Uber Astroturfs Opposition to the Lyft Divvy Deal by Purchasing News Coverage

The headline of the TRiiBE article, with a disclosure statement.
The headline of the TRiiBE article, with a disclosure statement.

“I had not heard about the [Lyft/Divvy] deal,” says Roseland resident Tira McBride. “It doesn’t seem fair that one company is going to be able to monopolize [Chicago’s bikeshare] industry.” She adds that the contract amendment sounds similar to Chicago’s hated parking meter deal.

West Side resident Charles Brace compares the Divvy/Lyft deal to the Chicago Skyway privatization contract. “I don’t agree with it,” he says. Nowhere in the coverage is it mentioned that Uber also sought to be Chicago’s exclusive bike-share provider.

The TRiiBE piece also states that the Uber deal “was valued at $450 million” compared to the total of $127 million for Chicago from the Lyft deal, but it doesn’t mention that without exclusivity Uber would only spend $200 million.

The article also quotes Robert Kellman, Uber’s global head of government affairs and policy for bike-share arguing that the Lyft deal would hurt the South and West sides, but it doesn’t include a response from Lyft. “We’re simply asking them to make [the city’s bike-share contract] non-exclusive so that any company that wants to invest in the South and West sides is able to do so,” Kellman says. Again, Uber was also seeking an exclusive contract. He encourages residents to contact their aldermen and tell them they oppose the Lyft deal.

The accompanying video is essentially a lobbying ad, including captions that state Uber’s talking points, such as “By approving the exclusive, no-bid [Lyft/Divvy] contract…”

Screen Shot 2019-03-27 at 8.34.25 PM

The TRiiBE has tweeted out its Uber-friendly coverage at least six times since yesterday. Some of the tweets mention that the content was “produced by The TRiiBE for Uber,” but others, such as the one below, don’t disclose that Uber is paying for the positive press.

As the editor of an independent news website myself, I know it can be challenging to keep such a publication afloat, so I don’t blame The TRiiBE for taking Uber’s money. Streetsblog Chicago also runs sponsored posts like this one, although we don’t allow sponsors, advertisers, and donors to shape our editorial content.

But buying good press to influence Chicago bike-share policy seems like a shady tactic on Uber’s part. They could have easily produced and disseminated their own press release and video to make their arguments, without trying to pass off PR materials as news coverage.

Meanwhile, today at City Hall South and West Side community leaders held a press conference that also compared the Lift/Divvy deal to the parking meter contract and argued that Lyft’s longer timeline for citywide expansion would be inequitable. (City officials have stressed that while the meter deal sold off an existing resource for 75 years, the Lyft deal would add thousands of new bikes and only lastsfor nine years.) But unlike the anti-Lyft messages in the The TRiiBE coverage, press conference participants say Uber wasn’t involved in the planning.

Tim Jones, a Hyde Park-based community advocate, told me he organized the event. Other participants included 20th Ward aldermanic candidate Reverend Andre Smith; former 7th Ward aldermanic candidate Jedidiah Brown; K.L.E.O. Center executive director Lesle´Honore´;  Donna Hampton Smith, president and CEO of the Washington Park Chamber of Commerce; and Ashlee Renee Evans from the Chatham Business Association.

“The city should reject exclusive contracts that only benefit a single company and are not in the best interests of all Chicago neighborhoods,” said Reverend Smith at the event, according to a Sun-Times report. “Unfortunately, what we are witnessing now is the city striking a no-bid, backroom deal with Lyft-owned Divvy that gives Divvy a monopoly over all bike-share programs in the city with no expansion to the South and West Side for over two years.”

Some of that language, as well as the text on signs at the event, was similar to phrases on Uber’s Pump the Brakes website, which refers to the contract amendment as “a no-bid” “backdoor deal” with Divvy.

Tim Brown speaks at the press event. Photo: Kye Martin, NBC Chicago, used with permission
Tim Brown speaks at the press event. Photo: Kye Martin, NBC Chicago, used by permission

Tim Brown told me the similarity between the participants’ talking points and Uber’s is due to him checking out the Pump the Brakes website of his own accord — he said he hasn’t been in touch with Uber. “I’m just a concerned citizen, concerned about equity on the South and West Sides and all over the city,” he said. “I follow the news like everyone else and I saw an opportunity being left on the table. Why not let everybody invest on the South and West Side?”

Tim Brown said he wasn’t personally acquainted with all the participants, but had connected with them via organizations like the Black Leadership Council. When I reached Jedidiah Brown, he said he didn’t remember the press conference organizer’s name. He added that he hasn’t been in touch with Uber.

“I heard about the issue from some media outlet and I was like, OK this isn’t cool,” Jedidiah Brown said. “This is the kind of thing I ran against in my aldermanic campaign… I’m just trying to make sure the city diversifies its portfolio and doesn’t make any bad deals.”

Chart from the Pump the Brakes website, including some misleading info.
Chart from the Pump the Brakes website, including some misleading info.

When I asked Tim Brown about the details of the competing Lyft and Uber offers, it turned out that he had a few misconceptions, which reflected misleading or incorrect statements on the Pump the Brakes website. For example, he wasn’t aware that Uber wouldn’t spend $450 million unless it got a monopoly. Also, thanks to the above chart, he was under the false impression that Divvy doesn’t offers discounted memberships for low-income residents or a cash payment option. In reality, $5 Divvy for Everyone annual memberships, which can be paid for with cash, have been available for 3.5 years.

But Tim Brown said that he didn’t see the misinformation on the website as being a major issue.”We don’t really care about those details. We just want to see more community investment on the South and West sides.”

Uber and Lyft didn’t respond to requests for comment for this article.

  • TF

    They got one thing right. It’s going to be a price increases. With 10,500 new pedal assist bikes and expanded coverage it’s going to be harder to find a traditional Divvy. In NYC there is a $2 dollar surcharge per ride on pedal assist Citibikes. That’s on top of the annual membership. Let’s say you make 400 trips a year. Even if you found a traditional bike 50% of the time that would be an additional $400 you’d have to pay. This doesn’t even include the price increases that Lyft would be allowed to make on the membership. I’m all for expanded coverage, more bikes and especially dockless. But does this new plans meet the needs of the City. Especially lower income citizens. And I can only guess that Uber would be the same. There is something to be said to a non exclusive deal that fosters some competition.

  • johnaustingreenfield

    Under the Lyft contract, the city would have to approve any fare hike over 10 percent (although that could add up over nine years) and “will maintain control over significant fare pricing changes and any new fare products or promotions.”

  • Tooscrapps

    This is why am skeptical of the e-bike fleet. E-bikes are a premium option and are likely to be priced as such.

    If I’m using Divvy for a short distance, an extra fee might blow any savings and what is so great about having a membership. If the fleet expands at the expense of the traditional bikes, then you might be faced with only e-bikes available when you pull up your app whether you want one or not.

  • TF

    Don’t know if the $2 e-bike surcharge would be classified as a fare hike. I see the 10 percent limit impacting the daily and annual plans. So the $99 we’re used to paying will soon be $108.

    I haven’t seen any mention of if the traditional bikes will be converted to dockless. If NOT I’d imagine this will make it even more difficult for the areas currently without docks to justify the expense of using Divvy. If all they have to choose from is the e-bikes, they’ll be hit with that surcharge every time.

    Frankly I’d just love to see the contract Lyft has offered the city. That would stop all this hypothesizing and mud slinging by Uber.

  • Austin Busch

    Could the city call out Uber on $450M for non-exclusivity, and then reinvest that money into expanding the Divvy fleet? I assume Uber intends it for bike lanes racks, etc. but technically divvy docks and bikes are “bike infrastructure”.

  • BinoyK

    I was in SFO in Jan 2019 and tried the Ford GoBike and it had electric pedal assist bikes with their docked fleet and I don’t think they were charging more for that service. It was included with the normal fees. And the electric bikes were so much better to bike on the hilly SFO streets.
    I am not a supporter of Uber but I have to agree with them that this contract process is not transparent to the public. Why is it being rushed through without public discussion. The Lyft/Divvy deal might be a good one as many people seem to think but why is not being debated or discussed before being rushed through city council.

  • BinoyK

    At least in SFO electric pedal assist bikes were part of the same membership fees. No extra cost. I think it should be like that for Divvy also. Not sure if that is mentioned in this new contract that Lyft/Divvy have proposed.

  • BinoyK

    Is there any language about ebikes being charged more than regular ebikes?

  • BinoyK

    I agree. The Lyft deal needs to discussed and debated to make sure we are getting the best deal possible. We are signing up for something for the next 9 years with minimal time to scrutinize the finer details.

  • JacobEPeters

    That would be considered a price increase, which means they could not increase the cost more than 10% from a traditional Divvy ride, & they could not charge per mile unless the city approved a such a change in pricing.

  • JacobEPeters

    Pricing is not described in the ordinance, only the process for approving price increases above the 10% per annum increases.

  • FlamingoFresh

    Yeah, I don’t see why (if the amount of money was really an issue for the City) to determine what Jump is currently promoting across these platforms ($450 million investment and no exclusivity) is a possible option for a deal. I haven’t heard the City confirm if this deal that Jump is promoting is true as of recent days. If it’s a bunch of lies and is only dependent on the exclusivity then the city should have every right to call out Jump and squash this smear campaign. If the amount of money is not an issue then they should just say they aren’t interested in bringing on Jump.

  • rohmen

    There seems to be a lot of contradictory info floating out there right now, but I understood that the $450m was the “value” of the 20,000 e-bikes and 20,000 e-scooters (and associated equipment) Jump would bring to the City by way of Jump’s build out. They’re not just going to hand $450m over, and I honestly don’t see how the system could ever be profitable if that is what they’re trying to suggest they’d do.

    It does appear that Jump is willing to offer $30m over 5 years for “infrastructure” improvement. I guess that amount could theoretically be used for Divvy as “infrastructure,” though the devil is in the details, and Jump may condition it on things like expanding bike lanes, etc. Also, spacing it out over 5 years, depending on how the contact is structured, seems to still leave Jump with the option of pulling out in 2 years if things aren’t profitable and likely not having to still turn over the full $30m.

  • ChicagoCyclist

    As a form of public transportation, I wish that bike share would be operated without a profit-motive — or perhaps with a ‘cap’ on profits.

  • JacobEPeters

    Meanwhile the proposed amendment to the Lyft/Motivate Divvy deal will generate far more than $30m over the next 5 years in dedicated city budget dollars for transportation infrastructure. Not to mention the shifting of spending on Divvy 4 Everyone (and potential operations losses) off of the public ledger & onto the private ledger of Lyft. I would love to see what the total cost of the 10,500 new electric assist bikes, & 175 new docked stations adds up to. Especially because that would be new fleet property of the city of Chicago, as opposed to the entirely privately owned fleet Uber/Jump proposed.

  • JacobEPeters

    They did just that in the meeting yesterday, but the Uber supporters continued to reference the misleading numbers from “Pump the Brakes”. Including mentioning $450m & 500 jobs in the same breath as saying they just want competition from multiple operators. As usual Uber drops in misinformation to undermine a completely legal process that doesn’t directly benefit them. Never get into bed with people like that.

  • rohmen

    …..and John’s more recent article highlights that the City did push back on the $450m figure cited by Jump finally, and noted it is almost all equipment and startup costs Jump would incur, with the City not actually getting any hard funding out of the $450m (and no ownership of anything).

    Uber is seriously a “fool me once, shame on me, full me twice…” company.