Ridesharing (also known as real-time ridesharing)

Ridesharing, or real-time ridesharing, refers to any service through which a person can arrange to share a ride with a driver to reach a desired destination. Most often in the twenty-first century, this type of ridesharing is arranged through smartphone applications operated by ridesharing companies such as Uber and Lyft. Since application-based real-time ridesharing first emerged in the 2000s and 2010s, the practice has become increasingly popular with both riders and drivers. An array of real-time ridesharing companies operates in cities across the United States and Europe. Most allow users to request a ride through a smartphone app that connects them with a driver, see the driver's location, indicate their destination, and pay their fare with a credit card. While these services offer many potential benefits, including reduced fuel consumption, decreased traffic congestion, and lowered parking costs, some critics argue that they also have serious potential consequences.

Brief History

Real-time ridesharing is based on the broader concept of ridesharing, which is the simple act of sharing a ride in some type of vehicle or other mode of transportation. While this type of ridesharing predates the automobile at the global level, its history in the United States principally began during World War II (1939–45). At that time, the federal government promoted ridesharing as a way of reducing public consumption of petroleum, steel, and rubber—materials that were essential to the war effort. To encourage conservation through ridesharing, the US Office of Civilian Defense established the Car Sharing Club Exchange and Self-Dispatching System, which helped commuters make ridesharing arrangements to get to and from work.

When the necessity of conserving essential materials declined in the early postwar years, so too did public interest in ridesharing. Ridesharing's popularity began to increase again when some large-scale employers began to embrace it as a way to reduce traffic congestion and address parking problems in the late 1960s and early 1970s. Many of these companies turned to "ridematching" programs that analyzed employee data and manually matched employees who lived near one another. The use of such programs became more widespread as the energy crisis that resulted from the 1973 Arab oil embargo made fuel conservation a major national issue. In the 1970s and beyond, high-occupancy vehicle (HOV) lanes, preferential carpool parking, and park-and-ride centers were developed to encourage commuters to embrace ridesharing and conserve energy.

In the 1980s and 1990s, the concept of ridesharing took another important step forward with the emergence of new telephone- and Internet-based ridematching programs such as Los Angeles Smart Traveler and Rideshare Express. Although these programs provided commuters with a new, more convenient ridesharing experience, they were never particularly popular and enjoyed only limited use.

The biggest advance in ridesharing came in the 2000s and 2010s with the advent of real-time ridesharing. At that time, a number of companies began offering real-time ridesharing amenities through social networking services and global positioning system–enabled smartphones. Chief among these were Uber, which was founded in 2009, and Lyft, which was founded in 2012. Originating primarily in San Francisco, California, real-time ridesharing quickly became a popular alternative to traditional ridesharing and public transportation in cities around the United States and elsewhere. Between 2018 and 2024, Uber's share of the US ridesharing market was between 68 and 76 percent, while Lyft had been between 28.1 and 24 percent. Globally, in 2022, Uber had 25 percent of the global ride-hailing and taxi market while Lyft had 8 percent.

Overview

Most real-time ridesharing services operate on the same basic premise. The potential rider uses a smartphone application to access the service's online network and requests a ride, often within minutes of their desired departure time. From the application, the potential rider can see how many drivers are available nearby and an estimate of how long it will take each driver to arrive at the pickup point. At the same time, drivers using the application in their own vehicle are notified of nearby ride requests and can accept or decline each request at will. If the driver accepts a particular request, he or she uses the application to notify the rider and heads to the pickup point. Once the pickup is complete, the driver takes the rider to his or her destination, which is often specified through the application prior to the pickup. Upon reaching the destination, the rider pays a fare or donation to the driver via credit card in a transaction that is often orchestrated automatically through the application. After the ride is completed, the rider and driver both have the opportunity to rate each other on the application.

Uber and Lyft are the most well-known real-time ridesharing services, and as of 2024 operated similarly to taxis, with passengers sitting in the back. Drivers for both companies occasionally offer bottled water and light snacks. Other ridesharing services may put their own unique spin on ridesharing. Carma, for example, specifically markets itself to commuters traveling to and from work. Via, which operates primarily in New York City, only offers carpool services, rather than individual rides. Turo (formerly RelayRides) takes a different approach by providing users with an online marketplace through which they can rent out their vehicle to other users.

Ridesharing services offer many potential benefits for riders, drivers, and even communities at large. For riders, ridesharing can be a more affordable, more convenient, and less stressful alternative to driving themselves. Drivers often use ridesharing as a way to generate extra income. Communities, however, can see some of the greatest benefits of ridesharing, including reduced traffic and environmentally harmful emissions, increased fuel economy, additional employment opportunities, and more. Critics are quick to point out, however, that ridesharing has some potential drawbacks. Because some governments are considering regulating real-time ridesharing services, there is a risk that traditional ridesharing methods like carpooling or vanpooling could effectively become illegal or infeasible because of new legal requirements that would come with regulation. Critics also charge that governmental confusion over the distinction between for-profit and public-purpose ridesharing might lead to unfair cuts in public funding of ridesharing programs. Real-time ridesharing has led to conflicts between ridesharing services and traditional taxi services.

Some critics contend that real-time ridesharing can present safety concerns for riders and drivers alike, both in terms of the risk of physical harm and the potential for invasion of personal privacy. In December 2024, Uber had over 1,459 lawsuits for sexual assault in multidistrict litigation. While Lyft's lawsuits are fewer, this is in part due to fewer riders. Because of these incidents, Uber rolled out new safety features aimed at protecting female passengers from sexual assault. The features included encrypted audio recordings, PIN verification, and live location sharing with friends and family. Additionally, the company added RideCheck, which detects if a ride ends early, stops unexpectedly, or goes off course.

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