Here’s the Sneaky Way Uber Gets You to Pay Surge Prices
Arthur Dominic Villasanta | | May 23, 2016 03:26 AM EDT |
(Photo : Getty Images) Surge price scourge
Your mobile phone's battery apparently tells ride sharing app Uber when the time's right for surge pricing, a controversial practice that can raise fares by up to nine times. Uber, however, denies it's using this knowledge to intentionally increase fares whenever it wants to.
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The Uber app installed on millions of mobile phones worldwide has a little known feature that informs Uber when a phone's battery is running low. When a phone hits low batt, that event causes the Uber app to switch to low power mode. The app then signals this low batt event to Uber.
That signal tells Uber you might be "more sensitive" or more than willing to pay more for your Uber ride. You can't call Uber if your battery dies, now can you?
This piece of technological wizardry plus the psychology of desperation is what Uber counts on for you to say yes when it tells says you've got to pay a surge price for a ride. Uber refers to surge pricing as "dynamic pricing."
"That is one of the strongest predictors of whether or not you are going to be sensitive to surge," said Keith Chen, Uber's head of economic research, as quoted by NPR.
Chen was quick to state Uber isn't using this knowledge to take advantage of its users.
"We absolutely don't use that to kind of like push you a higher surge price, but it's an interesting kind of physiological fact of human behavior."
Uber contends surge pricing helps increase supply or the number of Uber drivers in an area. Surge pricing also encourages more drivers to work. Without surge pricing, the number of drivers will eventually run out and people wouldn't be able to hire a driver.
Uber also argues that when demand starts to ebb, prices fall automatically. It also contends surge pricing has helped it become one of the largest ride sharing companies in the world.
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