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The Los Angeles City Council capped service charges third-party delivery services like Postmates, Grubhub, Uber Eats can pass on to restaurants at 15% of the purchase price during the pandemic following similar moves in San Francisco, Seattle and other major cities.
Restaurants have long complained about charges from the popular apps as high as 30% are eating away at their business, and those worries have grown during the pandemic, as owners find themselves relying more heavily on the services.
<p>Even as dine-in restaurants slowly reopen, many are still devastated by the months-long closure. During that time, those that managed to stay afloat could only offer customers carry out and pick up services in order to keep business alive.</p><p>"Any arbitrary cap – regardless of the duration – will lower order volume to locally-owned restaurants, increase costs for small business owners, and raise costs on customers. Delivery workers would have fewer work opportunities and lower earnings," said Jenna DeMarco, a spokesperson for GrubHub in an email. "We also believe that any cap on fees represents an overstep by local officials and would not withstand a legal challenge."</p><p>Chris Webb, the CEO of ChowNow, an online order platform that offers restaurants a flat fee, said restauranteurs have long been frustrated with the fees. </p><p>"What we are hearing from a lot of restaurants," he said. "' We cannot afford to stay in business and take around 30% commissions consistently. It's driving us out of business and now this (pandemic) is the motivator for us to move.'"</p><p>He said he saw business skyrocket as many restaurant owners shifted away from delivery services that relied on percentage-based fees and to his flat-fee model. Webb said he was signing up as many as 2,000 restaurants a month.</p><p>The effort to cap the services was driven in part by pressure from the United Food and Commercial Worker Union Local 770, which is organizing the drivers. The order, which must still be signed by Mayor Eric Garcetti, also prevents the apps from taking tips from drivers.</p><p>"This smart policy will prohibit these companies from taking tips from drivers and gouging restaurants with fees," said John Grant, president of UFCW 770 in a statement."Food delivery drivers are essential workers who provide meals for the residents of our City, especially to seniors and others who are sheltering at home or under quarantine."</p>
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'A Very Precarious Situation': How Trump's Order Could Impact The Fates of Snap, TikTok and Grindr
May 28 2020
An executive order that could enable federal regulators to punish social media companies for how they moderate content on their sites would have far-reaching impacts, especially on smaller companies with an online presence, including TikTok, Snap Inc. and Grindr, that lack the budgets to moderate every single message or post on their apps.
President Donald Trump threatened such a change via executive order after Twitter fact checked tweets that spread misinformation related to voting earlier this week. Rather than edit the tweet or block it, the social media company inserted a line that said "get the facts about mail-in ballots."
<p>At the heart of <a href="https://www.whitehouse.gov/presidential-actions/executive-order-preventing-online-censorship/" target="_blank">the new executive order</a> lies a complex 1996 law known as Section 230 of the Communications Decency Act that has been broadly interpreted by the courts over the years as shielding internet sites and apps from being financially liable for what user tweets, posts or generally publishes on their platforms.</p><p>It has also protected websites from being held liable for moderating content they see as obscene, violent or otherwise objectionable.</p><p>"Section 230 is one of the building blocks for free speech online," Emma Llanos, director of the free expression project at Center for Democracy & Technology, told dot.LA. "It has been absolutely essential to the creation of very large platforms and very small platforms, to the creation of all kinds of online communities, and to (enabling) different approaches to content moderation."</p><p>The section also gives people who operate those online services the legal certainty that they won't end up in court fighting about whether they appropriately took down a specific post out of the tens of thousands on their site, or if they've missed moderating something. "It gives some breathing room," Llanos said.</p><p>Rather than battle an endless number of lawsuits, such companies could either decide to not moderate content at all, or go out of business, experts say.</p><p>Santa Monica-based Snap Inc. has relied on Section 230 in numerous court cases, including one involving its speed filter where victims claimed that the company encouraged reckless driving by providing a speed filter that gauges and notes a driver's speed at the time of its use. Other cases have involved the use of Snapchats for harassment between users.</p><p>"At the core, those claims try to hold Snapchat accountable over how Snapchatters misuse their tools," said Eric Goldman, a professor at Santa Clara University School of Law and expert on Section 230. "A reduction of 230 will put Snapchat in a very precarious situation. What do they do if they can't rely on this legal immunity?"</p><p>Should such immunity change, Snapchat and relativity smaller companies like it — by far, the majority of social media companies that aren't Facebook or Google — could be forced from their industries under a hail of lawsuits, experts told dot.LA on Thursday.</p><p>"That's a very likely scenario for companies like Snapchat," Goldman said. "Snapchat can't police its premises well enough to prevent people from doing bad things. You can't have a Snapchat conversation where both sides of the conversation is reviewed by Snap employees before it's delivered a) that's a privacy violation and b) it's not instantaneous.</p><p>"What's Snapchat at that point, without any chatting?"</p><p>Snap Inc. declined to comment Thursday.</p><p>In another high-profile case, a man used the dating app Grindr to terrorize his ex-boyfriend, by creating fake profiles that impersonated him, with vulgar screen names and false information. The imposter directed hundreds of potential suitors to his ex's apartment or workplace on a daily basis.</p><p>West Hollywood-based Grindr was protected from financial liability in that case by Section 230, even if in the end, they could or should have done more to ensure the harassing content was flagged and removed, Goldman said.</p><p>Meanwhile, Culver City-based TikTok's use of Section 230 is more opaque because it's owned by Beijing-based technology firm ByteDance Ltd. It's unclear how much their leadership is swayed by the liability protections offered by Section 230 or by Chinese internet liability laws and cooperation with the Chinese government, said Eric Goldman, a professor at Santa Clara University School of Law and expert on Section 230.</p><p>A TikTok spokesperson did not respond to repeated requests Thursday for comment.</p><p>TikTok said <a href="https://newsroom.tiktok.com/en-us/tiktok-to-launch-transparency-center-for-moderation-and-data-practices" target="_blank">last month in a blog post</a> that it plans to open a "transparency center" in Los Angeles that would try to provide outside experts a view into how TikTok's teams moderate content on its platform and give insight into its moderation systems, processes and policies. The company also created a committee of outside experts to advise it on its content moderation.</p><p>Dan Schnur, a political strategist and professor, is a member of that advisory committee. He told dot.LA that the core of the outside group's efforts is to figure out how to protect young people from dangerous interactions online. Schnur emphasized that he does not speak for TikTok.</p><p>"Even though the president's executive order seems to be motivated by concerns about political speech, it appears that this would also greatly impact a platform's ability to monitor any types of conversation," Schnur said. "TikTok has devoted a great deal of time and attention to making sure that young people are not exposed to information that would compromise their safety. My personal worry is that if a social media platform didn't have the ability to label political content, it'd be even more difficult to protect children from potentially dangerous interactions online."</p><p>In mid-May, a coalition of child privacy rights groups filed a complaint against TikTok with the FTC, alleging that the platform is violating terms it previously agreed to when it was fined $5.7 million in early 2019 for violating the Children's Online Privacy Protection Act (COPPA). Numerous U.S. Congressmen on both sides of the aisle have called for an investigation, including 14 House Democrats who sent a letter to the FTC chairman on Thursday.</p><p>Sen. Ron Wyden, D-Oregon, who co-authored Section 230, said in a statement Thursday that President Trump's planned executive order is illegal and an effort to bully companies into giving Trump favorable treatment. He said eroding such protections will only make online content more likely to be false and dangerous. Section 230 also doesn't prevent internet companies from moderating offensive or false content, nor does it change the First Amendment of the Constitution. </p><p>"Trump is desperately trying to steal for himself the power of the courts and Congress to rewrite decades of settled law around Section 230," Wyden said. "All for the ability to spread unfiltered lies."</p><p>__</p><p><em>Reporter Sam Blake contributed to this story. Do you have a story that needs to be told? My DMs are open on Twitter </em><a href="https://twitter.com/latams" target="_blank"><em>@latams</em></a><em>. You can also </em><em>email me</em><em>, or ask for my Signal.</em></p><p><em><br/></em></p>
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Santa Monica-based Bird could benefit from a post COVID-19 world where fewer people are using public transportation, especially in urban areas in Europe and Asia where car ownership is more expensive, according to an optimistic new research note published by Pitchbook.
"We believe the thesis for shared mobility remains intact, and expect public aversion to mass transit to drive a $15 billion addressable market expansion for the industry," Asad Hussain, an emerging technology analyst at Pitchbook, wrote late Wednesday . "Anecdotally, we are hearing of an uptick in interest in mobility among investors seeing the light at the end of the tunnel."
<p>As of earlier this month, public transportation ridership was down approximately 70% in the U,S and 80% in Italy and France. <a href="https://thesource.metro.net/2020/05/14/metro-to-pursue-four-phase-plan-to-restore-bus-and-rail-service/" target="_blank">Metro ridership in Los Angeles has fallen</a> from about 1.2 million average weekday boardings to 360,000.</p><p>Scooters have often been billed as a compliment to public transportation, <a href="https://urbanmobilitydaily.com/has-public-transit-finally-found-its-first-mile-last-mile-partner-in-micromobility/" target="_blank">helping riders reach the "last mile."</a> However, Bird is already seeing evidence riders are replacing buses and trains with scooters, a habit the company is optimistic will stick. Bird also hopes that the <a href="https://www.nbclosangeles.com/news/local/las-slow-streets-program-closes-streets-to-provide-space-for-activity/2363020/" target="_blank">closing of city streets during the pandemic</a> could make using scooters more appealing since they have always struggled with being too fast for sidewalks and too slow for weaving in and out of vehicle traffic.</p><p>"Over the past month, we've seen sustained increases in trip duration of more than 50%," wrote Ryan Fujiu, chief product officer at Bird <a href="https://www.bird.co/blog/scooter-riders-making-comeback-riding-longer-than-ever/" target="_blank">in a blog post.</a> "Initially we attributed this to a desire to be back outdoors experiencing fresh air and open space, but we're seeing strong indications that it may be a much longer-term trend related to things like public transit concerns nearly a thousand miles of new open streets and a spike in the construction of protected cycling infrastructure."</p><p>Last month, cash-strapped Lime <a href="https://www.google.com/search?q=lime+raised+funding&oq=lime+raised+funding&aqs=chrome..69i57j69i59j69i60l3j69i61j69i65j69i60.2675j0j9&sourceid=chrome&ie=UTF-8" target="_blank">raised emergency funding at a steep 80% discount</a>, with Uber as the lead investor. Bird had the good fortune to raise new financing this year before the coronavirus slashed valuations but still has tried to preserve cash, <a href="https://dot.la/bird-layoffs-meeting-story-2645612465.html" target="_self">laying off 40% of its workforce in a widely criticized Zoom call at the end of March.</a> More deals and consolidation could likely be ahead. </p><p>"The pandemic will exacerbate a trend that we were already starting to see early signs of, which is consolidation in the industry," said Daniel Hoffer, managing director of Autotech Ventures.</p>Meanwhile, <a href="https://twitter.com/BirdRide/status/1265649858968317953" target="_blank">Bird unveiled its latest new feature Wednesday called Quick Start,</a> which allows riders to activate a nearby scooter via bluetooth on their mobile phone simply by walking towards it instead of scanning a QR code. Bird says early testing shows the new process, which is gradually being rolled out to markets, cuts the time it takes to unlock a scooter in half.
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