New Standard Aims to Ensure Accurate Fares in Both Ride-Hailing Technology and Traditional Taxi Services

To calculate a fare, ride-hailing apps rely on mobile devices for determining the vehicle’s movements and travel time, and to access the company’s proprietary software. In contrast, traditional taxis have hardware components installed that measure time and distance and feed the data to a taximeter. The National Institute of Standards and Technology (NIST) recently published a draft set of standards created by a NIST-led working group that proposes measurements and procedures that states could adopt for equal and fair regulations for both software-based ride-hailing services and traditional taxi services.

If adopted, the standards should help ensure that ride-hailing vehicles and taxis provide accurate data for ride distance and time, and therefore, accurate fares.

“For me, the most difficult aspect of developing the new standard was that we are not using a physical measuring system located in the vehicle to measure the distance, but are relying on the company’s software, as well as satellite- and cellular-based networks,” said NIST’s John Barton, technical advisor to the group that developed the proposed code. “There’s no precedent for determining the accuracy of the combination of GPS and a ride-hailing company’s software to determine travel distance,” he added.

“We are seeing a big change—weighing and measuring systems have gone from completely mechanical devices to electronic devices, and now to electronic signals,” said Doug Olson, chief of NIST’s Office of Weights and Measures.

The road to the new standard, and what some consider the next generation of direct-to-consumer measurements, began when Barton convened a U.S. National Working Group in 2012 to update regulations for traditional taximeters.

In response to questions from weights and measures field officials about the then-emerging ride-hailing services, the working group developed a committee to focus on the new technology. A variety of stakeholders from industry and state and local jurisdictions participated.

The committee agreed to update the existing standard for taximeters as planned, and to write a new draft standard for the software-based ride-hailing systems, which were soon dubbed “transportation network measuring systems.” The group worked “to ensure that both types of transportation providers comply with the same requirements and are regulated equally,” said Barton.

Both standards provide regulatory officials with the procedures they need to evaluate systems for commercial use, including how each system measures time and distance and how those measurements are used in calculating a passenger's fare.

For example, both types of transportation services are evaluated based on distance traveled and time elapsed—measurements that can be traced back to NIST standards. Regulatory officials compare a certified measurement of distance and/or time to information obtained from receipts for the ride-hailing vehicles and to displayed information on taximeters. Inspectors also check for any violations of other portions of the standards, such as improper information posted in the cars or broken displays.

The standards also address how information such as base fares and rates for time and distance is presented to operators and riders, and how the devices and systems are designed.

NIST provided leadership and technical expertise in GPS and computer security to the committee developing the new draft standard for ride-hailing apps. The committee used a draft code from the California Department of Food and Agriculture’s Division of Measurement Standards as a framework. The National Conference on Weights and Measures adopted the “Transportation Network Measurement Systems-Tentative Code”—the new draft standard— and “Taximeters Code”—the updated standard—in 2017 and approved them for publication in the 2018 NIST Handbook 44 (Specifications, Tolerances, and Other Technical Requirements for Weighing and Measuring Devices). This catalog of technical requirements and codes is the basic rulebook that lawmakers and weights and measures departments across the country adopt for use in their jurisdictions.

The updated taximeter code went into effect on January 1, 2018. Jurisdictions will give the tentative ride-hailing draft standard a trial run and report back to the working group with any problems or suggestions for change. All modifications will be evaluated and addressed before the standard becomes permanent.

California, which is headquarters to two of the largest ride-hailing app companies, is already using the Transportation Network Measurement Systems standard in a tentative status, and plans to begin regulating ride-hailing apps with the assistance of county weights and measures officials later in 2018.

This new software-based measurement process has applications beyond transportation. For example, pilots spraying fertilizer on crops are interested in using it to charge farmers to the exact acre for services rendered.

Another advantage Barton sees with the tentative code is that companies interested in creating ride-hailing apps can use the tentative code as a guide to meet still-developing regulations.