Dynamic pricing benefits Uber but customers and drivers are worse off, study says
Analysis from Oxford University shows dynamic pricing benefits Uber at the expense of drivers and customers, as ITV News Business and Economics Editor Joel Hills reports
'It doesn't cost them anything to run this vehicle. They don't pay the fuel. They don't pay the insurance. I'm the one paying. So why do they get 40%?'
More than 100,000 people in the UK drive for Uber. Some of them, like Abdurzak Hadi, a veteran of 11 years, have spent their careers navigating London's streets.
Others share their experiences, good and bad, on social media.
'£300 a day, that's £10,000 a month… of course I'm rich,' said one driver on YouTube.
For many others, the reality of driving for Uber is different.
'It's minimum wage, it's less than the minimum wage,' said another.
In March 2023, Uber changed the way it calculates fares. Known as 'dynamic pricing,' the new system uses algorithms to adjust trip prices in real time based on demand, location, driver availability, and even the weather.
The price you pay is no longer just about how far or how long you travel. It's shaped by where you are, what time it is, how many other people are requesting rides, and how many drivers are nearby. If there's a surge, like after a concert or during a deluge, prices can quickly jump.
Uber says dynamic pricing helps ensure customers can always get a lift and that higher prices encourage more drivers to log on.
But a new study from Oxford University suggests this change came at a cost to drivers and customers alike.
Five academics at the University of Oxford's Department of Computer Science analysed 1.5 million trips by 258 Uber drivers in the UK between 2016 and 2024.
Their findings are stark. After the introduction of dynamic pricing:
The average customer fare per hour rose from £32.82 to £43.50
The average driver pay per hour, adjusted for inflation, fell from £22.20 to £19.06
Drivers are now spending an extra 23 minutes a day waiting for trips
Uber's income per driver hour rose from £8.47 to £11.70
Perhaps most strikingly, the study found Uber's 'take rate' - the share of each fare it keeps - has risen significantly. While the company used to take around 25%, the average has increased to 29%, with some trips seeing more than 50% taken by Uber.
'The thing that most surprised me,' said Reuben Binns, Associate Professor at Oxford's Department of Computer Science, 'was that the higher the value of the trip, the more of a cut Uber takes. So the more the customer pays, the less the driver actually earns per minute.'
I asked him if this could be considered exploitative. 'I think so,' he replied.
Hadi remembers when the company took a flat 20% of every fare and shared that information clearly.
Since dynamic pricing was introduced, Uber has stopped disclosing what fee it takes on individual trips.
When we compared what Uber charged us for the ride with what it paid Hadi, we found Uber's cut was nearly 40%.
After costs like fuel, insurance, and car rental, Hadi says he earns £10 an hour 'on a good day' - below the UK minimum wage.
'I feel cheated,' he told ITV News. 'My hard-earned money is being taken away from me.'
The Worker Info Exchange helped drivers obtain their journey data from Uber using GDPR requests.
The data was then passed to the team from Oxford University.
James Farrarr formed the Worker Info Exchange after his experiences as an Uber driver.
Several years ago, Hadi was one of the drivers who took Uber to court over employment rights and won. Today, he's a union member and says he's ready to fight again, this time over dynamic pricing.
'If you don't fight, you won't win. But if you do fight - there's a chance.'
He says Uber's strategy of encouraging as many drivers as possible to log on, to keep rides readily available, inevitably creates winners and losers.
Crucially, drivers aren't paid for the time they spend waiting between trips.
'We urgently need powers to cap the number of vehicles Uber is allowed to put on the road,' he told ITV News.
'And we need proper transparency from Uber about how drivers are paid.'
He added: 'We [also] need to end this kind of algorithm trickery. In dynamic pay systems, everybody's entitled to understand on what basis they're being paid, on what basis they're being paid, on what basis the work is being allocated to them.'
Uber declined an interview for this story.In a statement, the company said it 'does not recognise the figures' in the Oxford report and insists that all UK drivers receive weekly earnings summaries, "which shows exactly how much Uber kept across the past seven days'.
The company says its take rate 'does vary a bit from week to week and from one driver to another, depending on the trips they took,' but that 'the percentage kept by Uber has remained stable for several years.'
However, Uber did not specify what that average is.
Uber also says UK drivers collectively earned £1 billion in the first three months of this year and that the company's pricing model ensures a balance between rider demand and driver supply.
Uber was once seen as the original disruptor, making travelling by taxi faster, cheaper, and easier.
But its treatment of drivers attracted strong criticism.
In recent years, the company's reputation has improved, especially after Uber agreed to give drivers more employment protections in the UK.
But as dynamic pricing reshapes the experience for drivers and customers alike, new questions are being raised about fairness, transparency, and who's really benefiting.
The original bad boy of the gig economy is in hot water again.
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BBC News
a day ago
- BBC News
Uber fares up despite driver income decline, Oxford study suggests
Uber's use of dynamic pricing has led to higher fares for passengers and lower earnings for drivers, whilst increasing the company's share of revenue, a study has University of Oxford study analysed data from 258 Uber drivers in the UK over more than 1.5 million trips between 2016 and found there had been a "significant shift" when the company introduced a dynamic pricing algorithm in 2023, which it said meant "passengers now pay more per trip, but drivers' earnings have declined".Uber said some claims in the report were "totally false", adding that all drivers were shown their potential earnings for a trip before deciding whether to accept it. The study, which was carried out by researchers from the university's Computer Science, said Uber's commission had risen from about 25% to 29% since its dynamic pricing model was the same time, researchers found that drivers' hourly income fell from more than £22 to just over £19 - with drivers spending more unpaid time waiting for rides than began operating in Oxford in February, despite private hire and black cab drivers warning the taxi app giant that it may struggle to succeed in the said the study "highlights the widening gap between what customers pay and what drivers receive"."The higher the value of the trip, the more of a cut Uber takes. So the more the customer pays, the less the driver actually earns per minute," its lead author, prof Reuben Binns, study was commissioned by the Workers Information Exchange, which is run by former Uber driver James Farrar - who previously successfully campaigned for the company's drivers to be treated as workers, rather than to the study, an Uber spokesperson said the company "do not recognise the figures in this report."They highlighted that drivers in the UK took home more than £1bn in earnings between January and March of this year, with all drivers receiving a weekly summary of their earnings, including a "clear breakdown of what Uber and the driver received from trips".On average across the week, the percentage kept by Uber has "remained stable for several years, but can vary from week to week and from one driver to another", the company said."We are proud that thousands of drivers continue to make the positive choice to work on Uber as passenger demand and trips continue to grow," the spokesperson added. You can follow BBC Oxfordshire on Facebook, X (Twitter), or Instagram.
Wales Online
a day ago
- Wales Online
There's a tiny hidden village in Wales where everyone lives in fairytale huts dotted around the woodland
There's a tiny hidden village in Wales where everyone lives in fairytale huts dotted around the woodland From the rocky country road it's hard to pick out the village which is renowned for its tipis - but nowadays the majority of the residents live in tiny turf-roofed huts which blend into the green landscape Peter Francis, 73, has lived at Tipi Valley in Carmarthenshire since 1983 (Image: John Myers ) The 100 or so folk of Tipi Valley in the wilds of west Wales don't have rules except for that shoes must be left at the entrance of their huts, yurts, or tipis - a steep tent made from canvas and held up by poles in their centre. From the rocky country road leading to the nearby village of Cwmdu in Carmarthenshire it's hard to pick out the village renowned for its tipis but where nowadays the majority of the residents live in tiny turf-roofed huts which blend into the green landscape perfectly, so much so I hadn't known I'd arrived at Rik Mayes' hut until it was pointed out to me from yards away. One of the eco-friendly huts costs around £5,000 to build and is 80% biodegradable. More efficient than the tipi, the huts have seen Tipi Valley lauded as a leading case study for sustainable and cheap living, while they are a pleasant addition to the hidden village which looks like something out of a fairytale. The people living here - some of whom still refer to themselves as hippies - weren't always welcomed by some in Cwmdu and Llandeilo before. Search Tipi Valley on Youtube and you'll find some old news clips of farmers questioning the hippies' right to be on the land. One councillor - Roland Morgan - even claimed some businesses had "no hippies" signs in their windows. While the residents of Tipi Valley have owned the land since 1976, the majority of the now 100 acres was purchased for agricultural usage with no planning permission for residential structures. The core issue surrounding the legitimacy of the land's use revolved around the legality of the nomadic structures on the land. While some of the structures at the site were initially deemed unlawful any worries the Tipi Valley residents had of being turfed out were helped when Valley dweller Brig Oubridge won a landmark legal case in 2006 - after a 13-year battle - which concluded his three tents and caravan were lawful. All of the huts have now been in the Valley for more than four years without any enforcement action, and so can stay put. Article continues below 'The council came to terms with us being here many years ago while knowing our ecological mission as such was to live here very simply,' Rik, a reverend originally from London and who has lived here since 1978, tells WalesOnline from his little wooden dwelling which could be mistaken for a garden shed but inside is like a tardis comprising a bed, a sofa, a television, a tiny kitchen, a shower unit and an office space. 'They've decided to let us get on with it,' he says. Rik Mayes in his medieval-like roundhouse hut - an eco-friendly home (Image: John Myers ) Rik Mayes has lived at Tipi Valley since 1978 and says he intends to stay in the eco village for the rest of his life (Image: John Myers ) Rik, 77, is at the top of the valley and is one of very few residents at Tipi who has access to a decent mobile phone signal, and so has taken on the role of a sort of de facto village receptionist. He scoffs at any suggestion he has a leading role in the community though, telling me there is no such thing. Tipi Valley has no hierarchy with the hippies believing the land is the owner of all of us. Nobody pays rent for their dwellings other than one family who stay in a more typical cottage which was bought by the community in 1998. There is no formal vetting process either for anyone who wants to rock up and give living here a crack. 'You have to weigh up whether you can cope with the lifestyle and the climate,' Rik explains. 'That's how Tipi Valley started. We bought the land in 1976 because we wanted people to have the opportunity to come along and give it a go, and that's the way it is. 'We are unique in that sense. There are not many places in the whole of the UK now where that could happen. If you want land in the UK now you're paying a lot of money for it or you're buying a piece of farmland, for example, which is usually far too big. 'We never started with a vision or a big grand plan. This place was just built by experience. We've just saved as many pennies as we could and we've bought little pieces of land here bit by bit. Now the residents of Tipi Valley have bought 100 acres themselves.' One hut can cost around £5,000 to build and are mostly biodegradable (Image: John Myers ) The huts melt into the green landscape perfectly, almost hidden (Image: John Myers ) Almost all of the residents live off grid while some - a handful - still live in tipis. Those who turn up at Tipi Valley, intrigued by a different way of living and hoping to become a permanent resident, tend to stay in the 'big lodge' - an oversized tipi where villagers meet monthly to eat and drink together and also congregate in the colder months. The big lodge is beside a stream which feeds a well where villagers get most of their water. 'People often still turn up and ask to stay here,' Rik says. 'Last week we had a guy staying in the big lodge who came so gently. He came to Swansea, booked a bed and breakfast, then caught a taxi up here and had the taxi wait for him while he came to us and asked permission if he could visit in future. I thought that was very polite. He came to visit just to ask permission to visit. A few days later he did come to visit properly and I believe he's in the big lodge at the moment. 'Another person in the big lodge turned up yesterday. He said his dad used to come here when he was young and he thinks he'd quite like to relocate here, so he's checking it out.' When we visit the big lodge we're greeted by Emily Driver who is inside the communal tipi which is uncomfortably warm. She's here to invite villagers to her dinner party at her yurt a short walk away. 'I was in the big lodge for four months and I loved it,' Emily, 32, who arrived here on her own last year, says. 'It's quite intense to live in at first. But it's such a grounding space. It slows you down. 'I arrived here from Leicester where I lived in the city and as soon as I got here it was a real crash. It was a huge change in speed and it was difficult to get accustomed to at first. I actually found it quite emotional. 'I remember ringing my mum crying and she said: 'Emily darling, why don't you sit down and have a cup of tea?' I shouted at her that it was so hard to even make tea in this place. But it's so good because it forces you to be patient.' Around 100 people live at Tipi Valley. The majority of the children attend or have attended the nearby Talley School - a Welsh medium school (Image: John Myers ) The village offers a more simple way of life which villagers say should be regarded as the norm (Image: John Myers ) Prior to visiting Tipi Valley for the first time Emily's grandfather had passed away, leading her to think about what she really wanted from her life. She had been a librarian in a prison before quitting her job and moving here. She recalls: 'Before he died grandad said to me: 'Take it whilst you can.' And I decided I wanted to live like this now while I can. I quit my job, quit my flat and came here. I've been here for a year now.' Asked if she intends to stay here for a long time she says: 'I don't really think like that. I don't think too much about what is to come. What it is guiding me at the moment are my seeds. My seeds need to be in the ground and watered so I'm here to do that. Once the seeds have grown and I've eaten them, who knows where life will take me?' 'Once people have been here for a while we let them build a permanent dwelling instead of living in a tipi,' Rik explains. He was out of the ordinary because he lived in a tipi for 35 years - far longer than most - before moving into the hut he originally built for his sons to live in while they were at school 'so they could turn out smartly'. Most of the Tipi Valley children go to the local Talley School, a Welsh medium school meaning most of the youngsters in the valley have varying degrees of Welsh language proficiency. Rik moved into the hut after his sons left school and then decided to move further down the valley closer to Cwmdu. 'Tipis and yurts are nomadic dwellings so we have to move them every six months to a different piece of land in the village,' he says. 'There is an art to pitching a tipi. It needs to be done in a certain way so when the rain comes the water runs down the tipi and off away from the tipi rather than back towards it. 'In the middle of your tipi you've got your hearth and the hearth gives you heat, light, cooking, everything. You live around that with your family. On the floor around that are rushes and on top of that are sheepskins. Around the edges are your baskets for clothes, wood and toys. You have to travel light in a tipi because you'll be moving on again soon.' The tipi called the big lodge by the villagers where newcomers live and where the locals congregate for community events (Image: John Myers ) Emily Driver moved to the eco village from Leicester after realising she wanted to live a different life while she is young (Image: John Myers ) Do many people come and go? 'Of course they do,' Rik laughs. 'If they didn't go we'd have about 4,000 people living here.' It isn't for the faint-hearted. Many people turn up believing the tipi life is the life they want, but sometimes they end up bringing the contents of their home with them and then they realise they can't hack it come the winter. On one occasion long-time resident Peter Francis had to remove 50 wheelbarrows full of possessions which one short-term resident had left behind after realising Tipi Valley wasn't for them. Rik says: 'Over the years we've had no end of people wanting to live here thinking it's their dream and then during a cold wet winter they've left and left all their stuff and it can be very difficult to sort out. 'It is challenging because it's quite a small space to live in and that means one cannot have many possessions. For example, when I was bringing my children up in a tipi there could only be one toy basket and when it was full one toy had to come out for a new one to go in. 'I actually found that very beneficial for my children. They didn't have a lot and I was amazed how unpossessive my kids were. When I was a child I was possessive because I had my bedroom to myself which was like my own little empire. 'What I am really pleased about, when I look at my whole life, is that my children were born and bred at Tipi Valley because the opportunity that afforded them was pretty unique - the opportunity to live in the wild and survive with basic means.' The majority of the residents of Tipi Valley now live in these round huts (Image: John Myers ) The electricity is solar powered, some of the food is grown on site in allotments, the toilets are compost loos, and the water comes from a well sourced by the stream (Image: John Myers ) Rik was persuaded to the valley in 1978 by a friend who had wanted him to start a school here. 'As soon as I came over the hill into the valley I knew I wanted to be here for the rest of my life,' he recalls. 'I didn't have any wanderlust to go all over the world or anything like that. I just wanted to find a place I could be freer and where I felt I belonged. I wanted to live close to nature and to bring my family up while living a life I could believe in more than I could believe in the civilisation we've got. Of course, we also need civilisation in part. We couldn't do without the NHS and roads.' He'd lived in many towns and cities across the UK including London, Manchester, Bournemouth and Southend by the time he reached Tipi Valley when he was 31. 'I find the idea of leaving here now just ludicrous,' he says. 'All my life I've just wanted to be around nature and to not have to feel that by crossing some fence I've trespassed into someone else's land. I was brought up on Rupert Bear who lived a wonderful life in the countryside where he could go pretty well wherever he liked. And that's what I wanted.' Peter, a former dairy farmer who has lived here since 1983, has built his fair share of huts. His current hut, with a reciprocal frame roof and an electric induction hob which runs entirely on solar energy, is comparative luxury considering what he's lived in at Tipi Valley before. Peter Francis has built his fair share of huts and says they're far more efficient than tipis or yurts (Image: John Myers ) Peter believes more people need to live in the way the residents of Tipi Valley do (Image: John Myers ) A short walk from his hut the 73-year-old has a sizable allotment where he grows his fruit and vegetables. He also grows his own coffee. 'It's about the philosophy of simplicity - that less is more,' he says. Although he agrees with Rik that he doesn't live by that motto when it comes to ice cream. 'Before living here I was down the road in Taliaris where I was a dairy farmer. It didn't all add up, being a dairy farmer. Small dairy farms even in the 1980s didn't pay and it was also during the time of mad cow disease. 'I used to say to my feed merchant in Llandeilo: 'Where are you getting this stuff from?' And he'd say: 'Quality stuff this is.' But it was actually dead cows I was feeding my cows on. No wonder the health problems were rife. It was all going wrong and I couldn't ever work out why. Only in retrospect did it all come out.' He was in a tipi briefly but found one hard to live in. 'I went and spent some time in Africa and came back with the idea of living in a thatched hut instead,' he says. 'I built my first hut entirely out of materials from the valley here apart from the nails. Unfortunately that one burnt down because I left a lamp burning while I was out.' He explains why Tipi Valley is no longer very Tipi. 'Nowadays a tipi costs maybe a couple of thousand pounds and with the canvas, under these conditions, you'd be lucky if it lasted three years. They're not very efficient. 'So although in the summer it's a wonderful experience to live in a tipi with the focus of the fire in the middle and being wonderfully close to being outside in nature, come the winter with the wind blowing through the door and the damp and dark, it can be difficult. 'The thing about these huts is the overhang on the roof which means the walls are dry. Yurts don't have that overhang so the walls are damp when it's raining and that means everything gets a bit damp.' A handful of residents at Tipi Valley still live in tipis (Image: John Myers ) The people of Tipi Valley believe we belong to the earth and the footprint of people on the earth should be as minimal as possible, hence the huts blend into the landscape and are eco-friendly (Image: John Myers ) He tells me the hut was very cheap to build - no more than £5,000. 'So nobody needs to be homeless,' he says. 'They just need to change the planning laws.' We are sitting in Peter's lounge area - although the hut isn't separated into rooms. It's more of a roundhouse with a kitchen area, a bed and all manner of plants. There are no corners, Peter points out proudly, so as to remove the temptation to have too much 'stuff'. There is no television but there are a few books. Article continues below 'I've not had a television since I was a boy,' he laughs. 'I prefer looking out of the window.' He's spoiled for choice here, having surrounded the hut with windows and doors which open up to create the sort of summerhouse which would sell for hundreds of pounds a week on Airbnb. 'It's funny isn't it,' he says. 'When I first came here we were considered a strange sort - beyond the pale. Wider society just didn't get us. And yet now it's become desirable. People say: 'Let's go glamping and stay in a turf-roofed hut and pay a grand a week.' 'What they didn't know then is that this life is actually normal. It's the urban, modern way of life which isn't normal, and the sooner people start downsizing the better. Otherwise we don't have a future because the way climate change is going at the moment, it isn't looking good at all.' Rik adds: 'So what you've got to do is go back to Cardiff, get a tent and go and live in the park.'
Daily Mail
a day ago
- Daily Mail
Aussie sums up the most infuriating problem with Sydney - and most people would agree
An outraged commuter has slammed Sydney 's public transport system after she spent two and a half hours getting home due to cancellations. Monique, who shared her frustration on TikTok, said she was left stranded and forced to share an Uber with two strangers during peak-hour traffic as a result. 'Sydney trains need to be fixed, because every month I am deserted on a random platform with no idea how to get home,' she said. 'They literally took us forward, then dumped us here and said, hey we're not going to your destination anymore. 'Then we get out, we have to go back to the way we came. Get off at another station for them to say, there's literally no trains.' The commuter said there were no bus replacements. A staff member advised Monique and two other passengers to go to another platform and catch a train to Central Station, where they could catch another train home. 'We run to that platform, we miss it, and then everything else is cancelled after that,' Monique said. With no other option to get home, she booked an Uber, which was cancelled twice. Monique eventually shared an Uber with two strangers and travelled to a nearby station, hoping to reconnect with a functioning train line. One passenger was picked up by a family member, while another attempted to board a short, five-minute train journey, only to find that one service had been cancelled and the next wasn't scheduled for another 40 minutes. Monique then accepted a lift from a couple to her parked car. Social media users shared their own stories of frustration with one Penrith commuter saying it took them three and a half hours. One said it took them six and a half hours to travel from Warwick Farm to Burwood, while another said they spent $200 on alternative transport to get from Central Station to Parramatta. 'Two-and-a-half hours was stranded in Cabramatta, then a train finally shows up, takes us to Lidcombe, then a 400 to 500m line up for bus replacement,' one said. 'Sydney trains are a burden on Sydneysiders.' Another said Sydney's public transport was one of the 'worst in the world'. 'Something is always happening every month,' she said. Sydney's rail network has faced recurring service disruptions, delays, and infrastructure issues in recent months. In May, thousands of commuters across the city experienced two days of disruption when a train hit an overhead power line at Strathfield Station. In the same month, flooding across tracks caused major delays just as Vivid kicked off. NSW Premier Chris Minns said at the time $1.5billion a year was spent on rail infrastructure and maintenance, so punters should expect a more reliable network.
