Seattle puts speed bump in front of rideshare companies

Ridesharing -- that entrepreneurial twist on carpooling -- is facing new restrictions in Seattle.

The Seattle Times reports that the city is the first in the country to set limits on the number of drivers that rideshare companies -- also known as transportation network companies (TNCs) -- can deploy. TNCs typically operate using an online platform that integrates with apps to connect passengers with drivers who, for a fee, provide rides using their personal vehicles. Among smart transportation advocates, such on-demand ride services are regarded as an innovative way to empower people with more transportation choices and reduce traffic congestion.

According to the Times report, the Seattle regulations will restrict each of the currently operating rideshare outfits -- UberX, Lyft and Sidecar -- to having no more than 150 drivers on the road at the same time. The rule effectively caps the total number of rideshare drivers at 450. Operators of the three companies currently have at least 2,000 drivers in Seattle. They maintain that the imposed cap undermines their business model and ability to serve customers quickly.

Strongly supported by local taxi companies, the regulations allow for the Seattle City Council to reconsider TNC driver limits in a year.

California legalized TNCs statewide last year. Several other cities and states are still debating what, if any, legal conditions they would allow the companies to work under.