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Uber Slashes Fares on One of Its Products

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TWC News: Uber Slashes Fares on One of Its Products
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More and more people are using apps like Uber to grab a cab, and with a price drop Monday, Uber says one of its services is now cheaper than a yellow taxi, but whether that's a good thing depends on who you ask.

Thomas Acosta said he's been driving "too long." And always a yellow cab.

"Twenty-seven years," he said.

Twelve-hour shifts on the streets, and he loves it.

"The best part of being a cab driver is the freedom, the freedom of decisions, right?" he said.

Now, customers have more freedom than ever to choose how they hail a cab.

"I'm driving, and that if I have a customer make a request, I'm going to accept," said livery driver Mahamadou Kone, who gets hailed through the mobile application Uber-X. "I just start three weeks ago."

Kone also likes the freedom to work when he wants.

"I make my money, I'm happy," he said.

He's also happy Uber-X dropped prices 20 percent during the slow summer season.

"The price is down," he said. "It's going to make more customer coming to Uber.

"There's now no reason not to take Uber," said Josh Mohrer, general manager of Uber NYC. "It's the cheapest and the most reliable."

Mohrer said the cut is for a limited time, but said it's sustainable.

"This is an experiment," he said. "Our theory is that trips per hour will increase enough that the driver economics stay stable."

Fernando Mateo, founder of the trade group the New York State Federation of Taxi Drivers, said the cut is "like guerrilla warfare." He thinks the venture capital-supported Uber will hurt minority and family businesses.

Some yellow cabbies worried about Uber taking their customers.

"For us, it's a very bad idea," said one driver.

Others said competition is good.

"People are used to go to street and just flag a cab. That's what they're used to," Acosta said.

Acosta admitted that mobile reservations might slowly take hold, but believes there will always be room on the streets for him.

"People on the street, they're still going to work with yellow," he said.

Uber's prices do vary. Prices go up when there's an increased demand. It's called surge pricing, and the company does notify customers in advance, but the state attorney general's office is investigating Uber for possible price gouging. The company believes in the end, it will turn out well for Uber.

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