When Uber and Lyft opened for business in Houston, the same thing happened that has happened in many cities with existing livery industries: taxi companies freaked out and sought help from the city government. Now both ride-sharing services are open for business in the city, with some additional rules in place that are intended to help traditional taxi companies compete with them.

The difference isn’t a restriction on Uber and Lyft, but allowing traditional cab companies to charge higher fees during busier periods. Uber’s “surge” pricing is a controversial business model, which some people call “gouging.” Instead of banning the practice, Houston has given existing taxi services a piece of that action, allowing cabs hailed through apps to charge extra during busy periods. Taxis hailed on the street have to stick to their established metered rates.

“We’re going to compete, we just wanted to make sure the playing field was level, and that everybody was going to play by the same rules,” explained the CEO of Houston’s Yellow Cab, the city’s biggest taxi company.

Existing drivers are glad that they can now earn money legally: both companies simply started hiring drivers and accepting fares a few months ago without making sure they were cool with regulators.

HOUSTON CITY COUNCIL GIVES GREEN LIGHT TO UBER, LYFT [KTRK] (Thanks, Rachael!)

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