uber_surgeclub.md

Uber Surge Club

Description

Uber drivers collectively log out of the app to create an artificial shortage of drivers. Uber’s surge pricing algorithm calculates the prices based on supply and demand – with a shortage of drivers leading to higher prices. After a few minutes the drivers log back into the app and benefit from the increased prices. It is reported that drivers systematically use this strategy when for instance an airplane lands and a many customers are to be expected. For the riders prices go up as well and it is the customers who pay the surplus of the Uber drivers. Oftentimes it is reported that drivers use either the Uber app for riders or an external app to verify how the surge rates develop. As an example for such an external app I found thesurgeapp or Track Surge: WeTheDrivers.
Drivers' motivations are across all sources listed below that Uber is not paying them enough or that they feel being treated unfairly.

A Uber statement in reaction to reportings of this strategy in 2019 is: „At Uber, we work to ensure the reliability of our service for our riders and drivers. This behavior is neither widespread or permissible on the uber platform, and we have technical safeguards in place to help prevent it from happening.“ [0]
However, apparently this strategy is commonly known among many Uber driver communities. Sometimes, drivers who know about and practice this strategy call themselves the ‚Uber Surge Club‘ with the first rule being: Don’t talk about the Surge Club. [1,2]
Not surprisingly then, many riders were upset when some drivers talked to the media about the strategy in 2019 [2] and it received a lot of media coverage internationally [3, 4].

There are several accounts of this strategy happening at different places:

• (May 2014, L.A.) [5]
  An Uber driver in L.A. describes how he slowly became friends with Armenian Uber drivers, who (at that time) made up the majority of Uber drivers in L.A. He found that these guys were really strategic about getting the most out of their job. Finally, one evening the other Uber drivers ‚invited‘ him to their group to collectively log out to ‚fix the rates‘, i.e. to increase the surge rates.

  • Coordination: Onsite at the parking lot. One Uber driver announced that everybody should log out.

• (Spring 2016, Boston Airport) [6]
  Robinson (2017) gives a very detailed account of the happenings at the Boston Logan International Airport in 2016. Due to the need for licenses to drive at the airport the group of Uber drivers did not change very much over time. This small fact facilitated social ties among each other (since they regularly met at the parking lot) and formed the basis for a collective action. The drivers had to coordinate across different Uber services (UberBLACK and UberX) and between different ethnic communities. They agreed on ‚striking‘ for 12 hours at a specific day in order to keep up the surge multiplier at 1.5 times the base rate. Initially they were very successful, however at one point the surge stopped – apparently Uber noticed what was going on.

  • Coordination: One driver who played a major role in organizing the action, estimates that using the meetings at the parking lot, facebook groups, email and two WhatsApp groups he had communicated with 20 leaders of the various informal Uber driver communities.
    The action itself was planned a little differently than the other logging out cases: The drivers hired someone whose job was it to make sure that only two drivers were online at the same time and keep a sequential list who was next. This turned out to successfully increase the surge multiplier.
  • Countermeasures: Robinson reports that after a couple of hours the surge multiplier stopped increasing which the drivers initially did not understand. They suspected that Uber found out what was going on – and indeed by checking the Uber customer app they saw that multiple cars were online at the Airport. Not being able to identify possible strike-breakers the drivers suspected that Uber placed ‚fake cars‘ to „make it appear that some drivers were online, as a way of breaking other drivers' commitment to strike“ (p. 111).
    However it was only after receiving an email from Uber threatening them with ‚deactivation for improper use of the Uber application‘ that the drivers moved to a more traditional form of collective action: A delegation of Uber drivers went to the Uber office with a list of problems and suggestions.

• (2015 - 2017) [7]
  By analyzing interviews with drivers and postings on the uberpeople.net forum between 2015 and 2017, Möhlmann and Zalmanson (2017) find various pieces of evidence for the logging out strategy. Drivers spread and discuss this strategy in the forum and explain it to newcomers. One snippet of a forum discussion reveals that drivers are convinced that Uber is aware of this strategy because „it happens every week. Deactivation en masse coming soon“ (p. 13).

• (May 2019, Reagan National Airport, Washington D.C.) [0]
  WLJA, the Washington D.C. local newsroom, reports that both Uber and Lyft driver use the logging out strategy which sometimes happens multiples times per night. One driver explains: „All the airplanes we know when they land. So five minutes before, we turn all our apps off all of us at the same time. All of us we turn our apps off. They surge, $10, $12, sometimes $19. Then we turn our app on. Everyone will get the surge.“ [0]

  • Coordination: Onsite. According to the newspaper article a couple of drivers give the commando to all drivers at the parking lot when to log out and back in. All drivers participate. Interestingly, it is reported that the drivers use ‚another app‘ to watch the surge going up. This could refer to the above-mentioned third party surge apps or the Uber customer app. Presumably drivers have more trust in these than the Uber driver app, which also indicates surge.
  • Countermeasures: The participating Lyft drivers faced deactivation (unclear if permanent or temporary), according to an official statement: „Lyft takes any allegations of fraudulent behavior very seriously as it violates our community guidelines and can lead to deactivation from the Lyft platform.“ [8]
    However, to me it is unclear if and what consequences this had for Uber drivers. Uber only stated that „this behavior is neither widespread or permissible on the Uber platform, and we have technical safeguards in place to help prevent it from happening.“ [8]

The reportings from 2019 at Reagan National Airport were the last traces of this strategy I could find. To me it is unclear whether this strategy is still possible or if Uber made changes in the algorithm to prevent such behavior.
Zalmanson, the researcher who co-authored [7], told ABC7 [8] that „the Uber company can detect these patterns for (something close to) certain. Given their machine learning capabilities, I would have to assume they might know when a surge feels produced and when it isn't."

Sources

[0] https://wjla.com/news/local/uber-and-lyft-drivers-fares-at-reagan-national
[1] https://youtu.be/SYkLhXMsZ8I
[2] https://www.uberpeople.net/threads/surge-club.334124/
[3] https://www.businessinsider.in/tech/uber-drivers-are-reportedly-colluding-to-trigger-surge-prices-because-they-say-the-company-is-not-paying-them-enough/articleshow/69790042.cms
[4] https://www.inc.com/minda-zetlin/uber-lyft-drivers-artificial-surge-pricing-reagan-national-washington-arlington-drive-united.html
[5] https://uberconfession.tumblr.com/post/86948127160/uber-brotherhood-and-a-few-sisters-too
[6] Robinson, H. C. (2017). Making a digital working class: Uber drivers in Boston, 2016-2017 (Doctoral dissertation, Massachusetts Institute of Technology).
[7] Möhlmann, M., & Zalmanson, L. (2017, December). Hands on the wheel: Navigating algorithmic management and Uber drivers’. In Autonomy’, in proceedings of the international conference on information systems (ICIS), Seoul South Korea (pp. 10-13).
[8] https://abc7news.com/uber-surge-pricing-lyft-ride-share-price-fixing/5306900/