Disrupter Technologies Face Uphill Fight With Regulators, But Public Support Key, Companies Say

Companies like Lyft face a regulatory landscape where many of those in power are “captured by those they’re regulating,” Mack said. But “ultimately” the “power of the technologies” is leading to broad support from the public and “we’re going to see a light being shined on misuse of regulation,” he said.

Mack said opposition has come “across the map” and there's no pattern to where Lyft faces a regulatory fight. A city like Houston is generally considered to be industry friendly, but the rules on the books made it impossible for Lyft to operate until the rules were changed, he said. “Regulatory capture and anti-competitive behaviors” are bipartisan, he said. “Sometimes you have to fight city hall."

Justin Kintz, head of North American public policy at Uber, said the company wants to operate across the U.S. but often faces regulatory opposition. “You can’t regulate something like this the same way you regulated a 100-year-old industry, the taxi industry,” he said.

In Europe, Yelp, which offers subscriber reviews of restaurants and other local businesses, has fought efforts to take the site down, said Luther Lowe, director-public policy. “This does have a chilling effect on freedom of speech,” he said. In about half the U.S. states angry business owners have initiated lawsuits against Yelp reviewers, Lowe said.

Panelists said user support has been critical to their success with regulators, when asked about the FCC example of comments flooding in on net neutrality seemingly changing the discussion at the agency. “We would be not nearly as successful if we didn’t have comments from constituents weighing in and being part of the public record if we didn’t get people to spend their own free time driving themselves to hearings to testify,” Mack said. Public involvement matters, he said.

The day may come when Yelp will have to “activate“ its subscriber base, especially if it decides to press for legislation to protect the kind of speech users rely on, Lowe said. One legitimately could ask if that's something for which a Yelp user has signed up, he said. “The defense of that is with these consumer applications and the Internet platforms, individuals just feel this personal ownership,” he said. “If that is being threatened, I think these users do feel that they have skin in the game.” Lowe said on issues like net neutrality there's some question about how platforms like Yelp “will use their massive lists to nudge policy.”

“Our laws reflect the entrenched industries,” said Jaclyn Suzanne Louis, aide to Rep. Tom Marino, R-Pa., chairman, of the Judiciary Subcommittee on Regulatory Reform, Commercial and Antitrust Law. Louis said there has been unprecedented turnover in Congress in the past three election cycles and the new Republican-controlled Congress is collectively younger and more tech savvy than previous Congresses.

Both sides care about innovation, but Republicans are more likely to create a friendlier tax environment for tech companies, Louis said. “We’re the party interested in reducing the size of government, which thereby means few regulations in all the different agencies, she said. “The House and Senate are going to be working together and getting more bills through in the next six months than we have seen in the last five or six years.” The CES panel did not have a Democratic official.

Uber took advantage of CES' location in Las Vegas to ask attendees to sign an electronics petition seeking a change in regulation so the company could operate there. Uber launched in Nevada in October, the company notes: "In late November, we chose to temporarily pause operations in the state, allowing time for us to work with ... elected officials to create a permanent regulatory framework that supports uberX ridesharing in Nevada."