Driven by a Stranger : UberPOP and the Creation of Peer-to-Peer Trust

University essay from Uppsala universitet/Företagsekonomiska institutionen; Uppsala universitet/Företagsekonomiska institutionen

Author: Daniel Ketema; Gustav Ronéus; [2015]

Keywords: ;

Abstract:

During the last couple of years, the global taxi industry has been somewhat overwhelmed as well-established taxi companies all over the world currently are experiencing severe competition from a new actor on the market. This company is named Uber and was founded in San Francisco in 2009. After only being around for six years, Uber is currently operating in 55 countries and over 200 cities worldwide and has an estimated worth of 40 billion USD without owning a single vehicle.

However, the thing that has drawn the most attention to Uber is that the company also offers a an additional super-low cost service called “UberPOP”. This service lets ‘regular people’, without taxi licenses operate as ‘taxi drivers’ and pick up passengers via the company’s app in their own cars and wearing their own clothes with neither a taxi registration plate nor any taxi stickers on the car. UberPOP works on the premise that anyone can apply on its website to become a driver, without having to undergo any formal taxi driver’s education or possess a taxi license. Uber simply demands that the person has to be at least 21 years old, do not have a criminal record, have an insured 4-door vehicle that cannot be older than five years, and a driver’s license. UberPOP is an example of a phenomenon called “peer-to-peer”, which means that private individuals can connect and conduct business with each other via a digital platform such as a website or a mobile application. A peer-to-peer system is a sort of online “consumer-to-consumer” network where regular people can do business with each other. Peer-to-peer is a direct contrast to business-to-consumer networks when people purchase services and goods from a company.  

When engaging in commerce via a “traditional” peer-to-peer system that connects people online, one quickly realizes that there is an importance for consumers to be able to trust each other. Current research states that trust between customers becomes highly important in online peer-to-peer systems as the technique is characterized by a very high level of anonymity and low levels of scrutiny, due to the fact that the peers never meet in person (Yu et al, 2004; Scharf, 2011). Uber has in a highly innovative way managed transfer this online phenomenon in the establishment of UberPOP. However, with the most vital difference that the peers in the case of UberPOP, actually meet each other in a physical setting when the passenger enters an unknown person’s car. The simple fact that the peers in UberPOP’s peer-to-peer system physically encounter with each other face-to-face is a significant element that has not yet been covered in previous research on peer-to- peer trust. 

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