Lyft is now allowed to operate in New York City, but it had to sacrifice its soul. The popular app ditched peer-to-peer ride-sharing--its reason for being--in order to win approval from the NYC Taxi and Limousine Commission. The company hits the streets of New York, sans pink mustaches, at 7 p.m. local time on Friday.
Instead of average folks using their own cars, Lyft has to work with TLC-licensed drivers using vehicles that have passed the city's inspections. The company is rolling out a beta service in all five boroughs rather than the Brooklyn and Queens launch it had initially planned.
Lyft had scheduled an NYC launch for July 11, but state Attorney General Eric Schneiderman and the Department of Financial Services blocked the app from setting up shop without permission. After meeting in court a handful of times over the last two weeks, Lyft agreed to do things the legal way.
Lyft's next move
In a Friday statement, Lyft said the agreement was "the first big step in finding a home for Lyft's peer-to-peer model in New York." The company said it plans to continue its talks with the TLC, the Attorney General's office, and the Department of Financial Services to find a path toward legalizing peer-to-peer ride-sharing.
Lyft also has to halt operations in upstate New York, where it currently operates in Buffalo and Rochester, to hammer out an insurance agreement with Schneiderman and the DFS.
"Now that we've outlined a path forward with state leaders, we will work together to make peer-to-peer policy progress as we have in numerous other cities and states," the company said Friday.
New York City hasn't exactly embraced ride-sharing. Ride-sharing apps Sidecar and RelayRides tried to roll out service in the city last year and quickly decamped after drivers' vehicles were impounded and the city issued cease-and-desist orders. NYC regulators proceeded to OK a pilot program for e-hail apps like Hailo and Uber, which work with taxi companies so passengers can request cabs on-demand. The program is now in its second year, and both Hailo and Uber have expanded their services in the city. That program doesn't include an option for peer-to-peer ride-sharing.
Uber offers ride-sharing through its low-cost UberX service in many other cities. In New York, UberX works with TLC-licensed drivers, though the company said if Lyft wins approval for peer-to-peer ride-sharing, Uber would be right behind with its own service.
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