left town.

Meanwhile, many Uber drivers have grown increasingly frustrated with the company, especially former cabdrivers that jumped to Uber's black car service.

A recent increase in the company's share of each trip's cost -- to 28 percent from 20 percent -- irritated drivers, though the increase only applies to new drivers.

Others have complained an oversaturation of drivers has made it more difficult to make a living, pitting the full-time UberBlack drivers against the part-time UberX folks. UberBlack drivers organized in August at Bush Intercontinental Airport, and have had preliminary discussions about striking.

In Houston, Get Me is feeding off uncertainty about the deal drivers have with Uber.

"We love Uber, they paved the way for this crowd-sourcing economy with the other (companies)," Laramy said. "But when we got into this we came in and said 'Can we make this work for the driver, so it's something they want to do?' What we found is you can maximize the amount of money from a driver's perspective over the course of an hour."

This helped inspire the "something or somewhere" model, Laramy said. By adding deliveries, drivers need not rely solely on carrying passengers to make money.

300 drivers signed up

Get Me, working out of a trailer in a parking lot on Washington Avenue, has 300 drivers signed up, exceeding its goal of 100 before Thursday's Houston launch.

Robert Kyamusugulwa has driven for Uber for about six months. He was among a handful of Uber drivers signing up with Get Me on Tuesday.

"I'll do what makes the most money," Kyamusugulwa said.

In Dallas, Laramy said he was surprised to see the company handle more deliveries -- about 65 percent of its requests -- than dropoffs.

Clients use the app to choose a store and list the items they want to buy. The drivers accept the errand, often based on their location, go to the store and purchase the items and deliver them. The delivery charge is 10 percent of the price of the items purchased, plus a fee based on the distance of travel, starting at $15 within five miles.

Laramy said the company competes with Uber for rides, based on offering numerous promotions and sales, which keep their prices about the same as an Uber trip. Driver satisfaction is central to the company's strategy.

"Take care of the drivers and the drivers will take care of the clients," Laramy said.

 

©2015 Houston Chronicle Distributed by Tribune Content Agency, LLC.