Uber puts the ire in Iron City

PITTSBURGH -- Late last year, residents of Pittsburgh's Bloomfield and Oakland neighborhoods found signs posted around their streets that warned of a world in which self-driving cars destroy local communities.

"Automation smothers natural beauty and awe," said one.

The posters were unsigned, but all sported the same symbol: the word "Uber" circled with a line through it.

Although many locals see Uber as a symbol of Pittsburgh's turnaround from an ailing former steel town to an up-and-coming tech hub, others resent the company's unwillingness to assimilate to the city's distinctive community, and the company has faced public protests and labor organizing efforts.

At first, Pittsburgh and Uber seemed like a great match. Pittsburgh has lots of talented robotics engineers, and Uber was looking to develop its self-driving car program and needed the brains to do that. The ride-hailing giant quickly made itself at home in the city, starting with a partnership with Carnegie Mellon University announced in February 2015 and the official opening of its Advanced Technologies Center later that year. Last September, Uber's self-driving test vehicles were on Pittsburgh roads, a development that turned heads at first but soon became a new normal, according to residents.

But Pittsburgh was hoping Uber would become a strong civic partner, much like the companies that had invested in the city when it was trying to revive itself after the exodus of the steel industry. Instead, Pittsburgh has been left feeling jilted, and is regrouping to make sure its future corporate relationships have spelled-out boundaries and expectations.

The city has come a long way since the collapse of the steel industry, said Pittsburgh Mayor Bill Peduto, and giving one company too much free rein without giving anything back to the people could reverse much of that progress.

"When we are willing to allow our public rights of ways to be used for the profit of a private company, there needs to be an understanding that we have visions for the city that can help enhance it for the people who live here," Peduto said. "What we expect is that those companies will be partners with us."

Start typing the word "Pittsburgh" into Google and you'll get only four letters in before the search engine tries to predict what you're thinking and offers: "Pittsburgh is a dump."

But Pittsburgh is not a dump. It is a city in recovery.

The city's primary industry, steel production, caved in the 1970s and bottomed out in the 1980s, as mills moved overseas and the country grappled with a recession.

"Our entire industry died," Peduto said. "We had unemployment greater than during the Great Depression. We lost more people than New Orleans after Hurricane Katrina, and they never came back."

Today, construction sites around downtown are common, and an empty storefront is rare. If you go through the city's Strip District, near many of the offices -- including Uber's -- around noon on a weekday, you'll find it teeming with young professionals.

Since 2010, the population has begun to stabilize, and unemployment, which hovered around 17 percent in 1983, is down to 5.2 percent, according to the Bureau of Labor Statistics. Peduto said a lot of that growth is thanks to a booming tech industry that was attracted to Pittsburgh because of its impressive universities, low cost of living and welcoming attitude toward new companies.

Universities such as Carnegie Mellon have been research powerhouses, and federal agencies have turned to them for numerous projects. The Silicon Valley giants soon caught on -- Google, Amazon and Apple have opened offices in the city, hoping to attract and retain local talent.

"Now we have a new economy," Peduto said. "It's the Ubers and the Googles and the Microsofts and the Intels, everyone that's coming to this town because of the incredible talent that we have."

Carnegie Mellon has long had one of the strongest robotics departments in the country, and with the arrival of Uber, a buzzing robotics environment quickly turned into a thriving sector, said Brian Kennedy, senior vice president for operations and government affairs at the Pittsburgh Technology Council.

"When Uber came, that ignited a revolution in robotics, and we now have a raging talent war," Kennedy said. "This is a tipping point in our history."

At the center of this talent war is Carnegie Mellon's National Robotics Engineering Center, which was founded in 1994 and focuses on automated technology for commercial purposes. John Bares and Eric Meyhofer are alumni of the center who spun off their own company in 2010: Carnegie Robotics, which makes robotics platforms and sensors.

Bares and Meyhofer went on to help Uber launch its Advanced Technologies Center, taking many of their current and former colleagues with them. The exodus sparked a flurry of headlines claiming Uber was poaching Carnegie Mellon's robotics talent.

Meyhofer disagrees with that characterization, saying that the team of 40 he and Bares brought to Uber had been looking to strike out on their own, and Uber presented the opportunity to do so.

"Instead of a four-person spinoff, it was a 40-person spinoff, and that had a lot more impact," Meyhofer said. "We had done things before but they were never big enough to support all of us leaving together."

Kennedy said Uber's relationship with Carnegie Mellon has strengthened -- rather than drained -- the university's talent pool.

"When you are making millionaires left and right, and letting people do that right here in Pittsburgh, you're going to attract talent and students," he said.

To get permission to open the Advanced Technologies Center and test its vehicles on public roads, Uber committed to investing $1 billion in the city and employing more than 1,000 people, Peduto said.

But that was as far as Uber was willing to go, according to Peduto. The company refused to work with the city on public transportation projects as part of its application to the Department of Transportation's Smart City Challenge -- which Pittsburgh lost to Columbus, Ohio -- and sponsor a city conference.

"I am convinced had we been able to get that partnership done, we would have won the Smart City Challenge," Peduto said. "The city would have received $50 million."

Pittsburgh residents have also taken note of Uber's lack of interest in the local community.

"I think they just became more about making as much money as they possibly could," said Ryan Kegges, a 26-year-old loan specialist at BNY Mellon.

To be sure, residents are happy with the convenient transportation options the company has brought to the city and take pride in being a testing ground for futuristic technology. It has also helped to bring a younger demographic into the city.

"I think they're a good match for the city," said Karen Cummins, 59, a nurse practitioner. "Any technological company coming to the area is going to be a good thing. It's going to bring a new vibe."

Peduto said Uber's arrangement with the city is unlikely to change, but going forward, he will be less lenient with other self-driving companies. He's in discussions with Argo AI, an autonomous driving technology company that received a $1 billion investment from Ford Motor Co. in February, on developing a mutually beneficial partnership.

"You're going to see a very different relationship with Ford than you're seeing right now with Uber," Peduto said, adding that he plans to revisit the public transportation partnership, this time with Ford and Argo AI.

Peduto said that as a young company, Uber can learn from Ford and other more established companies on how to adapt a more community-based corporate culture.

Uber, on the other hand, doesn't see any problems with its relationship with the city.

"I'm very happy with what we're doing for this city," said Meyhofer, who is from Pittsburgh.

As for Peduto's comments, Meyhofer said he's glad the city has a leader who cares so deeply about it, and he hopes Uber will continue to work with Pittsburgh.

"Peduto is Pittsburgh's biggest fan," Meyhofer said. "He's never content."