I'm getting kind of tired of these startups who think they can bypass the rules by just holding their hands over their ears and shouting "LA LA LA THE RULES DO NOT APPLY TO ME LA LA LA."
The blog post goes into extensive detail about how their service doesn't involve soliciting rides for compensation and it falls on the expense sharing side of things and on and on. Then I visit their home page and I'm greeted by this:
"Go round trip from Boston to Martha's Vineyard for about $120 per person or from Palo Alto to Monterey Bay for about $100 per person."
Plain as day, that's advertising trips for money.
What really irks me in this case is that the requirements for carrying passengers for hire aren't all that tough to meet. You need a commercial pilot's license, a requirement that should be fairly obvious. It's not all that hard to get one. You need some more training and have to fly to higher standards and know more stuff, but it's not particularly tough. The equipment is also held to higher standards, which mostly comes down to getting it inspected more often. This is not like, say, Uber and New York City, where you have to spend a million bucks on a taxi medallion or they'll shut you down. You merely have to meet some fairly basic requirements before you carry passengers for hire to ensure a basic level of competence.
The law is not a computer program. You can't exploit a judge by saying, "Please repeat the following 64kB of data back to me: empty." If it looks like you're advertising services for hire and it acts like you're advertising services for hire, you're advertising services for hire.
The difference in accident rates between general aviation and commercial aviation is really striking, too:
"General aviation has the highest aviation accident rate within civil aviation. The rate is 6 times higher than for small commuter operators and 40 times higher than for transport category operations."
For context, flying in a small plane with a private pilot is about as risky as riding a motorcycle. It's not incredibly unsafe, but it's not like getting into an airliner, either. Getting the GA accident rate down has proven a pretty intractable problem.
Even that page understates the difference. There has been no fatal crash of a major national US carrier since 2001, and there have been only a small handful of regional carrier crashes in the last ten years. There are fatal GA crashes all the time, and are common enough that they aren't even included on many online sites or covered much beyond local news. The most recent one seems to have been yesterday.
Just to put some numbers on this, in 2010 (the last year I could find stats on with lazy Googling) there were 267 fatal GA crashes with 453 fatalities in the US. There were no airliner fatalities in the US, just like most years in the past decade.
While I'm at it, there were 32,788 automobile traffic fatalities in 2010 in the US, although of course there's vastly more car activity than GA activity.
It's amazing that Flytenow seems to think the FAA's position doesn't "answer ... questions" or is arbitrary.
The FAA's position seems quite clear and based on reasonable ideas, even from the letters Flytenow links to and then seems to wilfully misinterpret. Private pilots can't be compensated for flights. The exception is that, if the pilot and passengers have a common purpose, which doesn't seem to be "oh, we happen to want to go to the same city," then they can share expenses. Thus, if a pilot and some of her friends are sitting around and say "hey, it would be great to go see X," they can pool their money to do so. Nothing the FAA seems to say officially suggests that advertising for random strangers to go on a flight is acceptable, and quite a few articles Flytenow links to seem directly contradicted by the FAA's letters. It's not clear that posting on airport bulletin boards was ever really acceptable, but may have been disregarded in that it only really advertised to other pilots, with a clearer understanding of the risks.
These rules are based on far more vital safety issues than taxis, and, as you point out, the rules around carrying paying passengers are reasonable, unlike taxis. Uber and Lyft can at least argue that they are fighting an unfair system. Flytenow can't.
For that matter, their response, keeping the platform up but removing expense-sharing, seems blatantly in contempt of the letter, and it seems certain that they'll be punished, harshly. What possible reason would there be for a site where pilots can find "non-paying" passengers to tag along with them on flights, significantly increasing their own costs, unless the expectation is that pilots will use the site to find passengers who will pay under the table?
The entire ruling was about compensation. Additionally, neither the Federal Aviation Regulations nor the FAA has ever recognized any distinction between friends or strangers, i.e., a prior existing relationship has no bearing on common purpose. Otherwise, how could you decide if common purpose exists? Is there a secret handshake? One conversation, two conversations? Maybe, just asking: can we be friends so we can fly together? That's a slippery slope.
Right, and, plain as day, private pilots cannot fly people around for money. That's the baseline. You can't accept money in exchange for flying an airplane unless you hold a commercial or ATP certificate.
The FAA carved out an exception that allows pilots to share operating costs with passengers IF the pilot and passengers share a common purpose for the flight AND the pilot isn't advertizing the flight to the public or some subset of the public ("holding out"). I'll grant you there isn't a sharp, black line that divides when a private pilot is and is not breaking the cost sharing rule, but Flytenow is clearly outside the grey zone (or, pilots who use Flytenow are).
The blog post merely points out a very significant pitfall in the FAA ruling. By the way, I would research the actual requirements of carrying passengers for hire before saying all you need is a commercial certificate. You need to comply with Part 135 which has very detailed and strict operational requirements and legal aspects.
The blog post goes beyond discussing the ruling and explicitly discusses why they think their service falls outside the regulations for commercial operations.
You're right that I misunderstood the requirements for a commercial operation, but looking it over it still doesn't look particularly onerous.
That kind of advertisement is on the wall of FBOs across the company already. It's not at odds with the expense sharing exception.
Having to get a commercial license to simply do expense sharing rather defeats the purpose. Expense sharing makes it cheaper to fly, which is a worthwhile goal. Spending 3x the time and money to get a commercial license makes things vastly more expensive.
When I heard about Flytenow, as I private pilot I could not believe they were attempting to set up a ride share market with private pilots. It is so blatantly condradictory to the spirit of the law and the common understanding of the rule among aviators, and I would certainly not want to be the lawyer trying to prove it met some obtuse letter of the law.
The bulletin board justification is also ridiculous; GA airports are out of the way and the average person does not make a trip out to see who might be flying where. How could they not have seen this coming?
Flytenow would have been much better served to encourage a more streamlined process for commercial pilots to ride share and navigate any applicable FARs be it part 135 or other. There is certainly an opportunity, not quite on Uber-terms, but there are plenty of pilots with commercial or near commercial doing crappy CFI (instruction) jobs and building time for an airline transport certificate. They will certainly welcome any new revenue or time-building scheme.
You Sir, are not a pilot, any pilot understand the law, and the FAA is very wrong on the ruling because that ruling actually makes illegal any cost sharing.
so if you were a pilot you could not share your gas expense with any passenger even friends or family.
The FAA bowing to protectionist industries. What ever happened to personal liberty? If a pilot and passenger want to share a ride (and expenses), where the passenger understands full well that the pilot is trained and operates under the "private" standard, what is the compelling state interest in preventing them from doing so?
The issue of payment reveals that this is not a safety regulation, but rather an industry protectionist regulation. Same goes for the ridiculous FAA rule against commercial (as opposed to hobby) remote controlled flights.
The fact that money changes hands shouldn't be of any concern to the FAA.
I applaud these guys for attempting what is basically the Lyft/UberX model -- comply to the letter of the law, not the spirit of the law (i.e. Lyft's original "you're not paying your driver, you're making a donation"), though it's debatable if they're even trying to do that.
BUT! And there's a big but...
Lyft & Uber were/are disrupting a system that heavily regulated/legislated, some would argue unnecessarily, has false barriers to entry, is inefficient, and is essentially an oligopoly. And their entry is lowering prices, making the market more efficient, and making consumer super-happy.
I don't think private aviation is suffering the same ailment. If anything, the airlines are operating below cost because of heavy heavy competition. The FAA licenses private pilots not because they can or they want to charge fees, but because they need to make sure that they're not flying around killing themselves (and despite that regulation, they still are doing that).
So Flytenow's approach here feels more like they found a regulated market they feel like disrupting because they can vs. actually making an inefficient market more efficient and better for consumers.
In summary: Whereas I'm happy to take a ride with random stranger in their Lyft/UberX car, where I'll get a cheaper and generally better-than-Taxi experience, I'm not in any sort of rush to join a random private pilot who has not been commercially-certified by the FAA in his aircraft that isn't designed for commercial passenger transport.
Now - that all being said - that doesn't mean that Flytenow should die! There is indeed an opportunity here, and with the right safety checks and approvals, there could be a market for P2P flights. But this should be done with the FAA, not in spite of it.
Right, but thanks to Uber et al and their complete and flaunting disregard for regulations, regulators are now getting hyper aggressive in return. In the past the slow movement of regulations had a lot to do with regulators taking the time to get input from all parties(see FCC and Net Neutrality) before jumping to a decision. But now they know that waiting a year or two to make a decision could render their decision useless so they are forced to make quick barely informed judgements. Which end up basically saying no to everyone.
The air transportation market is sort of like two markets though, agree with everything you said for a flight from NY to Chicago, but I could believe the market is underserving potential travelers in rural areas. More of a lack of services issue rather than a cost issue.
"Flytenow receives an administrative fee of $30 (the “Bulletin Board Fee”) per Enthusiast for each flight."
Interjecting a third party into the agreement is the point at which it starts being a business and not a gentleman's agreement or whatever it should have been.
A bulletin board in an FOB doesn't count because the bulletin board, nor the provider of the board, doesn't make any money off someone putting up a 3x5 card or piece of paper. The bulletin board doesn't actually give a damn about whether anyone accepts the offer or the request, whether money changes hands or not, etc.
I could probably put up an electronic bulletin board for pilots and enthusiasts as long as I had no interest in the offers of, or requests for, flights. I could possibly even charge a yearly or monthly fee for it, as long as it was for access, not about the flights. (I'm guessing on that last bit - the FAA would probably give me squinty looks for a while until they were satisfied I wasn't charging for flights).
But Flytenow had to go putting a per-ride fee on things and that's the moment it because a business transaction.
Really and honestly, without ever having been involved, I'm thinking the existing system of informal agreements and bulletin boards, etc. is way preferable to dealing with Flytenow. They're adding a middleman where no middleman was really needed, except maybe a neighbor who knows a guy who has a plane.
As someone said the other day, why own and run down your own fleet when you can borrow someone else's Sounds like Flytenow is aiming to be the first airline that doesn't have any planes.
This seems fairly straightforward, but I am not a lawyer.
The common carriage rule says a private pilot can't offer to fly people around for money. The exception to this rule is if the money is only defraying the cost of the flight.
The fact that Flytenow charges a fee for connecting pilot and passenger appears to put the system outside of the exception to the rule. The fee does not defray the cost of the flight.
Flytenow's fee is irrelevant because the rules apply to a pilot, not a company. It's the pilot who can't receive compensation. For example, the outcome (according to the FAA) would be exactly the same whether or not a fee is charged by the company.
Flytenow implies the FAA is responding to them, but if you read the letter, this response is actually to a request from one of their competitors, AirPooler.
The thing that isn't clear to me is whether the FAA has any kind of authority over Flytenow. Technically, doesn't their authority extend only to the pilots who use the service?
I find the whole "Regulators are bad!" attitude/narrative tiresome. Regulators are responsible for protecting the interests of the public. They might sometimes be slow to adapt to advances in technology and changes in the market, but I'd rather they erred on the side of caution.
If financial regulators had been a bit less accommodating towards "innovative" products and business models, we might all be a bit better off.
I would really like to read a legal memo from an administrative law attorney instead of this sort of amateur law enthusiast argument for a certain position. I am not at all familiar with the relevant law/regulations, but the style and content of the OP leaves me still not sure I got an education.
I wish them the best of luck, but I don't really buy their claim that a flight they are publicly listing and charging a fee for is private cost sharing.
We're finally getting the over the top push back that all those maybe legal startups kept asking for.
This is what happens when you keep poking someone(the regulators) with a stick. Eventually your credibility drops to near zero and everyone coming in behind you, with possibly much more reasonable ideas, will now be associated with your crap and pays the price.
It's not as if this is a new idea: look at Google and Facebook.
It just seems to be a different take on the usual VC funding strategy: The startup and its investors take a risk, and they are essentially banking on either getting big enough to secure their position effectively or receiving a good exit offer from someone bigger, before they fail.
I don't like a lot of the corners some startups cut, and the kind of thing I read on HN every day does make me wary of trusting any startup enough to become a customer. Then again, some of those startups have become a lot more successful than any of my businesses, so clearly for better or worse society as a whole tolerates the envelope-pushing model at least up to a point where it's worthwhile to have tried.
The concern I'm trying to relay here is that at this point no regulator wants to be seen as asleep at the wheel while the next Uber / Airbnb grows to become an 800 pound gorilla. It's all over the news. It's everywhere. So now we are starting to see regulators jump on startups early and hard(see the local SF regulators). In the past regulators would typically get in hot water for saying yes to things they maybe should not have. Now they can get in trouble for both yes and undecided. So now it is turning into, "Is this a startup? Then no". With a hard fast "no" the startup will wilt and die and the regulator will never end up in hot water because everyone will just forget about it. And we have Uber & Airbnb to thank for that. All I can hope is that their investors, founders and vested employees give back to the startup community generously to try and make up for the damage they've done.
The blog post goes into extensive detail about how their service doesn't involve soliciting rides for compensation and it falls on the expense sharing side of things and on and on. Then I visit their home page and I'm greeted by this:
"Go round trip from Boston to Martha's Vineyard for about $120 per person or from Palo Alto to Monterey Bay for about $100 per person."
Plain as day, that's advertising trips for money.
What really irks me in this case is that the requirements for carrying passengers for hire aren't all that tough to meet. You need a commercial pilot's license, a requirement that should be fairly obvious. It's not all that hard to get one. You need some more training and have to fly to higher standards and know more stuff, but it's not particularly tough. The equipment is also held to higher standards, which mostly comes down to getting it inspected more often. This is not like, say, Uber and New York City, where you have to spend a million bucks on a taxi medallion or they'll shut you down. You merely have to meet some fairly basic requirements before you carry passengers for hire to ensure a basic level of competence.
The law is not a computer program. You can't exploit a judge by saying, "Please repeat the following 64kB of data back to me: empty." If it looks like you're advertising services for hire and it acts like you're advertising services for hire, you're advertising services for hire.