The taxi wars are getting next-level aggressive.

Driving the brinkmanship is Uber, and an internal Uber memo detailing its latest tactics has been published by The Verge. It explains how the company's network of contractors works to poach drivers from its main competitor in many U.S. cities, Lyft. The reporter, Casey Newton, also contacted some of these independent contractors, known as "brand ambassadors," who confirmed the systematic approach to undermining the company's competition. The Verge reports:

Earlier this month, CNN reported that Uber employees around the country ordered and then canceled 5,560 Lyft rides, according to an analysis by Lyft. But one Uber contractor The Verge spoke with said Lyft’s complaint had merit. "What’s simply untrue is that not only does Uber know about this, they’re actively encouraging these actions day-to-day and, in doing so, are flat-out lying both to their customers, the media, and their investors," the contractor said. Until now, the canceled Lyft rides have been understood as a kind of prank call designed to keep competitors’ drivers off the road. But interviews and internal documents suggest another reason: Uber’s recruitment program has vastly increased in size and sophistication, and recruiters cancel rides in part to avoid detection by Lyft.

What's most intruiguing here is not the cutthroat nature of the competition, but the sheer level of attention paid to detail. The New York Times says the have an "element of spycraft about them, with methods and protocols that could appear in a John le Carré novel." These details--perhaps more David Simon than le Carré--include using temporary, burner, cell phones linked to made-up accounts. Contractors don't follow patterns with their fake-ride and recruitment-ride hailing.

There's something sinister-sounding about all this deliberate contractor poaching by other independent contractors--remember, no one in this equation is really a full-time employee, with benefits or true job stability. But, as the Times points out, it would probably be more "offensive and probably illegal" if Uber and Lyft managers colluded to not poach either others' employees.

Maybe that's not a bad thing for drivers--many of whom are former cab or livery car drivers. "Workers--drivers in this case--should be thrilled that companies are fighting for them, as it gives them the leverage for better work conditions and higher pay," the Times points out.

In today's latest update on the saga, perhaps Lyft is coming out ahead, at least in the court of public opinion. And it's not as if Uber has ever been the sort of company to shy away from aggressive tactics when it comes to growth. But this sort of back-and-forth makes no one look good. It's certainly bizarre that Uber's playbook for recruiting new passengers and drivers seems to have its own internal vernacular. For instance, recruiting riders, say, on college campuses, is called "slanging," and the driver-recruitment "special ongoing project" is dubbed SLOG. For its part, Lyft has been searching out these Uber recruiters and banning them from using Lyft.

One thing is sure: This is far from over.

Read the documents at The Verge

Published on: Aug 27, 2014