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Uber Prevails As D.C. Council Passes New Vehicles-For-Hire Law

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Uber puts customers in contact with a fleet of towncars using a smartphone application of iOS and Android phones.
Chris Chester
Uber puts customers in contact with a fleet of towncars using a smartphone application of iOS and Android phones.

The battle between Uber and the District of Columbia is over.

After clashing for months over how to regulate the sedan car service that customers order using a smartphone app, the D.C. Council  approved to legislation [PDF] Tuesday creating a sedan class of vehicles-for-hire separate from taxis. 

The bill will allow Uber to charge its customers fares based on distance and time as "digital dispatch" vehicles. Uber's black sedans are not hailed on the street; customers use the Uber smartphone application to order a car to their location using the phone's GPS and pay with a registered credit card number. 

While D.C.'s taxicab industry has been slow to modernize, Uber offers an innovative service that, while more expensive that a regular taxi, has become popular among residents looking for a stylish ride to the airport or to home after a night on the town. The company's victory in negotiating with D.C. lawmakers could have implications for its other service areas; Uber has gone back and forth with regulators in Massachusetts and now New York over the legality of it business model.

"Today was a fantastic victory for Uber but also for innovation, for our consumers here, and the drivers that partner with us," said Rachel Holt, Uber's general manager in the District, after the vote. She thanked her customers for helping convince the council as well as the District's taxicab commissioner to back away from a previous proposed law that Uber CEO Travis Kalanick described as ranging "from the draconian to the inane."

"It's not about anything we did or won. I think what really won was that the fact that we have a passionate consumer base here," Holt said.  

Over the past several months, Uber customers flooded Council members with complaints about proposals that threatened the company's business model. 

Once the heated rhetoric quieted down, both sides compromised. The new legislation requires greater pricing transparency on Uber's part.

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