SAN FRANCISCO -- When Hesky Kutscher needed to get across town, he didn't call a taxi. He tapped a smartphone app called Lyft, which lets users request car rides.
Minutes later, a black hatchback with a big fluffy, pink mustache on its grille pulled up. Kutscher hopped in the front seat and gave the driver a fist bump. Then they cruised over the streets of San Francisco, chatting like neighbors until he was dropped off near Union Square.Kutscher, who runs a medical data firm, said ride-hailing apps like Lyft -- with its whimsical mustaches -- are more convenient than cabs: "I need to get from A to B. They do it well, they do it for a good price, and the drivers are friendly."Fed up with traditional taxis, more city dwellers are using their smartphones to request rides using GPS-enabled mobile apps that let riders and drivers find each other in real time. Ride-summoning services such as Uber, SideCar and Lyft are expanding rapidly in San Francisco, New York and other U.S. cities.Uber lets passengers use their smartphones to summon luxury town cars and other vehicles driven by professional drivers. Customer credit cards are charged fares based on time and distance.Lyft and SideCar describe themselves as "ride-sharing platforms" that connect riders and drivers, who use their own vehicles. After each ride, passengers are asked for a voluntary donation based on what others paid for similar trips. The companies take a 20 percent cut."We started Lyft to create a system for matching up people who need a ride with people who can offer a ride," said Logan Green, co-founder of San Francisco-based Zimride, which operates Lyft.But taxi operators say the new ride services are little more than illegal cabs that don't have permits, pay city fees or follow regulations. The upstarts are also steering business away from cabdrivers."It makes for an uneven playing field," said Barry Korengold, who heads the San Francisco Cab Drivers Association. "We're not trying to stifle technology. We're saying do it in the legal way."Uber, which launched in 2010 and offers ride services in 18 cities, has been sued by San Francisco cabdrivers and Chicago car-service companies alleging unfair business. The San Francisco-based company has also run into trouble with regulators in New York, Vancouver, Boston and Washington, D.C.Last year, the California Public Utilities Commission issued cease-and-desist orders and $20,000 fines to Lyft, Sidecar and Uber for operating illegally. The agency says they are "charter-party carriers of passengers" that need permits.In December, the commission agreed to evaluate the safety of the Internet-based ride services and plans to draft rules to regulate them over the next several months. Last week, the agency reached agreements with Lyft and Uber that allow them to operate legally until the new rules are written. It's in discussions with SideCar over its operations.Lyft and SideCar say they're not charter-party carriers, but ride-sharing platforms. They say they shouldn't be regulated like taxis or limos because rides are prearranged, payments are voluntary and the firms don't own the vehicles or employ the drivers.Have more to add? News tip? Tell us
